1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

FILED

DEC 02 2016

SUSAN M. SPRAUL, CLERK

U.S. BKCY. APP. PANEL

OF THE NINTH CIRCUIT

NOT FOR PUBLICATION

UNITED STATES BANKRUPTCY APPELLATE PANEL

OF THE NINTH CIRCUIT

In re: ) BAP No. CC-15-1316-FDKi

)

BENJAMIN LEE TAYLOR and JANET ) Bk. No. 2:13-bk-35470-BR

LOUISE TAYLOR, )

) Adv. Pro. 2:14-ap-01163-BR

Debtors. )

_____________________________ )

)

BENJAMIN LEE TAYLOR, )

)

Appellant, )

)

v. ) MEMORANDUM*

)

KAREN GOOD, DBA Judgment )

Enforcement Bureau, )

)

Appellee. )

______________________________)

Argued and Submitted on November 17, 2016

at Pasadena, California

Filed – December 2, 2016

Appeal from the United States Bankruptcy Court

for the Central District of California

Honorable Barry Russell, Bankruptcy Judge, Presiding

 

Appearances: Dennis Winters of Winters Law Firm argued for

Appellant Benjamin Lee Taylor; Michael A. Wallin

of Slater Hersey and Lieberman LLP argued for

Appellee Karen Good.

 

* This disposition is not appropriate for publication. 

Although it may be cited for whatever persuasive value it may

have, see Fed. R. App. P. 32.1, it has no precedential value, see

9th Cir. BAP Rule 8024-1.
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Before: FARIS, DUNN,** and KIRSCHER, Bankruptcy Judges.

INTRODUCTION

Appellant and chapter 71 debtor Benjamin Lee Taylor appeals

from the bankruptcy court’s denial of discharge under

§§ 727(a)(2)(A), (2)(B), and (4)(A). He argues that the court

erred because the property that he allegedly concealed was not

his property or estate property, and the omissions and

misstatements relating to the property were not material. We

find no merit to Mr. Taylor’s arguments. Accordingly, we AFFIRM.

FACTUAL BACKGROUND

Mr. Taylor is the sole shareholder of a number of businesses

registered in the state of California: Taylor Concrete Pumping

Corporation (“TCP”), Taylor Transportation, Inc. (“TTI”), Ben

Taylor Concrete Co., Taylor Concrete Services, Inc., and Taylor

Concrete & Pumping (collectively, “Taylor Entities”).

Mr. Taylor maintained that TCP is a defunct corporation with

no assets that stopped doing business in 2013. He later

testified that, as of January 2014, none of the Taylor Entities

was doing business. 

Ms. Good is the assignee of two 2010 state court judgments

in excess of $430,000 against Mr. Taylor and TCP. She initiated

collection actions in California state court, including

** The Honorable Randall L. Dunn, United States Bankruptcy

Judge for the District of Oregon, sitting by designation.

1 Unless specified otherwise, all chapter and section

references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532, all

“Rule” references are to the Federal Rules of Bankruptcy

Procedure, and all “Civil Rule” references are to the Federal

Rules of Civil Procedure.

2
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

conducting judgment debtor examinations. During one of these

examinations, she inquired about TTI. Mr. Taylor testified that

he had never heard of TTI and did not own it. He also denied

owning any other active business besides TCP. 

 Mr. Taylor claimed that the recession severely damaged his

business between 2007 and 2009 and that he could not pay

creditors, including Ms. Good. He and his wife, Janet Louise

Taylor, filed their chapter 7 petition on October 18, 2013. They

represented that they only had $138 in cash on hand and $1 in a

checking account. In their bankruptcy schedules, they disclosed

their ownership of TCP, but did not include any other information

concerning the Taylor Entities.

At a § 341(a) meeting of creditors on December 5, 2013,

Mr. Taylor testified that he did not have a personal bank account

and that he paid his bills by money order. He was also asked

whether TTI had a Bank of America bank account. Mr. Taylor

testified that TTI was dissolved and that it did not have a Bank

of America bank account.

Ms. Good then served a subpoena on Bank of America for

documents relating to accounts held in the name of TTI or TCP. 

Bank of America responded by disclosing information pertaining to

an account held by TTI (the “TTI Account”), of which Mr. Taylor

is an authorized signer. The account statements provided by Bank

of America showed thousands of dollars deposited and withdrawn

from the TTI Account each month.2

2 For example, in the statement for October 2013 (the month

in which the Taylors filed for bankruptcy), the ending balance

(continued...)

3
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

On January 2, 2014, Mr. Taylor testified at a judgment

debtor examination in the California superior court that he used

the TTI Account to pay his personal bills. He also acknowledged

that he owned TTI and was its chief executive officer.

Mr. Taylor also changed his prior testimony and stated at a

Rule 2004 examination that the TTI Account belonged to TTI, but

he used it as an account for TCP because creditors had liens on

TCP’s bank accounts. He also deposited into the TTI Account

checks made to him personally and made withdrawals for both

business and personal expenses.

In March 2014, Ms. Good filed an adversary proceeding

against Mr. Taylor to determine nondischargeability of debt under

§§ 523(a)(4), (2)(A), and (6) and to deny discharge under

§§ 727(a)(2)(A), (2)(B), (3), (4)(A), and (5).3 In relevant

part, Ms. Good asserted that the Taylors were doing business and

collecting money under the name of TTI. They opened the TTI

Account, which was not reported on their petition or schedules,

and used the TTI Account as a depository for checks written to

TCP, TTI, Taylor Concrete & Pumping, and Mr. Taylor. She

estimated that the checks deposited in the name of TCP exceeded

$203,000 in 2012-13. She said that the Taylors withdrew funds

2(...continued)

was a paltry $364.24. However, the beginning balance was

$4,028.75, with deposits totaling $15,659.53 and withdrawals

totaling $19,308.04. Withdrawals included payments to Kohl’s

Department Stores, DirecTV, Netflix, and Experian credit

reporting.

3 The bankruptcy court later granted the Taylors’ motion to

dismiss the entire complaint as to Mrs. Taylor and the

§§ 523(a)(4) and (2)(A) claims as to Mr. Taylor.

4
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

from the TTI Account to pay both personal and business expenses.

At the trial of Ms. Good’s adversary proceeding, Mr. Taylor

testified that, because of tax levies and liens attached to his

personal bank account and TCP’s bank account, “I had no choice

but to use the only account I had to deposit checks I received

from my concrete work, the account in [TTI]. I did not do this

to hide the money from Ms. Good. I did it because it was the

only account I had access to.”

He additionally claimed that he did not make any false

statement at the § 341(a) meeting of creditors because he was

confused by Ms. Good’s questions regarding TTI and the TTI

Account.

At the conclusion of trial, the bankruptcy court said that

the concealment and false statements regarding the TTI Account

were sufficient to deny discharge under §§ 727(a)(2) and (a)(4),

and therefore it did not need to rule on the § 523 claims or the

remaining § 727 claims.

On September 1, 2015, the bankruptcy court issued the

following findings of fact:

3. In connection with his bankruptcy case,

defendant intentionally and fraudulently concealed from

his schedules and made misstatements regarding a bank

account held by Taylor Transportation, Inc. (“TTI”) at

Bank of America.

4. Defendant, with the intent to hinder, delay,

and defraud his creditors, used the above bank account

held at Bank of America as a depository for checks and

monies received by Taylor Concrete Pumping Corp., TTI,

and defendant. Defendant also used the funds from this

bank account for his personal expenses while having

concealed its existence from his creditors by failing

to disclose it in his bankruptcy petition.

Mr. Taylor timely filed his notice of appeal on

5
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

September 15, 2015. Subsequently, the bankruptcy court entered

an amended judgment on April 29, 2016 that included a Civil Rule

54(b) certification.

JURISDICTION

The bankruptcy court had jurisdiction pursuant to 28 U.S.C.

§§ 1334 and 157(b)(2)(J). We have jurisdiction under 28 U.S.C.

§ 158.

ISSUE

Whether the bankruptcy court erred in denying Mr. Taylor a

discharge pursuant to §§ 727(a)(2)(A), (2)(B), and (4)(A).

STANDARDS OF REVIEW

In an action for denial of discharge, we review: (1) the

bankruptcy court’s determinations of the historical facts for

clear error; (2) its selection of the applicable legal rules

under § 727 de novo; and (3) its determinations of mixed

questions of law and fact de novo. Searles v. Riley

(In re Searles), 317 B.R. 368, 373 (9th Cir. BAP 2004), aff’d,

212 F. App’x 589 (9th Cir. 2006).

De novo review is independent and gives no deference to the

trial court’s conclusion. Roth v. Educ. Credit Mgmt. Agency

(In re Roth), 490 B.R. 908, 915 (9th Cir. BAP 2013). 

A bankruptcy court clearly errs if its findings were

illogical, implausible, or “without support in inferences that

may be drawn from the facts in the record.” United States v.

Hinkson, 585 F.3d 1247, 1262–63 & n.21 (9th Cir. 2009) (en banc). 

Review for clear error is “significantly deferential,” and an

appellate court should not reverse unless it is left with “a

definite and firm conviction that a mistake has been committed.” 

6
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

In re Roth, 490 B.R. at 915 (quoting Baker v. Mereshian

(In re Mereshian), 200 B.R. 342, 345 (9th Cir. BAP 1996)).

DISCUSSION

A. The bankruptcy court properly denied discharge pursuant to

§ 727(a)(2).

Section 727(a)(2) provides that the bankruptcy court may

deny a discharge if:

(2) the debtor, with intent to hinder, delay, or

defraud a creditor or an officer of the estate charged

with custody of property under this title, has

transferred, removed, destroyed, mutilated, or

concealed, or has permitted to be transferred, removed,

destroyed, mutilated, or concealed –

(A) property of the debtor, within one year before

the date of the filing of the petition; or 

(B) property of the estate, after the date of the

filing of the petition[.]

§ 727(a)(2).

“A party seeking denial of discharge under § 727(a)(2) must

prove two things: ‘(1) a disposition of property, such as

transfer or concealment, and (2) a subjective intent on the

debtor’s part to hinder, delay or defraud a creditor through the

act [of] disposing of the property.’” Retz v. Samson

(In re Retz), 606 F.3d 1189, 1200 (9th Cir. 2010) (quoting Hughes

v. Lawson (In re Lawson), 122 F.3d 1237, 1240 (9th Cir. 1997)). 

1. The bankruptcy court did not err in finding that

Mr. Taylor transferred or concealed his property by

depositing his money in the TTI Account.

Mr. Taylor’s main argument is that the court erred in

finding that he concealed or lied about property of the estate,

because the TTI Account was not in his name, but rather belonged

to one of his companies, TTI.

7
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

“Most courts conclude that ‘property of the debtor’ under

section 727 does not include property of a corporation the debtor

controls, unless the court should pierce the corporate veil and

disregard the corporate form.” Kane v. Chu (In re Chu), 511 B.R.

681, 685 (Bankr. D. Haw. 2014) (citations omitted). The TTI

Account, in and of itself, is not property of the debtor or the

bankruptcy estate. 

But the salient question is not whether the TTI Account

itself is in Mr. Taylor’s name, but whether the money flowing in

and out of the TTI Account was Mr. Taylor’s property and

therefore rightfully a part of his bankruptcy estate. Ms. Good

proved at trial that Mr. Taylor used the undisclosed TTI Account

as his personal bank account. Mr. Taylor confirmed that he used

the TTI Account to deposit checks written to him personally and

made withdrawals for personal expenses. Mr. Taylor does not

dispute on appeal that the TTI Account contained his personal

funds and that he did not disclose the funds or the TTI Account.

Accordingly, the property at issue - a portion of the money

that passed through the TTI Account - belonged to Mr. Taylor. We

find no error with the court’s conclusion that Mr. Taylor was

using the TTI Account to conceal and transfer his personal

funds.4

4 None of the parties raise the issue of the timing of the

transfer and concealment in satisfaction of the separate subparts of §§ 727(a)(2). Nevertheless, the record is clear that

Mr. Taylor concealed his property both in the year prior to

filing his chapter 7 petition (by not disclosing the TTI Account

so as to avoid creditors’ liens) and after the bankruptcy filing

(by not including TTI or the TTI Account in his schedules and

(continued...)

8
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

2. The bankruptcy court did not err in finding that

Mr. Taylor had a subjective intent to hinder or delay

creditors.

Second, we must consider whether the court erred in holding

that Mr. Taylor had a subjective intent to hinder, delay, or

defraud his creditors.5 

“A debtor’s intent need not be fraudulent to meet the

requirements of § 727(a)(2). Because the language of the statute

is in the disjunctive it is sufficient if the debtor’s intent is

4(...continued)

denying at the § 341(a) meeting that he was aware of the TTI

Account). The record also reveals that Mr. Taylor admitted that

he deposited personal funds into the TTI Account and made

withdrawals for personal and family expenses, although the timing

of those transactions is less clear. At a minimum, the bank

statements provided by Ms. Good show that Mr. Taylor made

personal deposits and withdrawals for personal expenses during

the year prior to his bankruptcy filing, in satisfaction of

§ 727(a)(2)(A).

5 At the conclusion of the trial, the bankruptcy court

orally found that Mr. Taylor had an intent to hinder or delay his

creditors and stated that it need not reach the question whether

he had an intent to defraud. However, in its subsequent written

findings (prepared by counsel), it stated that Mr. Taylor had

“the intent to hinder, delay and defraud his creditors . . . .” 

(Emphasis added.) We need not resolve this discrepancy. The

court’s written order prevails over any oral findings. See

Rawson v. Calmar S.S. Corp., 304 F.2d 202, 206 (9th Cir. 1962)

(stating that the court’s oral “comment is superseded by the

findings of fact. The trial judge is not to be lashed to the

mast on his off-hand remarks in announcing decision prior to the

presumably more carefully considered deliberate findings of

fact”).

Further, the statute is written in the disjunctive, and we

may affirm even without a finding of an intent to defraud. See

In re Retz, 606 F.3d at 1200. It is clear that Mr. Taylor

intended to hinder and delay creditors, so we need not consider

whether the bankruptcy court erred in finding that he also had an

intent to defraud.

9
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

to hinder or delay a creditor. Furthermore, ‘lack of injury to

creditors is irrelevant for purposes of denying a discharge in

bankruptcy.’” In re Retz, 606 F.3d at 1200 (internal citations

omitted); see Wolkowitz v. Beverly (In re Beverly), 374 B.R. 221,

242-43 (9th Cir. BAP 2007), aff’d in part, dismissed in part,

551 F.3d 1092 (9th Cir. 2008) (“In other words, proof of mere

intent to hinder or to delay may lead to denial of discharge.”).

Whether a debtor intended to hinder, delay, or defraud a

creditor is a question of fact reviewed for clear error. Intent

may be inferred from surrounding circumstances6 or a course of

conduct. In re Beverly, 374 B.R. at 243.

Mr. Taylor argues that he did not have any intent to hinder,

delay, or defraud any creditor. However, he merely repeats or

rephrases variations of his argument that the property was not

his. He fails to discuss intent or the circumstantial evidence

that supported a finding of intent.

6 Various factors, called “badges of fraud,” may constitute

circumstantial evidence of intent. In re Beverly, 374 B.R. at

243.

These factors, not all of which need be present,

include (1) a close relationship between the transferor

and the transferee; (2) that the transfer was in

anticipation of a pending suit; (3) that the transferor

Debtor was insolvent or in poor financial condition at

the time; (4) that all or substantially all of the

Debtor’s property was transferred; (5) that the

transfer so completely depleted the Debtor’s assets

that the creditor has been hindered or delayed in

recovering any part of the judgment; and (6) that the

Debtor received inadequate consideration for the

transfer.

Emmett Valley Assocs. v. Woodfield (In re Woodfield), 978 F.2d

516, 518 (9th Cir. 1992).

10
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Even though Mr. Taylor did not admit an intent to hinder or

delay, the bankruptcy court could properly infer such intent from

the surrounding circumstances and his course of conduct. See

In re Beverly, 374 B.R. at 243. There was a close relationship

between Mr. Taylor and his wholly-owned businesses; he personally

was insolvent and deeply in debt; he did not disclose the TTI

Account but transferred personal funds and funds of the Taylor

Entities in and out of the TTI Account because his creditors were

aware of and had liens against his accounts and the Taylor

Entities’ other accounts; he withdrew substantial sums of money

from the TTI Account for personal use; he denied knowledge of

TTI; he denied the existence of the TTI Account; and he only

admitted the existence of TTI and the TTI Account when confronted

by Ms. Good. See In re Woodfield, 978 F.2d at 518-19 (finding

multiple badges of fraud, including “[t]he relationship between

the Debtors and the corporation could not have been closer; the

Debtors created and operated the transferee corporation. The

transfer was admittedly made in anticipation of the bankruptcy

filing. The partnership was admittedly in poor financial

condition at the time, having defaulted on several

obligations.”); Beauchamp v. Hoose (In re Beauchamp), 236 B.R.

727, 731-32 (9th Cir. BAP 1999), aff’d, 5 F. App’x 743 (9th Cir.

2001) (debtor concealed a bank account, and although he later

disclosed it, the concealment can be a ground for denial of

discharge).

The bankruptcy court could infer from these facts that

Mr. Taylor intended to hinder or delay his creditors from

discovering and seizing the funds in the TTI Account by

11
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

concealing TTI and, most importantly, the TTI Account. The court

found that Mr. Taylor, “with the intent to hinder, delay, and

defraud his creditors, used the [TTI Account] as a depository for

checks and monies received by [TCP, TTI], and defendant. 

Defendant also used the funds from this bank account for his

personal expenses while having concealed its existence from his

creditors by failing to disclose it in his bankruptcy petition.” 

Accordingly, based on the circumstantial evidence, the bankruptcy

court did not err in finding that Mr. Taylor had a subjective

intent to hinder or delay creditors.

3. Mr. Taylor’s misstatements are not shielded by any

“litigation privilege.”

With respect to § 727(a)(2)(A), Mr. Taylor argues that

statements made during discovery cannot be used against him

pursuant to the Noerr-Pennington doctrine and “litigation

privilege.” He contends that “[m]isrepresentations made during

discovery is not grounds for later action against parties” and

that “communications uttered or published in the courts or

judicial proceedings are absolutely privileged.” These arguments

are frivolous.

The Noerr-Pennington doctrine relates to “[t]he First

Amendment aspect of antitrust law,” and “exempts bringing a

lawsuit - that is, petitioning a court - from antitrust

liability.” Freeman v. Lasky, Haas & Cohler, 410 F.3d 1180, 1183

(9th Cir. 2005). This is not an antitrust case. 

The “litigation privilege” that Mr. Taylor cites is a

“privilege [that] is a bar to a defamation claim . . . .” 

Lisowski v. Davis (In re Davis), 312 B.R. 681, 690 (Bankr. D.

12
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Nev. 2004). This is not a defamation case.

To quote the bankruptcy court, “I hate to use the word

frivolous but I guess it really fits.” We agree and find this

defense of Mr. Taylor’s false statements completely meritless. 

B. The bankruptcy court properly denied discharge pursuant to

§ 727(a)(4)(A).

Section 727(a)(4)(A) provides that a court shall deny

discharge if “(4) the debtor knowingly and fraudulently, in or in

connection with the case . . . (A) made a false oath or

account[.]” § 727(a)(4)(A).

“To prevail on this claim, a plaintiff must show, by a

preponderance of the evidence, that: ‘(1) the debtor made a false

oath in connection with the case; (2) the oath related to a

material fact; (3) the oath was made knowingly; and (4) the oath

was made fraudulently.’” In re Retz, 606 F.3d at 1196 (quoting

Roberts v. Erhard (In re Roberts), 331 B.R. 876, 882 (9th Cir.

BAP 2005)). 

Mr. Taylor challenges the bankruptcy court’s § 727(a)(4)(A)

determination on the basis that the misstatements were not

material.7 “A fact is material if it bears a relationship to the

debtor’s business transactions or estate, or concerns the

discovery of assets, business dealings, or the existence and

disposition of the debtor’s property. An omission or

7 Mr. Taylor’s discussion of § 727(a)(4)(A) only addresses

the materiality of the false statements. Mr. Taylor waives any

other arguments with respect to § 727(a)(4)(A). See Christian

Legal Soc. Chapter of Univ. of Cal. v. Wu, 626 F.3d 483, 487 (9th

Cir. 2010). He does not challenge the first, third, and fourth

factors concerning the “false oath,” “knowing,” and “fraudulent”

requirements.

13
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

misstatement that detrimentally affects administration of the

estate is material.” Id. at 1198 (internal citations and

quotation marks omitted). “A false statement or omission may be

material even if it does not cause direct financial prejudice to

creditors.” Fogal Legware of Switz., Inc. v. Wills

(In re Wills), 243 B.R. 58, 63 (9th Cir. BAP 1999).

Mr. Taylor argues that his misstatements were not material

because the TTI Account was not his property. While it is true

that “omissions or misstatements concerning property that would

not be property of the estate may not meet the materiality

requirement of § 727(a)(4)(A)[,]” id., we have already rejected

this argument as it pertains to the TTI Account, because some of

the funds in the TTI Account were estate property.

Mr. Taylor also argues that the minimal amount in the TTI

Account renders his omissions and misstatements immaterial. We

disagree.

In determining whether an omission is material,

the issue is not merely the value of the omitted assets

or whether the omission was detrimental to creditors. 

Even if the debtor can show that the assets were of

little value or that a full and truthful answer would

not have directly increased the estate assets, a

discharge may be denied if the omission adversely

affects the trustee’s or creditors’ ability to discover

other assets or to fully investigate the debtor’s

pre-bankruptcy dealing[s] and financial condition.

6 Collier on Bankruptcy ¶ 727.04[1][b] (Alan N. Resnick & Henry

J. Sommer, eds., 16th ed.); see In re Wills, 243 B.R. at 64 (“we

conclude that a statement or omission relating to an asset that

is of little value or that would not be property of the estate

can be material if it detrimentally affects the administration of

the estate”). We may also consider materiality in the context of

14
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

“(1) matters relating to the extent and nature of the debtor’s

assets; (2) inquiries relating to the debtor’s business

transactions or estate; (3) matters relating to the discovery of

assets; [and] (4) the history of the debtor’s financial

transactions[.]” In re Wills, 243 B.R. at 62 n.3.

Mr. Taylor contends that his false statements were

immaterial because the TTI Account only held $364.24 at the end

of October 2013 and $251.58 at the end of December 2013. But we

cannot merely look at a snapshot of the TTI Account on a

particular date. Rather, Ms. Good proved that hundreds of

thousands of dollars flowed in and out of the TTI Account in the

months preceding and following the Taylors’ bankruptcy filing. 

While the ending balances for the months of October and December

2013 may have been minimal, the funds deposited into and

withdrawn from the TTI Account were not. 

Furthermore, the flow of money in and out of the TTI Account

not only reveals concealed assets, but also shows that Mr. Taylor

was working and earning money. By concealing the TTI Account and

the flow of his money, Mr. Taylor created a false impression

about his financial condition and the value of his business. 

This information has a direct bearing on the administration of

the bankruptcy estate and affects the creditors’ and chapter 7

trustee’s investigation into and evaluation of his pre-bankruptcy

dealings and financial condition. See id. at 63. In this

respect as well, Mr. Taylor’s false statements were material.8

8 Mr. Taylor cites a number of non-binding cases to support

his argument that his false statements were immaterial. However,

(continued...)

15
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Mr. Taylor argues that his misstatements did not interfere

with the administration of his estate. While the chapter 7

trustee apparently has not attempted to administer the TTI

Account, Mr. Taylor’s false statements nevertheless hindered

creditors and interfered with the administration of the estate. 

“The fundamental purpose of § 727(a)(4)(A) is to insure that the

trustee and creditors have accurate information without having to

conduct costly investigations.” In re Retz, 606 F.3d at 1196

(citation omitted); see Sergent v. Haverland (In re Haverland),

150 B.R. 768, 772 (Bankr. S.D. Cal. 1993) (“A trustee or creditor

should not be required to make a costly investigation, as in fact

the plaintiffs were forced to do, to uncover the existence of

property which the debtor knowingly fails to disclose.”).

Mr. Taylor concealed the existence of TTI in order to hide

8(...continued)

these cases are readily distinguishable and do not help

Mr. Taylor’s position. See Merena v. Merena (In re Merena),

413 B.R. 792, 817 (Bankr. D. Mont. 2009), aff’d, 2009 WL 4914650

(9th Cir. BAP Dec. 10, 2009) (finding the omission of lawsuits

immaterial, because, unlike the present case, they “do not

concern business dealings or the existence and disposition of

[the debtor’s] property”); Olympic Coast Inv., Inc. v. Wright

(In re Wright), 364 B.R. 51, 75 (Bankr. D. Mont. 2007), aff’d,

2008 WL 160828 (D. Mont. Jan. 16, 2008), aff’d, 340 F. App’x 422

(9th Cir. 2009) (finding that the omission of business entities

was not material because the businesses were all “defunct or

valueless” and there was no evidence that “the omitted assets had

any value to the estate”); Sprague, Thall & Albert v. Woerner

(In re Woerner), 66 B.R. 964, 974 (Bankr. E.D. Pa. 1986) (holding

that the debtor’s omissions concerning his personal bank account

were not material, where there was no evidence that funds were

going in or out of the account). These cases are not relevant to

the present case, where Mr. Taylor was still earning money and

regularly caused substantial funds (including personal funds) to

flow in and out of a concealed bank account in the name of a

concealed business entity.

16
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

the TTI Account. At another time, he even denied that TTI had an

account at Bank of America. These false statements directly

concerned the extent of Mr. Taylor’s assets, his business

transactions, and the history of his financial transactions. 

They impeded the creditors and the orderly administration of the

bankruptcy estate. As such, the court did not err in finding

that the omissions and false statements were material.

CONCLUSION

For the reasons set forth above, the bankruptcy court did

not err in denying Mr. Taylor discharge under §§ 727(a)(2)(A),

(2)(B), and (4)(A). Therefore, we AFFIRM.

17