Court Opinion

ID: 821397
Source: CourtListenerOpinion
Date Created: 2013-02-26 21:21:20.791196+00
Date Added: 2024-06-11T15:25:06.080195
License: Public Domain

FILED
                            NOT FOR PUBLICATION                             FEB 25 2013

                                                                        MOLLY C. DWYER, CLERK
                    UNITED STATES COURT OF APPEALS                       U .S. C O U R T OF APPE ALS

                             FOR THE NINTH CIRCUIT

In re: LEONA PHYLLIS FERRARA,                    No. 11-60051

              Debtor,                            BAP No. 10-1331

LEONA PHYLLIS FERRARA,                           MEMORANDUM *

              Appellant,

  v.

MARY JANE CONDIT,

              Appellee.

                         Appeal from the Ninth Circuit
                          Bankruptcy Appellate Panel
             Pappas, Markell, and Jury, Bankruptcy Judges, Presiding

                        Argued and Submitted January 16, 2013
                              San Francisco, California

Before: NOONAN, GRABER, and FISHER, Circuit Judges.

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
We affirm a holding of the Bankruptcy Appellate Panel (the BAP) in favor of Mary

Jane Condit, the conservator of John Charochak.

      The parties are familiar with the facts and prior proceedings. We note only

that the Arizona Probate Court held that Ferrara in 2006 became a trustee for her

husband by her acts and the operation of Arizona’s Adult Protective Services Act

(APSA). The Arizona Probate Court held her liable for $48,663.53 in damages and

$28,818.10 in attorney fees, costs, and interest. Ferrara did not appeal the

judgment.

      In 2009, Ferrara began this action in the bankruptcy court in chapter 7 and

sought to discharge the probate court’s judgment against her. Both the bankruptcy

court and the BAP ruled against her. She appeals to us.

      The BAP held that it should afford preclusive effect to the judgment of the

Arizona Probate Court, if Arizona courts would do so. Allen v. McCurry, 449 U.S.

90, 96 (1980). Condit had established the required factors under Arizona law to

preclude further litigation of the claim already decided definitively by the Arizona

Probate Court.

      Following Blyler v. Hemmeter (In re Hemmeter), 242 F.3d 1186 (9th Cir.

2001), the BAP found that a person acting as a trustee under the APSA was also

acting in a fiduciary capacity within the meaning of 11 U.S.C. § 523(a)(4). By

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virtue of the Arizona statute, Ferrara had been the trustee of her husband’s property

prior to her wrongdoing. That she claimed to have been unaware of her fiduciary

status was no defense, as ignorance of the law is no defense.

      It is anomalous to treat a person as a trustee when that person asserts her

ignorance of such a role and its responsibilities. As Ferrara did not appeal the

judgment of the Arizona Probate Court, she cannot effectively attempt to do so

here. But, it may be argued, to be a trustee under the Arizona statute is not to be a

trustee under § 523(a)(4) of the bankruptcy statute. In this instance, we reject this

argument. We agree with the BAP that the Arizona statutory trust that exists here

meets the three criteria articulated in Hemmeter, 242 F.3d at 1190. We therefore

affirm the judgment.

      AFFIRMED.

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