Court Opinion

ID: 3166726
Source: CourtListenerOpinion
Date Created: 2015-12-31 16:03:57.283103+00
Date Added: 2024-06-11T12:17:21.809140
License: Public Domain

Dec 31 2015, 9:58 am

ATTORNEY FOR APPELLANT                                    ATTORNEY FOR APPELLEE
Matthew A. Griffith                                       Bradley J. Buchheit
Griffith Law Group, LLC                                   Tucker Hester Baker & Krebs, LLC
Indianapolis, Indiana                                     Indianapolis, Indiana

                                           IN THE
    COURT OF APPEALS OF INDIANA

Steven E. Dotlich,                                       December 31, 2015
Appellant-Defendant,                                     Court of Appeals Case No.
                                                         29A02-1503-CC-125
        v.                                               Appeal from the Hamilton
                                                         Superior Court
Tucker Hester, LLC,                                      The Honorable Steven R. Nation,
Appellee-Plaintiff.                                      Judge
                                                         Trial Court Cause No.
                                                         29D01-1112-CC-12997

Brown, Judge.

Court of Appeals of Indiana | Opinion 29A02-1503-CC-125 | December 31, 2015            Page 1 of 18
[1]   Steven E. Dotlich appeals the trial court’s entry of summary judgment in favor

      of William Tucker with respect to Dotlich’s malpractice claim against Tucker.

      Dotlich raises five issues which we consolidate and restate as whether the court

      erred in entering summary judgment in favor of Tucker. We affirm.

                                            Facts and Procedural History

[2]   Dotlich first met with Tucker, an attorney with Tucker Hester, LLC (the

      “firm”) on January 24 or 25, 2011. At the meeting, Dotlich explained that most

      of his debts were secured by crane equipment, vehicles, or other assets, and that

      he was mostly concerned about saving his family home and his 12.5% limited

      partnership interest his father had given him in Speedway Industrial Park, L.P.

      Dotlich met again with Tucker on February 3, 2011, at which time Dotlich

      signed an engagement letter, and Tucker filed a voluntary petition for

      bankruptcy under Chapter 7 of the Bankruptcy Code on behalf of Dotlich on

      the same day. Tucker filed “Schedule B – Personal Property” with the

      bankruptcy court on February 17, 2011, which included an interest of 12.5% in

      “Speedway Industrial Park, Inc.”1 Appellant’s Appendix at 149. Tucker filed a

      1
          Specifically, the description of the property provided:

                 Speedway Industrial Park, Inc. - Debtor owns 12.5% interest in this entity. Remaining
                 ownership interest is as follows: Dan Dotlich 12.5%, Rudy Dotlich 12.5%, Dale Dotlich
                 12.5%, Monnie Dotlich 24.5%, Margaret Dotlich 24.5%, MD Realty, Inc. 1%. Debtor has
                 no records for the corporation. There has been litigation between debtor and other owners
                 of the corporation. Debtor is unable to obtain any information regarding the corporation.
                 To obtain the information, Trustee should contact . . . , CPA, or Monnie Dotlich. Contact
                 information for [CPA]. Contact information for Monnie Dotlich: . . . . Debtor has never
                 received dividends and is obligated to pay taxes every year.

      Appellant’s Appendix at 149. The property was also listed on Schedule C for property claimed as exempt,
      the “Value of Claimed Exemption” for the property was listed as $279.00, and the “Current Value of
      Property Without Deducting Exemption” was listed as “Unknown.” Id. at 154.

      Court of Appeals of Indiana | Opinion 29A02-1503-CC-125 | December 31, 2015                      Page 2 of 18
      motion to withdraw his appearance from Dotlich’s bankruptcy case on August

      24, 2011, and two days later the court granted the motion.

[3]   On December 23, 2011, the firm filed a Complaint on Account in the Hamilton

      Superior Court against Dotlich alleging that he owed the firm $10,658.73. On

      February 23, 2012, Dotlich by new counsel filed an answer. On April 2, 2012,

      Dotlich’s new counsel also entered an appearance for him in his bankruptcy

      case. In the Hamilton Superior Court, Dotlich filed a Motion for Leave to

      Amend Answer to Complaint and a Motion to Join Person as Party on July 27,

      2012, and the court granted the motions, including that William Tucker was

      named as a counter-defendant on August 1, 2012,. Dotlich filed an Amended

      Answer and Counterclaims on August 28, 2012, alleging:

              1. There was an attorney-client relationship between William
              Tucker and his law firm (“the Firm,”) as attorneys, and Steven E.
              Dotlich, as client.
              2. As a result of the attorney-client relationship, Tucker and the
              Firm, who held themselves out to the public as possessing greater
              than ordinary knowledge and skill in the field of bankruptcy law,
              had a duty to represent Mr. Dotlich with the reasonable care,
              skill, and diligence ordinarily possessed and exercised by
              attorneys specializing in the field of bankruptcy law, under
              similar circumstances.
              3. Tucker and the Firm’s conduct in filing bankruptcy for Mr.
              Dotlich, was a breach of their duty to exercise reasonable care,
              skill, and diligence on Mr. Dotlich’s behalf.
              4. As a result of said negligence in filing bankruptcy on behalf of
              Mr. Dotlich, Mr. Dotlich sustained injury and loss.

      Court of Appeals of Indiana | Opinion 29A02-1503-CC-125 | December 31, 2015   Page 3 of 18
      Id. at 127-128.2 The bankruptcy court’s docket shows that a discharge of debtor

      was entered on March 4, 2013, and that the bankruptcy case was closed on

      April 8, 2014.

[4]   On June 19, 2014, Tucker filed a motion for summary judgment together with a

      designation of evidence. He contended that Dotlich was judicially estopped

      from pursuing his counterclaim, that Dotlich failed to amend his bankruptcy

      schedules to reflect his malpractice claim and accordingly represented to the

      bankruptcy court that he had no such claim, and that Dotlich would gain an

      unfair advantage if not estopped as the bankruptcy trustee relied on his

      misrepresentations and determined that there were fewer available assets for

      distribution to his creditors.

[5]   Dotlich filed a response together with designated evidence. He contended that

      Tucker’s motion was premised on the false conclusion that the malpractice

      claim is an asset of the bankruptcy estate, and that Tucker made a number of

      post-petition errors, including improperly listing assets as exempt and failing to

      accurately describe assets and their true values. He noted that Chapter 7 differs

      from bankruptcy under Chapters 11 and 13, and asserted that the filing of a

      2
       Also, his answer, Dotlich asserted affirmative defenses including that: (1) the firm overbilled him for the
      services that were actually provided; (2) the legal services provided by the firm were poor in quality and do
      not deserve the compensation outlined in the account agreement for the quality of work that was expected of
      the firm; (3) the firm failed to communicate properly with Dotlich concerning the services it was obligated to
      provide; (4) the firm failed to provide Dotlich with proper instructions regarding the legal services it was
      obligated to provide; (5) the firm failed to follow Dotlich’s instructions and is seeking fees that were not
      earned; (6) Dotlich repeatedly objected to and complained about the firm’s services and bills; and (7) the firm
      harmed Dotlich’s legal rights and committed negligence.

      Court of Appeals of Indiana | Opinion 29A02-1503-CC-125 | December 31, 2015                        Page 4 of 18
      Chapter 7 bankruptcy petition creates a bankruptcy estate encompassing all

      interests of the debtor in property “as of the commencement of the case” and

      that his malpractice claim arose after the filing of the petition. Id. at 109.

[6]   In his reply, Tucker argued that only the bankruptcy trustee could pursue the

      claims, and all of the elements of a claim for legal malpractice were present at

      the time the bankruptcy petition was filed. He also argued that, even if the

      malpractice claim did not accrue under Indiana law “as of” the filing date, the

      claim has sufficient roots in Dotlich’s pre-bankruptcy activities to warrant

      inclusion in his bankruptcy estate. Id. at 913.

[7]   On December 15, 2014, the court held a hearing, and on February 9, 2015,

      entered summary judgment in favor of Tucker and against Dotlich on Dotlich’s

      counterclaim. The court found that Dotlich received a discharge in bankruptcy

      more than seven months after he moved for leave to file his counterclaim in this

      case, he did not amend his bankruptcy schedules or notify the trustee of the

      claim, and that the counterclaim was property of the bankruptcy estate and only

      the bankruptcy trustee could pursue it. The court noted that Section 541(a)(1)

      of the Bankruptcy Code defines “property of the estate” to include “all legal or

      equitable interests of the debtor in property as of the commencement of the

      case,” and that property of the estate is broadly construed. Id. at 14 (citing 11

      U.S.C. § 541(a)(1)). The court found that causes of action that accrue as a

      result of the filing of a bankruptcy petition are property of the estate. Id. at 15

      (citing In re Strada Design Assocs., Inc., 326 B.R. 229, 235 (Bankr. S.D. N.Y.

      2005); In re Alvarez, 224 F.3d 1273, 1278 (11th Cir. 2000), cert. denied, 531 U.S.

      Court of Appeals of Indiana | Opinion 29A02-1503-CC-125 | December 31, 2015   Page 5 of 18
      1146; In re Dow, 132 B.R. 853, 860 (Bankr. S.D. Ohio 1991)). The court further

      stated that this conclusion follows from a comparison between 11 U.S.C. §§

      541(a)(1) and (a)(7), where Section 541(a)(1) deals with the debtor’s interests

      “as of the commencement of the case” as opposed to interests “before” or

      “prior to” filing, id. (citing Alvarez, 224 F.3d at 1278), and Section 541(a)(7)

      defines property of the estate to include any interest in property that the estate

      acquires “after the commencement of the case.” Id.

[8]   The court found that, under Indiana law, a legal malpractice claim consists of

      four elements: an attorney-client relationship, negligence, proximate cause, and

      damages, and that a claim “based on negligently advising a client to file a

      bankruptcy petition accrues, at the latest, at the time the petition is filed.”

      Strada Design Associates, 326 B.R. at 237; see also Alvarez, 224 F.3d at 1279

      (same); In re Bounds, 495 B.R. 725, 732 (W.D. Tex. 2013) (same); Dow, 132
B.R. at 859-60 (same). The court noted that Dotlich’s counterclaim alleged that

      “Tucker breached his duty of care by filing Dotlich’s bankruptcy petition” and

      that “Tucker’s breach was the proximate cause of Dotlich’s damages.” Id. at

      18-19 (citing In re Seven Seas Petroleum, Inc., 522 F.3d 575, 583 (5th Cir. 2008)

      (the facial allegations of the complaint limit and guide the accrual analysis)).

[9]   The court further concluded that, “[a]ssuming for the sake of argument that

      Dotlich’s malpractice claim did not accrue under Indiana law ‘as of’ the filing

      date, it still has sufficient roots in Dotlich’s pre-bankruptcy activities to warrant

      inclusion into his estate.” Id. at 20. The court found in part:

      Court of Appeals of Indiana | Opinion 29A02-1503-CC-125 | December 31, 2015   Page 6 of 18
               28. Here, Dotlich’s malpractice claim has all its roots in his pre-
               bankruptcy past. He consulted with and retained Tucker prior to
               the petition date. The allegations of lack of due care, culminating
               in the filing of Dotlich’s chapter 7 petition, relate to Tucker’s pre-
               petition advice. Finally, Dotlich suffered his alleged injury—loss
               of control of his ownership interest in Speedway Industrial Park,
               Inc., subjecting it to the liquidation powers of the trustee—at the
               moment the petition was filed.

       Id. at 17, 20-21.

[10]   The court found that unless and until the bankruptcy trustee abandoned the

       claim from the estate, Dotlich had no standing to pursue it.

[11]   The court also concluded that Dotlich is judicially estopped from pursuing his

       counterclaim, noting that federal courts have developed a basic default rule

       that, if a plaintiff-debtor omits a pending (or soon-to-be-filed) lawsuit from the

       bankruptcy schedules and obtains a discharge (or plan confirmation), judicial

       estoppel bars the action and that Indiana abides by this rule. Id. at 24 (citing

       Hammes v. Brumley, 659 N.E.2d 1021, 1028 n.4 (Ind. 1997) (“Unless scheduled

       by the debtor and abandoned by the trustee in bankruptcy, such [assets] may no

       longer be pursued by the debtor.”), reh’g denied; Shewmaker v. Etter, 644 N.E.2d
922, 930 (Ind. Ct. App. 1994) (“Indiana will not allow a debtor who has

       shielded assets from his creditors to pursue that asset in its courts.”), adopted by

       Hammes).

       Court of Appeals of Indiana | Opinion 29A02-1503-CC-125 | December 31, 2015   Page 7 of 18
[12]   The order provided there was no just reason for delay and expressly directed the

       entry of judgment in favor of Tucker and against Dotlich on his counterclaim

       pursuant to Trial Rule 54(B).

                                       Issue and Standard of Review

[13]   The issue is whether the trial court erred in entering summary judgment in

       favor of Tucker on Dotlich’s counterclaim. Our standard of review is the same

       as it is for the trial court. Manley v. Sherer, 992 N.E.2d 670, 673 (Ind. 2013).

       The moving party bears the initial burden of making a prima facie showing that

       there are no genuine issues of material fact and that it is entitled to judgment as

       a matter of law. Id. Summary judgment is improper if the moving party fails to

       carry its burden, but if it succeeds, then the nonmoving party must come

       forward with evidence establishing the existence of a genuine issue of material

       fact. Id. We construe all factual inferences in favor of the nonmoving party and

       resolve all doubts as to the existence of a material issue against the moving

       party. Id. An appellate court reviewing a challenged trial court summary

       judgment ruling is limited to the designated evidence before the trial court, but

       is constrained to neither the claims and arguments presented at trial nor the

       rationale of the trial court ruling. Id.

[14]   In the summary judgment context, we are not bound by the trial court’s specific

       findings of fact and conclusions of law. Rice v. Strunk, 670 N.E.2d 1280, 1283

       (Ind. 1996). They merely aid our review by providing us with a statement of

       reasons for the trial court’s actions. Id. The fact that the parties make cross-

       Court of Appeals of Indiana | Opinion 29A02-1503-CC-125 | December 31, 2015   Page 8 of 18
       motions for summary judgment does not alter our standard of review.

       Huntington v. Riggs, 862 N.E.2d 1263, 1266 (Ind. Ct. App. 2007), trans. denied.

                                           The Parties’ Arguments

[15]   Dotlich contends that, by ignoring uncontested evidence and mischaracterizing

       his counterclaim, the trial court was able to apply the law in such a way as to

       explain why it rendered judgment against him. He concedes that, if his claim

       was property of the bankruptcy estate, then only the bankruptcy trustee could

       bring it. He asserts, however, that Tucker, “per bankruptcy rules, had 14 days

       to gather and analyze documents and data necessary to determine the propriety

       of continuing the bankruptcy for Dotlich, or whether other non-bankruptcy

       strategies and remedies would have been advisable,” and that “[h]ad Tucker

       done his job properly, Tucker would have concluded that bankruptcy was a

       very poor choice for Dotlich, and Tucker would have and should have allowed

       Dotlich’s bankruptcy to be automatically dismissed at the end of that 14-day

       period.” Appellant’s Brief at 11. He asserts that Tucker committed malpractice

       on February 17, 2011 when he filed the schedules which listed the partnership

       interest as an exempt asset and as having a value of $279, and that Tucker made

       no attempt to mitigate the losses he caused. Dotlich also argues that he is not

       judicially estopped from asserting Tucker’s post-petition bad acts because post-

       petition causes of action in a Chapter 7 bankruptcy are the right of the debtor

       alone to pursue.

[16]   The firm argues that “[t]he filing of the petition caused the (alleged) harm that

       Dotlich complains of—not the filing of the schedules 14 days later” and that “at
       Court of Appeals of Indiana | Opinion 29A02-1503-CC-125 | December 31, 2015   Page 9 of 18
       the moment his petition was filed, he lost control of his ownership interest in

       Speedway Industrial Park (an asset), subjecting it to the liquidation powers of

       the trustee.” Id. at 17-18.

[17]   The firm also asserts without citation to authority that every federal court of

       appeals that has considered the question “has held that a debtor in bankruptcy

       who receives a discharge (i.e., a personal financial benefit) by representing that

       he has no valuable legal causes of action cannot turn around after the

       bankruptcy ends and try to recover on a supposedly nonexistent claim.” Id. at

       25.

                                                    Discussion

[18]   The trial court found that Dotlich’s malpractice claim constituted an asset or

       property of his bankruptcy estate on three bases, namely, that the malpractice

       claim arose at the time the bankruptcy petition was filed, that the claim was

       sufficiently rooted in Dotlich’s pre-bankruptcy past such that it should be

       considered property of his bankruptcy estate, and that Dotlich is judicially

       estopped from pursuing the claim.

[19]   We first turn to when Dotlich’s malpractice claim arose. Tucker filed a

       voluntary petition for bankruptcy under Chapter 7 on behalf of Dotlich on

       February 3, 2011. Pursuant to 11 U.S.C. § 541(a), the commencement of a

       bankruptcy action by filing a bankruptcy petition creates an estate, and with

       certain exceptions the “property of the estate” includes “all legal or equitable

       Court of Appeals of Indiana | Opinion 29A02-1503-CC-125 | December 31, 2015   Page 10 of 18
interests of the debtor in property as of the commencement of the case.”3

(Emphasis added). The scope of the property defined by Section 541 to be

property of the estate is broad, and in general all interests of a debtor, both legal

and equitable, are property of the estate. In Matter of Jones, 768 F.2d 923, 926

(7th Cir. 1985). Whether a particular interest held by the debtor is “property of

the estate” is a question of federal bankruptcy law, but the nature and extent of

that interest is defined by state law. Butner v. United States, 440 U.S. 48, 54-55,

99 S. Ct. 914, 917-918 (1979); In Matter of Jones, 768 F.2d at 927; see In re Marrs-

Winn Co., Inc., 203 B.R. 964, 971-972 (Bankr. C.D. Ill. 1995). “Property of the

estate” is broadly construed. See United States v. Whiting Pools, 462 U.S. 198,

204-05, 103 S. Ct. 2309, 2313 (1983). “This policy is embodied in the concept

that property of the estate may include property that a debtor receives post-

petition where its origins are sufficiently rooted in the debtor’s pre-bankruptcy

past.” In re Stewart, 452 B.R. 726, 741 n.9 (Bankr. C.D. Ill. 2011) (citing Segal,
382 U.S. at 380, 86 S. Ct. 511).

3
    Section 541(a) provides in part:

           The commencement of a case under section 301, 302, or 303 of this title creates an estate.
           Such estate is comprised of all the following property, wherever located and by
           whomever held:
                     (1) Except as provided in subsections (b) and (c)(2) of this section, all legal or
                     equitable interests of the debtor in property as of the commencement of the case.
                     ...
                                                     *****
                     (7) Any interest in property that the estate acquires after the commencement of
                     the case.

Court of Appeals of Indiana | Opinion 29A02-1503-CC-125 | December 31, 2015                         Page 11 of 18
[20]   In Indiana, the elements of an action for legal malpractice are: “(1) employment

       of an attorney, which creates a duty to the client; (2) failure of the attorney to

       exercise ordinary skill and knowledge (breach of the duty); and (3) that such

       negligence was the proximate cause of (4) damage to the plaintiff.” Reiswerg v.

       Statom, 926 N.E.2d 26, 30 (Ind. 2010). Generally, for an action to accrue, it is

       not necessary that the full extent of the damage be known or even ascertainable,

       but only that some ascertainable damage has occurred. See Cooper Indus., LLC v.

       City of S. Bend, 899 N.E.2d 1274, 1280 (Ind. 2009).

[21]   In his counterclaim, Dotlich alleged in part that “Tucker and the Firm’s

       conduct in filing bankruptcy for Mr. Dotlich, was a breach of their duty to

       exercise reasonable care, skill, and diligence on Mr. Dotlich’s behalf” and that

       “[a]s a result of said negligence in filing bankruptcy on behalf of Mr. Dotlich, Mr.

       Dotlich sustained injury and loss.” Appellant’s Appendix at 128 (emphases

       added). According to his claim, Tucker committed malpractice when he filed

       the bankruptcy petition on behalf of Dotlich.

[22]   When the Chapter 7 voluntary petition was filed, Dotlich’s bankruptcy estate

       was created and his interests in property vested in the estate, and all of the legal

       ramifications attendant to the creation of the estate came into existence. See In

       re Alvarez, 224 F.3d at 1277. In his designated affidavit, Dotlich stated that he

       first met with Tucker on January 24 or 25, 2011, at which time he explained to

       Tucker that he was mostly concerned about saving his family home and his

       12.5% limited partnership interest in Speedway Industrial Park, L.P. Dotlich

       Court of Appeals of Indiana | Opinion 29A02-1503-CC-125 | December 31, 2015   Page 12 of 18
       stated that, at that meeting, Tucker recommended an emergency bankruptcy

       and that there was no substantive discussion about whether he should file

       bankruptcy or pursue other strategies. He stated he met again with Tucker on

       February 3, 2011, that Tucker rushed him to sign his engagement letter, again

       there was no substantive discussion about his bankruptcy, and that Tucker filed

       his bankruptcy petition that day. In his appellant’s brief, Dotlich argues that

       Tucker failed to advise him that his most valuable assets could be better

       protected outside bankruptcy. He does not dispute that his limited partnership

       interest became property of the bankruptcy estate as of the filing of the petition.

[23]   In opposition to Tucker’s summary judgment motion, Dotlich designated the

       affidavit of Grant Shipley. Shipley stated that a partnership interest cannot

       typically be sold at the request of a creditor but rather the creditor’s remedy is to

       obtain a charging order requiring that profits and distributions be redirected to

       the creditor, that it would be prudent to advise a debtor to weigh the benefits of

       waiting out the collection process rather than filing bankruptcy with the

       potential that the trustee would sell the limited partnership interest, and that the

       bankruptcy trustee can step into the shoes of the debtor and sell the partnership

       interest unless it is exempt. He stated in reviewing the docket sheet in the

       bankruptcy case, he did not see that the trustee objected to Dotlich’s claimed

       exemption. Dotlich stated in his affidavit that his interest in the limited

       partnership was sold to one of his family members for around $80,000.

       Court of Appeals of Indiana | Opinion 29A02-1503-CC-125 | December 31, 2015   Page 13 of 18
[24]   The filing of the petition obligated the trustee to liquidate Dotlich’s assets,4 11

       U.S.C. § 704(1), and the deprivation of this asset caused harm to him at the

       time of the filing. See In re Alvarez, 224 F.3d at 1277 (noting, in response to the

       debtor’s argument that the harm did not occur until after the petition was filed,

       that the debtor’s loss of ownership and control of his assets which occurred

       when the petition was filed constituted a significant and tangible change which

       obviously caused harm to him); see also In re Strada, 326 B.R. at 237 (holding,

       where the debtors argued they did not suffer injury until after the petition was

       filed, that the filing of the petition obligated the trustee to liquidate the debtors’

       assets, that the filing decreased their values as measured by the difference

       between their going concern and liquidation values, and that just being in

       Chapter 7 was sufficient harm itself to impose a duty on the firm to rectify it); In

       re Dow, 132 B.R. at 860 (holding that the damages caused by the alleged

       malpractice occurred at the point of the filing of the Chapter 7 bankruptcy

       petition). Also, Dotlich’s assertion that Tucker failed to permit the bankruptcy

       proceeding to be dismissed relates to a failure to seek to remedy the initial

       negligent act or ameliorate the harm rather than the act that completed the

       malpractice. See In re Alvarez, 224 F.3d at 1278 n.10 (noting that the debtor’s

       allegation of a post-filing failure was more aptly described as simply a failure to

       seek to remedy the initial negligent act or ameliorate the harm rather than as an

       independent act of negligence). We conclude that Dotlich’s malpractice claim

       4
        The decrease in value of Dotlich’s property to its liquidation value constitutes harm. See In re Strada, 326
B.R. at 237.

       Court of Appeals of Indiana | Opinion 29A02-1503-CC-125 | December 31, 2015                       Page 14 of 18
       arose with the filing of the bankruptcy petition and thus constituted property of

       the bankruptcy estate under 11 U.S.C. § 541.

[25]   In addition, according to Segal v. Rochelle, 382 U.S. 375, 86 S. Ct. 511 (1966), a

       claim can be sufficiently rooted in a debtor’s pre-bankruptcy past such that the

       claim should be considered property of the debtor’s bankruptcy estate. The

       Court in Segal considered whether the debtors’ claims for loss-carryback tax

       refunds were property of the debtors’ bankruptcy estates. The Court

       determined that two key elements pointing toward realization of a refund

       existed at the time the bankruptcy petitions were filed, that taxes had been paid

       on net income within the past three years and that the year of bankruptcy at

       that point exhibited a net operating loss. Id. at 380, S. Ct. at 515. The Court

       concluded that the loss-carryback refund claim was “sufficiently rooted in the

       pre-bankruptcy past . . . that it should be regarded as ‘property’ . . . .” Id.

[26]   The trial court did not err in determining that Dotlich’s malpractice claim was

       firmly rooted in the pre-bankruptcy past such that the claim constituted

       property of his bankruptcy estate. See In re Alvarez, 224 F.3d at 1278-1279

       (concluding that the debtor’s legal malpractice cause of action was sufficiently

       rooted in his pre-bankruptcy past that it should be considered property of the

       debtor as of the commencement of his bankruptcy case and thus property of his

       estate and noting that the malpractice claim was even more firmly rooted in the

       pre-bankruptcy past than the claim in Segal) (citing In re Tomaiolo, 205 B.R. 10,

       15 (Bankr. D. Mass. 1997) (holding that the debtor’s malpractice claims were

       Court of Appeals of Indiana | Opinion 29A02-1503-CC-125 | December 31, 2015   Page 15 of 18
       sufficiently rooted in the pre-bankruptcy past to be includible in his bankruptcy

       estate, noting that his claims concerning advice given him to file bankruptcy

       was based upon pre-petition conduct of the defendants, and observing that,

       although the debtor alleged post-petition negligence in the defendants’ failure to

       cure errors in documents, that conduct had pre-petition roots), aff’d; see also In re

       Strada, 326 B.R. at 238 (holding the malpractice claims had all of their roots in

       the debtors’ pre-bankruptcy past and noting that the firm was consulted with

       and retained prior to the petition date, that the allegations of lack of care

       culminated in the filing of the Chapter 7 petitions, and that the debtors suffered

       their injury and decline in value at the moment the petitions were filed).

[27]   Further, Dotlich is judicially estopped from pursuing his malpractice claim.

       “[A] debtor in bankruptcy who denies owning an asset, including a chose in

       action or other legal claim, cannot realize on that concealed asset after the

       bankruptcy ends.” Cannon-Stokes v. Potter, 453 F.3d 446, 448 (7th Cir. 2006)

       (citing Payless Wholesale Distribs., Inc. v. Alberto Culver (P.R.) Inc., 989 F.2d 570,

       571 (1st Cir. 1993) (holding that the district court should have recognized the

       defense of judicial estoppel and dismissed Payless’s complaint, and stating that

       “[t]he basic principle of bankruptcy is to obtain a discharge from one’s creditors

       in return for all [of] one’s assets, except those exempt, as a result of which

       creditors release their own claims and the bankrupt can start fresh,” and that

       Payless had “a better plan. Conceal your claims; get rid of your creditors on the

       cheap, and start over with a bundle of rights. This is a palpable fraud that the

       court will not tolerate, even passively,” and that “Payless, having obtained

       Court of Appeals of Indiana | Opinion 29A02-1503-CC-125 | December 31, 2015   Page 16 of 18
       judicial relief on the representation that no claims existed, can not now

       resurrect them and obtain relief on the opposite basis”), cert. denied, 510 U.S.
931), cert. denied, 549 U.S. 1099. See Robinson v. Tyson Foods, Inc., 595 F.3d
1269, 1274-1275 (11th Cir. 2010) (noting that the duty to disclose all assets and

       potential assets applies to proceedings under Chapter 13 and Chapter 7 alike

       and is a continuing one that does not end once the forms are submitted to the

       bankruptcy court), reh’g and reh’g en banc denied; Cannon-Stokes, 453 F.3d at 447-

       448 (noting that Cannon-Stokes filed a Chapter 7 bankruptcy petition and was

       discharged and finding that judicial estoppel blocked her attempt to realize a

       claim for her personal benefit).

[28]   Based upon the designated evidence, Dotlich’s malpractice claim constituted

       property of the bankruptcy estate under 11 U.S.C. § 541. Accordingly, the trial

       court did not err in determining that Dotlich is precluded from pursuing the

       claim and in entering summary judgment in favor of Tucker on Dotlich’s

       counterclaim for malpractice.

[29]   To the extent Dotlich argues the court erred in denying his verbal cross-motion

       for summary judgment on the firm’s collection claim, we note that under

       Appellate Rule 2(H)(2) an order is a final appealable judgment if “the trial court

       in writing expressly determines under Trial Rule 54(B) . . . there is no just

       reason for delay and in writing expressly directs the entry of judgment (i) under

       Trial Rule 54(B) as to fewer than all the claims or parties . . . .” A “Trial Rule

       54(B) certification of an order that disposes of less than the entire case must

       contain the magic language of the rule.” Ramsey v. Moore, 959 N.E.2d 246, 253

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       (Ind. 2012) (citing Georgos v. Jackson, 790 N.E.2d 448, 452 (Ind. 2003), reh’g

       denied). The trial court’s order in this case contains the “magic language” of

       Trial Rule 54(B) with respect to its entry of summary judgment “in favor of

       Tucker and against Dotlich on his counterclaim against Tucker,” but does not

       include the language of Trial Rule 54(B) with respect to the denial of Dotlich’s

       verbal cross-motion for summary judgment on the firm’s collection claim.

       Appellant’s Appendix at 35. Accordingly, the portion of the court’s order

       denying Dotlich’s verbal cross-motion for summary judgment does not fall

       under Appellate Rule 2(H)(2). See Ramsey, 959 N.E.2d at 253 (observing that

       the “magic language” in the trial court’s order applied to only the portion of the

       order regarding the grant of summary judgment for Dr. Ramsey, that it was

       apparent that the trial court intended the Rule 54(B) language to apply solely to

       that claim, and that there was a clear absence of the Rule 54(B) language in the

       portion of the court’s order denying other motions, and concluding that,

       accordingly, the relevant part of the trial court’s order did not fall under

       Appellate Rule 2(H)(2)).

                                                    Conclusion

[30]   For the foregoing reasons, we affirm the trial court’s entry of summary

       judgment in favor of Tucker on Dotlich’s counterclaim for malpractice.

[31]   Affirmed.

       Riley, J., and Altice, J., concur.

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