Coggin, In re
| Decision Date | 08 September 1994 |
| Docket Number | No. 93-6914,93-6914 |
| Citation | 30 F.3d 1443 |
| Parties | Bankr. L. Rep. P 76,063 In re Thomas Edward COGGIN, Debtor. Phyllis B. COGGIN, Plaintiff-Appellee, v. Thomas Edward COGGIN, Defendant-Cross-Plaintiff-Appellant-Cross-Appellee, Thomas E. Reynolds, Trustee-Cross-Defendant-Appellee-Cross-Appellant. |
| Court | U.S. Court of Appeals — Eleventh Circuit |
J.N. Holt, Birmingham, AL, for appellant.
Thomas E. Reynolds, pro se.
Appeals from the United States District Court for the Northern District of Alabama.
Before BIRCH and CARNES, Circuit Judges and MORENO *, District Judge.
This case requires us to untangle a knot that each party has played a role in tying. The appellant and debtor in the underlying bankruptcy case, Thomas Edward Coggin ("Coggin"), appeals the district court's affirmance of the decision of the bankruptcy court. The bankruptcy court held that it had jurisdiction over the challenges to Coggin's discharge. The challenges were filed after the statutorily mandated date by the appellees, Phyllis B. Coggin ("Mrs. Coggin"), a creditor and Coggin's ex-wife, and Thomas E. Reynolds (the "trustee"). Coggin argues that the appellees' motions to extend the time for filing such challenges to his discharge were not timely made and, therefore, should not have been granted. Coggin also challenges the bankruptcy court's denial of his discharge. The trustee cross appeals the bankruptcy court's determination that the value of Coggin's avoidable conveyance to his son, Tommy, is not recoverable by the estate from Coggin himself. We affirm the bankruptcy and district court decisions in all respects.
On April 25, 1989, Coggin filed a voluntary Chapter 7 petition in the United States Bankruptcy Court for the Northern District of Alabama. The bankruptcy court set the section 341 1 hearing for June 5, 1989, and fixed August 4, 1989 as the last day for filing a complaint objecting to Coggin's discharge under section 727 or 523 (the "bar date"). On July 28, 1989, the trustee filed a motion to extend the bar date, pursuant to Federal Rule of Bankruptcy Procedure 4004(b), 2 and the bankruptcy court granted the motion the same day without notice or a hearing being granted Coggin. The trustee did not serve either Coggin or his attorney with the motion. A copy of the order granting the trustee's motion to extend the bar date, however, was mailed to Coggin when it was granted. On August 3, 1989, Mrs. Coggin filed an identical motion under Rule 4004(b), which the bankruptcy court also granted immediately, without affording Coggin either notice or a hearing. On the day she filed the motion, Mrs. Coggin served it by mail on Coggin's attorney, but not on Coggin himself.
On September 28, 1989, Mrs. Coggin initiated an adversary proceeding by filing a complaint objecting to the discharge of certain debts of Coggin, pursuant to section 523, or, in the alternative, objecting to his discharge generally, pursuant to section 727. The bankruptcy court granted partial summary judgment to Mrs. Coggin, holding that Coggin was obligated to Mrs. Coggin for past due monthly alimony in the amount of $17,486.50 and that such obligation was nondischargeable under section 523. Coggin does not appeal this decision. On October 26, 1989, the trustee filed a complaint objecting to Coggin's discharge under sections 727(a)(2)(A) and 727(a)(4)(A). Specifically, the trustee made two arguments under section 727(a)(4)(A) and one under section 727(a)(2)(A). First, he asserted that Coggin had knowingly and fraudulently made false oaths, in violation of section 727(a)(4)(A), by failing to disclose that he was to receive $8,000 from the settlement of a lawsuit. Second, the trustee asserted that Coggin had again knowingly and fraudulently made a false oath when he failed to disclose a transfer of $13,000 to his son, Tommy, within one year of his filing the petition. 3 Lastly, the trustee alleged that Coggin's transfer of $13,000 to his son, an occurrence which Coggin does not dispute, was a transfer made with the intent to hinder, delay, or defraud creditors in violation of section 727(a)(2)(A).
Coggin filed a motion to dismiss both the trustee's and Mrs. Coggin's complaints on the basis that they had failed to file the complaints by the bar date and had not properly moved for an extension of the bar date under Rule 4004(b). Specifically, Coggin asserted that in order for a motion to extend the bar date to be timely, it must be "made" by the bar date, and that such a motion is "made" when it is served. The bankruptcy court acknowledged at that time that it had erred in granting the trustee's and Mrs. Coggin's motions ex parte, without giving Coggin notice or a hearing. The bankruptcy court, therefore, vacated its earlier grant of the extension of the bar date pursuant to section 105(a) and gave Coggin an opportunity to show cause why such an extension should not have been granted. Coggin responded that the motion for extension should not be granted because it was not timely made (i.e., served) and, therefore, the bankruptcy court was procedurally barred from extending the bar date and was required to dismiss the trustee's and Mrs. Coggin's complaints. The bankruptcy court rejected this argument, granted the extension of time, and accepted the complaints as timely filed within the extended time.
In April, 1990, trial was held on the claims of the trustee and on Mrs. Coggin's claim that Coggin owed her a portion of several tax refund checks. The bankruptcy court found that Coggin owed Mrs. Coggin $8,398.67 in tax refunds and that such obligation was nondischargeable under section 523(a)(6). The court also found that sufficient evidence was presented to deny Coggin's discharge on all three grounds asserted by the trustee--the two false oaths under section 727(a)(4)(A) and the $13,000 transfer under section 727(a)(2)(A).
The district court affirmed the bankruptcy court in all respects on September 30, 1993. Coggin timely filed this appeal. He challenges the rejection of his argument that the trustee and Mrs. Coggin's motions for extension of the bar date were untimely. He also appeals the judgments made against him as to dischargeability under section 727.
Additionally, the trustee brought suit against Coggin and his son, Tommy, for recovery of the $13,000 payment Coggin made to Tommy. The trustee settled his case with Tommy prior to the trial in the bankruptcy court. The bankruptcy court found that the transfer of $13,000, in addition to being grounds for denying Coggin's discharge, was also an avoidable conveyance under section 548. The court held, however, that the trustee could not recover that transfer from Coggin under section 550(a)(1). This ruling was affirmed by the district court. The trustee cross appeals this denial of recovery from Coggin.
In reviewing the judgment of the bankruptcy court in this case, we are presented with three specific holdings. First, we examine the determination of the bankruptcy court that the appellees' motions for extending the bar date were timely made. Second, we evaluate the bankruptcy court's denial of Coggin's discharge under section 727. Finally, we review the determination that a trustee cannot, under section 550(a)(1), recover the value of a fraudulent transfer from the transferring debtor.
The bankruptcy court's determination that the appellees' motions to extend the bar date were timely made is a question of law reviewable de novo. Southtrust Bank v. Thomas (In re Thomas), 883 F.2d 991, 994 (11th Cir.1989), cert. denied, 497 U.S. 1007, 110 S.Ct. 3245, 111 L.Ed.2d 756 (1990). The facts underlying this determination are not in dispute.
The trustee filed a motion to extend the bar date on July 28, 1989, seven days prior to the bar date. Mrs. Coggin filed a similar motion to extend time on August 3, 1989, the day before the bar date. The bankruptcy court granted both motions ex parte, without a hearing of any kind, on the day each motion was filed. In the case of the trustee's motion, neither Coggin nor his attorney was ever served with the motion. Coggin admits, however, that after the court granted the motion, he received a copy of the order in the mail. Mrs. Coggin's motion contains a certificate of service which includes Coggin's attorney, but not Coggin himself. There is no evidence as to whether the order granting her motion was sent to Coggin.
A motion to extend the bar date is a contested matter under the Code. Collier on Bankruptcy states Broadly speaking, proceedings in bankruptcy cases can be divided into: (1) adversary proceedings, governed by Part VII of the Bankruptcy Rules; (2) administrative matters, in which there is no adversary party (for example, an unopposed motion by a trustee to sell property of the estate); and (3) contested matters, which do not qualify as adversary proceedings because they are not defined as such by Rule 7001 but which, nevertheless, resemble adversary proceedings in that there are two parties who are opposing each other with respect to relief sought by one of them.
9 Collier on Bankruptcy p 9014.03 (15th ed. 1994) (footnote omitted). A motion to extend time best fits in the third category, as it is opposed by the debtor, but is not an adversary proceeding enumerated in Rule 7001. As a result, Rule 9014 applies to this motion. 4 Rule 9014 provides in pertinent part:
In a contested matter in a case under the Code not otherwise governed by these rules, relief shall be requested by motion, and reasonable notice and opportunity for hearing shall be afforded the party against whom relief is sought. No response is required under this rule unless the court orders an answer to a motion. The motion shall be served in the manner provided for service of a summons and complaint by Rule 7004....
Fed.R.Bankr.P. 9014 (emphasis added). In the case of a motion under Rule 4004(b), the rule...
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