Makeen v. Wadsworth (In re Makeen)
- Summarized by David Treacy , U.S. Bankruptcy Court, Eastern District of Kentucky
- 11 months 1 week ago
- Case Type:
- Consumer
- Case Status:
- Affirmed
- Citation:
- No. 23-1110 (10th Circuit, Jan 30,2024) Not Published
- Tag(s):
-
- Ruling:
- The U.S. Court of Appeals for the Tenth Circuit held a bankruptcy court did not err in concluding a debtor, who operated a property rental business, could not exempt real property from the bankruptcy estate as his “stock in trade” under Colorado's state-created exemptions.
- Procedural context:
- At the Tenth Circuit, Debtor (appearing pro se) raised for the first time that no party objected to his claimed exemptions when he first amended them to cover his rental property in May 2020. He contended this precluded the Chapter 7 Trustee from objecting to the exemption claims when Debtor later amended his schedules because he had not changed the exemption. Debtor also contended he had not waived this argument by not raising it earlier because, he said, the thirty-day window to object to an exemption is jurisdictional and non-waivable, citing Taylor v. Freeland & Kronz, 503 U.S. 638 (1992). After explaining Taylor was off-point, the Tenth Circuit explained that Fed. R. Bankr. P. 4003 permits a party in interest to object to claimed exemptions within 30 days of an amendment and the trustee objected within that time frame when he filed his second amendment to his schedules. Moving to the merits, the Tenth Circuit then evaluated de novo what the Colorado Supreme Court would conclude "stock in trade" means under Colorado law as the exemption statute itself does not define the term.
- Facts:
- Debtor Akeem Abdullah Makeen filed a chapter 7 bankruptcy petition in the U.S. Bankruptcy Court for the District of Colorado in July 2018. In May 2020, he amended his schedules to claim as exempt two rental properties as his "stock in trade" under Colorado's state-created exemptions. No party objected. In March 2021, Debtor again amended his schedules but continued to claim the same exemption covered the two rental properties. Chapter 7 Trustee David Wadsworth then objected to the claimed exemptions, arguing the "stock in trade" exemption did not apply to real property. The bankruptcy court upheld the trustee's objection and Debtor appealed. After the U.S. District Court for the District of Colorado affirmed the bankruptcy court's ruling, Debtor took a second appeal to the Tenth Circuit.
- Judge(s):
- HARTZ, PHILLIPS, and McHUGH
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