Runski, In re, No. 96-1081

CourtUnited States Courts of Appeals. United States Court of Appeals (4th Circuit)
Writing for the CourtBefore WILKINSON, Chief Judge, and WIDENER and WILKINS; WILKINS
Citation102 F.3d 744
Parties, 37 Collier Bankr.Cas.2d 230, Bankr. L. Rep. P 77,208 In re Lorraine B. RUNSKI, Debtor. CYPHER CHIROPRACTIC CENTER, Creditor-Appellant, v. Lorraine B. RUNSKI, Debtor-Appellee.
Docket NumberNo. 96-1081
Decision Date18 December 1996

Page 744

102 F.3d 744
65 USLW 2455, 37 Collier Bankr.Cas.2d 230,
Bankr. L. Rep. P 77,208
In re Lorraine B. RUNSKI, Debtor.
CYPHER CHIROPRACTIC CENTER, Creditor-Appellant,
v.
Lorraine B. RUNSKI, Debtor-Appellee.
No. 96-1081.
United States Court of Appeals,
Fourth Circuit.
Argued Oct. 29, 1996.
Decided Dec. 18, 1996.

Page 745

ARGUED: Warren W. Grossman, Grossman & Sandoval, McLean, VA, for Appellant. Steven Brett Ramsdell, Tyler, Bartl, Burke & Albert, Alexandria, VA, for Appellee. ON BRIEF: Thomas P. Gorman, Tyler, Bartl, Burke & Albert, Alexandria, VA, for Appellee.

Before WILKINSON, Chief Judge, and WIDENER and WILKINS, Circuit Judges.

Reversed by published opinion. Judge WILKINS wrote the opinion, in which Chief Judge WILKINSON and Judge WIDENER joined.

OPINION

WILKINS, Circuit Judge:

Cypher Chiropractic Center (Cypher) appeals a decision of the bankruptcy court allowing the debtor, Lorraine B. Runski, to redeem certain personal property pursuant to 11 U.S.C.A. § 722 (West 1993). We conclude that the property in question is not subject to redemption because it is not "intended primarily for personal, family, or household use." Accordingly, we reverse.

I.

In 1993, Cypher sold its chiropractic business and all of its assets to Runski for $50,000. Cypher financed a portion of the purchase amount, securing the loan with a lien on the medical and office equipment included in the purchase of the business assets. Runski eventually defaulted on the loan and filed a Chapter 7 bankruptcy petition. The bankruptcy court granted Runski's subsequent motion to redeem the medical and office equipment pursuant to § 722, concluding that because Runski owned the property in her own name and was the sole user, the medical and office equipment constituted "property intended primarily for personal ... use" within the meaning of that provision. The district court affirmed.

We review the decision of the district court de novo, effectively standing in its shoes to consider directly the findings of fact and conclusions of law by the bankruptcy court. Butler v. David Shaw, Inc., 72 F.3d 437, 440 (4th Cir.1996). As such, we review legal conclusions by the bankruptcy court de novo and may overturn its factual determinations only upon a showing of clear error. Id. at 441. The proper construction of the Bankruptcy Code is a question of law subject to plenary review. Id.

II.

Section 722 of the Bankruptcy Code provides:

"An individual debtor may, whether or not the debtor has waived the right to redeem under this section, redeem tangible personal

Page 746

property intended primarily for personal, family, or household use, from a lien securing a dischargeable consumer debt, if such property is exempted under section 522 of this title or has been abandoned under section 554 of this title, by paying the holder of such lien the amount of the allowed secured claim of such holder that is secured by such lien."

11 U.S.C.A. § 722. Cypher does not dispute that the medical and office equipment at issue either is exempted or has been abandoned by the trustee, thereby making the property available for redemption. Accordingly, the principal issue before us is whether the bankruptcy court correctly determined that the property was "property intended primarily for personal, family, or household use."

Cypher contends that the bankruptcy court erred in determining that Runski was entitled to redeem the medical and office equipment. Before the bankruptcy court, Runski agreed that the medical and office equipment is not "family" or "household" goods, but argued that because she owned the equipment in her own name and that she, herself, used it in the course of her business, the equipment was "personal" to her. The bankruptcy court agreed. 1 Cypher challenges this ruling, maintaining that the relevant consideration in determining whether property is subject to redemption under § 722 is the purpose for which the property is used, not the manner in which it is titled. And, Cypher argues, because the property was used for the purpose of conducting a business, it is not "intended primarily for personal ... use" within the meaning of § 722....

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62 practice notes
  • Aspen Skiing Co. v. Cherrett (In re Cherrett), No. 14-60079.
    • United States
    • United States Courts of Appeals. United States Court of Appeals (9th Circuit)
    • October 16, 2017
    ...should be considered consumer debt for purposes of 11 U.S.C. § 1301, is a question of law, which we review de novo."); In re Runski , 102 F.3d 744, 745, 747 (4th Cir. 1996) ("determining whether debt is for ‘personal, family, or household purposes' under § 101(8)" to "aid in determining the......
  • In re Phillips, No. 06-71604 SCS.
    • United States
    • United States Bankruptcy Courts. Fourth Circuit. U.S. Bankruptcy Court — Eastern District of Virginia
    • March 8, 2007
    ...is incorrect because the Solis court misapplied the holding of the Fourth Circuit in Cypher Chiropractic Center v. Runski (In re Runski), 102 F.3d 744 (4th Cir.1996). According to Phillips, Runski addressed "personal, family or household" use vis-à-vis "business" use for the purposes of det......
  • In re Schwalb, No. BK S 05 17766 LBR.
    • United States
    • United States Bankruptcy Courts. Ninth Circuit. U.S. Bankruptcy Court — District of Nevada
    • August 3, 2006
    ...to a business is not borrowing for "personal, family or household" purposes. Cf. Cypher Chiropractic Center v. Runski (In re Runski), 102 F.3d 744, 747 (4th Cir.1996) (equipment held in individual's name but used in business not held for personal use within meaning of 11 U.S.C. § 722; "debt......
  • Curtis v. Propel Prop. Tax Funding, LLC, No. 17-2114
    • United States
    • United States Courts of Appeals. United States Court of Appeals (4th Circuit)
    • February 6, 2019
    ...for which the debt was incurred" to determine 915 F.3d 246"whether debt is for ‘personal, family, or household purposes.’ " In re Runski , 102 F.3d 744, 747 (4th Cir. 1996) (quoting 11 U.S.C. § 101(8) ). In that context, a debt that "was not incurred with a profit motive or in connection wi......
  • Request a trial to view additional results
62 cases
  • Aspen Skiing Co. v. Cherrett (In re Cherrett), No. 14-60079.
    • United States
    • United States Courts of Appeals. United States Court of Appeals (9th Circuit)
    • October 16, 2017
    ...should be considered consumer debt for purposes of 11 U.S.C. § 1301, is a question of law, which we review de novo."); In re Runski , 102 F.3d 744, 745, 747 (4th Cir. 1996) ("determining whether debt is for ‘personal, family, or household purposes' under § 101(8)" to "aid in determining the......
  • In re Phillips, No. 06-71604 SCS.
    • United States
    • United States Bankruptcy Courts. Fourth Circuit. U.S. Bankruptcy Court — Eastern District of Virginia
    • March 8, 2007
    ...is incorrect because the Solis court misapplied the holding of the Fourth Circuit in Cypher Chiropractic Center v. Runski (In re Runski), 102 F.3d 744 (4th Cir.1996). According to Phillips, Runski addressed "personal, family or household" use vis-à-vis "business" use for the purposes of det......
  • In re Schwalb, No. BK S 05 17766 LBR.
    • United States
    • United States Bankruptcy Courts. Ninth Circuit. U.S. Bankruptcy Court — District of Nevada
    • August 3, 2006
    ...to a business is not borrowing for "personal, family or household" purposes. Cf. Cypher Chiropractic Center v. Runski (In re Runski), 102 F.3d 744, 747 (4th Cir.1996) (equipment held in individual's name but used in business not held for personal use within meaning of 11 U.S.C. § 722; "debt......
  • Curtis v. Propel Prop. Tax Funding, LLC, No. 17-2114
    • United States
    • United States Courts of Appeals. United States Court of Appeals (4th Circuit)
    • February 6, 2019
    ...for which the debt was incurred" to determine 915 F.3d 246"whether debt is for ‘personal, family, or household purposes.’ " In re Runski , 102 F.3d 744, 747 (4th Cir. 1996) (quoting 11 U.S.C. § 101(8) ). In that context, a debt that "was not incurred with a profit motive or in connection wi......
  • Request a trial to view additional results

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