Ingram et al v. AAA Cooper Transportation, Inc.
Filing
45
ORDER granting 26 Motion for Summary Judgment. The Clerk is directed to enter final judgment in favor of Defendant, terminate all deadlines and motions, and close this case. Signed by Judge J. Randal Hall on 03/01/2016. (thb)
IN THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF GEORGIA
AUGUSTA DIVISION
MARK INGRAM, Individually and
as Personal Representative of
the Estate of Kellie Ingram,
*
*
*
*
*
Plaintiff,
v.
*
l:14-cv-142
*
AAA COOPER TRANSPORTATION,
INC.,
Defendant.
*
ORDER
At
Mark
issue
Ingram and
proceeding
from
in
is
January
this
Kellie
Order
positions
taken by
Plaintiffs
Ingram in two proceedings.
Plaintiff's
2008
are
bankruptcy
through
May
case,
2013
in
which
the
The
was
United
Bankruptcy Court for the District of South Carolina.
is the present litigation,
in which Plaintiffs
first
pending
States
The second
seek to recover
on Mark Ingram's loss of consortium claim and on Kellie Ingram's
personal injury claims.1
Presently
Dismiss,
or
in
before
the
the
Court
Alternative
is
Motion
Defendant's
for
"Motion
Summary
to
Judgment"
1 Both the bankruptcy case and the present litigation were filed
by Mark Ingram and Kellie Ingram. Kellie Ingram is now deceased, and
this Court substituted Mark Ingram on behalf of Kellie Ingram's
Estate.
To maintain consistency, throughout this Order, the Court
refers to Plaintiffs in plural with respect to both the current
proceeding and the bankruptcy case.
based
on
the
Defendant
doctrine
argues
that
of
judicial
Plaintiffs
estoppel.
are
estopped
(Doc.
from
26).
asserting
their claims in the present litigation because of their failure
to disclose the existence of the claims as assets in their prior
bankruptcy case.
law,
(Def.'s Br.,
Doc.
26-1 at
4).
Under Georgia
judicial estoppel is a matter for summary judgment,
Court considers
Trotter,
et
Defendant's motion as
al.,
442
S.E.2d 265,
the reasons discussed below,
266
such.
(Ga.
and the
Southmark Corp.
Ct.
App.
1994).
v.
For
the Court GRANTS Defendant's motion
for summary judgment.
I.
The
material
facts
BACKGROUND
are
not
in
dispute
and
establish
the
following.
In January
2008,
Plaintiffs Kellie and Mark
Ingram filed
for Chapter 13 bankruptcy in the United States Bankruptcy Court
for the District of South Carolina.
of their initial petition,
(Doc.
26,
Ex.
A).
As part
Plaintiff's filed schedules of their
real and personal property.
(Id. at 12-16) .
Subsequently,
in
April and May 2008,
Plaintiffs amended their asset schedules.
(Id.,
On
Exs.
B-C) .
confirmed Plaintiffs'
Post-confirmation,
June
Chapter
on June
19,
5,
2008,
the
Bankruptcy
13 payment plan.
2009,
Plaintiffs
Court
(Id.,
Ex.
D).
again
amended
their asset schedules, and the Bankruptcy Court likewise amended
its confirmation order to reflect the change in assets.
While the bankruptcy case remained
2012,
pending,
on
5,
Kellie Ingram was involved in an automobile accident with
an employee of Defendant AAA Cooper Transportation.
of Mark Ingram, Doc. 31 at 23).
the
June
present
litigation.
(Affidavit
That accident is the subject of
Plaintiffs
never
amended
their
asset
schedules in the bankruptcy proceeding to reflect the potential
claim against Defendant.
Meanwhile,
30,
2013,
Plaintiffs'
the
Bankruptcy
Ingram.
(Doc.
trustee's
report,
creditors,
while
payment.
26,
Court
of
I).
$55,151.62
(Id. , Ex.
In May 2014,
Ex.
Court
H) .
dispersed
in
On
discharged
According
Plaintiffs
closed Plaintiffs'
State
bankruptcy proceeded apace.
debts
May 9,
Mark
to
and
the
$54,176.00
was
2013,
On April
bankruptcy
to
discharged
the
Kellie
their
without
Bankruptcy Court
case.
Plaintiffs filed the present litigation in the
Richmond
County,
Georgia
against
Defendant
asserting Plaintiff Kellie Ingram's claims for personal injuries
and Plaintiff Mark Ingram's loss of consortium claim.
Ex.
1) .
(Doc.
On
June 23,
(Doc. '1,
Defendant removed the case to this Court.
1) .
During the deposition of Mark Ingram,
Plaintiffs'
Defendant
Defendant learned of
prior bankruptcy and that Plaintiffs'
were
Ex. 1 at 2) .
not
among
Plaintiffs'
sworn
claims against
assets.
(Doc.
37,
Defendant then informed Plaintiffs' counsel of its
intent to file a motion for summary judgment asserting judicial
estoppel for taking an inconsistent position as to the existence
of these claims in the bankruptcy proceeding.
On
March
13,
2015,
Plaintiffs
(Doc. 26, Ex. L) .
filed
a
motion
in
the
Bankruptcy Court to reopen the bankruptcy case and amend their
schedule of assets to include
claim and the
of
Kellie
Court
to
claims
Ingram.
Mark Ingram's loss of consortium
for personnel injuries held by the
(Doc.
26,
Ex.
ruled
on
Plaintiffs'
Dismiss,
or
in the Alternative,
and
Brief
in
this case.
Mark
Support
(Doc.
Ingram's
on
26).
motion,
the
K) .
Before
Defendant
Motion
grounds
of
the
Bankruptcy
filed
for
Estate
its
"Motion
Summary Judgment
judicial
estoppel"
The Bankruptcy Court subsequently denied
motion
to
reopen
the
bankruptcy
proceeding,
reasoning that, because 11 U.S.C. § 1322(d) and § 1329(c)
creditors'
years,
ability
to
Plaintiffs'
receive
creditors
reopening the proceedings.
II.
Summary
genuine
as
entitled to judgment
56(a).
the
payments
stood
is
to
from
to
debtors
gain
limit
to
five
nothing
from
(Doc. 40, Ex. A at 7-8).
SUMMARY JUDGMENT
judgment
dispute
in
STANDARD
appropriate
any material
only
fact
if
and
as a matter of law."
"there
the
Fed.
is
no
movant
is
R.
Civ.
P.
Facts are "material" if they could affect the outcome of
suit
under
Liberty Lobby,
the
governing
Inc., 477 U.S.
substantive
242,
248
law.
(1986).
Anderson
v.
The Court must
view the facts in the light most favorable to the non-moving
party,
U.S.
in
Matsushita
574,
Elec.
587 (1986),
[its]
favor."
1428, 1437
Indus.
Co.
v.
Zenith
Radio
Corp.,
475
and must draw "all justifiable inferences
U.S. v.
Four Parcels of Real
(11th Cir. 1991)
(en banc)
Prop.,
941 F.2d
(internal punctuation and
citations omitted).
The
Court,
moving
by
motion.
How
reference
Celotex
to
carry
proof at
1115
trial.
(11th
Cir.
two
has
to
Corp.
this
proof at trial,
of
party
the
initial
materials
v.
Catrett,
burden
depends
Fitzpatrick v.
1993) .
on
When
burden
file,
477
on
City of
the
by
negating
an
essential
showing
basis
317,
the
Atlanta,
2
has
the
(1986).
burden
F.3d
the
the
for
323
bears
non-movant
the movant may carry the
ways:
the
U.S.
who
of
of
1112,
burden
of
initial burden in one
element
of
the
non-
movant' s case or by showing that there is no evidence to prove a
fact necessary to the
non-movant's case.
Clark,
604,
Inc.,
Adickes
v.
929 F.2d
S.H.
477 U.S.
317).
response
in
& Co.,
Before the
opposition,
movant has met
genuine
Kress
issues
its
606-08
398
See Clark v. Coats &
(11th Cir.
U.S.
144
1991)
(1970)
(explaining
and Celotex,
Court can evaluate the non-movant's
it
must
first
initial burden of
of material
fact
judgment as a matter of law.
F.3d 248, 254 (11th Cir. 1997)
consider
whether
showing that there
are no
and that it is entitled
Jones v.
City of Columbus,
(per curiam).
the
to
120
A mere conclusory
statement that the non-movant cannot meet the burden at trial is
insufficient.
Clark,
929 F.2d at 608.
If-and only if-the movant carries its initial burden,
the
non-movant may avoid summary judgment only by "demonstrat[ing]
that there is indeed a material issue of fact that precludes
summary judgment."
proof at trial,
Id.
the
When the non-movant bears the burden of
non-movant must tailor its
method by which the movant
carried its
response to the
initial burden.
If
the
movant presents evidence affirmatively negating a material fact,
the
non-movant
withstand
fact
a
"must
directed
sought
to be
the movant
shows
non-movant
must
respond
verdict
either
with
additional
verdict
motion
deficiency."
burden by
Id.
relying
on
Fitzpatrick,
that
the
sufficient
trial
at
trial
2
sufficient
on
the
F.3d at
record
material
1116.
on a material
fact,
contains
based
1117.
the
to
on
The
withstand
the
alleged
non-movant
pleadings
or by
cannot
repeating
a
the
directed
evidentiary
carry
F.2d
Rather,
(11th
Cir.
1981).
the
its
conclusory
See Morris v. Ross,
1033-34
If
evidence
allegations contained in the complaint.
1032,
to
ignored" by the movant or "come forward
evidence
at
at
of evidence
show
that was "overlooked or
evidence
motion
negated."
an absence
with
663
non-movant
must respond with affidavits or as otherwise provided by Federal
Rule of Civil
In
notice
this
of
Procedure
action,
56.
the
Clerk
Defendant's motion for
of
the
Court
gave
Plaintiffs
summary judgment and informed
them of the summary judgment rules, the right to file affidavits
or
other
materials
in
opposition,
and
the
consequences
of
default.
(Doc.
Wainwright,
27.)
772
The notice requirements
F.2d 822,
825
(11th Cir.
of Griffith v.
1985)
(per curiam),
therefore, are satisfied and the motion is ripe for review.
III.
Defendants
doctrine
the
of
argue that
judicial
potential
party
is
bankruptcy
done
so,
not
as
claims
because
assets
they
proceeding
Plaintiffs
that
and
estopped
amend
contend
their
if
an
judicial
motion
to
their
Chapter
move
to
13
reopen
disclosure.
estoppel
to
disclose
under Georgia law,
they
asset
are barred by the
failed
during
Plaintiffs counter that,
judicially
notwithstanding
Plaintiffs'
estoppel
claims
bankruptcy case.
DISCUSSION
does
reopen
and
not
a
a
Having
apply,
amend
was
ultimately unsuccessful.
The Court begins by discussing the bankruptcy laws that are
relevant to Defendant's judicial estoppel motion.
This includes
a
also
discussion
of
bankruptcy
law
generally
and
a
more
particular examination of Plaintiffs' motion to reopen and the
Bankruptcy Court's denial of that motion.
With that analysis in
hand, the Court turns to the judicial estoppel question.
A.
Relevant Bankruptcy Law
The Court begins with a general overview of the bankruptcy
laws
relevant to this case.
Unlike Chapter 7, which serves to
liquidate a debtor's assets, Chapter 13 of the Bankruptcy Code
serves
1239,
13
a
reorganization purpose.
1244
U.S.C.
§
1306(a)
1306(a)
vests
estate.
Id.
petitioner's
and
the
at
§
1327(b)
plan
Waldron,
536
F.3d
plan,
or
the
(quoting 13 U.S.C.
petitioner's
§
1327(b)
order
property
Then,
. . .
interact
to
form
estate
Upon petitioning for bankruptcy,
1241.
estate to the debtor
the
In re
(11th Cir. 2008), the Eleventh Circuit explained how
property and debtor property.
§
In
upon
"returns
§ 1327(b)).
the
bankruptcy
confirmation
some
Me] except as
confirming
in
of
property
the
of
the
otherwise provided in
the
plan.'"
Crucially,
Id.
at
1242
the Eleventh Circuit
held that any assets acquired after confirmation remain part of
the estate property pursuant to § 1306(a).
Id.
at
1243.
Thus,
Waldron explicitly held that a debtor's claims for legal relief
of all types that arise after the confirmation of a Chapter 13
plan but before the completion of the plan are property of the
bankruptcy estate.
See id. at 1241-43, 1245.2
Chapter 13 would,
petitioners
bankruptcy
disclosure
not
court
in
of course, be largely a dead letter were
required
and
to
disclose
their
a bankruptcy
their
creditors.
case
2 As
the
Eleventh Circuit
confirmation assets remain part
is
crucial
assets
"Full
to
noted in Waldron,
of the bankruptcy
to
and
the
the
honest
effective
whether postestate or are
returned to the petitioner is subject to a circuit split.
536 F.3d at
1241-43.
In Plaintiffs' own bankruptcy case, the Bankruptcy Court
noted the existence of the split, but found it unnecessary to engage
in that question because petitioner's plan and the confirmation order
provided that ''property of the estate does not vest in the debtor
until the closing of the case."
(Doc. 31).
functioning of the federal bankruptcy system."
Aeroplex,
Inc.,
quotations
291 F.3d 1282,
omitted).
"A
1286
debtor
(11th
to
the
bankruptcy
541(a)(7)).
The
court."
IcL
disclosure
of
Cir.
seeking
bankruptcy laws must disclose all assets,
(citing
Burnes v.
Pemco
2002)(internal
shelter
under
the
or potential assets,
11
U.S.C.
§§
521(1),
gives
the
trustee
such ''assets
and creditors a meaningful right to request ... a modification
of the debtor's plan to pay his creditors," Waldron,
1245,
or
grant
the
trustee
an
opportunity
to
claims and obtain money for the creditors."
Stores,
Inc.,
No.
2:14-cv-052,
536 F.3d at
"to
settle
the
Brown v. Winn-Dixie
2015 WL 3448614,
at
*7
(S.D.
Ga.
May 20, 2015).
Further,
"[t]he duty to disclose is a continuing
one
not
once
that
does
bankruptcy
court;
end
rather,
a
the
forms
debtor
statements if circumstances change."
are
must
submitted
amend
Burnes,
his
to
the
financial
291 F.3d at 1286.
Additionally, bankruptcy courts may not confirm or modify a
Chapter
13
greater
than
1329(c).
payment
plan
five
years.
As
Chapter
13
noted
to
by
to
11
the
include
require
U.S.C.
§
Bankruptcy
this
payments
over
1322(d);
Court,
five-year
11
a
U.S.C.
Congress
limitation
period
§
amended
period
to
"provide the relief and fresh start for the debtor that is the
essence
Cong.
of
modern
1st Sess.
With
proceedings
117
that,
bankruptcy
law."
H.R.
Rep.
No.
595,
95th
(1977).
the
relevant
Court
to
this
now
turns
motion.
to
the
Plaintiffs
bankruptcy
filed
for
Bankruptcy on January 31,
2008.
amended their asset schedules.
confirmed
Plaintiffs'
June
2008,
24,
assets,
June
Plaintiffs
Plaintiffs
On June 5, the Bankruptcy Court
13 plan.
again
Post-confirmation,
amended
their
schedule
which the Bankruptcy Court confirmed a month later.
2012,
the
occurred.
accident
giving
rise
to
Plaintiffs'
Plaintiffs never amended their asset
Upon
learning
estoppel in this
Court
Chapter
In April and May,
to
their
As
their motion.
Defendant's
litigation,
reopen
disclosure.
of
of
In
claims
schedule.
to
seek
judicial
Plaintiffs moved in the Bankruptcy
bankruptcy
mentioned
intent
on
case
above,
the
to
amend
Bankruptcy
In its well-reasoned order,
their
Court
asset
denied
the Bankruptcy Court
acknowledged that "[t]he proper inquiry focuses on the effect of
reopening the case on the creditors.
no
effect
on
administration
the
would
should be denied."
Co. ,
406
however,
F.3d
that
estate
creditors,
necessary,
then
(Doc. 31, Ex. 1 at 4)
538,
the
be
or
If the reopening will have
543
(8th
Cir.
the
and
no
motion
2005)).
The
Court
(Id. at 7).
result
Plaintiffs'
of
the
potential
bankruptcy
claims
10
On that basis,
(Id. at 7-8).
proceedings
against
prohibited
Thus, there was no
potential benefit to the creditors in reopening.
the Court denied Plaintiffs' motion to reopen.
found,
which coincided
approximately with the closing of the case in 2013,
The
reopen
(citing In re Apex Oil
five-year limitation period,
any distribution to creditors.
to
further
Defendant
is
now
clear:
were
estate
property under
their
plan,
and they had a continuing duty to
disclose their claims to the Bankruptcy Court from the time the
claims arose in June 2012 until their bankruptcy case closed in
May
2013.
And,
finally,
because they attempted to
reopen and
amend after the close of the five-year limitation period,
payment
plan
could not
be
modified
to
benefit
their
creditors,
resulting in the Bankruptcy Court denying Plaintiffs'
reopen
their
and
duty
Plaintiffs
bankruptcy
amend.
to
Plaintiffs
disclose
disclosed
trustee
their
the
may
therefore
claims
claim,
have
failed
against
their
moved
to
1244
(noting
that
11 U.S.C.
motion to
comply
creditors
the
allows
Had
or
the
Chapter
See Waldron,
§ 1329(a)
with
Defendant.
amend
payment plan to reflect this new asset.
at
to
their
536 F.3d
trustees
unsecured creditors to move to modify the plan to,
13
and
inter alia,
increase payments or extend the plan's time for payments).
As
it
in
stands,
Plaintiffs
were
able
to
discharge
$55,151.62
unsecured claims.
B.
Judicial Estoppel
In a diversity action, the application of judicial estoppel
is a matter of
v.
S.
1995) .
Diamond
state law.
Associates,
Original Appalachian Artworks,
Inc.,
44
F.3d
925,
930
Inc.
(11th Cir.
Prior to 1994, the doctrine of judicial estoppel was
evidently unknown to Georgia
law.
In 1994,
Georgia's
first
foray into this field began explicitly as a way of applying the
11
federal doctrine of judicial estoppel in an effort to effectuate
the
decisions
Trotter,
1994) .
of
Smith
As
Southmark,
&
the
the
bankruptcy
Jacobs,
Court
courts.
442
S.E.2d
discusses
application of
See
in
265,
greater
Southmark
Corp.
266
Ct.
(Ga.
detail
judicial estoppel
below,
in
v.
App.
since
Georgia
and
federal courts has diverged.
Under
Georgia
law,
the
"precludes
a
from
asserting
proceeding
which
party
is
doctrine
inconsistent
a
of
judicial
position
with
a
in
Emory University,
Wolfork v.
555 S.E.2d 96, 98 (Ga. Ct. App.
Tackett,
540
S.E.2d
611,
612
a
position
successfully asserted by it in a prior proceeding."
(Ga.
estoppel
previously
Coachran v.
2001)
Ct.
judicial
App.
(quoting
2001)).
"[T]he essential function and justification of judicial estoppel
is
to
means
prevent
of
the
use
obtaining
of
unfair
intentional
advantage
self-contradiction
in
a
forum
as
provided
a
for
suitors seeking justice. The primary purpose of the doctrine is
not to protect the litigants,
the judiciary."
Southmark,
punctuation omitted).
who would attempt
calculated
proceedings
but to protect the integrity of
442
S.E.2d at 267
"The doctrine
(citations
is directed against
and
those
to manipulate the court system through the
assertion
of divergent
sworn positions
and is designed to prevent parties
in
judicial
from making a
mockery of justice through inconsistent pleadings."
Johnson v.
Trust Co. Bank, 478 S.E.2d 629 (Ga. Ct. App. 1996) (citations and
punctuation omitted).
12
Georgia
courts
have
frequently applied
judicial
estoppel
where a party fails to disclose a potential claim among their
assets in a bankruptcy proceeding.
524 S.E.2d 510
that
(Ga. Ct. App.
See, e.g., Reagan v.
1999).
Lynch,
These courts have reasoned
"[c]ompliance with disclosure requirements is essential to
maintaining
a
disclosure
disclose
that
requirements
such
such
(citations
Byrd
v.
bankruptcy
Towne
is
The
Lake,
light
Chapter
viewed
exist."
omitted).
In
under
information
claims
JRC
case.
11,
as
is
Ltd.,
true
484
the
the
amounting
Southmark,
same
of
442
under
S.E.2d
stringent
failure
to
a
S.E.2d
Chapter
309
(Ga.
to
denial
at
267
13.
See
Ct.
App.
1997) .
As discussed above,
to disclose any assets,
Bankruptcy Court
and
their
case,
bankruptcy
asset
disclosures
against
claim
to
Defendant.
"amount [s]
Southmark,
Plaintiffs were under a continuing duty
including potential legal claims, to the
their creditors.
Plaintiffs
reflect
to
a
denial
442 S.E.2d at 267.
failed to
the
Plaintiffs'
During the
amend their
existence
failure
that
to
such
pendency of
of
sworn
their
claim
disclosure
their
claim[]
exists."
Plaintiffs' pursuit in this Court
of a claim, the existence of which they denied to the Bankruptcy
Court,
constitutes an inconsistent position.
There
is,
however,
one
frequently
Id.
litigated
difference
between Georgia's judicial estoppel and its federal counterpart
that
allows
a
party
to
remedy
13
its
previously
inconsistent
position.
Under
Georgia
law,
where
a
party
amends
their
bankruptcy court filings to reflect the potential claim, summary
judgment
on
Clark v.
Perino, 509 S.E.2d 707 (Ga. Ct. App. 1998); Johnson v.
Trust
Co.
courts
judicial
Bank,
in
478
the
Cartersville,
estoppel
S.E.2d
Eleventh
Georgia,
grounds
629
(Ga.
Circuit,
348
F.3d
is
Ct.
see
1289,
not
warranted.
App.
1996).
Barger
1297
v.
(11th
See
Unlike
City
Cir.
of
2003),
Georgia applies this exception even when the debtor amends only
after
the
threat
litigation.
338,
339
cv-3,
2014
that
judicial
estoppel
in
See Rowan v. George H. Green Oil,
(Ga.
Moreover,
of
Ct.
WL
the
simply
2002);
69088866,
Georgia
moving
successful or not,
See Rowan,
App.
at
Court
to
Tuten v.
*2-3
of
Target
(S.D.
Appeals
amend
or
Ga.
has
reopen,
at
above,
contend,
is
Inc.,
572 S.E.2d
Corp.,
No.
Dec.
8,
least
4:142014).
suggested
whether
eventually
may be sufficient to avoid judicial estoppel.
argue
that
this
exception
applies
virtue of moving to reopen the bankruptcy case,
There
subsequent
572 S.E.2d at 339.
Plaintiffs
they
the
some
Georgia
exception
in
cured
their
merit
to
previously
Plaintiffs'
here.
By
Plaintiffs have,
inconsistent
argument.
As
position.
mentioned
courts have often framed the application of the
terms
of
whether
the
party
has
moved
to
amend
rather than whether the party has, in fact, amended their asset
disclosure.
compatible
Additionally,
with
the
policy
Plaintiffs'
rationale
14
view
is
arguably
motivating
judicial
estoppel.
By moving to amend or reopen, Plaintiffs, in a sense,
attempted
to
arguably
change
have
no
its
longer
position
taken
in
an
the
bankruptcy
inconsistent
case
position
and
in
a
judicial proceeding.
In
its
protects
brief,
Defendant
plaintiffs
who
have
argues
that
successfully
Georgia
amended
law
only
their
asset
disclosures in the bankruptcy proceeding and that those who have
only moved to
remain
amend or
subject
undisclosed
to
moved to
judicial
claims.
reopen a bankruptcy proceeding
estoppel
Defendant
in
pending
reaches
this
litigation
conclusion
on
by
analyzing Georgia cases and determining that any suggestion that
merely
moving
to
amend
or
reopen
is
sufficient
occurred
in
dicta.
After
judicial
reviewing
estoppel
the
cases,
Georgia
the
Court
Court
is
of
Appeals's
convinced
supporting both parties' positions exists.
to
"moving
to
amend"
defeating
judicial
estoppel,
Compare, e.g.,
537
Ct.
200,
201-02
(Ga.
App.
bankruptcy
added)
the
pleadings
with id.
amendment
that
that
plaintiff
to
at 202
ever
include
court
we
have
there has been no
tort
to
amend
his
claim.")(emphasis
P[I]f the bankruptcy court permits an
allowing an omitted tort claim,
the Georgia
are
Jowers v. Arthur,
attempted
the
dictum
there
2000) P [W] hen
applied judicial estoppel to bar a claim,
evidence
that
For every reference
equal references to "amends."
S.E.2d
numerous
in which
15
it stands
the tort
to reason
claim is asserted
should honor the bankruptcy court's actions.")(emphasis added).
But,
as
Defendant
Georgia court
either
argues,
held
the
Court
that moving
has
not
to amend,
found
standing
sufficient or insufficient to defeat
where
alone,
a
was
judicial estoppel.
That question appears to remain open.
That
motion
said,
alone
Plaintiffs'
this
is
Court
need not
sufficient.
and
distinction between the present
case
to
pending.
or
Bankruptcy
to
Court's
reopen
amend
motion
whether
Bankruptcy
The
address
reopen
Court
remains
found
that
the
amend
and a
is
a
making
denial
of
significant
case where
a motion
Significantly,
five-year
a
limitation
the
period
prohibited approval of any extension of a payment plan and that
reopening would therefore not be of any benefit to Plaintiffs'
creditors.
Accordingly,
Plaintiffs
have
been
unsuccessful
in
amending their previous position in the bankruptcy proceeding.
As Georgia courts have recognized, successfully amending an
asset disclosure is, in essence,
position.
has
See Cochran,
successfully
a way of retracting an earlier
555 S.E.2d at 99 ("[W]hen a plaintiff
amended
her
petition
to
include
any
claim
against the defendant as a potential asset . . ., it cannot be
said
that
the
present
position
in
the
trial
court
is
inconsistent with the position asserted by plaintiff in a prior
proceeding and,
claim."
therefore,
(emphasis
Plaintiffs'
failure
judicial estoppel does not bar her
added)).
to
reopen
The
the
16
opposite
bankruptcy
is
true
proceedings
here.
sets
their
position,
stone.
as
reflected
on
their
asset
disclosure,
It is also no matter that Plaintiffs attempted,
unsuccessfully,
to reopen the proceedings.
in
albeit
While it may be true
in some sense that once the motion to reopen and amend was made
Plaintiffs
were
immediately asserting
both
proceedings,
and,
upon
the
bankruptcy
the
reality
Bankruptcy Court's
proceedings
Plaintiffs'
is
position
to
in
a
that
they
denial,
extinguish
the
consistent
used
creditors'
proceeding
in
successfully
conclusively
their
bankruptcy
have
position
is
the
claims.
contained
in their asset schedules, which lack the present claims.
Having
failed
to
amend their
current
inconsistent
mockery
of
the
justice
because
of
the
Bankruptcy
reopening.
positions
in
asset
the
system.
two
This
Court's
schedules,
Plaintiffs'
proceedings
is
makes
particularly
specific
reason
for
a
true
not
The five-year limitation period allowed Plaintiffs
to extinguish their creditors' claims and to move on with their
lives.
Though
disclosures,
they
their
may
attempt
have
tried
to
amend
to
reopen
was
their
asset
unsuccessful,
the
bankruptcy proceeding remains closed, their position in the now-
complete bankruptcy remains one of non-disclosure,
this
worked
to
Plaintiffs'
substantial
benefit
and all of
and
to
the
prejudice of Plaintiffs' creditors.
To
conclude
otherwise
would
lead
to
perverse
outcomes.
Many debtors have potential claims accrue after confirmation of
an asset distribution plan.
It is easy to imagine these debtors
17
failing
to disclose
bankruptcy
period.
assets
their
proceeding
Cf.
Waldron,
were
increased
not
claims
and
during
would
to
be
the pendency of the
the
five-year
536 F.3d at 1245
subject
payments
during
("If post-confirmation
disclosure,
rare
limitation
modifications
because
voluntarily disclose new assets . . . .").
few
debtors
for
would
Once the bankruptcy
case has closed and the five-year limitation period has passed,
these
that
the
debtors
could
file
they could defeat
reopen
the
bankruptcy
court
only
statutes of
a
would
need
claims
with
confidence,
case,
deny
while
the
motion
resting
based
To execute such a scheme,
the
knowing
judicial estoppel motion by moving to
bankruptcy
limitation period.
would
their
slightest
window
limitations and the
assured
on
the
that
a
five-year
debtor-plaintiffs
between
their
claims'
five-year bankruptcy limitation
period.
With that in mind,
heart of the
estoppel."
(Ga.
Ct.
"essential
CSX Transp.,
App.
acknowledged,
estoppel]
it is clear that this case goes to the
2009) .
Georgia
function and justification of judicial
Inc.
As
v.
the
Howell,
Georgia
675 S.E.2d
Court
courts "apply federal
of
law
306,
308
Appeals
has
[of
judicial
in order to give the proper effect to the judgment of
the bankruptcy court .... The goal is to afford the judgment
of the bankruptcy court the same effect here as would result in
the court where
S.E.2d at 266.
that
judgment was rendered."
Southmark,
442
Consistent with that goal, Georgia courts do not
18
apply judicial estoppel when a plaintiff successfully amends its
bankruptcy filings to reflect its legal claims.
effect to the bankruptcy court proceedings.
Similarly, applying
judicial estoppel where a bankruptcy court has
to
amend
or
estoppel]
Transp.,
reopen
supports
"the
primary
Doing so gives
denied a motion
purpose
of
[judicial
. . . protecting the integrity of the judiciary."
CSX
675 S.E.2d at 308.
Where,
as
here,
a
plaintiff
fails
to
disclose
a
potential
claim during a bankruptcy case and conclusively fails to
reopen
the case on the grounds that the five-year limitation period has
passed,
they
proceeding
have
which
is
"assert[ed]
inconsistent
a
position
with
a
in
position
successfully asserted by it in a prior proceeding."
442 S.E.2d at 266.
judicially
estopped
Having done so in this case,
from
asserting
their
a
judicial
previously
Southmark,
Plaintiffs are
claims
against
Defendant.3
3 The Court's decision rests on Plaintiffs'
conclusive failure to
reopen and amend the bankruptcy case on the grounds that the five-year
limitation period has passed.
The relevant considerations could be
different where a plaintiff has moved to amend or reopen and the
motion remains pending in the bankruptcy court.
The relevant
considerations may also be different had Plaintiffs failed to reopen
their bankruptcy court proceeding for different reasons.
See In re
James, 487 B.R. 587, 594 (Bankr. N.D. Ga. 2013) (finding no motive to
conceal a claim where debtors Chapter 13 plan paid creditors 100% of
their owed debts).
19
IV.
For
motion
FINAL
the
for
foregoing
summary
JUDGMENT
and motions,
in
reasons,
judgment.
favor
CONCLUSION
of
the
The
Court
Clerk
Defendant,
is
GRANTS
Defendant's
DIRECTED
terminate
all
to
ENTER
deadlines
and CLOSE this case.
ORDER ENTERED at Augusta, Georgia, this
/
day of March,
2016.
HONORABLE
J.
RANDAL
HALL
UNITED/STATES DISTRICT JUDGE
SOUTHERN
20
DISTRICT OF GEORGIA
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