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

FEB 02 2015

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NOT FOR PUBLICATION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-14-1032-PaTaD

) 

MOHSEN LOGHMANI, ) Bankr. No. 12-12998-VK

)

Debtor. ) Adv. No. 12-01419-VK

___________________________________)

)

MOHSEN LOGHMANI, )

)

Appellant, )

)

v. ) M E M O R A N D U M1

)

UNITED STATES TRUSTEE; )

AMY GOLDMAN, Chapter 7 Trustee,2 )

)

Appellees. )

___________________________________)

Submitted Without Oral Argument

on January 22, 20153

Filed - February 2, 2015

Appeal from the United States Bankruptcy Court

for the Central District of California

Honorable Victoria S. Kaufman, Bankruptcy Judge, Presiding

 

Appearances: Mohsen Loghmani, Appellant, pro se, on brief;

Russell Clementson, Trial Attorney, United States

Trustee, on brief for Appellee United States

Trustee.

 

1 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.

2 Appellee Amy Goldman, Trustee, did not file briefs or

participate in this appeal.

3 After examination of the briefs and record, and after

notice to the parties, in an order entered October 21, 2014, the

Panel unanimously determined that oral argument was not needed for

this appeal. 9th Cir. BAP Rule 8019-1.

-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: PAPPAS, TAYLOR, and DUNN, Bankruptcy Judges.

Chapter 74 debtor Mohsen Loghmani (“Debtor”) appeals the

judgment of the bankruptcy court denying him a discharge under

§ 727(a)(2)(A) and (a)(4)(A) in an adversary proceeding prosecuted

by the United States Trustee (“UST”). We AFFIRM. 

I. FACTS

The material facts are not in dispute. On August 24, 2005,

Debtor, along with his wife, purchased a parcel of vacant land in

San Bernardino County, California (the “Property”). Debtor and

his wife paid $17,000 for the Property and took title as “husband

and wife as joint tenants.”

In 2009, Debtor was sued by Tessie Cleveland Community

Services Corporation (“Tessie”) in California state court. In the

state court action, Tessie alleged, among other things, that

Debtor breached a personal services contract. After trial, a jury

rendered a verdict in favor of Tessie on its breach of contract

claim and awarded Tessie $388,325.47 in damages on December 28,

2011.

After the jury’s verdict, but before a judgment was entered,

Debtor and his wife transferred the Property to their son via a

quitclaim deed signed by Debtor and his wife on February 2, 2012. 

Debtor asserts that, at the time of this transfer, while he valued

the Property at approximately $10,000, he and his wife did not

receive any payment from their son for the transfer because they

owed him money and this transfer was meant to satisfy a portion of

4 Unless otherwise indicated, all chapter, section and rule

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

to the Federal Rules of Bankruptcy Procedure, Rules 1001-9037.

-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

that debt. Debtor’s son was listed on Debtor’s schedule F as

holding a “personal loan” unsecured claim. On the same day he

signed the quitclaim deed, Debtor drove from his home in North

Hollywood to the San Bernardino County Recorder’s Office and

recorded the deed.5

Two weeks later, Debtor transferred a 2003 BMW Z4 Roadster to

the same son in exchange for $5,200 in cash. Debtor later used

some of these funds to pay his bankruptcy counsel’s fees.

On March 7, 2012, after Debtor’s transfer of the Property and

the BMW, the state court entered a judgment against Debtor.6 

On March 29, 2012, represented by counsel, Debtor filed a

chapter 7 petition. Debtor’s schedules and statement of financial

affairs (“SOFA”) did not disclose the transfers of the Property or

the BMW to his son. The schedules and SOFA, however, did list

Debtor’s transfers of his interests in other real property in

which he lacked any equity.

On May 31, 2012, Debtor testified at his § 341(a) meeting

that his schedules and SOFA were true and correct, although he

noted that he might add a couple of unsecured creditors. 

Thereafter, Debtor’s bankruptcy case was selected by the UST for a

debtor audit. See 28 U.S.C. § 586(f). On July 2, 2012, the

auditors filed a report with the bankruptcy court concluding that

5 We take judicial notice of the fact that the distance

between North Hollywood, California and San Bernardino, California

Recorder’s Office is approximately 70 miles. See Federal Rule of

Evidence 201.

6 The state court later awarded Tessie attorney’s fees in

the amount of $1,458,101.25. The state court’s judgment is

currently on appeal.

-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

Debtor’s schedules and SOFA contained a material misstatement

because they did not disclose Debtor’s transfer of the BMW. 

Debtor filed an amended SOFA listing the transfer of the BMW to

his son, but the amended SOFA did not disclose the transfer of the

Property.

The UST later discovered Debtor’s prepetition transfer of the

Property to his son. On November 30, 2012, the UST filed an

adversary complaint against Debtor objecting to entry of a

discharge under § 727(a)(2)(A) and (a)(4)(A). Eight months later,

on July 31, 2013, Debtor filed a second amended SOFA wherein, for

the first time, he disclosed the Property transfer. 

The UST and Debtor filed a joint pretrial stipulation

reciting various undisputed facts and identifying issues of fact

for trial. Notably, the UST and Debtor agreed it was undisputed

that Debtor and his wife “owed their son money and transferred

[the Property] to their son in order to remove the property from

their holdings and to give their son priority over their other

creditors.” As to the fact issues, the parties advised the

bankruptcy court: 

The following issues of fact, and no others,

remain to be litigated. Whether [Debtor]

intentionally and fraudulently failed to

disclose the transfer of [the Property] in

his [SOFA]. Whether [Debtor] knowingly and

fraudulently gave a false oath by failing to

disclose the transfer of [the Property] in

his [SOFA]. Whether [Debtor] transferred

[the Property] to his son to hinder, delay or

defraud a creditor, or the [t]rustee.

-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

Notwithstanding the stipulation, at trial7 Debtor appeared

pro se and testified that he did not disclose the transfer of the

Property in his SOFA, amended SOFA, or at his § 341(a) meeting,

because he had thought the Property was his wife’s separate

property. Trial Tr. 49:11-12, Dec. 3, 2013.

At the conclusion of the parties’ submission of evidence,

testimony, and argument, the bankruptcy court recited its oral

ruling holding that, pursuant to § 727(a)(2)(A) and (a)(4)(A),

Debtor would be denied a discharge. On January 7, 2014, the

bankruptcy court entered written findings of fact and conclusions

of law incorporating its oral ruling. As it had in its oral

ruling, the court determined that Debtor’s “testimony that he did

not disclose the transfer of [the Property] because he thought

[it] was his wife’s [separate property]. . . is not credible.” As

to § 727(a)(2)(A), the bankruptcy court concluded:

The facts and circumstances including (1) the

closeness of the relationship between

[Debtor] and the recipient of the [t]ransfer,

[Debtor’s] son; (2) the transfer shortly

after the jury verdict . . .; (3) [Debtor’s]

belief that he could not pay his creditors;

and (4) that [Debtor] personally signed and

personally recorded the quit-claim deed to

his son, all establish that [Debtor]

transferred [the Property] with the actual

intent to hinder, delay or defraud a

creditor.

7 At a hearing the day before the trial was to begin, Debtor

advised the bankruptcy court of his plan to file a motion to

dismiss his chapter 7 case and thereby eliminate the need for the

trial on the objection to his discharge. After the hearing,

Debtor filed the motion to dismiss his case, and the next day

Debtor asked the bankruptcy court to rule on his motion before

making his opening remarks at the trial. The bankruptcy court

declined to do so due because Debtor had not given proper notice

of the motion to creditors. The bankruptcy court eventually

denied Debtor’s motion to dismiss his case in an order dated

January 29, 2014.

-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

As to the UST’s § 727(a)(4)(A) claim, the bankruptcy court

concluded: “[t]he evidence shows that [Debtor] made false oaths

and accounts in his original [SOFA], his amended [SOFA], and at

his § 341(a) examination. [Debtor] knowingly and fraudulently

made these false oaths and accounts in connection with the case.” 

On January 7, 2014, the bankruptcy court entered a judgment

denying Debtor a discharge under both § 727(a)(2)(A) and

(a)(4)(A). Debtor filed a timely appeal. 

II. JURISDICTION

The bankruptcy court had jurisdiction under 28 U.S.C. §§ 1334

and 157(b)(2)(J). We have jurisdiction under 28 U.S.C. § 158. 

III. ISSUE

Whether the bankruptcy court erred in denying Debtor a

discharge under § 727(a)(2)(A) and (a)(4)(A).

IV. STANDARD OF REVIEW

We review a bankruptcy court’s decision resolving an

objection to discharge as follows:

“(1) the bankruptcy court’s determinations of

the historical facts are reviewed for clear

error; (2) the selection of the applicable

legal rules under § 727 is reviewed de novo;

and (3) the application of the facts to those

rules requiring the exercise of judgments

about values animating the rules is reviewed

de novo.”

Retz v. Samson (In re Retz), 606 F.3d 1189, 1196 (9th Cir. 2010)

(quoting Searles v. Riley (In re Searles), 317 B.R. 368, 373 (9th

Cir. BAP 2004), aff’d, 212 Fed. Appx. 589 (9th Cir. 2006)).

The bankruptcy court’s determinations concerning the debtor’s

intent are factual matters reviewed for clear error. Beauchamp v.

Hoose (In re Beauchamp), 236 B.R. 727, 729 (9th Cir. BAP 1999). A

-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

factual finding is clearly erroneous if it is “illogical,

implausible, or without support in the record.” In re Retz,

606 F.3d at 1196 (citing United States v. Hinkson, 585 F.3d 1247,

1261-62 & n.21 (9th Cir. 2009) (en banc)).

V. DISCUSSION

The party objecting to a debtor’s discharge under § 727(a)

bears the burden of proving by a preponderance of the evidence

that the debtor’s discharge should be denied. In re Retz,

606 F.3d at 1196. Courts are to “‘construe § 727 liberally in

favor of debtors and strictly against parties objecting to

discharge.’” Id. (quoting Bernard v. Sheaffer (In re Bernard),

96 F.3d 1279, 1281 (9th Cir. 1996)). 

Here, the bankruptcy court denied Debtor’s discharge pursuant

to § 727(a)(2)(A) because he transferred the Property with the

intent to hinder, delay, or defraud his creditors, and under

§ 727(a)(4)(A) because he failed to timely disclose his

prepetition transfer of the Property.8 Debtor argues that the

court erred because he lacked the required bad intent to deny him

a discharge because: (1) he believed the Property was owned solely

by his wife; (2) he was under extreme mental stress leading up to

and during his bankruptcy case due to the state court litigation

and judgment; and (3) he was ineffectively represented by his

8 While Debtor’s briefing discusses the Property and his

reasons for transferring and not disclosing the transfer to his

son, it also veers off topic in addressing his reasons for

transferring the BMW. The brief also includes Debtor’s extensive

recitation about the actions and conduct of Tessie’s counsel in

connection with the state court action. While these matters may

arguably provide context, at bottom, Debtor’s perceptions about

the wrongs imposed upon him are not relevant or helpful in

resolving this appeal.

-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

bankruptcy counsel. Debtor’s arguments all lack merit.

A. The bankruptcy court did not err in finding that Debtor 

transferred the Property with the intent to hinder, delay, or

defraud creditors for the purposes of § 727(a)(2)(A).

Section 727(a)(2)(A) provides: 

(a) [t]he court shall grant the debtor a

discharge unless— . . . (2) the debtor, with

intent to hinder, delay, or defraud a

creditor or an officer of the estate . . .

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[.]

Under § 727(a)(2)(A), a party objecting to a debtor’s discharge

must prove by a preponderance of the evidence: “‘(1) disposition

of property, such as a 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.’”

In re Retz, 606 F.3d at 1200 (quoting Hughes v. Lawson

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

The presence of “badges of fraud” may support a bankruptcy

court’s finding that a debtor acted with fraudulent intent in

transferring or concealing property, including:

(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.

In re Retz, 606 F.3d at 1200 (quoting Emmett Valley Assocs. v.

-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

Woodfield (In re Woodfield), 978 F.2d 516, 518 (9th Cir. 1992)).

In this case, it is undisputed that Debtor transferred his

interest in the Property to his son on February 2, 2012, and that

Debtor filed his bankruptcy petition on March 29, 2012. Debtor

argues, however, the bankruptcy court erred in finding that he

made this transfer with the intent to hinder, delay, or defraud

his creditors because, at the time, he believed his wife was the

sole owner of the Property and he did not realize his mistake due

to the stress he was under at the time. 

The bankruptcy court rejected Debtor’s contention. Because

the court’s determination of Debtor’s intent is a finding of fact, 

we review if for clear error. In re Beauchamp, 236 B.R. at 729. 

We find no clear error here. 

To begin, the bankruptcy court found Debtor’s testimony was

not credible when he testified that he did not know he owned the

Property when he deeded it away. As the trier of fact, the 

bankruptcy court’s findings as to credibility of witnesses are

afforded deference because the court had the opportunity “to note

‘variations in demeanor and tone of voice that bear so heavily on

the listener’s understanding of and belief of what is said.’” 

In re Retz, 606 F.3d at 1196 (quoting Anderson v. City of Bessemer

City, North Carolina, 470 U.S. 564, 575 (1985)). As a result, we

will not disturb the bankruptcy court’s decision declining to

believe Debtor’s testimony concerning his intent in transferring

the Property. 

Beyond the credibility determination, we also agree with the

bankruptcy court’s conclusion that the undisputed facts belie

Debtor’s assertion that he thought he did not own the Property at

-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

the time of the transfer. Debtor executed the quitclaim deed on

February 2, 2012, a short time after the jury had returned a

sizeable verdict against him in the state court action. The same

day that he signed the deed, he drove from his home in North

Hollywood to the San Bernardino Recorder’s Office, a distance of

approximately seventy (70) miles, to record the deed. 

In addition, the bankruptcy court identified several badges

of fraud in this case as support for the inference that Debtor had

acted with the requisite intent under § 727(a)(2)(A), including:

(1) the close relationship between Debtor and the transferee of

the Property; (2) the timing of the transfer, soon after entry of

the large jury verdict; (3) the fact that Debtor believed he could

not pay his creditors at the time of the transfer; and (4) the

fact that Debtor personally signed the quitclaim deed and

personally delivered it to be filed on the same day. The

bankruptcy court emphasized these factors and “all establish that

[Debtor] transferred [the Property] with intent to hinder, delay

or defraud.” The bankruptcy court did not clearly err in making

these findings. 

On this record, the bankruptcy court did not err in finding

that Debtor transferred his interest in the Property to his son

with the intent to hinder, defraud, or delay his creditors, and in

concluding that Debtor’s discharge should be denied under

§ 727(a)(2)(A).

B. The bankruptcy court did not clearly err under § 727(a)(4)(A)

in finding Debtor knowingly and fraudulently made a false

oath or account in his SOFA, amended SOFA, and at the

§ 341(a) meeting.

Section 727(a)(4)(A) provides: “(a) [t]he court shall grant

-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

the debtor a discharge, unless— . . . (4) the debtor knowingly and

fraudulently, in or in connection with the case— (A) made a false

oath or account.” The party objecting to a debtor’s discharge

must prove under § 727(a)(4)(A), by a preponderance of the

evidence, “‘(1) that 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 1197 (quoting Roberts v. Erhard

(In re Roberts), 331 B.R. 876, 882 (9th Cir. BAP 2005)). In order

to prove fraudulent intent under this Code provision, the

objecting party must show: (1) the debtor made a false statement

or omission in the bankruptcy case; (2) that he knew was false at

the time of making the statement; and (3) that he made the

statement with the “intention and purpose of deceiving the

creditors.” Khalil v. Developers Sur. & Indem. Co.

(In re Khalil), 379 B.R. 163, 173 (9th Cir. BAP 2007) (quoting

In re Roberts), 331 B.R. at 884); see also In re Retz, 606 F.3d at

1199. “Intent is usually proven by circumstantial evidence or by

inferences drawn from the debtor’s conduct.” In re Retz, 606 F.3d

at 1199 (citing Devers v. Bank of Sheridan, Mont. (In re Devers),

759 F.2d 751, 753-54 (9th Cir. 1985)). 

Here, the bankruptcy court did not err in deciding that

Debtor made a false oath in connection with his case, and that he

did so repeatedly. 

Debtor filed his initial SOFA on March 29, 2012; it omitted

his transfer of the Property to his son. Debtor then testified at

his § 341(a) meeting on May 3, 2012, that his SOFA was true and

correct. After his case was audited by the UST, and he was

-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

notified that he had not properly disclosed the transfer of his

BMW to his son, Debtor filed an amended SOFA that again omitted

the transfer of the Property. The bankruptcy court found that,

taken together, these facts were sufficient to show that Debtor

had made false oaths in connection with the case. We find no

error with this conclusion.

There is also no dispute that these false oaths related to a

material fact. The Property was purchased for $17,000, and Debtor

testified he believed the value of the Property to be

approximately $10,000 at the time of the transfer. Had the Debtor

disclosed the transfer, the trustee may have been able to avoid it

and liquidate Debtor’s interest in the Property for the benefit of

his creditors. See § 547(b) (empowering a trustee to avoid

prepetition preferential transfers to creditors). Under these

facts, we agree with the bankruptcy court that the Property was a

significant asset of Debtor and that his omission of information

about the transfer would constitute a material fact under

§ 727(a)(4)(A). See In re Khalil, 379 B.R. at 173 (discussing the

“broad test of materiality” that “[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.’”)

(quoting Fogal Legware of Switz., Inc. v. Wills (In re Wills),

243 B.R. 58, 62 (9th Cir. BAP 1999)).

Debtor insists that the bankruptcy court erred in concluding

that he made knowing and fraudulent false oaths in connection with

his case because he allegedly did not know he owned the Property

when he transferred it. Again, however, we find no error in the

-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

bankruptcy court’s findings.

The bankruptcy court found, as it did under § 727(a)(2)(A),

that Debtor acted fraudulently. For the reasons discussed above,

we have concluded that this finding was not clear error. 

We also find no error in the bankruptcy court’s determination

that Debtor made the false oaths knowingly because it is supported

by sufficient evidence. See In re Khalil, 379 B.R. at 173 (“A

debtor ‘acts knowingly if he . . . acts deliberately and

consciously.’”) (quoting In re Wills, 243 B.R. at 62); see also

In re Retz, 606 F.3d at 1198 (holding that a debtor acts knowingly

if he or she deliberately and consciously signed the schedules and

SOFA knowing they were incomplete). Here, based upon the

evidence, the court properly found that Debtor deliberately and

consciously omitted the Property transfer in the SOFA, amended

SOFA, and in his testimony at the § 341(a) meeting. 

Debtor argues that he should not be denied a discharge

because the omissions in his bankruptcy filings resulted from the

ineffective assistance of his bankruptcy counsel. We disagree. 

It is generally correct that “‘a debtor who acts in reliance on

the advice of his attorney lacks the intent to deny him a

discharge of his debts.’” In re Retz, 606 F.3d at 1199 (quoting

First Beverly Bank v. Adeeb (In re Adeeb), 787 F.2d 1339, 1343

(9th Cir. 1986)). But “[t]he advice of counsel is not a defense

when the erroneous information should have been evident to the

debtor.” Id. (citing Boroff v. Tully (In re Tully), 818 F.2d 106,

111 (1st Cir. 1987)). Here, Debtor does not claim he informed his

counsel of the transfer of the Property, that it was counsel who

omitted this important information from the two versions of the

-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

SOFA, or that counsel advised him not to mention the Property at

the § 341(a) meeting. Instead, Debtor focuses on other alleged

mistakes by his counsel to justify our reversal of the bankruptcy

court.9 Even if these matters raise some level of concern, they

do not excuse Debtor’s repeated false assertions under oath that

he provided complete information; exactly the opposite was true. 

The bankruptcy court did not err in denying Debtor a

discharge under § 727(a)(4)(A).

VI. CONCLUSION

We AFFIRM the judgment of the bankruptcy court denying Debtor

a discharge.

9 The other alleged failures of counsel Debtor discusses in

his brief include: (1) incorrectly claiming a homestead exemption

on Debtor’s wife’s home; (2) completing and filing means test

schedules even though Debtor’s debts were primarily business

debts; (3) losing the auditor’s paperwork; (4) not listing the BMW

as a prepetition transfer, even though Debtor told him about it;

and (5) being an hour late to his first meeting with Debtor

without excuse. Appellant Op. Brief at 9-11.

-14-