Court Opinion

ID: 4346237
Source: CourtListenerOpinion
Date Created: 2018-11-30 21:01:16.533001+00
Date Added: 2024-06-11T14:48:18.198801
License: Public Domain

FILED
                            NOT FOR PUBLICATION
                                                                            NOV 30 2018
                    UNITED STATES COURT OF APPEALS                      MOLLY C. DWYER, CLERK
                                                                          U.S. COURT OF APPEALS

                           FOR THE NINTH CIRCUIT

STEPHEN P. ARNOT, Chapter 7            )      No. 17-35856
Trustee for the Estate of Jason Daniel )
Neel and Connie Lee Neel,              )      D.C. No. 3:17-cv-00591-MO
                                       )
      Plaintiff-Appellant,             )      MEMORANDUM*
                                       )
      v.                               )
                                       )
SERVICELINK TITLE COMPANY )
OF OREGON, FKA LSI Title               )
Company of Oregon, LLC,                )
                                       )
      Defendant-Appellee.              )
                                       )
STEPHEN P. ARNOT, Chapter 7            )      No. 17-35857
Trustee for the Estate of Robert W. )
Christensen and Marlene J.             )      D.C. No. 3:17-cv-00592-MO
Christensen,                           )
                                       )
      Plaintiff-Appellant,             )
                                       )
      v.                               )
                                       )
DAVID A. WEIBEL; U.S. BANK, )
N.A., as Trustee,                      )
                                       )
      Defendants-Appellees.            )
                                       )

      *
       This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
                   Appeal from the United States District Court
                            for the District of Oregon
                   Michael W. Mosman, Chief Judge, Presiding

                     Argued and Submitted November 6, 2018
                                Portland, Oregon

Before: FERNANDEZ and IKUTA, Circuit Judges, and SESSIONS,** District
Judge.

      Stephen P. Arnot, as bankruptcy trustee of the reopened bankruptcy estate of

Jason and Connie Neel and the reopened bankruptcy estate of Robert and Marlene

Christensen, appeals the district court’s grant of summary judgments against him.1

The summary judgment in No. 17-35856 was in favor of ServiceLink Title

Company of Oregon,2 the entity named as the foreclosing trustee at the time of the

foreclosure on the Neels’ property. The summary judgment in No. 17-35857 was

in favor of David A. Weibel, the person named as a foreclosing trustee on the

Christensen property, and U.S. Bank, as trustee, which is the successor trustee of

      **
        The Honorable William K. Sessions III, United States District Judge for
the District of Vermont, sitting by designation.
      1
      Hereafter references to “the Debtors” will include all of the debtors in the
bankruptcies.
      2
       ServiceLink was formerly known as LSI. Hereafter ServiceLink will be
referred to as LSI.

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the trust entity that was the purchaser at the foreclosure sale.3 Arnot asserts that

the district court erred because the causes of action he asserts against the

Foreclosure Parties were not listed in the Debtor’s schedules4 and, therefore, were

not abandoned when the bankruptcy estates were closed.5 We agree and reverse.

      When the Debtors filed their bankruptcy petitions, none of their petitions

listed the causes of action6 that Arnot now seeks to pursue. That did not prevent

those causes of action from becoming part of the assets of the bankruptcy estates,

and no party asserts that it did. No doubt the Debtors had the duty to list claims

that they knew about when they filed the petition or learned about during the

bankruptcy proceedings,7 but no party asserts that they breached that duty. Nor is

there a claim that the original bankruptcy trustee knew of those assets. Therefore,

we deem any claims of knowledge to be waived. See Martinez v. Sessions, 873

      3
        Hereafter references to “the Foreclosure Parties” will include all of the
parties in whose favor summary judgment was given.
      4
          See 11 U.S.C. § 521(a)(1).
      5
          See 11 U.S.C. § 554(c).
      6
        Of course, causes of action are assets of the debtor in bankruptcy. See
United States v. Whiting Pools, Inc., 462 U.S. 198, 205 n.9, 103 S. Ct. 2309, 2313
n.9, 76 L. Ed. 2d 515 (1983).
      7
          See Hamilton v. State Farm Fire & Cas. Co., 270 F.3d 778, 784 (9th Cir.
2001).

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F.3d 655, 660 (9th Cir. 2017); Smith v. Marsh, 194 F.3d 1045, 1052 (9th Cir.

1999). That leaves us with the uncomplicated words of the relevant statutory

provision: “[A]ny property scheduled under section 521(a)(1) of this title not

otherwise administered at the time of the closing of a case is abandoned.”

11 U.S.C. § 554(c); see also id. § 521(a)(1). Plainly, the causes of action that

Arnot seeks to pursue were not listed anywhere in the petitions, and it follows that

they were not scheduled.8 Nor were they administered. Therefore, despite the

closing of the cases, they remained part of the bankruptcy estates of the Debtors.

See Cusano v. Klein, 264 F.3d 936, 945–46 (9th Cir. 2001); Stein v. United Artists

Corp., 691 F.2d 885, 891 (9th Cir. 1982); cf. Beezley v. Cal. Land Title Co. (In re

Beezley), 994 F.2d 1433, 1439 (9th Cir. 1993) (O’Scannlain, J., concurring)

(“Nowhere . . . is the reason why a debt was omitted from the bankruptcy

schedules made relevant to the discharge of that debt.”).9 Therefore, Arnot had

      8
       Arnot seeks to have us conduct a periplus of the territory covered by the
word “scheduled” in § 554(c), but we decline to do so. Whatever that word
encompasses, the causes of action were not listed at all. Thus, its scope is not
relevant to this disposition.
      9
       See White v. Nielsen (In re Nielsen), 383 F.3d 922, 925 (9th Cir 2004)
(generally adopting “the reasoning of the concurrence [in Beezley].”)

                                          4
standing to pursue them.10

      REVERSED.

      10
        We decline to rule upon the various other defenses raised by the
Foreclosure Parties. They should be addressed by the district court in the first
instance. See Diouf v. Mukasey, 542 F.3d 1222, 1235 (9th Cir. 2008); Badea v.
Cox, 931 F.2d 573, 575 n.2 (9th Cir. 1991).

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