Opinion ID: 197463
Heading Depth: 2
Heading Rank: 1

Heading: The Joint-Account Withdrawals

Text: 11 The threshold matter for our consideration is whether the Trustee adequately preserved the claims asserted on appeal. A thorough review of the entire record discloses that the theory advanced by the trustee on appeal in support of his claims to the various amounts withdrawn from the joint accounts is altogether different than that litigated below. Accordingly, we conclude that these claims were abandoned below. 12 The Trustee argued before the bankruptcy court that Massachusetts law establishes a rebuttable presumption that the spouse whose funds are deposited in a joint spousal account (contributing spouse) is presumed to have intended that each spouse own a one-half interest in the deposited funds. See Gibbons v. Gibbons, 296 Mass. 89, 4 N.E.2d 1019, 1020 (1936). Thus, the Trustee contended throughout the proceedings below that the Debtor was the contributing spouse; that he owned one-half the monies in these joint accounts; that Mrs. Rauh, the party challenging the aforementioned presumption, had not carried her burden, see Blanchette v. Blanchette, 362 Mass. 518, 287 N.E.2d 459, 463 (1972), of establishing that the contributing spouse intended to retain ownership of all monies deposited; 3 and, therefore, that either Mrs. Rauh had converted the Debtor's one-half share, or the Debtor had conveyed his one-half share to Mrs. Rauh in fraud of creditors. Accordingly, the Trustee claimed, the Debtor's transfers were voidable under Bankruptcy Code § 544(b) and ch. 109A. 13 The bankruptcy court instead ruled that a joint spousal account creates a very different presumption; namely, that the contributing spouse intended to give the noncontributing spouse a beneficial interest in all monies deposited to their account, subject only to the contributing spouse's coequal, unilateral right, at any time, to withdraw all monies on deposit, see Noonan v. Rauh (In re Rauh ), 164 B.R. 419, 423 (Bankr.D.Mass.1994) (citing, e.g., Blanchette, 287 N.E.2d at 463). The bankruptcy court also held that the party challenging the presumption (viz., the Trustee ) may rebut it only by adducing evidence that the contributing spouse intended to convey no present beneficial interest to the noncontributing spouse. See id. (citing, e.g., Ross v. Ross, 2 Mass.App.Ct. 502, 314 N.E.2d 888, 893 (1974), cert. denied, 420 U.S. 947, 95 S.Ct. 1329, 43 L.Ed.2d 425 (1975)). The bankruptcy court further noted that the Trustee had neither alleged nor established that the Debtor intended to convey no beneficial interest in these monies to Mrs. Rauh. See id. 14 The bankruptcy court reasoned as follows: (1) either spouse has the unilateral legal right to withdraw all monies in their joint spousal account, thereby divesting the other spouse of any beneficial interest, see id. at 424 (citing Heffernan v. Wollaston Credit Union, 30 Mass.App.Ct. 171, 567 N.E.2d 933, 937 (1991)); thus, in 1989 Mrs. Rauh simply withdrew her own 100% beneficial interest in the funds; (2) consequently, any transfer of the Debtor's beneficial interest in the deposited monies to Mrs. Rauh had occurred not at the time of the withdrawals by Mrs. Rauh in 1989, but much earlier (viz., not later than the dates on which the Debtor made the respective deposits to their accounts); (3) since the withdrawals by Mrs. Rauh in 1989 consisted entirely of her own funds, no transfer of property of the Debtor could have taken place; and (4) a fortiori, no conversion or conveyance, fraudulent or otherwise, occurred at that time. See id. 15 The position adopted by the Trustee on appeal bears no resemblance to his litigation stance below, as the Trustee now contends that he did rebut the legal presumption posited by the bankruptcy court. 4 The Trustee relies for support upon Mrs. Rauh's trial testimony that the Rauhs always paid their household expenses from their joint accounts (i.e. the accounts were mere convenience accounts), and argues that her testimony conclusively rebutted any presumption that the Debtor intended to give Mrs. Rauh a beneficial interest in the deposited funds. 16 Thus, the Trustee utterly abandons the interpretation of Massachusetts law which formed the bulwark on which he based his claims before the bankruptcy court: that (1) the creation of a joint spousal account by the Debtor triggered a legal presumption that the Debtor intended to give Mrs. Rauh only a 50% interest in the deposited funds; and (2) that Mrs. Rauh--not the Trustee--bore the burden of rebutting that presumption. Indeed, on appeal the Trustee implicitly acknowledges the validity of the bankruptcy court's divergent interpretation of Massachusetts law (viz., the presumption that all deposited funds were intended as a gift to Mrs. Rauh), simply arguing instead that he did rebut the presumption, as identified by the bankruptcy court, by establishing that the Rauhs used their joint spousal accounts to defray household expenses. As the Trustee has not challenged the bankruptcy court's delineation of the underlying presumption on appeal, we can only conclude that he has abandoned the original--and much broader--legal theory relied on below. Consequently, we express no opinion on the validity vel non of the bankruptcy court's ruling. 5 See Baybank Middlesex v. Ralar Distribs., Inc. (In re Ralar Distribs., Inc.), 69 F.3d 1200, 1204 n. 5 (1st Cir.1995) (noting that theories neither briefed nor argued on appeal are deemed waived); Executive Leasing Corp. v. Banco Popular de Puerto Rico, 48 F.3d 66, 68 (1st Cir.) (On appeal, [w]e will not rely upon arguments and allegations that are developed only in the [trial] court pleadings.), cert. denied, 516 U.S. 861, 116 S.Ct. 171, 133 L.Ed.2d 112 (1995); Nelson v. Taglienti (In re Nelson), 994 F.2d 42, 45 n. 6 (1st Cir.1993); see also Carducci v. Regan, 714 F.2d 171, 177 (D.C.Cir.1983) (judicial system assumes assistance of counsel in framing arguments and citing authority). 17 Nor need we decide the only claim actually presented by the Trustee on appeal; viz., that Mrs. Rauh's household expense or convenience account testimony conclusively rebutted any presumption that the Debtor intended to donate all monies in the joint spousal accounts to her. 6 As the bankruptcy court itself correctly noted, the Trustee never contended below that the Debtor had created these accounts with intent to pass no present beneficial interest to Mrs. Rauh. 18 A party may not raise new arguments for the first time on appeal. See, e.g., Juniper Dev. Group v. Kahn (In re Hemingway Transp., Inc.), 993 F.2d 915, 935 (1st Cir.), cert. denied, 510 U.S. 914, 114 S.Ct. 303, 126 L.Ed.2d 251 (1993). 7 The Trustee's waiver cannot be excused simply because the raw facts he now considers determinative of his newfound legal theory may have been before the bankruptcy court. See United States v. Slade, 980 F.2d 27, 31 (1st Cir.1992) (irrelevant that party is debuting only new arguments and not new facts on appeal). Nor was the newfound theory properly preserved below merely by the Trustee's generalized argumentation as to the ownership of the Rauhs' joint accounts. See id. at 30-31 (noting that appellant must have articulated the specific arguments below); McCoy v. Massachusetts Inst. of Tech., 950 F.2d 13, 22 (1st Cir.1991) (Overburdened trial judges cannot be expected to be mind readers. If claims are merely insinuated rather than actually articulated in the trial court, we will ordinarily refuse to deem them preserved for appellate review.), cert. denied, 504 U.S. 910, 112 S.Ct. 1939, 118 L.Ed.2d 545 (1992). As the bankruptcy court was never afforded an opportunity to consider the theory and authorities now advanced by the Trustee, 8 nor to make any predicate factual findings, we decline the invitation to do so on appeal. See In re Mark Bell Furniture Warehouse, Inc. v. D.M. Reid Assocs. (In re Mark Bell Furniture Warehouse, Inc.), 992 F.2d 7, 9 (1st Cir.1993) ( 'If lawyers could pursue on appeal issues not properly raised below, there would be little incentive to get it right the first time and no end of retrials.' ) (quoting Poliquin v. Garden Way, Inc., 989 F.2d 527, 531 (1st Cir.1993)). 9