garden morning may please the court my name is timothy told by and i'm the attorney for leavitt family limited partners and also for tom and associates i've reserved three minutes of my time for  i think the crux of this case can be summarized in the language that the trial court utilized in its july th two thousand and seventeen ruling in denying the defendant's motion for summary judgment which the court stated the personal guarantee of mr mr landis side prepared titian was discharged in his chapter seven case and was not renewed or reestablished by mr landy when he signed the lease extension in his capacity as a corporate officer of studio twenty six on i would submit and we would submit that that issue as to whether or not the lease extension operated to renew mr or land his personal obligations as a kirin tor in a party under the lease were issues that should have been decided and should be decided alternately in the state court in which the action was brought not by the bankruptcy court  twenty six inc in two hundred and fifty two thousand and five signed as a personal guarantor two thousand and eight files a personal bankruptcy at that point he was current on his lease there were no issues with the lease under studio twenty six no so instead of going back and recreating a whole new lease they simply cited an extension and said we're using all of the terms that were agreed to in two thousand and five are what we are going to today and that's exactly what the issues that were presented before the state court before this matter was brought before the bankruptcy court suppose for a moment that mr landy had never filed bankruptcy in two thousand and eight and we had filed suit based on the extension in two thousand and eleven mr landy would still be making the same arguments he has made here today i'm sure his counsel would be raising the same argument that he only cited as a corporate officer is not bound by the personal view on t v so on and so forth do i wish my client had had missed or landy sign a separate document that said personal guarantee in two thousand and eleven surety but he didn't so the question that ultimately to be decided by the state court is his signing of that at least you're actually no there are other bases as well and it is brought out in the in the trial as well that actually two weeks after the lease extension was signed the entity studio twenty dollars ceased to exist its corporate charter was cancelled by the state of ohio by failing to fit pay its franchise tax so studio twenty six dollars during all of the period of time that these charges accrued didn't even exist well then who liable studio twenty six doesn't exist anymore somebody was still there somebody was still operating that somebody was missed or landing but again those are all issues that should be ultimately decide the claims asserted in that case fall within the discharge injunction i e allege pre partition or post petition conduct and whether the claims can be proven is a question for the state court in which their lives litigated there's no question  the complaint is clear in fact there was an amended complaint that was pending when these these proceedings started that it was based upon and on the execution of the extension in two thousand and eleven and all of the charges that arose were from that extension we're not looking for any debt that was owed prior to two thousand and eight in fact and nothing that was owed prior to two thousand and eleven for that matter was actually two thousand and fifteen when these debts incurred that the trial the bankruptcy code we would respectfully disagree with that and that mr and when he got his st start his debts from prior to two thousand and eight and applications were discharged and he had a new star and he signed a new lease extension he and we contend and that's an issue and we decided that he incurred personal liability by signing the at least extension in two thousand and eleven all of the charges were incurred then a fresh start does not equate to a discharge in perpetuity because that's actually what mr land is looking for he thinks that his discharge in two thousand and eight not only discharged him of its debts an obligation prior to the point but on into the future as well and that is not what the st rd provision is intended for were several bases for holding him liable in the state court proceeding one the guarantee correct to the lease even though he signed as president you would argue that he could you could argue to the state court that didn't give him the principal building that's correct and then are you were you suing for occupancy as opposed to under the lease you know privity of the state as opposed to previous contract because i mean what it what exactly you said yeah what exactly would your theory of i'm primarily was that was the guarantee that he by by signing the extension that he did personally guarantee it but also the fact that under the lease he's listed as a lessee under  listed as the guarantor under the lease and also the fact that the entity studio twenty six dollars ceased to to operate ceased to exist within two weeks after the lease was signed somebody was still there it wasn't studio twenty corporation i believe was two thousand and fifteen could be it could have been two thousand and fourteen i don't recall specific was it was a couple years after that it was several years two thousand and fourteen or fifteen i don't recall specifically off and i think i'm thinking two thousand and fifteen when he vacated moved on and left in the rear of several months rent damage to the premises and that that was also ultimately the products of our our action and stay i'm sorry to interrupt but i don't understand you go straight up you're the lessee and you didn't pay and you committed waste why not just go at it that way it all is that the initial i mean we actually were very in the pleading stages of the of the proceedings in state court and  obviously you bring every claim that you think might be viable i wouldn't want it to have waived that potential in case the court were not to find for whatever reason that he was he was liable under the lease but regardless he would have been liable for transactions and personal guarantee in that they're not discharged by the bankruptcy and in fact actually one of the things that the trial court noted as well is that in fact there's a split of authority as to whether or not the mr orlando's two thousand and  bankruptcy discharge his obligations of the guarantor even under the two thousand and five lease now i would submit that all of the cases that were either for or against all pertain simply to a pre partition guarantee whereas the difference here in this case is that there was a post petition affirmation ratification whatever you might want polit through the extension of that lease none of those cases dealt with it but regardless even the trial court noted that there is a split of authority on the issue as to whether or not that obligation was discharged the trial court and i believe this court can reconsider that issue as to whether or not that that is true or not but regardless i think that those to the essentially the willfulness aspect submit though that the primarily in this instance we have a split of authority it's not a clear issue it's not a clear cut issue so there was no willful violation otherwise would be freezing any attempt to  to litigate any issues where there might be any legitimate issue involved in the case where there's a split of authority and it's not a clear matter of clear legal law we would submit that it should not be considered to be a will for violation correct we believe that that is was clearly a matter for the state court proceedings of your stick he was to court to construe the scope of the federal court injunction at least with regards to a discharge proceeding i can't speak to any other action that might be but with regards to these particular proceedings the bankruptcy court was limited to looking at where the allegations were the claims brought alleging pre partition or post petition conduct it's clear and whether or not we alternately prevail on those issues or not testified that he's the managing partner since two thousand and four since his father passed away and he's the one in charge of the leases it also operates a dentist office which is side by side to the commercial space it's there so your honour's are landy is asking asked the bankruptcy court the trial court to decide the threshold issue here ok did his twenty thousand and eighty seven discharge did it discharge his personal guarantee of a corporate debt ok now if this is answered in the affirmative then we never get to the questions of and state law of state common law regarding contract formation and such that raises now if a person if the personal guarantee is this terry should be discharged his corporate obligations then it's the discharge the personal guarantee is moot it ceases to function as an instrument it can't be resurrected it can't be ok i mean he they should have sued the corporation ok but they sued or landy personally if you think about it the lease was extended by the corporation he signed in his corporate capacity the corporation was valid at that time ok happens after that after the corporation is dissolved well the it's the corporation was only it was the articles were cancelled for failure to pay the franchise tax but it's still a defact corporation that doesn't just eliminate the corporation it could be reinstated in full upon payment of the franchise tax you think about it a corporation is still still when it corp when the articles are canceled th still exists for purposes of like winding down in this solution so the state recognizes the corporation they just they classify it you know is a defacto corporation so mr landa could walk in and you know pay their franchise tax and boom he has a corporation that exist still exist the only reason he would resurrect it would be to simply dissolve it at this point so i don't the the when the father speak or complain remember they  didn't they should they didn't sue the corporation who they should have really sued because that's the entity that the less sorehead privily with ok the lease extension signed by the corporation signed  by the landlord you know that's the contract ok you know you're dragging in our land there that's why when you look at the stake or complain they they focus on that guarantee language because how else do they have  because well like a lot of like a lot of times it's found that you know a corporation could end up being an empty shell that has liabilities but that's all it has you know and i mean that's that's that's a that's a that's a common everyday occurrence and that's why we have corporate you know that's why we have the corporate protection yeah i mean it's not a situation i think where where you'd like in this was an even alleged below on the stick or complain if it's a one count complaint you know that's part of the big groups of court record the complaint now i mean amended complaint if you look at the record in the bankruptcy court in the circuit on appeal you have you have just that one come complaint the complaint may have been amended at a later time but it's never part of this record and i can assure you that when you look at it when you look at the record and pick and appeal here so that's all they have they have one count and they're pleading it and  you know there are plenty against the individual in this individual capacity not this corporate capacity and we think i think the court correctly rule that you know you take away you know know that happens a lot now you know we don't you don't see these people being turned around and being you know expecting to have that obligation kerri anne they file the bankruptcy to rid themselves of that contract of that cosigning state court we had to list as an affirmative defense discharged in bankruptcy you know and we submit that the appropriate forum would have been for you know early and or for levitt for thoma to look at this they were noticed to go to bankruptcy court and say hey you know is this a dischargeable claymore or not i mean that would have been the appropriate steps conceivable to find a violation of the just quickly summarize taggart you know so integrity think is we know it it abandoned this idea of a subjective test ok where you know what's in the creditors mind that they think they were doing the right thing that was the  th circuit test that tagore rejected but terry good also had a problem with this so called strict liability way that the lower the trial courts generally look at the stay in discharge violations so i think though when these matters are on appeal and when these matters are now before trial court judges they're still going to look at their initial analysis that so called strict liability analysis where that was the creditor and notice what did the creditor do you know that and then i think you overlay that with the tear good notion that you know let's step back a minute and see if the creditor acted  follows rate smack in the center of those easier cases where it's typically a business somebody had say a business had a open ended  company still continues to borrow say lumber or whatever and i'm going basis ok and then there's a problem later in there's a lawsuit and they want to sue the bar of the company for their power longer they want to sue the individual the individual says hey wait a minute you know i discharge this in my belly or bankruptcy and there's cases that fall flat on the side of the debt or they're like yeah that's the reason the starter saw they pursue relief you know to discharge this contract this obligation under the contract and i think this is a similar situation it's not that complicated it's a lease guarantee what you know it could be a lease guarantee for you know somebody is a part know that that party has now filed bankruptcy and they've made the guarantee that cosigning you know moved in no longer exists as an instrument i think it falls on the simple side of the of that equation as far as some of the split of authority and i think that's why you know if you're if we're talking about contempt and things the predator had more or less had an obligation to to seek then to find that issue out from the bankruptcy court instead of just you know going in there you know guns blazing like the bankruptcy doesn't apply to us so apply this case the  lubber gotten a new guarantee when it renewed at least should have because i'm kind of trying to find out what would a landlord do they've got a good tenant they want to keep that but if the individual filed bankruptcy do they have to throw this person out because they can't have a guaranteed obligation they want that guarantee and they probably should have a guarantee how do they approach that problem they sign a new guarantee i would think ok guarantee post think even though you have an existing lease there's just merely being renewed i'm trying not to figure out the sink should release and a revolving line of credit goes down to nothing after the case has been filed the discharge given and then goes back that the award of fees and costs were appropriate and that an abuse of discretion in this case yes thank you so just a couple points and rebuttal the apple e r user presents that really the sole issue that is to be determined is whether or not the bankruptcy in two how and actually the court will have the opportunity to address that issue in this case as to whether or not the discharge applies to a personal guarantee but regardless of how this court decides those issues as to whether or not mr lanty is liable under the two thousand eleven lease extension are still going to be raised in state court let me ask you this under under bankruptcy court are you free to go back to state court and not say a word about the guarantee to one of the lease under these circumstances i probably would take great pause just because based on the litigation posture of the i don't know we'd have to think through that whether or not we would even even bother with that and the amount of pardon and the amount of controversy actually them on controversies gotten to be considerable with the damages that were done but the money is there but whether or not it would be more of a practical decision then would have to be evaluated between me and my client whether or not it would be worthwhile to do that we i think we would legally have viable claims under those alternate theories whether or not it makes sense to pursue those or not is it would be speculative for me at this point but the point being is that again all of those issues regardless of  mr orlando his personal liability as to the two thousand and eleven lease modification will be an issue that will need to be litigated in state court regardless of whether or not his personal  bankruptcy in two thousand and eight discharged that personal guarantee under the two thousand and five lease if we were suing him under the two thousand and five lease i would one we wouldn't file the suit if we did then we probably would have a very good claim not only for decide that we should have done it you were discharged it certainly was not a willful violation we think the area of case law is sufficiently unsettled that that we had a reasonable basis for seeking in attempting to do that th