Cery Bradley Perle v. Alfonso Fiero (In re Cery Bradley Perle)

Summarized by Kevin Baum , Windels Marx Lane & Mittendorf, LLP
12 years 7 months ago

Citation:

Perle v. Fiero (in re Perle), No. 11-60000, --- F.3d --- (9th Cir. Aug. 2, 2013)

Tag(s):

Ruling:

Affirming the Bankruptcy Appellate Panel’s ruling that an arbitration debt was nondischargeable under 11 U.S.C. §§ 523(a)(3) and 523(a)(6), the Ninth Circuit held that a creditor’s challenge was timely despite having not filed within 60 days of the first date set for the creditors meeting 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. In reaching its decision, the Ninth Circuit concluded that the creditor’s lawyer’s knowledge of the bankruptcy could not be imputed to the creditor on an agency theory when the lawyer no longer represented the creditor in relation to the debt at issue, and only learned of the filing in the course of representing another client.

Procedural context:

Appeal from the Ninth Circuit Bankruptcy Appellate Panel ruling affirming the Bankruptcy Court's order determining that the arbitration debt owed to the creditor was nondischargeable.

Facts:

The chapter 7 debtor filed for bankruptcy in 2001. Among his debts was an arbitration award owed to a securities dealer. The chapter 7 debtor failed to list the securities dealer or the arbitration award on his Schedule E. Two months after the chapter 7 debtor filed for bankruptcy, a private equity firm filed a nondischargeability complaint against the debtor arising from a default judgment it obtained against him. Although the lawyer representing the private equity firm had also represented the securities dealer in the arbitration case (and continued to represent the dealer in other matters at that time), the lawyer never informed the securities dealer of the chapter 7 debtor’s pending bankruptcy case. In September 2006—over four years after the debtor had received a discharge and the bankruptcy case was closed—the securities dealer moved to reopen the case in order to challenge the dischargeability of the arbitration award.

Judge(s):

Ikuta and Nguyen, Circuit Judges, and Burns, District Judge

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