was to deny discharge based on certain transfers which in reality were payments in a significant amount of tuition and other expenses for their children in the year prior to filing that was based on intent to hinder delay and of creditors and the court found that they didn't meet their burden of proof so that's not it issue in this a p actually the court found that we proved that there was no intent present and burden yeah exactly that was the outcome th del dykes collected very expensive watches and time pieces and that he as a result owed a significant amount of money to the jeweler he bought it for a credit they got a loss a judgment against him for over three hundred thousand dollars to avoid a levy of his assets he brought all the remaining time pieces that he had in his possession in two thousand and thirteen to the office of the creditors attorney got a receipt showing everything he turned over and gave it to him in lieu of a levy the us trustees count to allege that that there was insufficient record keeping with regard all the record keeping didn't relate to the turnover of assets to the attorney only related to the lack of paperwork and documentation for the receipt and return over a number of years of watches so it was impossible to know what was received in return and difficult to determine what is financial transactions war isn't that true ultimately that's the court's findings and that's the roof frames one of the issues we're here before the panel today and that is two points to that one that that entire argument made by the us trustee a trial and that the judge found dealt with transactions prior to that that wasn't pled at all in the pleadings why didn't you ask for a more definitive statement under the rule because it looked to us like count two is very clear they were looking at the one transaction in two thousand and thirteen there was nothing in the complaint that indicated they were looking to the prior transactions from seven to five years prior to the filing  a case and so that wasn't something we were trying at the time apparently was something the us trustee based on their brief and their reply in here and various arguments they may but they were trying we weren't we weren't l stipulate to any additional issues we just simply were cooperating with the u s trustees office to make the trite trial go quicker and cleaner they had certain exhibits they want to introduce we felt they were trying to attack our clients credibility probably  admissible we didn't want to spend time on it we weren't trying any additional issues we kind of one that was relevant if i mean i guess i'm not understanding that argument if you let the exhibits then aren't you concerning to those issues being tried but we didn't know that that was the issue we just knew that they were exhibit showing watches that they had had they had purchased we didn't know what they were going for beyond so we weren't trying that issue and even if you take it a step further and you say we were trying that issue which we want one looks at these transactions and while we understand that the transactions are confusing if you look at the testimony of dr dykes and you look at the documents that were in the record all of these transactions occurred in the timeframe of two thousand and nine to roughly two thousand and eleven more than five years prior to the filing case the reason some of these records we just weren't sure of you know is laid out in the transcript in the testimony but it had to deal with the dramatic downturn in the diets financial fortunes were they lost their home terminated his income went from back then two thousand and ninety thousand and two the high six figures a significant amount more than i mean your response to judge so dean is look at the testimony i think that's what you said but the statute requires books and records in writing well that a three require preservation or maintenance of documents records and papers and the standard in the case law is what a reason you know reasonable records under the circumstances and in this case we're not talking about an end of business contacts the court has a higher context in terms of records this isn't business this is personal it was hobby related and the fact would be hobby but it involved people who are educated and for a long period of time dealt with expensive transactions correct at the time with the sin they didn't consider that they were having any issues with this they were paying the bills regularly paying everything off and it's also the timeframe of these transactions were if you go through the reported case whether we said in our brief almost every single case involves transactions in the wall you know three years prior to the filing you know usually you don't see many or any but i found cases where the timeframe was going back seven years i mean what's the reason how long do you keep records how how long do we do that and in this case there's mitigating intervening factors one of which is when they washed all of their income lost the house to foreclosure he lost his medical practice when he was forced to leave and this is an issue in the case is everything was one of the three storage lockers we couldn't make the payments the storage company sold those and got rid of them he never saw anybody get some of the records some of the recent things that he couldn't he had no records of what was in the storage lockers no because he never thought  case of mixed findings of law in fact and what we're looking at is the conclusions of law here and whether you know want to number one whether these things are outside the scope of the pleadings which made it fundamentally unfair that's the first  second issue if you get past that and we're trying that issue is the is the application of the case law and the statutory law here dealing with a reasonable person keeping records under the circumstances is that being met is the conclusions of law correct here we're saying gee if somebody didn't maintain records from seven to five years ago after going through all of the things they went through does that constitute reasonableness of whether to keep the records or not is a finding of fact why i think what happened is a finding of fact applying it to the law as a conclusion of the law right but if the bankruptcy court said it was not reasonable that's a finding  we also were appealing the finding under count three and then has to do with a false oath on the schedules of account alleged that the initial schedules in did not include a reference to all of the transfers that were referenced in count one that we discussed previously and that's accurate they weren't in there the it appears the court in its finding based everything on when amended schedules were filed in february fifteenth of two thousand and seventeen that itemized these items when in fact and granted there's the  credibility finding by the judge but a lot of the testimony and the exhibits were in controvert is that i don't know that it goes to a matter of credibility they just weren't there was you know when you're winning credibility and there's opposite testimony in the record and you're saying ok i don't believe this dykes who testified that she in the schedules did what she thought she was supposed to do it's in the transcript there's a citation in the brief and she also testified that  that she felt that the tuition payments and expense payments were in the ordinary course of business the testimony was basically that they've been paying me to asian for their children for ten years these were the youngest of five children and they didn't see anything out of the ordinary with it and so they didn't realize when they were giving the information to prepare the schedules that this was a transfer they thought it was just paying the normal expense as the testimony indicated could you get a set information so we started compiling that information providing it to me as man to voluntarily prove and we provided it to the u s trustees office in the transcript mr dr dykes darrell dykes describes was the basis for the ultimate schedule amendments so the issue in the case law here it appears on this on the issue of the false oath it goes to whether the failure to disclose was reckless and whether there was an attempt  concealment there was no attempt to conceal what they were disclosing everything reckless well they thought this was an ordinary payment they didn't think it was something that that was out of the ordinary and in retrospect they should have disclosed should have been on the original schedules but we don't believe it rises to the level of intent required of the statute case law i see it about two minutes left of this reserve that for me i think you thank you say good morning ms levine and my partner pronouncing your last name correctly yes that's correct it's that living with the department of justice for the united states trustee in your honour's the bankruptcy court in the complaint in front of me can you respond to the statement that was made by opposing counsel that the complaint only referred to turnover of watches to the attorney in satisfaction of the unknown if he had additional watches it's a notice pleading standard and we think that was sufficient notice but even if it wasn't we do think that that claim was tried by consent as you point out the not argue at any point in the bankruptcy court that the a three claim could not be supported by this evidence they argued in the post trial brief that the a five claim wasn't pled but they didn't make that argument on the eighth reclaim three claim mr all of points out that how far back do you want the records to be because he believes we should focus on near bankruptcy and although he didn't give me a timeframe suggest one or two years three years before bankruptcy not five to seven as he pointed out certainly your honor and i think the time frame varies depending on the case the real question is whether a creditor can determine what happened with the estate with the financial affairs are and it depends on context and so the context here is the creditor regarding that the house that they lost started for closure proceedings in two already got the lead up to bankruptcy going on and with respect to what's been called the paid for watches in particular the big issue is we don't know when they were transferred that could have been last year that could have been two years ago this was justified because it was too long ago when they haven't produced any evidence of actually when these transfers occurred it doesn't go to the eighty five which was not specifically played which is the failure to five but my point was that wasn't really planned and did they have notice of that clause of action under the complaint your honor i think that they did have notice even if you think that the pleading on expenses for their adult children they focused on one specific question in the statement of financial affairs but the duty is complete candor and they never explain they've never it tempted to explain why these expenses were not disclosed anywhere else in their schedules a statement of financial affairs they don't explain despite the fact that there were it was in the stipulations of fact that it wasn't in there t court mentioned this that these expenses weren't disclosed under question seven regarding payments to insiders question thirteen regarding gifts over six hundred dollars and all that they were normal expenses of the family and that's my point they're really very carefully framing the issue was all about question eighteen but the issue was in question eighteen the issue is should they have disclosed the isn't you know they could characterize this in one way or they could characterize it in another way but you pick which bucket it falls and there's a bucket for it in the schedule and they should have made those disclosures were the expenses ongoing at the time they filed was this like a regular monthly payment you can characterize it different ways but that doesn't excuse you from not disclosing at all it might affect where you put it you i have two minutes i just point out is dr dykes is a law school graduate he's not a lawyer he's never passed the bar he's never practiced just that i think that was on the record in response and what they were doing was going through their records and it took some time to make sure that when the amended the schedules and provided the information to us trustee that the information was accurate as accurate as possible do you think it's interesting that they had records about th not about the watches well it's it's not i think it's explainable and clearly explainable because this was the year prior to filing the watches was seven to four years before the filing it was a significant period of time and it was after the loss of the house the storage containers and the disaster ok but i guess they talk about it being in the ordinary course of business so it seems like they would have records going back for as long as they've been paying those expenses for their children i'm sure th that this disaster that occurred to them when they lost their house they didn't have a financial issue arising in two thousand and eight it didn't arise until after the foreclosure occurred because the real transaction there was the bank promised that they would turn out a construction loan when the time came it turned out the bank officers had given them fraudulent information everything ballooned they never had a problem making their ordinary peanuts or doing anything until they couldn't refinance from the balloon and that disaster occurred  honor i just have one final point to make in response with that the confession of judgment was two hundred ninety thousand dollars and that just is a reminder that there was a lack of record regarding the watches that returned there's no pleading issue with that confession of judgment of three hundred ninety thousand dollars but no way to determine how much of that debt remains even though the returns are made in two thousand and thirteen and the filing for bankruptcy was two thousand and sixteen several years later so that alone is sufficient to  excuse me my name is john had key and i'm representing the