Court Opinion

ID: 4457202
Source: CourtListenerOpinion
Date Created: 2019-11-20 14:09:07.500425+00
Date Added: 2024-06-11T14:23:27.399569
License: Public Domain

[Cite as Moore v. Hodge, 2019-Ohio-4752.]
                  IN THE COURT OF APPEALS
              FIRST APPELLATE DISTRICT OF OHIO
                   HAMILTON COUNTY, OHIO

JANE MOORE,                                          :     APPEAL NO. C-180633
                                                           TRIAL NO. A-1603927
        Plaintiff-Appellant,                         :

  vs.                                                :       O P I N I O N.
                                                     :
JESSICA HODGE,
                                                     :
ISAAC HODGE,
                                                     :
  and
                                                     :
NATIONWIDE MUTUAL FIRE
INSURANCE COMPANY,                                   :

    Defendants-Appellees,                            :

                                                     :
  and
                                                     :
ELIAS TSBOURIS,
                                                     :
JULIE EICHSTADT,
                                                     :
   and
                                                     :
HUMANA INSURANCE COMPANY,

    Defendants.                                      :

Civil Appeal From: Hamilton County Court of Common Pleas

Judgment Appealed From Is: Affirmed

Date of Judgment Entry on Appeal: November 20, 2019

O’Connor Acciani & Levy and Kory A. Veletean, for Plaintiff-Appellant,
                   OHIO FIRST DISTRICT COURT OF APPEALS

Law Offices of Raymond H. Decker, Jr., and Raymond H. Decker, Jr., for
Defendants-Appellees Isaac Hodge and Jessica Hodge,

Rolfes Henry Co. L.P.A., Jerome F. Rolfes and Matthew F.X. Craven, for Defendant-
Appellee Nationwide Mutual Fire Insurance Company.

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                      OHIO FIRST DISTRICT COURT OF APPEALS

ZAYAS, Presiding Judge.
         {¶1}   Plaintiff-appellant Jane Moore appeals the decision of the trial court

granting summary judgment to defendants-appellees Isaac and Jessica Hodge and

Nationwide Mutual Fire Insurance Company and dismissing her complaint based

upon the doctrine of judicial estoppel.        The court determined that Moore was

estopped from bringing the claims because she failed to disclose the claims in her

bankruptcy filings. For the following reasons, we affirm the trial court’s judgment.

                            Facts and Procedural History

         {¶2}   On April 25, 2012, Jane Moore filed for Chapter 13 bankruptcy. On

July 19, 2012, her plan was confirmed, and her repayment requirements were set

forth.   During the pendency of the bankruptcy, Moore was involved in two car

accidents. On July 13, 2014, Moore was in a car accident with Elias Tsbouris, and on

July 19, 2014, she was in an accident with Jessica Hodge.

         {¶3}   On July 18, 2014, Moore filed a motion to retain insurance proceeds

with the bankruptcy court and notified the court of her receipt of $1,370 in auto

insurance proceeds. She asked to retain $744.18 to purchase a new car. The motion

was granted. On August 6, 2014, she filed a second motion to retain insurance

proceeds, notifying the court that she had received $1,370 as an insurance payout to

scrap her damaged 2003 Ford Taurus. She asked to keep $714 to purchase another

vehicle, and the request was granted.

         {¶4}   On November 17, 2015, Moore’s bankruptcy was discharged. Her case

was finalized on December 10, 2015, and closed on December 29, 2015.

         {¶5}   On July 11, 2016, Moore filed a complaint against Elias Tsbouris and

Julie Eichstadt, the owner of the car Tsbouris was driving, Jessica Hodge and Isaac

Hodge, the owner of the car Jessica was driving, Nationwide Mutual Fire Insurance

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                     OHIO FIRST DISTRICT COURT OF APPEALS

Company, and Humana Insurance Company. Moore raised several claims related to

the car accidents.

       {¶6}   Both Nationwide and the Hodges filed motions for summary judgment

alleging that Moore was judicially estopped from asserting her claims because she

did not meet her statutory duty to disclose the claims related to the accidents to the

bankruptcy court. After the motions were filed, Moore filed a motion to reopen the

bankruptcy case, which was granted.

       {¶7}   The trial court granted the motions for summary judgment, and

dismissed Moore’s claims with prejudice against defendants Nationwide and the

Hodges. Moore appealed, and this court dismissed the appeal for a lack of a final

appealable order because the counterclaims remained unresolved. Subsequently, the

parties stipulated that all remaining claims and counterclaims were dismissed, and

the trial court issued a revised entry granting the motions for summary judgment.

Moore timely appealed asserting that the trial court erred in granting summary

judgment on the basis of judicial estoppel because the failure to list her claims on the

bankruptcy filings was inadvertent and without a motive to conceal.

                                 Standard of Review

       {¶8}   We review an appeal from summary judgment de novo. Duell v. City

of Cincinnati, 2018-Ohio-4400, 122 N.E.3d 640, ¶ 3 (1st Dist.). Additionally, we

review a trial court’s application of the doctrine of equitable estoppel for an abuse of

discretion. See Independence v. Office of the Cuyahoga Cty. Executive, 142 Ohio

St.3d 125, 2014-Ohio-4650, 28 N.E.3d 1182, ¶ 29.

                                  Judicial Estoppel

       {¶9}   The doctrine of judicial estoppel “precludes a party from assuming a

position in a legal proceeding inconsistent with a position taken in a prior action.”

Advanced Analytics Laboratories, Inc. v. Kegler, Brown, Hill & Ritter, L.P.A., 148

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                     OHIO FIRST DISTRICT COURT OF APPEALS

Ohio App.3d 440, 2002-Ohio-3328, 773 N.E.2d 1081, ¶ 37 (10th Dist.), citing Bruck

Mfg. Co. v. Mason, 84 Ohio App. 3d 398, 616 N.E.2d 1168 (8th Dist.1992). In order

to apply the doctrine of judicial estoppel, the proponent must show that his opponent

“(1) took a contrary position; (2) under oath in a prior proceeding; and (3) the prior

position was accepted by the court.” Greer-Burger v. Temesi, 116 Ohio St. 3d 324,

2007-Ohio-6442, 879 N.E.2d 174, ¶ 25.          The purpose of judicial estoppel is to

preserve the integrity of the courts by preventing a party from abusing the judicial

process. Id.

       {¶10} In a bankruptcy proceeding, “[a] debtor seeking shelter under the

bankruptcy laws must disclose all assets, or potential assets, to the bankruptcy

court.” Chrysler Group, L.L.C. v. Dixon, 8th Dist. Cuyahoga No. 104628, 2017-Ohio-

1161, ¶ 17, 18, citing 11 U.S.C. 521, 541(A)(7). “[T]he duty to disclose is a continuing

one that does not end once the forms are submitted to the bankruptcy court.”

Chrysler Group at ¶ 26, quoting Tennyson v. Challenge Realty (In re Tennyson), 313
B.R. 402 (Bankr.W.D.Ky.2004).

       {¶11} “A cause of action is an asset that must be scheduled” under federal

bankruptcy law. Chrysler Group at ¶ 17. The debtor need not “ ‘know all the facts or

even the legal basis for the cause of action, rather, if the debtor has enough

information * * * to suggest that it may have a possible cause of action, then it is a

“known” cause of action such that it must be disclosed.’ ” Id. at ¶ 19, citing In re

Coastal Plains, Inc., 179 F.3d 197, 208 (5th Cir.1999). A debtor’s subsequent pursuit

of an undisclosed cause of action “creates an inconsistency sufficient to warrant

application of judicial estoppel.” Chrysler Group at ¶ 18.

       {¶12} However, “judicial estoppel is not appropriate when a debtor’s failure

to disclose a claim in a prior bankruptcy proceeding is inadvertent” or due to a

“mistake.” Saha v. Research Inst. At Nationwide Children’s Hosp., 10th Dist.

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                      OHIO FIRST DISTRICT COURT OF APPEALS

Franklin No. 12AP-590, 2013-Ohio-4203, ¶ 16.             An omission may be deemed

inadvertent where the debtor lacked knowledge of the factual basis of the

undisclosed claims, had no motive for concealment, and the evidence supports an

absence of bad faith. See White v. Wyndham Vacation Ownership, Inc., 617 F.3d
472, 478 (6th Cir.2010).

       {¶13} In this case, Moore admits she was aware of the claims, but mistakenly

believed she did not have a duty to disclose the claims. Therefore, her actions should

be deemed inadvertent because she had no motive for concealment.

       {¶14} However, “[a] motive to conceal claims from the bankruptcy court

always exists as a matter of law, since ‘it is always in a Chapter 13 petitioner’s interest

to minimize income and assets.’ ” Saha at ¶ 19, quoting Lewis v. Weyerhaeuser Co.,

141 Fed.App. 420, 426 (6th Cir.2005). Because the defendants provided evidence to

show Moore’s omission, and that she knew the facts underlying her claims and had a

motive to conceal, Moore had the burden of establishing an absence of bad faith. See

White at 478.

       {¶15} The “absence of bad faith” inquiry focuses on affirmative actions taken

by the debtor to notify the bankruptcy court of the claims. See Stephenson v. Malloy,

700 F.3d 265, 274 (6th Cir.2012) (declining to apply judicial estoppel where trustee’s

affidavits acknowledging awareness of suit presented a factual dispute regarding

whether the debtor’s omission was in bad faith); Eubanks v. CBSK Fin. Group., Inc.,

385 F.3d 894, 895-897 (6th Cir.2004) (declining to apply judicial estoppel where

evidence showed that debtor notified trustee of claim, asked trustee to pursue the

claim on behalf of the estate, moved for a status conference on the claim, and moved

to substitute the trustee as plaintiff in the suit).

       {¶16} During the bankruptcy proceeding, Moore did not take “affirmative

action to fully inform the court and the trustee of the asset’s existence.” See Greer-

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                     OHIO FIRST DISTRICT COURT OF APPEALS

Burger, 116 Ohio St. 3d 326, 2007-Ohio-6442, 879 N.E.2d 174, at ¶ 29. She did not

inform the court until after the issue was raised in litigation, 15 months after the

bankruptcy was closed.         Courts do not look favorably on efforts to correct an

omission that occurs after an opposing party raises the issue. See White, 617 F.3d at

481.

       {¶17} Given the record before us, we cannot say that the trial court abused its

discretion. The record shows that Moore was represented by counsel throughout the

bankruptcy proceedings, and that she informed counsel of the proceeds she received

for the damage to her car after each accident. Moore did not submit any evidence

that she or her bankruptcy attorney informed or attempted to inform the trustee or

the bankruptcy court of the claims.

       {¶18} Consequently, Moore’s actions indicate that the failure to include the

claims in the bankruptcy schedule was not mere inadvertence or mistake, and the

trial court did not abuse its discretion in finding that judicial estoppel applied to bar

Moore’s claims.

                                       Conclusion

       {¶19} Accordingly, we overrule the sole assignment of error and affirm the

judgment of the trial court.

                                                                     Judgment affirmed.

BERGERON and WINKLER, JJ., concur.

Please note:
       The court has recorded its own entry on the date of the release of this opinion.

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