of i'm represent the appellant's today dr sharon and darryl dykes this case arises out of an adversary proceeding in a bankruptcy case where the bankruptcy court after a trial denied my the the trustee had been administering assets throughout and in fact was administering assets before and after the trial if that's the question i guess i'm not i apologize i'm not understanding the court's question here well the it strikes me that the reason the trustees greatest interest in the in the watch is what was returned and what were they worth and so forth the record watches recordkeeping would have been to protect  both bellew so in its claim but other credit other creditors from a false or exaggerated claim by below zero then what was that was that did they know the answer to that when the discharge trav occurred before trial amended that claim to reduce it by i think one hundred and twenty thousand dollars it's in the record you know and i don't know what happened with regard to that that wasn't part of the most recent event if if in fact if in  fact the debtors had returned three hundred and fifty thousand worth of watches to the judge to the blue so as a judgment creditor that would have reduced the claim its claim in bankruptcy right yes i think so so that's a that's a heck of a reason good reason for the trustee to want an accurate record keeping with respect to that transaction in the case trust me never asked us for that information out of the deal and that's what this is all about the fact that there was a list of watches returned but there was no value and then it was inconsistent with the list of watches i'm just going from what i got out of the briefs sure will but it was it was front and center in the in the administration of the not only the administration of the assets in the estate but the the protection of creditors of these of the the claims against the the case trusting never inquired into that never asked us of that and never looked into i what was the status of the claims against the estate when there when the discharge draft to they were still open the trustee had not  all the assets are in and then due claims litigation and claims adjustment at that point that had not occurred the court question i want to answer that as directly as possible that had not occurred or process started at the time of the trial which was i believe december  seventeen about a year and a half after the filing of the  unless you get us to reverse a three we don't have to consider a forty five that's correct and there well there's two counts that the court ruled on one was that there were records that were on a count for a false th all the way to thank our guardian the failure previous failure to disclose that transfers to children was one of the one of the three bases to deny no that was why i was addressing your honor the court dismissed that claim saying it was no intent to hinder delay or defraud creditors in that trying to do a yes i'm talking about a four a well the only two counts the court found back ten years and found that transactions occurring from four to ten years prior to the bankruptcy filing that the clients my clients the debt tours did not have adequate books and records showing what happened a watch is not a background as in the briefing i just touch on it for purposes of argument the background is my clients were doing very well my husband dr dykes was a surgeon dr sharon dykes a doctor they were making estimated a one million dollars a year and only two thousand and a series of events occurred that led basically left them destitute by two thousand and twelve bad investments bad advice bad decisions end result as they pretty much lost everything and including when may when the transaction that was the catalyst for a rethinking of bad investment in a house where the bank foreclosed got a deficiency storage locker and they lost it if you've ever seen storage wars on t v that somebody bit in and bought everything and so they didn't have those records dr bags did testify at trial as to what happened the court using kind of something that was kind of disturbing to us a document that never been admitted to trial and citing it in the water use that to find that doctor died his testimony lacked credibility therefore didn't consider a lot of his testimony as to what happened in the watches and eventually ruled that the record keeping from fourteen years ago was inadequate and was the grounds for the denial of discharge what document are you referring to that they admitted that  she relied on that was not admitted it was exhibit nineteen it's referenced in the transcript i believe pages four and five op trial attorney for the u s trustee and i stipulated to the entry of numerous exhibits and the electronic docket at bankruptcy court we out one of the storage lockers describing contents from various things and when we want to be up to cross examine because we think the guy may have got a lot of watches in reporting for tax purposes and we wanted to cross examine we couldn't so it wasn't admitted and counsel and i actually agreed to the in this court cited that the only information in the entire record that would support some of the judge's findings and credibility are would have come from  cited in our materials so counsel what about the trial testimony about the watch boxes it seems to me that that goes to the credibility of the testimony as i understand it at trial there was an admission made that the watch boxes were either damaged in a basement flood or placed in storage and yet later on the claim was made that they didn't keep the boxes i think it's that's consistent the the storage about the testimony was that the storage boxes were put in a storage locker or the storage containers they were  innocent document that wasn't met if the bankruptcy judges credibility finding it's corrupt and we uphold it on appeal for some of the reasons stated here does your client your clients lose or as or not it's another path there's another path the path is the case we were unable to locate any cases that a court utilized transactions and lack of records from prior three to four years prior to the filing  bankruptcy here we're going back almost ten years and claiming lack of adequate documentation so the question is what's the reasonable loss of that finding i mean how far back the people have to keep record keeping system especially when you have creditors sort of wanting to satisfy their own claims against the estate and so isn't that a problem can we just from based on that on that ground alone no i mean i understand if a receipt and he got a receipt he got something showing what he gave them there's no dispute that's what he gave it as far as values values or whatever they would sell it for credit against the judgment he didn't know at the time there wasn't time so i don't think so them for nonpayment of rent would only have it would only could only the pros and he proceeds above the rental way along to the bail right  inferi if someone bids and more than the amount of rental client so that if if the if the boxes contained all of these items of value or records that were essential is they get when they went in there and got anything of value out of it before and that that was therefore they didn't have to keep paying rent and the the the seizure of the the storage lockers by them for nonpayment of rent didn't matter to  the quick answer the question is number one wants their month or so behind the debt or is blocked out without if they can't pay it up number two dollars he didn't have the ten thousand dollars two cents pay it up number three the private sale provisions don't require an inventory i'm part of the storage company and people who buy it and there's i think a ten day redemption period after that which and this all occurred back in two thousand and twelve he didn't have those opportunities because he had no income he would bounce out of his house was in a rental appellate not sure that was a remedy either but under the of course it was well and a losing party of a losing party who thinks the procedure process has been on fair you have you can you going to run to the appellate tribunals or you can go back to the trial dr you'll say this wasn't fair get a ruling on that and then take your appeal yes you are in retrospect we want the bankruptcy court out just answer question honestly ok ok any other question as a record you know  in i think that there's under the banksy code there is a deadline to file these kinds of complaints and so that the timing was based on that deadline it's a statutory deadline we did get it extended a couple of times and then we filed u keeping and you're on it the bank code requires that is to come to the table at the time of the petition with adequate records and it definitely designed so that for example the case to see him and what what records were adequate essential the dealings with the with the with blue so if i'm pronouncing it right how do you how do you how do you know them the materiality of the lack of record keeping until you've worked through the b states our obligation is to make sure that betters comply with the code and that didn't happen here if the code requires them to have adequate records and it's a very important requirement along with the requirements of honesty not making fraudulent statements of having a has to have the information of what assets exist what financial transactions occurred to determine if there's anything that can be recovered for the estate and any information that would suggests that a proof of claim should be challenged and that's why the inadequate for the reasons found that by the bankruptcy court and that alone is sufficient to affirm so in a stand maybe you don't care because you don't each raised the issue but the court cares and the creditors care because the fact is w ways but it also talked about the fact that when you're talking about timing when you don't know when the transaction happened because of the lack of records you can't say what happened to far back in difference were you looking for i mean obviously a receipt for the sale of the watches to the doubters would not be very helpful because you're talking about the disposition of the watch so do they have to have an inventory and specific records of when each watch was sold i mean what exactly are you receipts showing the shipping of up watches back the records could be any number of things but the problem is here there was a roof record at all you just left to wonder what happened to these watches and it's worth noting that for example talk to dykes testified that he received this one hundred and seven thousand dollars watch with no paperwork no receipt and he returned it in the same way but actually in the record there is a receipt for that one hundred and seven of what happened after it she claimed in testimony that he returned to the same way he got it but adequate records means a record not just the daughter's testimony and there was no record at all  watch or of the five watches where they were showing that he fully paid for those watches and your honor i would like to touch on a few other issues  and that was based on these returns to blue so it was based on the lack of records regarding these watches as well as the lack of records regarding what happened to the hundreds of thousands of dollars worth of property put in storage and  don't have their their greater depth of experience with these kinds of issues you had i don't think there's any reason to remember because the record fully supports the bank's equips decision it is a clear  deferential standard review regarding findings of fact and understood subsection a for which is worth noting there's no pleading challenge on that particular claim the bankruptcy court found that the dykes is knowingly made false statement indifference to the truth because there was a substantial amount of transfers to or on behalf of their adult children that they didn't disclose and that finding as fully supported by the record this court is completely capable of seeing that there is no reason for for among other things payments made to her on behalf of insiders which are defined as relative and we get into the discretionary aspect of the destroyer and sure i know what i've read schedules of the best they say clear and you know and they've got the thing at the bottom and threatening you with perjury and everything else but it's some there are there are there are errors that warrant a denial of discharge and there are mistakes that corrected mistakes  deferential standard of review the record supports the bankruptcy court finding of fact which included that there is no evidence as to why even if these payments were an ordinary course there was a reason not to disclose and they were plainly called for by the schedules of statement of financial affairs but they weren't disclosed also wanted to respond to the argument regarding credibility because i know that the court had some questions on that and the bankruptcy court based its credibility finding on not just one statement regarding what happened with the watch boxes it's clear from the court's decision and it stated expressly that the court found dr dykes not credible because of his demeanor because of inconsistency and what he was saying and there was other evidence needed that boxes went into storage that is you know it's not really clear why that is jump to the conclusion that the court was referring to something that was not admitted if if this was also clear and clearly required why does his credibility matter he won i think you're right that with respect to the adequate records of the inadequacy of the records the credibly doesn't matter on  do it but also there's a difference in terms of the timing with respect with respect to the intent and the court found that there is a court well i did you don't need to go on but i just think i think this the credit of the credibility finding suggests that there was a lot of discretion being exercised here you are the credibility finding as fully supported by the record the only part that challenges respect  person the bought the storage box who said there were no watch boxes in it or of i believe so but the credibility statement that the bankruptcy court made had to do with the credibility of the statement about what happened to the watch box based on was no evidence in the record that anything that betters state interfered with her administration of the assets or the case or created any inconvenience whatsoever there was no evidence in the record she didn't testify number two there was no evidence introduced by the us trustee as to what records would be reasonable under the circumstance me so i got to let me ask you a question about the bankruptcy court seem to spend a lot of well this a lot of emphasis on the fact that your clients were sophisticated they were highly educated they were doctors is the standard provides a reasonable record sliding scale or is it an objective standard i think it can be a sliding scale the pace on their sophistication but my client was a doctor darryl dices a surgeon sandboxes a doctor as i know from my practice and working with a lot of business people that doesn't make them good businesspeople or have anything knowledge or record keeping whatsoever they're good at what they do but there was no evidence that they were good at other things th snob side dr darrell dykes ultimately went to law school but he graduated in two thousand and fourteen he went because as the evidence in the in the case shows he's a consultant advisor on health policy issues in washington and that was the focus of the sixteen immediately when the case trustee and this is in the record asked about the student transfers the money they said yeah we did we thought it was in the ordinary course trustee said can you provide a record of it they provided a record they provided a record to the u s trustee that record was attached to their complaint the information that was the basis of this case was provided before the adversarial proceeding was filed granted the client didn't found them into schedule till february one but the disclosures had been occurring sits a pember and the testimony was also the e mails were sent to the u s trustee outlining everything in december of two thousand and sixteen long before the adversary proceed may i ask one follow up question which is  lot of what we've been talking about here is even if the grounds have been satisfied why deny discharge but i don't see you make an abuse of discretion argument that says you know even if one of these grounds a satisfy they still shouldn't have