First American National Bank-eastern, Plaintiff-appellant, v. Jimmy Lee Mullins, T/a Jim Mullins Motors, Defendant-appellee, 848 F.2d 184 (4th Cir. 1988)

Plaintiff bank appeals from a judgment of the district court affirming the judgment of the bankruptcy court which held that defendant Mullins had no intent to defraud the plaintiff. We affirm.

Plaintiff contends that the district court was clearly erroneous in its judgment that defendant had not intended to defraud the plaintiff.

The defendant operated a used car dealership in which purchases of used cars for the dealership were financed by the plaintiff bank in a floorplan type line of credit. This arrangement provided that upon selling financed cars the defendant would pay to the plaintiff an amount equal to the sales price of the car within ten days of the sale. When the defendant filed a Chapter 7 petition for bankruptcy, there were three vehicles that had been sold without the bank having received the money to which it was entitled. Plaintiff thereupon filed a claim in bankruptcy arguing that defendant had embezzled these funds and seeking to have these debts of the defendant declared nondischargeable under section 523(a) (4) of the Bankruptcy Code, 11 U.S.C. § 523(a) (4).

We affirm on the opinion of the district court that plaintiff made no showing of fraudulent intent, and hence there was no embezzlement. (First American National Bank-Eastern v. Jim Lee Mullins, t/a Jim Mullins Motors, Inc., Civil Action No. 86-0170-B, February 24, 1987 (W.D. Va.) ).

Accordingly, the judgment of the district court is

AFFIRMED.