Court Opinion

ID: 31726
Source: CourtListenerOpinion
Date Created: 2010-04-25 10:21:05+00
Date Added: 2024-06-11T09:37:59.181609
License: Public Domain

United States Court of Appeals
                                                                      Fifth Circuit
                                                                   F I L E D
                   UNITED STATES COURT OF APPEALS
                                                                     June 3, 2003
                        For the Fifth Circuit
                                                               Charles R. Fulbruge III
                                                                       Clerk

                            No. 02-41538
                          Summary Calendar

                 In the Matter of: GEORGE THOMAS COX
                                Debtor
               ---------------------------------------

                        CADLEWAY PROPERTIES,

                                                                 Appellant,

                                 VERSUS

                         GEORGE THOMAS COX,

                                                                 Appellees.

            Appeal from the United States District Court
         For the Eastern District of Texas, Tyler Division
                              (6:01-CV-576)

Before JONES, STEWART, and DENNIS, Circuit Judges.

PER CURIAM:*

      Appellants   Cadleway    Properties     (“Cadleway”)    appeals      the

  *
   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opinion should not be published and is not precedent except under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.

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bankruptcy court’s grant of summary judgment, affirmed by the

district court, in its suit against George Thomas Cox (“Cox”)

seeking to prevent the discharge of Cox’s debts pursuant to 11

U.S.C. § 727(a)(2)(A).   We review the bankruptcy court’s factual

findings for clear error and its legal conclusions de novo.     In re

Luce, 960 F.2d 1277, 1280 (5th Cir. 1992) (per curiam).

      § 727(a)(2)(A) states:

      The Court shall grant the debtor a discharge, unless–

      the debtor, with intent to hinder, delay or defraud a
      creditor...has   transferred,   removed,   destroyed,
      mutilated, or concealed, or has permitted to be [the
      same]--

           property of the debtor, within one year before the
           date of filing of the petition.

11 U.S.C. § 727(a)(2)(A).      The bankruptcy court and the district

court granted summary judgment to Cox because they determined that

the properties challenged by Cadleway were not the properties of

Cox, but rather the separate property of his wife Kristi Cox.    The

lower courts based this decision on the fact that Cox paid for her

property investments out of her separate funds.1   Edsall v. Edsall,

  1
   Both below and here Cadleway points to a series of bankruptcy
decisions in which courts applied § 727. In re Penner,107 F.R. 171
(Bankr. N.D. Ind. 1989); Metropolitan Petroleum Co. v. Frumovitz
(In re Frumovitz), 10 B.R. 61 (Bankr. S.D. Fla. 1988); Teilhaber
Mfg. Corp. v. Hodge (In re Hodge), 92 B.R. 919 (Bankr. D. Kan.
1988); In re Elliott, 83 F. Supp. 771 (E.D. Pa. 1948). But as the
district court noted, in those cases, unlike here, the bankrupt
spouse transferred his property interest to the non-bankrupt
spouse, or used the non-bankrupt spouse to conceal the bankrupt
spouse’s continued property interest.     Here, Cox never had a
property interest in Kristi’s property.

                                   2
240 S.W.2d 424, 426 (Tex. Civ. App. 1951) (holding that presumption

of common marital property is overcome with evidence that property

was paid for by separate funds of spouse).

      On appeal Cadleway argues that because Cox is entitled to a

right of reimbursement for his work in Kristi Cox’s property

investments, those properties should be treated as Cox’s for the

purposes of § 727.         TEX. FAM. CODE § 3.408 (Vernon Supp. 2003)

(granting   right   of     reimbursement        for   spouse     for    inadequate

compensation for “time, toil and effort” of spouse in business

arrangement).       Even    assuming       arguendo      that     the   right    of

reimbursement at divorce is property in terms of § 727, here Cox

does not enjoy that right because of a pre-marital agreement

between himself     and    Kristi   Cox    in    which   he     relinquished    his

statutory rights.        Thus, there is no “property of the debtor”

involved here, preventing § 727 from being triggered.2

      The judgment of the district court is AFFIRMED.

  2
   To the extent that Cadleway seeks to challenge the bankruptcy
court’s determination that the Cox’s home was exempt property for
§ 727 purposes, that argument is waived for inadequate briefing.
L & A Contracting Co. v. Southern Concrete Servs., 17 F.3d 106, 113
(5th Cir. 1994).

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