In re: Cery Perle, No. 11-60000 (9th Cir. 2013)
Annotate this CaseDebtor filed for chapter 7 bankruptcy but did not list, as one of his outstanding debts, a $350,000 arbitration award to Fiero Brothers (creditor). At issue on appeal was whether the creditor's lawyer's knowledge of the bankruptcy constituted notice to the creditor. In this instance, the lawyer learned of debtor's bankruptcy during his representation of another client and, although the lawyer continued to represent the creditor on other matters, he no longer represented the creditor in relation to the debt at issue. Under these facts, the court declined to impute the notice or actual knowledge of debtor's bankruptcy filing that the lawyer had to creditor. Accordingly, the court affirmed the BAP's ruling that the arbitration debt was nondischargeable under sections 523(a)(3) and 523(a)(6) of the Bankruptcy Code.
Court Description: Bankruptcy. The panel affirmed the Bankruptcy Appellate Panel’s ruling that an arbitration debt was nondischargeable in bankruptcy under 11 U.S.C. §§ 523(a)(3) and 523(a)(6). The panel held that the creditor’s challenge to the dischargeability of the debt was not filed within 60 days of the first date set for the creditors meeting but nonetheless was timely because the chapter 7 debtor did not adequately identify the debt on his Schedule E, and the creditor did not have notice or actual knowledge of the bankruptcy. The panel held that the creditor’s lawyer’s knowledge could not be imputed to the creditor on an agency theory when the lawyer learned of the bankruptcy during his representation of another client and after the completion of his representation of the creditor in relation to the debt.
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