Court Opinion

ID: 157288
Source: CourtListenerOpinion
Date Created: 2010-08-14 04:57:14+00
Date Added: 2024-06-11T15:03:51.967501
License: Public Domain

F I L E D
                                                                 United States Court of Appeals
                                                                         Tenth Circuit
                   UNITED STATES COURT OF APPEALS
                                                                         DEC 18 1998
                           FOR THE TENTH CIRCUIT
                                                                    PATRICK FISHER
                                                                             Clerk

    In re:

    LINDA A. WATSON,

              Debtor.                                   No. 97-4208
                                                  (D.C. No. 97-CV-440-B)
                                                         (D. Utah)
    LINDA A. WATSON,

              Appellant,

    v.

    DIANE S. JONES and
    ADDIE MERRITT,

              Appellees.

                           ORDER AND JUDGMENT           *

Before BRORBY , BRISCOE , and LUCERO , Circuit Judges.

*
      This order and judgment is not binding precedent, except under the
doctrines of law of the case, res judicata, and collateral estoppel. The court
generally disfavors the citation of orders and judgments; nevertheless, an order
and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3.
       After examining the briefs and appellate record, this panel has determined

unanimously that oral argument would not materially assist the determination of

this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1.9. The case is

therefore ordered submitted without oral argument.

       Debtor Linda Watson objected to Diane Jones’ proof of claim in the

underlying bankruptcy proceeding. The $13,980 claim resulted from an award of

attorney fees in a custody dispute between debtor and appellee Addie Merritt.

The bankruptcy court overruled the objection and allowed the claim. Debtor

appealed, and the district court reversed the bankruptcy court decision,

disallowing the claim because, under Utah law, an award of attorney fees in a

domestic dispute is in favor of the litigant, not the attorney. Therefore, the

district court found that Jones, Addie Merritt’s attorney in the custody dispute,

was not a creditor and did not have a claim under the Bankruptcy Code.

Immediately thereafter, Jones filed a motion to amend the claim to substitute

Addie Merritt as the proper claimant. The bankruptcy court allowed the

amendment, and debtor appealed. The district court, relying on this court’s

decision in Unioil, Inc. v. Elledge (In re Unioil, Inc.)   , 962 F.2d 988 (10th Cir.

1992), affirmed the bankruptcy court’s decision to allow amendment. Plaintiff

appeals.

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       We apply the same standards as did the district court in reviewing the

bankruptcy court’s decision: we review its legal conclusions de novo and its

factual findings for clear error.   See Phillips v. White (In re White)   , 25 F.3d 931,

933 (10th Cir. 1994). In deciding whether the bankruptcy court was correct in

allowing amendment of the claim to substitute the proper claimant, “we consider

de novo the threshold issue whether the original proof of claim was amendable at

all; and, if it was, we assess the decision to allow amendment under the particular

circumstances solely for an abuse of discretion.”      In re Unioil , 962 F.2d at 992.

              Ordinarily, amendment of a proof of claim is freely permitted
       so long as the claim initially provided adequate notice of the
       existence, nature, and amount of the claim as well as the creditor’s
       intent to hold the estate liable. The court should not allow truly new
       claims to proceed under the guise of amendment.

Id. As in Unioil , debtor does not dispute that the claim was deficient in any of

these respects or that the amendment altered the substantive content of the claim.

The only change was the substitution of the claimant legally entitled to enforce

the attorney fee award. “Accordingly, as a matter of law, the proof of claim was

amendable.” Id. Further, the bankruptcy court did not abuse its discretion in

allowing amendment of the proof of claim in the particular circumstances of this

case. Debtor has shown no prejudice resulting from the amendment. Indeed, the

substance of the claim remains the same.      See id. at 993 (holding no abuse of

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discretion where no actual prejudice was shown and substance of claim was

unaltered by amendment that merely substituted proper claimant).

      We AFFIRM the district court’s opinion and order. The mandate shall

issue forthwith.

                                                  Entered for the Court

                                                  Wade Brorby
                                                  Circuit Judge

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