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Margaret Kinney v. HSBC Bank USA

Summarizing by Lars Fuller

Rajala v. Taylor (In re Taylor)

Citation:
Rajala v. Taylor (In re Taylor), BAP No. KS-13-020 (BAP 10th Cir. July 22, 2013)
Tag(s):
Ruling:
Tenth Circuit BAP panel affirmed bankruptcy court's entry of default judgment revoking discharge against debtor.
Procedural context:
Chapter 7 trustee filed timely complaint to revoke debtor's discharge, serving debtor and debtor's then-counsel of record. After debtor failed to file answer, trustee moved for default judgment, providing notice to debtor and opportunity for hearing. Debtor failed to object. Bankruptcy court entered default judgment. Debtor filed timely notice of appeal.
Facts:
Chapter 7 trustee filed timely complaint to revoke debtor's discharge after debtor failed to comply with court orders to provide the trustee with tax returns, or pay court costs. Trustee served debtor and debtor's then-counsel of record with complaint. Debtor's then-counsel was in process of withdrawing as counsel, having filed a motion to withdraw two days before trustee filed complaint. Thirty-nine days after serving the complaint, and before an order entered authorizing debtor's counsel's withdrawal, trustee filed and served upon debtor and her then-counsel a motion for default judgment with notice and an opportunity for hearing. Debtor did not respond to the motion for default judgment. Bankruptcy court entered default judgment revoking debtor's discharge and ordering her to pay costs and attorney fees. Debtor filed a timely notice of appeal, but did not file a motion with the bankruptcy court requesting reconsideration, or that the judgment be set aside. On appeal, debtor argued that she had provided her tax returns to her then-counsel and that consequently, no judgment should have entered. The BAP held that it could not consider evidence not presented to the bankruptcy court absent a miscarriage of justice. Finding no grounds to reverse the bankruptcy court, the BAP affirmed.
Judge(s):
J. Thurman (Chief Judge), J. Michael, and J. Jacobvitz

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