Court Opinion

ID: 2964805
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Date Created: 2015-09-21 21:31:23.268082+00
Date Added: 2024-06-11T11:43:02.145777
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USCA1 Opinion

	

                           UNITED STATES COURT OF APPEALS
                                FOR THE FIRST CIRCUIT
          No. 96-1845
                                IN RE DAVID C. RAUH,
                                       Debtor,
                                              
                              DAVID J. NOONAN, TRUSTEE,
                                Plaintiff, Appellant,
                                         v.
                                   KUEI FONG RAUH,
                                Defendant, Appellee.
                                                    
                    APPEAL FROM THE UNITED STATES DISTRICT COURT
                          FOR THE DISTRICT OF MASSACHUSETTS
                   [Hon. Nathaniel M. Gorton, U.S. District Judge]
                                                    
                                       Before
                               Boudin, Circuit Judge,
                             Cyr, Senior Circuit Judge,
                              and Lynch, Circuit Judge.
                                                    
               Claudia  J. Reed,  with  whom  David J.  Noonan  and  Cohen,
          Rosenthal P.C. were on brief for appellant.
               Joseph I.  Schindler, with  whom Jonathan  S. Schindler  and
          Klieman, Lyons,  Schindler,  Gross &  Pabian  were on  brief  for
          appellee.
                                                    
                                    July 18, 1997
                                                    

                    CYR, Senior Circuit Judge.  Appellant David J.  Noonan,
          trustee in  bankruptcy of  David C.  Rauh ("Debtor"),  challenges
          various 
                 bankruptcy court rulings    later affirmed by the district
          court    declining to set aside certain prepetition transfers  to
          Kuei Fong Rauh, the Debtor's wife, and disallowing the  Trustee's
          postjudgment 
                      motion to amend the complaint, findings, and judgment
          relating to three fraudulent-conveyance claims belatedly asserted
          against Mrs. Rauh.  We affirm the judgment, as amended to reflect
          an additional voidable transfer to Mrs. Rauh. 
                                          I
                                     BACKGROUND
                    In  1976,  the Debtor,  Gary  Stahelski,  and  a  third
          individual no longer involved in the case, founded a partnership,
          Environmental
                       Water Systems ("E.W.S."), which was to engage in the
          plumbing  and  heating  business.   Six  years  later,  the  same
          individuals formed a corporation, E.W.S. Realty, Inc. ("Realty"),
          which developed real property  for sale or lease.  The  principal
          lenders 
                 for 
                     the 
                        various 
                                real estate development projects undertaken
          by Realty  were Commerce Bank &  Trust Co. ("Commerce Bank")  and
          Country Bank for Savings ("Country Savings").  The loans obtained
          to finance the Realty  projects were secured by mortgages on  the
          various 
                 properties 
                           under 
                                 development and were guaranteed by Realty,
          as  well as  by  the Debtor  and  Stahelski in  their  individual
          capacities.  During 1988, the Debtor, Stahelski, and Vincent  and
          Ernest Osterman engaged  in a real estate development project  in
          their individual capacities.   Around the  same time, these  four
                                          2

          individuals 
                     formed 
                           Pioneer Valley Partners No. 1, Inc. ("Pioneer"),
          a 
           corporation 
                       which 
                            was 
                                to develop a shopping mall known as Pioneer
          Plaza.   The Pioneer Plaza project  financing came from the  real
          estate sellers  and Commerce  Bank.   The loans  were secured  by
          mortgages on the Pioneer Plaza real estate and guaranteed by  the
          various corporations, the Debtor, Stahelski, and the Ostermans. 
                    For 
                       a 
                         time, 
                              E.W.S. 
                                     and 
                                         Realty were reasonably successful,
          especially during 1986, 1987 and 1988.  As the Massachusetts real
          estate market  slumped in 1989,  however, the Debtor's  financial
          position 
                  deteriorated, 
                               due to difficulties in obtaining lessees for
          space 
               in 
                  the 
                     Pioneer 
                             Mall, a slowdown in the construction business,
          and the heavy indebtedness incurred with E.W.S. and/or Realty for
          services performed in connection with the Pioneer Plaza  project.
          E.W.S. 
                and 
                    Realty in turn became deeply indebted to third parties.
          By May 1989, the Debtor  realized that he and Stahelski would  be
          unable 
                to 
                   meet 
                       the 
                           $200,000 mortgage payment due the sellers of the
          Pioneer Plaza real estate  in June and an additional payment  due
          Country Savings around the same time.
                    Between  June  1  and  September  2,  1989,  Mrs.  Rauh
          unilaterally  withdrew  $127,758  from  various  joint   accounts
          maintained 
                    in the names of both spouses and deposited the proceeds
          in 
            accounts 
                     she 
                        either 
                               held jointly with her daughter or in her own
          name as trustee for  her son.    The bankruptcy court found  that
          these 
               transfers 
                        were 
                             made by Mrs. Rauh with actual intent to remove
          the monies in  the joint spousal accounts  from the reach of  the
          Debtor's creditors.  
                                          3

                    On June  28, 1989, the  Debtor suddenly absconded  wit
          $9,000 withdrawn from an unspecified joint spousal account.  Mrs.
           auh 
              sought 
                    an 
                       explanatio
                                                                          h
          R                      n from Stahelski, who described the dismal
          financial 
                   picture 
                          confronting him and the Debtor and suggested that
          the  Debtor might  have  left with  another  woman.   The  Debtor
          resurfaced approximately two weeks later, however, and  Stahelski
          terminated 
                    the Debtor's employment with Realty shortly thereafter.
          At about the same time, the E.W.S. partnership was dissolved.
                    The Debtor sued  Stahelski to recover the value of  his
          interests  in E.W.S. and  Realty.  Mrs.  Rauh joined the  action,
          claiming 
                  damages 
                         for 
                             emotional distress caused by her dealings with
          Stahelski following  the Debtor's  disappearance.   The suit  was
          settled on July  23, 1991 (the "Stahelski Settlement"), with  the
          Debtor receiving vehicles and equipment of little value in return
          for 
             relinquishing all interests in E.W.S. and Realty to Stahelski;
          Mrs. Rauh received $15,000 in cash and a $40,000 promissory  note
          payable 
                 to 
                    Realty.1  She continued to receive all payments made on
          the $40,000  note until well after  the Debtor filed a  voluntary
          chapter 7 petition on March 24, 1992.
                    In  due course,  the  Trustee  commenced  an  adversary
          proceeding  to  set  aside   several  transfers  to  Mrs.   Rauh,
          individually and  as next friend  of the Rauh  children.  As  the
          challenged transfers  all  occurred  more than  one  year  before
          bankruptcy,  see  Bankruptcy Code  S  548,  the  Trustee  invoked
                  1Meanwhile,  the Debtor  had deeded  his  tenancy-by-the-
          entireties 
                    interest 
                            in 
                               the marital home to Mrs. Rauh on January 28,
          1991, for nominal consideration.  
                                          4

          Bankruptcy Code S  544(b) and chapter  109A of the  Massachusetts
          General Laws ("ch. 109A")    the Massachusetts Uniform Fraudulent
          Conveyance Act ("UFCA")    as grounds for avoiding them.2
                    At 
                      trial, 
                             the Trustee managed to persuade the bankruptcy
          court 
               to 
                  set 
                     aside 
                           only 
                                the transfer of the Debtor's joint interest
          in 
            the 
                marital 
                       home 
                            and 
                                the transfer of the $40,000 promissory note
          to  Mrs.  Rauh  in  connection  with  the  Stahelski  Settlement.
          Thereafter, 
                     the 
                        Trustee 
                                moved to amend the complaint, findings, and
          judgment to  conform with the  evidence.  See  Fed. R. Bankr.  P.
          7015(b), 7052(b), 9023(a);  Fed. R. Civ. P. 15(b), 52(b),  59(a).
          The proposed  amended  complaint  alleged  additional  fraudulent
          transfers. 
                     
                     Nearly a year after trial, the bankruptcy court denied
          the 
             postjudgment 
                         motion 
                                on the mistaken ground that the Trustee had
          failed 
                to 
                   file a motion to amend the complaint to conform with the
          evidence.  See infra Section II.B. 
                    In addition to the ruling at  trial    refusing to  set
          aside Mrs.  Rauh's withdrawals  from the joint  accounts      the
          Trustee 
                 now 
                     challenges the bankruptcy court's postjudgment rulings
          refusing 
                  to 
                     set 
                        aside: 
                                
                                the $15,000 cash payment Mrs. Rauh received
          in the Stahelski  Settlement; a $6,565.31  deposit, on March  27,
          1992, to Mrs. Rauh's own bank account, comprised of three  checks
          dated two weeks prior to the Debtor's chapter 7 petition, payable
          to the Debtor  and endorsed over to  Mrs. Rauh; and $3,786.76  in
               2The  Uniform Fraudulent Transfer Act ("UFTA") did not  take
          effect in Massachusetts until well after these transactions.  See
          Mass. Gen.  Laws ch. 109A  (1997), amended by  St. 1996, ch.  157
          (approved July 8, 1996) (replacing UFCA provisions with UFTA).
                                          5

          deposits to Mrs.  Rauh's own bank account, between September  17,
          1991 and February 12, 1992, consisting of several checks from the
          Debtor's customers made payable to Mrs. Rauh.  
                                         II 
                                     DISCUSSION
          A.   The Joint-Account Withdrawals 
                    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.
                    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, 4 N.E.2d 1019, 1020 (Mass. 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,  287 N.E.2d 459,  463 (Mass. 1972),  of
          establishing  that the  contributing  spouse intended  to  retain
                                          6

          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 S 544(b) and ch. 109A.
                    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,  314 N.E.2d 888, 893  (Mass. App. Ct. 1974),  cert.
          denied, 420 U.S. 947 (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
               3Mrs. Rauh contended at trial that the  funds in these joint
          accounts 
                  derived from assets owned by her alone; she was therefore
          the contributing spouse; and she had intended that all the  funds
          remain her property.  The Trustee, on the other hand,  introduced
          evidence 
                  that 
                       the 
                          funds 
                                in these accounts derived from the earnings
          and 
             investments 
                         of 
                           the 
                               Debtor or represented proceeds from jointly-
          held 
              assets. 
                       The bankruptcy court found, however, that the Debtor
          was the sole contributing spouse. 
                                          7

          Mrs. Rauh.  See id.
                    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, 
                                567 N.E.2d 933, 937 (Mass. App. Ct. 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 
                               (v
                                 iz., 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.
                    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
            
            
             
              
              4
               The 
                   Trustee 
                          also 
                               points out that the expert witness presented
          by Mrs.  Rauh testified  that all monies  in these joint  spousal
          accounts 
                  were 
                       assets 
                             of 
                                the Debtor.  However, this expert testimony
          was offered to prove that  the Debtor was not "insolvent," as  of
          1988, 
               for 
                   purposes of ch. 109A, S 4.  There has been no attempt by
          the Trustee to explain  how this expert testimony bears upon  the
          Debtor's donative intent in establishing the joint accounts.  See
          United States  v. Zannino,  895 F.2d  1, 17  (1st Cir.)  ("issues
          adverted to in a perfunctory manner, unaccompanied by some effort
          at 
            developed 
                      argumentation, are deemed waived"), cert. denied, 494
          U.S. 1082 (1990).   
                                          8

          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.  
                    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.
            
            
             
              
              5
               Nor 
                   do 
                     we 
                        consider 
                                 a quite different argument never raised by
          the 
             Trustee 
                      
                        that even if Mrs. Rauh had a right to withdraw 100%
          of these funds, a voidable transfer of a property interest of the
                                          9

          (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, 116 S. Ct. 171  (1995);
                    Taglienti
                                                                          .
          Nelson v.           (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). 
                    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.
                    A 
                     party 
                           may 
                              not 
                                  raise 
                                        new arguments for the first time on
          Debtor (i.e. his putative  coequal, unilateral right to  withdraw
          100% 
              of 
                 these 
                      funds, 
                             or 
                                his ownership interest in 50% of the funds)
          nonetheless occurred at  the time Mrs.  Rauh exercised her  legal
          right to withdraw the funds. 
            
            
             
              
              6
               For 
                   one thing, Mrs. Rauh's trial testimony was not as clear,
          in 
            context, 
                     as the Trustee suggests.  When asked from what account
          the Rauhs' household expenses were paid, she responded:  "We only
          have [sic] one checking account at  that time.  So it [sic]  paid
          from 
              the 
                  checking account."  The record reveals, however, that the
          Rauhs 
               had 
                   many joint accounts in 1989.  Consequently, it cannot be
          ascertained from the record which was the checking account.
                                         10

          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 (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 Un ited 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. 
                         Massachu
                                 setts 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
          (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
               7We  consider arguments raised for the first time on  appeal
          only 
              in 
                 exceptional circumstances threatening a "clear miscarriage
          of justice."  See Playboy Enter., Inc. v. Public Serv. Comm'n  of
          Puerto 
                Rico, 
                     906 
                         F.2d 
                              25, 40 (1st Cir.), cert. denied, 498 U.S. 959
          (1990).   We  discern no  such exceptional  circumstances in  the
          present case. 
                 8Even in  the Trustee's postjudgment  motion to amend  the
          findings and  judgment,  there is  no  mention of  the  perceived
          relevance of Mrs. Rauh's testimony regarding the Rauhs' household
          expenditures.
                                         11

          Warehouse, Inc.
          little
          531 (1st Cir. 1993)).
                    After the bankruptcy  court entered  final judgment  in
          Febr
                          v.                                              e
                                 d 7, 9 (1st Cir. 1993) ("'If lawyers could
           ursue 
                on 
                   appeal issues not properly raised below,  there would be
                 incentive to  get it right  the first time  and no end  of
          retrials.'") (quoting Poliquin v. Garden Way, Inc., 989 F.2d 527,
                               9
          B.   Amendments to Complaint
                          
              uary 1994,  see       p.  5, the Trustee  moved to amend  the
          complaint to conform to the  evidence at trial, and to amend  the
          judgment, to set aside, inter alia, a $15,000 cash transfer  Mrs.
          Rauh received in the Stahelski Settlement, and transfers to  Mrs.
          Rauh of several checks from the Debtor's customers.10 
                    Rule 
                        7015(b) 
                                of 
                                  the 
                                      Federal Rules of Bankruptcy Procedure
                    Fed. R. Civ. P. 15(b) to adversary proceedings)  state
                             D.M.  Reid Assocs. (In re Mark Bell  Furnitur
          Warehouse, 
                    Inc.
                       ), 
                          992 
                              F.2
          p
          (applying                                                       s
                 We  
                              supra                                       e
          au          the Trustee cites on appeal do not appear to  support
              newfound  theory.       Levy v. 
                9    note in passing,  however, without deciding, that  th
            thorities
          the                    See          Levy,  35 N.E.2d 659,  661-62
          (Mass.  1941); Zak v.  Zak, 25 N.E.2d  169, 170-71 (Mass.  1940);
          Rosman
                
                v. 
                   Ros
                      man, 19 N.E.2d 41, 42 (Mass. 1939); Cram v. Cram, 160
          N.E. 337, 339-40 (Mass. 1928); Moore v. Mansfield, 142 N.E.  792,
          793-94 (Mass. 1924); Hutchinson v. Hutchinson, 383 N.E.2d 82,  87
          (Mass. App. Ct. 1978).  In each instance, the contributing spouse
          either averred or testified that he never intended to donate  any
          beneficial interest  in the  account to  the other  spouse.   The
          Trustee alludes  to no comparable  averment or  testimony in  the
          present 
                 record.  Moreover, we have found no Massachusetts decision
          holding that mere evidence that household expenses were paid from
          joint 
               accounts was necessarily relevant to, let alone conclusively
          rebutted, a presumption of donative intent.  Finally, the Trustee
          adduced no competent evidence that the Rauhs used all their joint
          accounts to pay household expenses.  See supra note 6.
               10 We review the bankruptcy court's denial of the motion  to
          amend the complaint only for  abuse of discretion.  See Lynch  v.
          Dukakis, 719 F.2d 504, 509 (1st Cir. 1983).
                                         12

          that
                    When issues not  raised by the pleadings  are
                    tried by express  or implied  consent of  the
                    parties, 
                            they shall be treated in all respects
                    as if they had been raised in the  pleadings.
                    Such  amendment of  the pleadings  as may  be
                    necessary  to cause  them to  conform to  the
                    evidence 
                            and 
                                to raise these issues may be made
                    upon motion  of any party  at any time,  even
                    after judgment; but failure so to amend  does
                    not affect the result  of the trial of  these
                    issues. . . .
          Fed. 
              R. 
                 Bankr. P. 7015(b).  Under Rule 7015(b), motions to amend a
          complaint  to conform  to  the  evidence admitted  at  trial  are
          liberally allowed.  See, e.g., Brandon v. Holt, 469 U.S. 464, 471
          & n.19  (1985)  (permitting amendment  to pleadings  pursuant  to
          Federal Rule of  Civil Procedure 15(b)  even after Supreme  Court
          mandated remand).
                    A post-trial  motion  to conform  the judgment  to  the
          evidence 
                  should not be allowed, however, unless the opposing party
          expressly or impliedly agreed to try the matter in question.  See
          Luria Bros. & Co. v. Alliance Assurance Co., 780 F.2d 1082,  1089
          (2d Cir. 1986).  Even so, amendment should not be allowed if  the
          opposing 
                  party demonstrates "unfair prejudice."  See DCPB, Inc. v.
          City of  Lebanon, 957  F.2d 913, 917  (1st Cir.  1992); Lynch  v.
          Dukakis, 719 F.2d 504, 509 (1st Cir. 1983); Scully Signal Co.  v.
          Electronics  Corp. of Amer.,  570 F.2d 355,  362 (1st Cir.  1977)
          ("Although  Rule 15(b)  by its  terms requires  amendment of  the
          pleadings whenever an issue has been tried by express or  implied
          consent, courts have  refused to grant such motions if  amendment
          would prejudice  one of  the parties,  such as  by requiring  the
                                         13

          presentation 
                      of additional evidence."), cert. denied, 436 U.S. 945
          (1978); 
                 see
                     
                     a
                      lso Morgan and Culpepper, Inc. v. Occupational Safety
          & Health Review Comm'n, 676 F.2d 1065, 1066 (5th Cir. 1982).  The
          term  "unfair prejudice" refers  to whether a  party "had a  fair
          opportunity to defend  and whether he could offer any  additional
          evidence if the case were  to be retried on a different  theory."
          See
             
             Browning 
                     Debenture 
                               Holders' Comm. v. DASA Corp., 560 F.2d 1078,
          1086 (2d Cir.  1977) (quoting 3 James  Wm. Moore et al.,  Moore's
          Federal Practice q 15.13[2], at 993 (2d ed. 1966)).
               1.   The Stahelski Settlement Transfer
                    The stated  basis for denying  the Trustee's motion  to
          amend the  judgment to conform  with the  evidence introduced  at
          trial, 
                in 
                   relation 
                           to 
                              certain cash transfers from Stahelski to Mrs.
          Rauh, was the mistaken understanding by the bankruptcy judge that
          the Trustee had never filed such a motion and that any  amendment
          therefore would have been unfair because Mrs. Rauh had not had an
          opportunity to present  a defense.   The bankruptcy court  docket
          sheet 
               reveals, however, that the Trustee did file such a motion on
          April 19,  1994, and that Mrs. Rauh later filed a reply.  As  the
          denial 
                therefore 
                         constituted an "abuse of discretion," the judgment
          must be amended provided the motion was meritorious.  See Webb v.
          Hiykel, 713  F.2d 405, 407-08  (8th Cir.  1983) (appellate  court
          reverses trial  court  and orders  judgment where  plaintiff  was
          entitled  to relief  on unpled  theory and  defendants would  not
          experience undue prejudice). 
                    At trial,  without  objection, the  Trustee  introduced
                                         14

          competent evidence of the $15,000 cash payment Mrs. Rauh received
          from Stahelski.   See Conjugal Partnership  of Jones v.  Conjugal
          Partnership of Pineda, 22 F.3d 391, 400-01 (1st Cir. 1994)  ("One
          sign 
              of 
                 implied consent is that issues not raised by the pleadings
          are presented  and argued  without proper  objection by  opposing
          counsel. . . . Under Rule 15(b), lack of consent is manifested by
          an objection on  the ground that the  evidence is not within  the
          issues 
                raised by the pleadings.") (citation and internal quotation
          marks omitted).  Mrs. Rauh contends on appeal, however, that  she
          did 
             not 
                 object at trial because the Trustee introduced the $15,000
          cash 
              payment 
                      only to prove that her receipt of the promissory note
          had 
             been 
                  fraudulent.  See DCPB, Inc., 957 F.2d at 917 ("Consent to
          the 
             trial 
                   of 
                      an issue may be implied if, during the trial, a party
          acquiesces in the introduction of evidence which is relevant only
          to that issue.") (emphasis added); Luria Bros. & Co., 780 F.2d at
          1089 
              ("That 
                    such 
                         evidence, relevant to both pled and unpled issues,
          was 
             introduced 
                       without 
                               objection does not imply consent to trial of
          the unpled issues, absent some obvious attempt to raise  them.");
          Ellis v. Arkansas Louisiana Gas Co., 609 F.2d 436, 440 (10th Cir.
          1979) 
               ("Implied 
                        consent 
                                may not be inferred merely because evidence
          relevant 
                  to 
                     a properly pleaded issue incidentally tends to prove a
          fact  not within  the pleadings."),  cert. denied,  445 U.S.  964
          (1980).  We disagree.  
                    At  trial, the  Trustee maintained  that the  Stahelski
          Settlement proceeds received by Mrs. Rauh constituted  fraudulent
          conveyances under ch. 109A because (1) the Debtor, with intent to
                                         15

          keep assets from his creditors, diverted to Mrs. Rauh the bulk of
          the 
             consideration 
                          he 
                             otherwise would have received in settlement of
          his  claims against  Stahelski; and  (2) none  of the  settlement
          proceeds 
                  received by Mrs. Rauh were attributable to the settlement
          of her own tort claim for infliction of emotional distress.   See
          supra  p. 4.   Accordingly, the only  conceivable purpose of  the
          Trustee's 
                   evidentiary proffer relating to the $15,000 cash payment
          was to establish the amount of the Stahelski Settlement  transfer
          which was voidable.  The evidence offered by the Trustee was  not
          even remotely probative  of whether the  Debtor had conveyed  the
          $40,000 promissory note with  fraudulent intent, nor whether  the
          transfer 
                  of 
                     the promissory note constituted consideration for Mrs.
          Rauh's relinquishment of her tort claim. 
                    Furthermore, Mrs. Rauh  has not  demonstrated that  any
          "unfair  prejudice" would  result  from the  postjudgment  relief
          requested 
                   by 
                      the Trustee.  See DCPB, Inc., 957 F.2d at 917; Scully
          Signal Co.,  570 F.2d  at 362.   At trial,  the bankruptcy  court
          expressly rejected her  contention that the  Stahelski-Settlement
          payments 
                  were 
                      in 
                         satisfaction of her emotional distress claim.  The
          court  found  instead   that  the  Debtor  thereby   fraudulently
          transferred his interests in E.W.S. and Realty indirectly to Mrs.
          Rauh, see supra p. 4, a  finding Mrs. Rauh does not challenge  on
          appeal. 
                  
                  Nor 
                      has Mrs. Rauh suggested that her contention in regard
          to  the  Trustee's  $15,000  fraudulent-transfer  claim  differed
          significantly from her  defense to the  surrender of the  $40,000
          promissory 
                    note, see supra p. 4, which took place in the identical
                                         16

          circumstances
                      .  See Modern Elec., Inc. v. Ideal Elec. Sec. Co., 81
          F.3d 
              240, 
                   247 
                      (D.C. 
                            Cir. 
                                 1996) (complaint amended to include unjust
          enrichment claim, after parties had tried similar quantum  meruit
          claim); 
                 Morgan 
                       and 
                           Culpepper, Inc., 676 F.2d at 1068 ("Federal Rule
          of Civil Procedure 15(b)  contemplates amendments in cases  where
          relevant issues have been litigated."); Cunningham v. Quaker Oats
          Co.
            , 
              107 
                 F.R.D. 
                        66, 
                            70-71 (W.D.N.Y. 1985) (new plaintiff allowed to
          be 
            named 
                  in 
                     complaint, where defense to original plaintiff's claim
          was primarily legal in nature, the defense had already been tried
          and it applied to both the original and new plaintiff).  
                    As 
                      Mrs. 
                           Rauh 
                                implicitly consented to try the fraudulent-
          conveyance 
                    claim 
                         relating to the $15,000 cash transfer she received
          in 
            the 
                Stahelski Settlement, and she has not shown that any unfair
          prejudice would result from the postjudgment relief requested  by
          the Trustee, the motion to conform the complaint and the judgment
          with the evidence should have been allowed. 
          2.   Checks from Debtor's Customers
                    The 
                       bankruptcy 
                                 court 
                                       likewise denied the Trustee's motion
          to 
            amend 
                  the 
                      judgment to set aside alleged fraudulent transfers of
          several checks from the Debtor's business customers made  payable
          directly,  or endorsed  over, to  Mrs.  Rauh.   See 11  U.S.C.  S
          548(a)(2) (transfers by insolvent  within one year of  bankruptcy
          petition); id.  S  549 (postpetition  transfers).   Although  the
          bankruptcy court once again acted on the mistaken belief that the
          Trustee had filed no postjudgment motion to amend the  complaint,
          see supra Section  II.B, we may affirm  its ruling on any  ground
                                         17

          supported by the record.  See Max Sugarman Funeral Home, Inc.  v.
          A.D.B. 
                Investors
                        , 
                          926 
                              F.2d 1248, 1253 n.9 (1st Cir. 1991).  As Mrs.
          Rauh did not agree to try  this issue, we decline to disturb  the
          bankruptcy court ruling. 
                    The record discloses  that Mrs. Rauh was never on  fair
          notice of these claims.  The checks in question were material  to
          count VI of  the complaint as amended  prior to trial, see  DCPB,
          Inc.
             , 
               957 
                   F.2d at 917; Luria Bros. & Co., 780 F.2d at 1089; Ellis,
          609 F.2d at 440, wherein the Trustee alleged that funds presently
          in 
            Mrs. 
                 Rauh's various bank and mutual fund accounts were property
          of 
            the 
                chapter 
                       7 
                         estate, 
                                 either because Ms. Rauh had converted them
          from the Debtor, or the Debtor had fraudulently conveyed them  to
          her. 
               
               See
                   
                   sup
                      ra pp. 5-6.  Count VI focused on transfers from joint
          accounts 
                  to 
                     accounts held in Mrs. Rauh's name alone (e.g. "between
          November, 
                   1988 and November, 1989, the Defendant and/or the Debtor
          transferred funds . . . at various times from jointly owned  bank
          accounts to other bank accounts.").  See supra Section II.A.   In
          her answer  Mrs. Rauh asserted  that "these accounts  contain[ed]
          monies 
                which 
                      were earned or derived solely by her efforts and were
          not monies earned or derived from any effort of the debtor."
                    The  dispute at  trial likewise  concerned whether  the
          monies in the joint accounts had derived solely from Mrs.  Rauh's
          own efforts, or from the Debtor's.  See supra note 3.   Mrs. Rauh
          testified that  she was  the sole source  of these  monies.   The
          Trustee, in turn, used the Debtor-customer checks made payable to
          Mrs. Rauh to impeach her credibility by way of demonstrating that
                                         18

          the Debtor    not Mrs. Rauh    was the source of those particular
          deposits to their joint accounts.
                    T
          c                      ence, nor the Trustee's examination of the
                     fairly  signaled an  intention to  establish that  th
                     hus, 
                         neither 
                                the 
                                    Trustee's introduction of these Debtor-
           ustomer 
                  checks 
                        into 
                             evid
          witnesses,                                                      e
          Debtor had transferred  these specific checks  to Mrs. Rauh  with
          fraudulent 
                    intent, 
                           within the meaning of 11 U.S.C. SS 548(a)(2) and
          549.   Rather,  it was  not until  after trial  that the  Trustee
          mentioned 
                   these 
                        specific 
                                 transfers to Mrs. Rauh's accounts from the
          Debtor's business customers.  As the Trustee thus failed to alert
          Mrs. 
              Rauh 
                   to 
                      his intention, her failure to object at trial did not
          connote  implicit consent to  try the unpled  issue.  See  Modern
          Elec., Inc., 81 F.3d at 247; United States v. 890 Noyac Road, 945
          F.2d 1252, 1257 (2d  Cir. 1991); Luria Bros.  & Co., 780 F.2d  at
          1089.
                    Although  the Trustee's  unpled  claims may  well  have
          prevailed 
                   at 
                      trial, we cannot assume that Mrs. Rauh would not have
          been able to establish her present contention    that the  checks
          were 
              not 
                  property of the chapter 7 estate    had she been afforded
          fair 
              notice 
                    and 
                        opportunity to resist the unpled claims at trial.11
          See 890  Noyac Road,  945 F.2d at  1259 (although opposing  party
          already may have presented all the evidence she had, "[g]iven the
            
            
             
              
              11
                For 
                    example, at trial Mrs. Rauh testified that she had used
          personal funds  to defray various  business expenses because  the
          Debtor's  checking  account had  been  attached.    Further,  she
          represented that she had overpaid some of the Debtor's  suppliers
          and 
             that 
                  their 
                       checks 
                              accordingly represented reimbursements of her
          overpayments.
                                         19

          confused context in  which this proof was presented, however,  we
          decline to speculate  about how [the defendant] might have  dealt
          with 
              the 
                  issue . . . had it been squarely presented."); Morgan and
          Culpepper,  Inc.,  676  F.2d  at  1068  ("We  deem  improper  the
          Commission's prejudgment of possible defenses which a company may
          assert. . .  . Where amendment of  pleadings is permitted on  the
          basis of the second half of Fed. R. Civ. P. 15(b), the Commission
          may 
             not 
                 deny 
                     the 
                         petitioner the opportunity to present new defenses
          by stating the ex parte conclusion that all possible defenses are
          meritless."). 
                        
                        As 
                          Mrs. 
                               Rauh was not afforded fair notice that these
          newly 
               minted 
                     Debtor-customer check claims were being interjected by
          the 
             Trustee 
                     at trial, the Trustee was not entitled to amend either
          the complaint or the judgment.
                                         III
                                     CONCLUSION
                    Accordingly, the judgment is  amended to set aside  the
          $15,000 cash  payment  received by  Mrs.  Rauh in  the  Stahelski
          Settlement.  In all other respects, the judgment is affirmed.  No
          costs.
                    SO ORDERED.
                                         20