610 F.2d 228 (5th Cir. 1980), 77-2863, Matter of Bardwell
|Citation:||610 F.2d 228|
|Party Name:||In the Matter of Charles Moore BARDWELL, Jr., et al., Bankrupts. HIGHLAND VILLAGE BANK, Appellant, v. Charles Moore BARDWELL, Jr., et al., Appellees.|
|Case Date:||January 15, 1980|
|Court:||United States Courts of Appeals, Court of Appeals for the Fifth Circuit|
Ben H. Sheppard, Jr., Houston, Tex., for appellant.
Dale Ledbetter, Houston, Tex., for appellees.
Appeal from the United States District Court for the Southern District of Texas.
Before CHARLES CLARK, RONEY and HENDERSON, Circuit Judges.
Highland Village Bank sought to prevent either the discharge in bankruptcy of Charles Moore Bardwell, Jr. and Rachel Hudgins Bardwell, his wife, or the discharge of their debt to the Bank. The Bank asserted that a knowingly false financial statement was given to the Bank when the Bardwells obtained a loan. The bankruptcy court found the statement false but dismissed the Bank's objection as to Mrs. Bardwell, because it also found that Mrs. Bardwell believed the financial statement to be true and correct when she executed it, and that she did not act with such reckless indifference to the facts as to warrant a finding that she acted fraudulently or with an intent to deceive. The Bank appeals. The district court's decision that the bankruptcy court's finding of fact as to Mrs. Bardwell was not clearly erroneous is affirmed. The Bank's objection to Mr. Bardwell's discharge is not raised on appeal.
The Bank argues that an intent to deceive the Bank must be imputed to the bankrupt, Rachel Hudgins Bardwell, because her execution of the financial statement in reliance on the accuracy of information furnished by her husband demonstrates reckless indifference to the facts stated therein.
At trial, Mrs. Bardwell testified that before signing the financial statement, she "glanced at it briefly," and relied on her husband, an attorney, for the truth and correctness of the statement he had prepared. She admitted that two notes owing to her mother and totaling $24,250 had been omitted from the statement. She did not sign one of the notes until after the statement was made, though her husband had previously signed it, and did not remember when she first became aware of the note. She stated she had forgotten the other note payable to her mother because in a letter received from her stepfather shortly before the financial statement was completed...
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