### IN THE COURT OF APP EALS OF TENNESS EE AT KNOXVI LLE N ove m be r 15, 200 5 S es sio n
KAT HRY N H EAD RIC K v. B RA DLE Y C OUN TY MEM ORIA L HOS PITA L, ET AL 

### . Appeal f romthe Circ uit Court for Bradley County No. V-99- 380 Law renceP uckett, Judge

No. E2005-00925-COA- R3-CV - F ILED JANUARY 31, 2006

I n th is app e a l, the iss ue pr e se nte d is wh e the r a pa rt y ha s sta nd ing to pu rs ue a pe rs on a l in

jury c la im in state court that a ccr

ued af ter the f iling of the party ’s bankr

uptcy petition and befor e the c losing of the ba nkruptcy case

. Ms. Headrick filed a Chapter 13 ba nkruptcy

petition. W hile the bankr uptcy
case was pe nding, Ms. He adric k was involved in a single car acc ident and was trea ted for her injuries byDr. Da niel J ohnson at Br adley CountyMemorial Hospital. Subsequently , she conve rted he r Cha pte r 1 3 b a nk

ru ptc y c a se to a Cha pte r 7 ba nk

ru ptc y c a se . Wh ile the Cha

pte r 7 c a se wa s st ill pending , she discover ed that she suf fer ed a hip fra cture in the car accident whic h she alleg es that Dr. J ohnson and the Hospital fa iled to timely diag nose and trea t. There afte r, Ms. Hea drick re ceive d a discharg e in bankr

uptcy and the ba nkruptcy

case was c losed. Ms. Hea drick th en fi l ed a medical neg lige nce c ase a g ainst Dr. J ohnson and Bradle y Memorial Hospital. The D efe ndants filed a motion for summary

judgme nt asserting that Ms. Hea drick did not have standing to bring the ca se. The trial
c ou rt a g re e d a nddis mis se d th e c a se

. Af te r re vie w o f the re c or d a ndapp lic a ble a uth oriti e s, we ho ld that Ms. Headrick’s post-bankr uptcy cause of ac tion is notpart of the bankruptc y es tate and there fore , as a matter of law Ms. Hea drick did have standing to bring the lawsuit. The tria l court’s decision is reve rsed.
Tenn. R. App . P . 3 Appeal as of Right; Judgme nt of th e Circ uit Court Reve rsed; Cause Rem anded

S HAR ON G. LEE , J ., d el i v er ed t h e opinion of the c ourt, in which H ER SCH EL P. F RAN KS , P.J ., and C H A RLES D. S US ANO , J R ., J ., joined.

Sh ell ey I . Stil es, B rentwood, Te nnessee , and Robert J. S hockey , Nashville, Tenne ssee, f or the appellant, Kathry n Hea drick.

Arthur P. B ro ckan d T i m o t h y J

. M i l l i ro n s , C h at t an o o ga, T en n es s ee , fo r t h e a p p el l ee , Da n i el J ohnson, M. D. , in div idu a lly

a ndd/b /a Sou the a st T e nn e sse e Ortho pa e dic s.

Sue E. Sc ru g g s a ndB lake F . M ur c his on , Ch a tta no og a , T e nn e sse e , f or the app e lle e , Br a dle y

Cou nty Memorial Hospital.In a C h a p te r 1 3 b a n k ru p tc y c a se , a p o rtio n o f a d e b to rs ’ futu re e a rn ing s is c o llec te d b y a tr u ste e a n d p a id to 1

cr edi t ors

. A C hapt er 13 d ebt or does not r ece i ve a di s cha r ge of debt s , but i s al l owed t o ext end or r educe t he debt l oad t hrough a p l an o f

rehab i l i t at i o n. I n a C hap t er 7 b ankruptcy case, t he t rus t ee co l l ect s and l i q ui d at es a deb t o r’ s ass et s and t he d eb t o r rec eive s a d i sch arg e o f d eb t s.
-2-

OP IN ION

I.

This a ppeal involves a claim for medical neg lige nce intertwined with a bankruptc y case . On J anuary 10, 1997, Kathryn Hea drick filed a Chapter 13 b an k ru p t cy petition in the United States B a nk ru pt cy Co urt fo r the Ea ste rn Di stric t of Te nn e sse e . In th e sc he du le of pe rs on a l pr op e rt y attache d to her pe tition, M s. Hea drick stated that there w ere no unliquidated claims of any nature

. On Dec ember

4, 1997, Ms. Headrick was injure d in a one- car acc ident. She was tre ated at Bra dley CountyMemorial Hospit al (“ the Hospital”) by Dr. Da niel J ohnson of Southeast Tenne ssee Ortho pa e dic s for in

ju rie s th a t in c lud e d a

br ok e n a rm a nda br ok e n le g . O n M arc h 3 , 1 99 8, Ms. Hea drick filed a notice w ith the bankruptcy court to conve rt her Cha

pter 13 c ase to a

Chapter 7 c ase. 1 She listed Dr. J ohnson and the Hospital as c reditors. On A pril 24, 1 9 9 8 , a bankruptc y cre ditors meeting was he ld in the case which was described as being a “no a ssets” ca se. On e ither April 30, 1998, or May

1, 1998, Ms. Headrick discover ed tha t s h e h ad a fr actur ed hip that she c laimed Dr. John so n a ndthe Ho sp ita l f a ile d to pr op e rl y

dia g no se a ndtr e a t f

oll ow ing he r c ar accid e nt i n Dec ember

of 1997. Ms. Hea drick did not list or otherwise id en t i fythe potential cause of a ction ag ainst Dr. Johnson or t h e Ho s p i tal as an a sset in any of the ba nkruptcy

schedule s. She did not amend her bankruptc y filings to disc lose the potential medical ne g lige nce c laim. On November 24, 1998, her ba nkruptcy

trustee f iled a report s tating that there w as no prope rty available for distribution from the estate over and above t hat ex empt by law. On November 30, 1998, the bankr uptcy court enter ed an or der discha

rg ing Ms. He adric k of her debts. On Ma rc h 1 7 , 1999, a fina l decr ee w as enter ed in the Chapter

7 bankruptc y

case an d the ca se wa s closed. The next m onth, on April 28, 19 99 , M s. He a dric k f

ile d s uit a g a ins t D r. John so n a ndthe Ho sp ita l a lle g ing that th e y ha d n e g lig e ntl y failed to diag nose and tre at her hip frac ture a nd t h at s h e h ad been damag ed by this omi ssion. Dr. John so n a ndthe Ho sp ita l f ile d a mo tion f

or su mma ry jud g e me nt s e e kin g a

dis mis sa l of

Ms. Hea d r ic k ’ s la w s u it

o n th e b a s is o f

th e b a n kru p tc y

f il in g s

. T h e tria l c o u r t, r e lyin g o n th is Co u r t’ s opinion in Tangwal l v. Stapleton, No . E20 01 -0 21 21 -C OA -R 3- CV , 200 2 WL 17 23 69 2, (T e nn . Ct

. App. E.S., filed J uly

25, 2002) no appl. perm. filed, determined that once Ms. He adrick filed for bankruptc y , her c ause of

action ag ainst Dr. Johnson and the Hospital beca me a pa rt of the ba nkruptcy estate, a nd the trustee in ba nkruptcy became the prope r par

ty to bring these a ctions. Concluding tha t at the time Ms. Headrick filed the la wsuit she did not have leg al standing to bring the ca se, the trial court dismissed the ca se as t o M s

. He ad ri ck, but not as to the bankr uptcy trustee. Ms. He adric k appea ls and seeks our

revie w of the tria l court’s de cision.-3- II.

Th e so le iss ue we add res s in th is a pp e a l is wh e the r the tr ia l c ou rt e rr e d in dis mis sin g Ms. Hea drick’s la wsuit by

summary judgme nt upon gr ounds that Ms. Hea drick lacked standing to pursue the cause of a ction beca

use it was prope rt y o f her ba nkruptcy estate a nd was not disclosed to her bankruptc y

trustee during the pendenc y of her bankruptc y

.
III

. Summary j u d gm en t s enable courts to conc lude ca ses that ca n and should be re solved on dispositi ve leg al issues. Se e By rd v . H all
, 84 7 S. W.2 d 2 08 , 2 10 (T e nn . 1 99 3) ; Airport Props. L td. v. Gulf Coast Dev., I

nc., 90 0 S. W.2 d 6 95 , 6 97 (T e nn . Ct . A pp .1 99 5) . T he y are appro pria te on ly when the f

acts mate rial to the dispositive leg al issues are undisputed. Acc ording ly , they should not be used to resolve fac tual disputes or to de termine the fac tual infere nces that should be draw n from t h e evidenc e whe n those infer ence s are in dispute. See B ellamy v . Fede ral Express Corp., 749 S.W .2d 31, 33 (Tenn. 1988)

.
To be e ntitled to a summary judgme nt, the moving party must de monstrate that no g enuine issues of material fac t exi st and that he or she is entitled to judgment as a matter of la w. See Tenn. R. C iv. P. 5 6. 04 ; By rd v . H all
, 84 7 S. W.2 d at 21 0; Planet Rock
, Inc. v. Regis Ins. Co., 6 S.W .3d 484, 490 (Tenn. Ct. App.1999). Asummary judgme nt should not be g rante d, howeve r, when a g enuine dispute exi s t s wi t h re gard to any materia l fac t. Seave rs v. Me thodist Med. Ctr., 9 S.W .3d 86, 97 (Tenn. 1999) ; Ho gin s v . R os s, 98 8 S. W.2 d 6 85 , 6 89 (T e nn . Ct . A pp . 1 99 8)

. Ou r ta sk on app e a l is to review the re cord to de termine whe ther the r equirem ents for g ranting summary judgme nt have been me t. See H

unter v. Brown, 95 5 S. W.2 d 4 9, 50 -5 1 ( Te nn . 1 99 7) ; Ag hil i v . Saa da tne jad i, 958 S.W .2d 784, 787 (Tenn. Ct. App. 1997). T enn. R. Civ. P. 56.04 provides that summary judgme nt is appropriate wher e: (1) the re is no g enuine issue with re g ard to the material fa cts rele vant to the claim or de fense contained in the motion, se e By rd v . H all , 847 S.W .2d 208, 210 (Tenn. 1993) ; and (2) the moving party

is entitled to a judgme nt as a matter of l aw on the undisputed facts. See Anderson v. Standard Register Co. , 857 S.W .2d 555, 559 (Tenn. 1993) . A party seeking a summary jud g me nt mus t de mon str a te the abs e nc e of a ny g e nu ine a nd mate ri a l f

a c tua l is su e s. By rd

v . H all
, 847 S.W .2d 208, 214 (Tenn. 1993)

. When the party

seeking summary

judgme nt makes a proper ly supported motion, the burden shifts to the non-moving pa rty to set forth spec ific fa cts establishing the e x i stence of disputed, materia l fac ts which must be resolved by the trier of

fac t. Se e By rd

v . H all , 847 S.W .2d at 215. Robinson v. Ome r , 9 52 S.W. 2d42 3, 42 6 (T e nn

. 19 97 ). Th e no n- mov ing pa rt y ma y no t si mpl y

re st up on th e ple a din g s, bu t mu st o ff e r p ro of by a ff ida vit s o r o the r d isc ov e ry ma te ri a ls ( de po sit ion s,
a ns we rs to i nte rr og a torie s, a nda dmi ssi on s o n f ile ) p ro vid e d b y

Rul e 56 .0 6 s ho wi ng that the re is a g e nu ine is su e for tr ial. I f the no n- mov ing pa rt y do e s n ot s o r e sp on d, the n s umm ary jud g me nt, if appropriate, shall be e ntere d ag ainst the non-moving party . Tenn. R. Civ. P. 56.06.-4-

Summa ry judgme nts do not enjoy a pre sumption of corre ctness on appe al. See Ne lson v. Martin, 95 8 S.W.2 d 6 43 , 6 46 (T e nn . 1 99 7) ; City of T ullahoma v. Bedford County, 938 S.W .2d 408, 41 2 ( Te nn . 1 99 7) . Ac c or din g ly , whe n we re vie w a summ ary jud g me nt, we vie w a ll the e vid e nc e in t h e l i gh tm o s tfa v o ra b l e t o t h e n o n -m o v an t , an d we re s o l v e al l fa ct u al i n fe re n ce s i n t h e n o n -m o v an t 's favor

. See Luther v . Compton, 5 S.W. 3d63 5, 63 9 ( Te nn . 1 99 9) ; Muhlheim v . Knox County Bd. of Educ., 2 S.W .3d 927, 929 (Tenn. 1999) . A summary judgme nt wi l l be upheld only when the undisputed fac ts reasona

bly support one conclusion - t hat the moving party is entitled to a judgme nt
as a matter of law

. See W hite v. Lawrence, 97 5 S. W.2 d 525, 52 9 ( Te nn . 1 99 8) ; Mc Cal l v . W ild e r, 913 S.W .2d 150, 153 (Tenn. 1995)

.

I V.

Th e tr ia l c ou rt ’s or de r d ism iss ing Ms. He a dric k’ s c a se pr ov ide d a s f oll ow s:

Def endant’ s Mo t i ons for Summary J udg ment are controlled by the
case of T a n g w e l l v

. S t ap l e t o n e ta l , LE X IS 2 0 0 2 T e n n

. A p p

. LE X IS 54 2, a ndthe op ini on a uth or e d b y Judg e F rank s. Al tho ug h tha t c a se involved a ca

use of a ction which had a ccr ued bef ore the filing of

the plaintiff’s B ankruptc y

Petition and the case her e d o es not , the Ba nkruptcy

Code bu rd ens t he petitioner w ith a continuing responsibilityto d isclose to the trustee, during the pendenc y of the Ba nkruptcy Procee dings, a

per s o n al i n

j u rym al p ra ct i ce ca u s e o f a ct i on
s h e r e a l i z e s h a s a c c ru e d t o h e r d u r i n g t h e c o u r s e o f t h e B a n kru p t c y. [FN1 U.S.C. § 541(a)( 7).] Under the B ankruptc y Code, plaintiff’s
c a us e of a c tio n a g a ins t the se de fe nd a nts be c a me a pa rt of the Es ta te in B a nk ru ptc y a ndthe Tr

us te e in B a nk

ru ptc y be c a me the pr op e r p art y to bring these a ctions. [FN2 11 U.S.C. § 554(c) a nd (d).] Which, as J udg e Franks opined, me ans that the ba nkrupt plain t i ff loses leg al
s tan d in g to b r in g th e m. [F N 3 T a n g w e ll v

. St ap le to n ] Th e re fo re , th e mot ion s o f the de fe nd a nts are g rante d an d the c a se is dismiss ed with pre

judice as to Kathry n Hea drick, but not as to the T ru s t e e i n B a n kru p t c y.

Under the United States B ankruptc y Code, when a

debtor files a

bankruptc y

petition, a ba nk ru ptc y e state is c re a te d whi c h inc lud e s all of the de bto r’ s le g a l or e qu ita ble int e re sts in p ro pe rt y as of the c ommenceme nt of the ca se. 11 U.S .C. §541 (a)( 1). These interests in property include
cause s of ac tion. Bauer v. Comm erce Union Bank, 859 F.2d 438, 441 (6 Cir. 1988). Upon the th appointment of a truste e in bankr uptcy , the trustee suc cee ds to all causes of action formerly

held by the de bto r, a nd the de bto r la c ks sta nd ing to p ur su e tho se c a us e s o f a c tio n. 11 U. S.C. §3 23 (a ); Bo wie v. Rose Shanis F i n a n ci a l S ervices, LLC , 86 2 A .2 d. 11 02 (M d. Ct. Ap p. 20 04 ); Vucak v. City of-5-

Portland, 96 P.3d 362 (Or. Ct. App. 2004). Property that the debtor schedule s in the petition that ha s no t been a dmi nis te re d w he n th e c ou rt c los e s th e c a se is a

ba nd on e d to the de bto r. 11 U. S.C. §5 54 (c ). B ut e state pr op e rt y wh ic h is no t a dmi nis te re d a s p art of the ba nk ru ptc y c a se a ndwh ic h is not abandone d to the debtor unde r sec tion 554 remains prope rty of the e state.

As we ha ve noted, Ms. He adric k’s bankr uptcy was converted from a Chapter 13 case to a Cha pte r 7 c a se on Ma

rc h 3 , 1 99 8. Th e B a nk

ru ptc y Cod e , 1 1 U .S. C. § 34 8( a ), pr ov ide s:

Conversion of a c ase f

rom a c ase under one cha pter of this title to a
case under a nother c hapter of this title constitutes an order for relief under the chapte r to which t h e ca s e is converted, but, ... does not aff ect a cha n ge i n the date of the filing of the pe tition, t he
commence ment of the c ase, or the orde r of r elief.

Subsection (f)( 1)(A) of § 348 further provides that when a case under chapte r 13 is c onverte d to a
case under a nother c hapter such as Chapte r 7:

[P]ro pe rt y

of the e state in the c on ve rt e d c a se sh a ll c on sis t of pr op e rt y of the e state, as of the date of the filing o f t h e p etition, that rema ins in the po sse ssi on of or is und e r the c on tr ol of the de bto r o n th e date of conve rsion. (empha sis added).

Acc ording ly , when a

case is converte d from Chapter 13 to Cha

pter 7, we must look t o the date of the filing of the Chapter

13 ca s e to i dentify

the prope rty

of the Chapter

7 estate a s defined by §541. See a lso In re Pe te rs , 44 B.R. 68, 70 (B ankr. M.D. Tenn. 1984). Ms. Headrick filed he r Chapter 13 c ase on January 10, 1997. Her

cause of ac tion originat ed wi th an injury that occur

red on Dec ember

4, 1997 - appr ox imately 11 months a fter her case commence d under Chapte r 13. She did not discover her

cause of ac tion until late April or early May of 1998 - approxi mately 16 months afte r her case commence d under Chapter 13. Thus, Ms. Headrick’s ca use of a ction had not arisen wh e n s he fi le d h e r C ha

pte r 1 3 p e tit ion a nd the re fo re , pur su a nt to § 34 8, it d id n ot b e c ome pr op e rt y of the Chapter

7 bankruptc y

estate.

The trial c ourt indicates that it re lied upon Tan gwa ll v . S ta pleton , e t al in r e a c hin g its decision. I n Tangwal l, we aff irmed the trial court’s ruling that the plaintiff did not h av e s t anding to assert a

cause of ac tion that he had fa iled to set forth in h i s b an k rupt cy schedule s and that the
cause of ac tion rema ined a part of the plaintiff’s bankr uptcy estate unde r control of

the bankr uptcy trus te e . H ow e ve r, that ca se is r e a dil y dis tin g uis ha

ble fr om the pr e se nt m a tte r b e c a us e un de r the fa c ts in Tan gwa ll t h e cause of ac tion at issue acc rued be fore the debtor f iled his bankruptcy

petition.-6-

Although in the c ase now befor e us t h e t ri al court acknowledg ed this distinction, t he trial c ourt determined that 11 U.S.C. § 541(a)(7) imposed a duty upon Ms. Headrick to disclose a c ause of action ac cruing during the pende ncy of her bankruptc y

case . We respec tfully

disag ree

.

11 U. S.C. §5 41 (a )( 7) pr ov ide s th a t “ [an y ] int e re st i n p ro pe rt y that the e sta te acquir es af ter the c omm e nc e me nt of th e c a se ” is i nc lud e d in thepr op e rt y of the ba nk ru ptc y e state . ( e mph a sis
a d d e d )

. P r o p e r t y a c q u i r e d b y the estate s h o u l d n o tb e c o n f u s e d w i t h p r o p e r t y a c q u i r e d b y the debtor

. § 541(a) (7) applies only to pr operty that is a cquire d post-petition by the ba nk ru

ptc y e sta te . I t does not apply to property

that is acquire d post-petition by the debtor

. In re Doe mling , 127 B.R. 954, 956 (W.D

. Penn. 1991). See a lso Casey v. H ochman, M

.D., 96 3 F .2 d 1 34 7 ( 10 Cir .1 98 2) . M s. th Hea drick’s c ause of action was not acquir ed by the estate, but by her individually

as a r esult of an inj ury to h e r p ers on , an d a ny

re c ov e ry sh e mig ht r e a lize a s a

re su lt o f h e r l a ws uit

wo uldbe to compensate for that personal injury , not to compensate f or an injury to the estate. §541( a)( 7) does not bring Ms. Headrick’s ca use of a ction within the bankruptcy estate.

The a ppellees c ite Stanley v. She rwin-W illiams C o. , 156 B.R. 25 (W.D. Va. 1993) in support of the trial c ourt’s ruling in this m atter. In Stanley , the debtor, a painting contra ctor, filed a petition under Chapte r 11 of the B ankruptc y Code. Ther eaf

ter, a cause of ac tion arose in fa vor of the de btors ag ainst the Sherwin-Williams C ompany for inter fer ence with contrac tual re l ations. The debtor ’s ba nk ru ptc y c a se the n c on ve rt e d to Cha pte r 7 a ndthe de bto r s ub se qu e ntl y re c e ive d a d isc ha rg e of his debts under that chapter . After rec eiving his discharg e, the de btor filed sui t against S herw inWilli a ms. At

no tim e did the de bto r am e nd his ba nk ru ptc y sc he du le of

a sse ts t o in c lud e the c a us e of ac tion. The Court ruled that bec ause the debtor’s c ause of action exis ted prior to his discha rg e, it w a s p ro pe rt y

of the ba nk ru ptc y e state

. Th e Cou rt de te rm ine d that the pr op e rt y re ma ine d p ro pe rt y of the e state bec ause it had neither be en formally abandone d nor aba ndoned by operation of law as
sc he du le d pr op e rt y

. Ac c or din g ly , the Cou rt he ld that th e de bto r l a c ke d s ta nd ing be c a us e the c a us e of a c tio n w a s n ot h is t o a sse rt

.

I n their brief

, the appe llees state that we relied on Stanley in our opinion in Tan gwe ll. Whil e we did cite Stanley in the latter c ase, w e did so only for the pr oposition t hat “[i] f a c ause of action is not formally

schedule d, it will remain property of the estate, having been neither administered nor abandone d by the trustee, and the debtor will ha ve no standing to a ssert it.” Tan gwe ll, id

. a t * 7

. We did not rely

upon Stanley for the proposition that a debtor lac ks standing to a ssert an unsc heduled
ca u s e o f a ct i o n ac q u i re d p o s t -p et i t i o n , an d we d o n o tagr ee wi t h t h at h o l d i n g.

Our re view of a

pplicable c ase la w re veals a split of authority

with reg ard to the issue of whether a debtor ’s cause of a ction that arises post-pe tition is property of the ba nkruptcy

estate, a s discussed in Charts v. Nati onwide Mutual Insurance Co. , 300 B.R. 552 (D . Conn. 2003). I n Cha rts , the plaint if

fs hu sb a nda ndwi fe fi le d a Cha pte r 7 pe tit ion . A fe w m on ths the re a ft e r andprior to the ir discharg e, husband, who operated an insurance ag ency , enter ed into an ag ency ag ree ment with the defe ndant. Subsequently , the defe ndant ca ncelled the ag ree ment, g iving rise to claims in favor of-7-

the plaintiffs. As in the matter sub judice, the plaintiffs failed to disclose these c laims during the pendenc y of their bankruptcy , and in their m otion for summ ary judgme nt, the defendants ar g ued that the claims consti tuted property of the e state and the ref

ore, the plaintiffs could not assert them for lack of standing

. Upon revie w of a rec ommended ruling that the plaintiffs’ c laims should be deemed to be e state pr op e rt y , th e Cou rt no te d th a t va

ri ou s c a se s, a mon g the m Stanley v. She rwin-W illiams Co., ha d a dd re sse d th e iss ue a ndha d r e a c he d d isp arate c on c lus ion s:

I n th e r e c o mm e n d e d ru li n g o n th e o r ig in a l mo ti o n for summary ju d gm ent, t he Court re lied on Correll v. Equifax Check Servs., I nc., 234 B.R. 8 (D. Conn. 1997), in which the Court held that pursuant to § 541(a)(7), a Fair Debt Collection Act ca use of a ction arising out of dunning letters re ceive d by the debtor afte r the bankr uptcy petition was filed constituted property of the e state. S e e C o rre ll , 2 3 4 B.R. at 10. Othe r courts have rea ched simi lar conclusions based on § 541( a)( 7). S e e Polvay , 1997 WL

188127, at *2 (“ Causes of a ction
ari sin g a ft e r the de bto r f

ile s f or ba nk ru ptc y g e ne ra lly be c ome pa rt of the e state .” ); Stanley v. She rwin-W illiams C o., 156 B .R. 25 (W. D. Va

. 19 93 )( de bto r did no t ha ve sta nd ing to maintain cause of ac tion for interfe renc e of c ontrac tual
re la tio ns wh ic h a

ro se prior to the dis c ha

rg e of his e state ); In re Griseuk , 165 B

. R

. 9 5 6 , 9 5 7

- 5 9 ( B a n k r

. M. D. F l. 1994)(holding t h at persona l injury action arising during the pendenc y of t he bankruptcy

proce eding s was prope rty of the
e state ); De Larc o v . D e W itt , 1 3 6 A.D.2d 406, 408, 527 N.Y.S.2d 615 (N.Y. A pp. Di v

. 1 9 8 8 ) (“Upon the filing of a

v o l u n tary bankruptc y

petition, all property

which a de btor owns or subseque ntly

acquir es, i n cludi ng a ca

use of a ction, vests in the bankruptc y

estate.” ) Howe ver, othe r courts have held that post-petition, pre-disc h arg e ca uses of a ction under simil ar c ircumstance s are proper t y o f the de btor. Se e In re Durrett, 187 B.R. 954 , 413, 417-19 (B ankr.D .N.H. 1995) (p e rs on a l inj ury a c tio n ari sin g po st- pe tit ion did no t beco me pa rt of the ba nk ru ptc y e state ); In re Doe mling , 127 B.R. 954, 955-56 (W.D.Pa. 1991) (tort claim arising out of post-petition automobile acc ident was prope rty of the de btor, rathe r the estate)

. T ak en toge ther, these case s indicate that ther e may be no brig ht- lin e te st f

or wh e the r a c a us e of a c tio n that a c c ru e s p os tpetition will b e i n cluded as part of the bankruptc y estate. Ra the r, in m akin g su ch a de te rm inatio n, the Cou rt sh ou ld consider whe the r th e c au se of a c tio n “i s su ffi c ie ntl y ro ote d in-8- the pre-bank ruptcy past and so littl e entangled with the b a n k r u p t ’ s a b i l i t

y t o m a k e a n u n e n c u m b e r e d f r e s h s ta rt .” Doemling, 1 2 7 B. R

. at 9 5 7 (c i t i n g Se ga l v . R oc he lle , 3 82 U. S. 37 5, 86 S.Ct . 5 11 , 15 L .E d. 2d42 8 ( 19 66 ) andno tin g that it is sti ll c on tr oll ing de sp ite the re vis ion of the ba nk ru ptc y c od e in 1978) (internal quotations omitt ed). (empha sis added).

The Court in Cha rts he ld that th e plaint if fs did no t lac k sta nd ing to p ur su e the ir c la ims beca use the c laims “did not involve matters that could be tra ced to the pla intiff s ’ pre -petition conduct” and the a g ree ment out of which the c laims arose “ was n ot ‘rooted in the de btor’s pre

bankruptc y

past’ (w hich ende d with the filing of the petition...).” Cha rts , id . at 558.

5-541 Co ll ie r

o n B a n k r u

p tc y ¶541.03 (Ala n N. Resnick & Henry J . Sommer eds., 15 ed., th 2005) provides a s follows reg arding whether property acquir ed by the debtor post-pe tition becomes property of the ba nkruptcy

estate:

As a gener al rule, the estate is norma lly comprised only

of property interests b el o ng ing to the de btor at the time the petition is filed. I n g ener al, property of an individual not then owned but s u b s equentlyacquir ed by the debtor doe s not become property

of t he estate, but rathe r, bec omes the debtor’s pe rsonal prop erty , clea r of a ll claims that are ultimately

discharg ed in the bankr

uptcy case

. Un de r the statut e , “a ny

int e re st i n p ro pe rt y

that th e e state
a c qu ir e s a ft e r the c omm e nc e me nt o f the c a se ” is i nc lud e d in “prope rty of the estate” by

section 541(a )(7) . By

obvious implication, pr operty

acquir ed postpetition by

the individual debtor is u su a lly

no t pr op e rt y

of the e state . How e ve r, a c a se in the Un ite d St ate s Suprem e Cou rt [ Se ga l v . R oc he lle , 382 U. S. 3 75 (1 96 6) ] co nc lud ed th at w he n p os tpe tit ion pr op e rt y

“ is [s o] roote d in the pr e -b a nk ru ptc y pa st a ndso lit tle entangled w ith the bankrupt’s a bilityto make an unencumbe red fre sh start [t hen] it should be ” prope rty of the estate. (empha sis in original).

T h e e x c e p t i o n n o t e d b y C o l l i er to the g ener al rule tha t after acquir ed prope rty

of a de btor do e s n ot c on sti tut e pr op e rty of th e ba nk ru ptc y e state is the sa me e xce pti on no te d b y the Cou rt

in Ch a r ts d er i v i n g from the Supreme Court’s opinion in Segal . And eve n this ex ception has be en-9-

reje cted in the rec ent ca s e of In re Holstein, 321 B.R. 229,238 (N .D. I ll. 2005) (finding that the debtor in Se ga l ha d a n in te re st i n th e su bje c t a sse t w hen the b a nk ru ptc y wa s f ile d a ndthat Segal

“ do e s n ot e xpa nde state pr op e rt y to i nc lud e le g a l or

e qu ita ble int e re sts a

de bto r a c qu ir e s p os tpetition, as long a s a cle ver truste e can tie those interests to the ‘pr e-ba nkruptcy past’”.)

I n the pre sent ca se, the c ause of act i o n asserted by

Ms. Headrick is not rooted in her “ prebankrupt cy

past” a nd so, even unde r that exception, there is no basis for finding that her c ause of actio n i s p roperty

of her bankruptc y

estate. The ref

ore, he r fa ilure to disclose the c ause of action during the pende ncy

of her bankruptc y should not stop her f rom asserting it at pre sent. See Farmer v. Taco Be ll Corporation 242 B.R.435, 441 (W.D. Tenn. 1999)

.

V.

For the fore g oing rea sons, w e reve rse the judg ment of the trial c ourt and re mand for f urther action consistent with this o p i n ion. Costs on appea l are adjudg ed ag ainst the appe llees, Da niel John so n, M. D. , in div idu a lly a ndd/b /a

/ S ou th eas t T e nn e sse e Ortho pa e dic s, a ndB ra dle y Cou nty Me moria l H os pit a l.

_________________________________________ SHARON G. LEE, J UDGE