Court Opinion

ID: 21075
Source: CourtListenerOpinion
Date Created: 2010-04-25 07:40:51+00
Date Added: 2024-06-11T08:02:33.048531
License: Public Domain

IN THE UNITED STATES COURT OF APPEALS

                       FOR THE FIFTH CIRCUIT

                           No. 99-51190
                         Summary Calendar

          In the Matter Of: ROUNDVILLE PARTNERS L L C,
                                             Debtor

ROUNDVILLE PARTNERS L L C,

                                               Appellant,

                                versus

STEPHEN M JONES; FRANKIE SUE
JONES,
                                               Appellees.

          Appeal from the United States District Court
                for the Western District of Texas
                          (A-99-CV-617)

                             May 29, 2000

Before HIGGINBOTHAM, DeMOSS, and STEWART, Circuit Judges.

PER CURIAM:*

     Roundville appeals the district court’s affirmance of the

bankruptcy court’s denial of relief under 11 U.S.C. § 548(a)(1)(B).

This suit arose out of a contract gone sour in which the Joneses

were to sell five lots of property to Roundville.   Initially, the

parties planned to conduct the sale through a single contract.

Later, the Joneses requested that the contract be executed in two

stages for tax purposes, selling some property first and the rest

     *
       Pursuant to 5TH CIR. R. 47.5, the court has determined that
this opinion should not be published and is not precedent except
under the limited circumstances set forth in 5TH CIR. R. 47.5.4.
of the lots in a second contract.          Because of zoning requirements,

the two stages ended up with lopsided value: Roundville was to pay

more for the first-stage contract than that property was worth and

less under the second-stage contract than that property was worth.

The total price, however, was equivalent to the amount specified in

the original contract.

     When    the   Joneses   refused       to   execute   the   second   stage,

Roundville was left having paid more for the first stage property

than it was worth considered on its own.           Roundville took two steps

in response.       It filed a state court action seeking specific

performance of the second-stage contract.            After filing Chapter 11

proceedings, it also filed an adversary proceeding for fraudulent

transfer in the bankruptcy court under 11 U.S.C. § 548(a)(1)(B).

     The bankruptcy court held that Roundville either was not made

insolvent by or had received equivalent value for the Contract 2

closing because it became the beneficial owner of Contract 3.              The

court reasoned that Contract 3 had value despite the Joneses’

refusal to close because of Roundville’s state court cause of

action.     The district court affirmed, and Roundville appealed.

     Having reviewed the pleadings and bankruptcy court’s opinion

in this matter, we are persuaded that there was no clear error in

the bankruptcy court’s determination.             In light of the value of

Contract 3, Roundville cannot satisfy the requirements of § 548.

     AFFIRMED.

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