Court Opinion

ID: 9699317
Source: CourtListenerOpinion
Date Created: 2023-08-25 20:19:20.961674+00
Date Added: 2024-06-11T18:20:47.391088
License: Public Domain

RUSSELL, Bankruptcy Judge,
dissenting:
FACTS
There are only two possible times when Amick could possibly have been notified that the debtor had in fact filed her bankruptcy petition. The first was on October 27,1988, the day that she filed her Chapter 7 petition. At the trial, the debtor testified:
Q. And after you had filed that bankruptcy had you contacted Mr. Amick and informed him that you had in fact filed the bankruptcy?
A. I took that morning off to do it and then I went back to work, so he was aware.
The only other time there,was testimony on this issue at the trial was during the cross-examination of Amick by the debtor’s counsel, Mr. Buttars, regarding a telephone conversation between Amick and Buttars on December 13, 1988:
Q. Okay. And isn’t it true also at that time that when we discussed the original two hundred and sixty-five dollars ($265), that I had to explain to you that Ms. Waller had filed a bankruptcy and that that money was used for the filing of the bankruptcy as you originally agreed with her?
A. As I recall, no. That is not correct.
During final argument, the trial court concluded:
On the basis of the present record then we’ll attempt to arrive at a conclusion which will make the parties whole. I would make further finding that I would feel certainly as of December 13th, the phone conversation, that Mr. [Amick] was aware of the bankruptcy proceedings as a result of his conversation with Mr. Buttars.
(Emphasis added).
Counsel for Amick objected to the court’s announced findings as to what was said during the December telephone conversation and the court’s response was as follows:
MR. FRAHM: Your Honor, unless I’m misunderstanding, are you accepting as fact, by virtue of Mr. Buttars’ cross examination, his assertion that at that point in time he gave Mr. Amick notice? Because Mr. Buttars has not been a witness in this matter. The only way that that testimony came out is by virtue of his cross examination.
THE COURT: That’s correct. Cross examination is evidence, counsel. And I’m sure you realize. And that gives an inference, I think, which will enable me to make that finding.
MR. FRAHM: But then should I not have an opportunity to examine Mr. But-tars on that issue?
THE COURT: Well, I assume you had that right before you rested. Okay. I’ll take the matter under advisement on *355that basis and let you know my decision as soon as I can. We’ll be in recess.
DISCUSSION
It is clear that the only possible evidence relied upon by the court in finding that Amick had notice of debtor's bankruptcy filing related to the testimony of Amick upon cross-examination by Buttars.
I find it surprising that the majority concludes that the trial court relied on evidence other than the December 13 telephone conversation. The majority opinion states:
The court did not specifically find that Amick knew of the automatic stay by virtue of the December 13, 1988 phone conversation. Instead the court found, after hearing the testimony of Waller and Amick, that Amick knew of the terms of the automatic stay as of at the very latest December 13, 1988.
The majority further holds that:
Application of the foregoing principles to this case requires us to conclude that the court’s finding that Amick knew of the filing of the bankruptcy and is held to knowledge of the terms of the automatic stay as of, at the very latest, December 13, 1988 was not clearly erroneous. Initially we note that there is no admissible evidence that Amick learned of the filing on December 13, 1988. As the dissent points out, although the bankruptcy court could discredit Amick’s testimony concerning the December 13, 1988 telephone conversation, it could not properly transform a question in the form of an assertion, which was denied by Amick, into evidence of the facts asserted in the question. There is, however, evidence that Amick knew of the bankruptcy filing prior to December 13, 1988. Waller testified that Amick was aware of the bankruptcy filing, that she discussed the bankruptcy with Amick, and that she told him what she was going to do immediately before the filing. Although the testimony of Waller clearly could have been stronger and more direct, this evidence is sufficiently strong to support the bankruptcy court’s finding. The bankruptcy court’s apparent decision to credit this testimony, which tells a coherent and facially plausible story not contradicted by extrinsic evidence, was not clearly erroneous.
The majority finally concludes:
In the findings of fact and conclusions of law submitted by the court, the court did not specify whose testimony supported its finding that Amick knew of the bankruptcy as of at the very latest December 13, 1988.
The problem with this analysis, is that the court did not rely on Waller’s testimony on this issue. This is not surprising in that, although not objected to, the testimony of the debtor that she felt that Amick knew that she had filed her bankruptcy petition, was clearly a conclusion of questionable weight. It is no wonder that the court did not rely on the conclusionary testimony of the debtor in making its decision.2
Although it was clearly within the trial court’s discretion to totally disregard Am-ick’s testimony concerning the December 13 telephone conversation, it could not properly transform the questions by But-tars, denied by Amick, into affirmative evidence.3 Buttars was not a witness and therefore could not and did not testify.
Counsel for Amick accurately recognized the problem, that the court was considering the allegations contained in Buttar’s question as affirmative evidence. Counsel complained that he did not have an opportunity to cross-examine Buttars (because Buttars was not a witness).
The court’s reply that “[wjell, I assume you had that right before you rested” confirmed the obvious error the court had made. It is obvious that only witnesses *356may be cross-examined and that the court was improperly treating Buttar’s question as if Buttar had been testifying as a witness. The above quoted colloquy between Amick’s counsel and the court reveals the error.
CONCLUSION
The record is clear that the trial court did not find that Amick had notice of the debt- or’s bankruptcy on the day it was filed. The record is equally clear that the trial court found that Amick had notice of the bankruptcy from the debtor’s attorney, Mr. Buttars, on December 13, 1988.
Because the court’s finding of notice to Amick is not supported by admissible evidence, it is clearly erroneous and must be reversed. I would remand to the bankruptcy court for further proceedings consistent with this Opinion.

. Because the court did not rely on this testimony, I need not discuss whether this evidence would be sufficient to support a finding of notice to Amick.

. Naturally, if Amick had admitted that Buttar’s had told him that the debtor had filed her bankruptcy case, that admission would be affirmative evidence of notice. In that case the admission incorporates the question. However, as in the present case, when the question is denied by the witness the best that, the questioner may legitimately expect is that the court will reject the answer. The court may not however, then *356assume the opposite is true and turn the question into admissible evidence entirely transforming the questioning attorney into a witness.