In re Aiello, Bankruptcy No. 2-92-03924. Adv. No. 2-92-2399.
| Decision Date | 18 October 1994 |
| Docket Number | Bankruptcy No. 2-92-03924. Adv. No. 2-92-2399. |
| Citation | 173 BR 254 |
| Court | U.S. Bankruptcy Court — District of Connecticut |
| Parties | In re Antoinette AIELLO a/k/a Antoinette Rogers, Debtor. Robert ROGERS, Plaintiff, v. Antoinette AIELLO a/k/a Antoinette Rogers, Defendant. |
Daniel H. Cohan, Serignese, Petrone & Zipfel, East Hartford, CT, for plaintiff.
Charles A. Maglieri, Bloomfield, CT, for debtor-defendant.
The matter before the court is a complaint brought by the plaintiff, Robert Rogers, the former husband of Antoinette Aiello, also known as Antoinette Rogers, the debtor, objecting to the granting of her discharge. The plaintiff relies, for the most part, on Code § 727(a)(4)(A) () for the denial of the discharge. The court held hearings on the complaint over several nonconsecutive days, commencing March 2, 1994 and terminating July 27, 1994, after which the parties submitted memoranda of law.
The debtor, nee Antoinette Costanza, now 41 years old, is a native of Italy who came to the United States in 1971. Her first marriage, during which three children were born, ended with a decree entered by an Iowa court. As a result of the dissolution of that marriage, the debtor retained sole ownership of realty in Des Moines, Iowa, known as 4001 Willowmere Circle (the Iowa property). On November 10, 1984, the debtor intermarried with the plaintiff in Iowa. This second marriage ended with a marriage dissolution decree entered on April 10, 1989 by the Connecticut Superior Court, in which the plaintiff was required to vacate the Connecticut family residence and the debtor was ordered to pay the plaintiff $10,000 within 60 days of the decree and $10,000, without interest, two years from the date of the decree. When neither of the payments was received, the plaintiff, in August 1992, started a contempt proceeding against the debtor in the Superior Court. The debtor's lawyer in the contempt action referred the debtor to Attorney Gene Cohen, Esq. (Cohen), an experienced bankruptcy attorney, for the purpose of filing an immediate bankruptcy petition.
Cohen, after meeting with the debtor and taking down her responses to the questions posed in the bankruptcy petition and schedules (the "petition"), caused a Chapter 7 petition to be drafted. The debtor, on October 1, 1992, after review, executed the petition. Cohen filed the petition with this court on October 2, 1992.
The debtor, on March 24, 1992, had executed a warranty deed in anticipation of a pending sale of her Iowa property. The sale concluded on April 30, 1992, with the debtor shortly thereafter receiving a check for the net sales proceeds in the amount of $65,871.37. On May 5, 1992, the debtor initially deposited this check in a newly-opened savings account at the Tolland Bank. On May 20, 1992, she closed this account and opened another savings account at the Bank of South Windsor, with a deposit, on June 4, 1992, of $64,471.44. The debtor then caused two cashier's checks totaling $39,958.75 to be issued to a former boyfriend, with whom she had remained in contact, as repayment of loans received from him over a period of years starting in 1989. These checks were dated June 25, 1992 (for $3,100.00) and July 24, 1994 (for $36,858.75). On July 20, 1992, the debtor made a cash gift of $5,800.00 from this account to one of her daughters. Prior to closing out the Bank of South Windsor account on July 30, 1992 by a withdrawal of the then balance of $405.24, the debtor had paid various medical, tradesmen and furniture purchase bills.
The debtor's petition, filed on October 2, 1992, disclosed none of the events described in the preceding paragraph. She had answered "None" to all of the following questions appearing on her petition: (a) whether she had made any payments (1) exceeding $600 to any creditor within 90 days of commencement of the case, (2) within one year for benefit of creditors who are or were insiders, (3) as gifts within one year exceeding $200 to family members; (b) whether she had made any transfers of property within one year; and (c) whether she had closed any checking or savings accounts within one year.
The court scheduled December 3, 1992 as the date for the first meeting of creditors. The Office of the United States Trustee had designated John J. O'Neil, Esq. (O'Neil) as the debtor's Chapter 7 interim trustee. On or about November 4, 1992, the plaintiff advised O'Neil by letter that the debtor had sold her Iowa property on April 30, 1992 and had failed to report this transaction in her petition. The plaintiff also forwarded to O'Neil a copy of the transfer deed.
When Cohen and the debtor appeared for the creditors' meeting, which was also attended by the plaintiff and his attorney, O'Neil advised Cohen of the information he had received from the plaintiff. Cohen then requested, on the record, a continuance of the creditors' meeting so that she could file an amendment to the debtor's petition to set forth the debtor's transfer of property. O'Neil asked Cohen to include information on how the debtor disposed of the sale proceeds, and continued the meeting to December 14, 1992.
The debtor executed, on December 14, 1992, an amendment to the petition which states only that she had transferred the Iowa property on April 30, 1992 for a price of $83,478. At the December 14, 1992 continued creditors' meeting, O'Neil and the plaintiff's attorney questioned the debtor about the Iowa property transfer and the debtor's use of the proceeds. O'Neil also asked about any pending tort claims, and the debtor conceded she held such a claim and had failed to list it. Cohen, on January 20, 1993, filed with the court a second amendment to the petition listing the debtor's personal injury action, claiming a $7,500 exemption in the action and listing the Tolland Bank (but not The Savings Bank of South Windsor) as a financial account closed during the prior year.
The debtor thereafter retained new bankruptcy counsel, Charles A. Maglieri, Esq., who, on or about February 5, 1993, filed a completely amended petition to list properly all the matters hereinbefore mentioned, and to make further corrections concerning, inter alia, omitted rental income from the Iowa property.
At trial, the plaintiff testified that he had been in regular communication with the debtor prepetition concerning the $20,000 due him under their marriage dissolution decree. The debtor had promised payment when she sold the Iowa property. He stated that when he telephoned the debtor in June 1992, the debtor denied the Iowa property had been sold and stated that she was still unable to pay him. When he later discovered the completion in April 1992 of the sale, he filed his contempt action against the debtor in state court.
The debtor generally asserted misunderstanding of questions or memory loss as the reasons she made false statements in the petition. She also claimed she may have advised Cohen of the Iowa property...
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