Singh v. Singh (In re Singh)
- Citation:
- In re Singh, 9th Circuit Bankruptcy Appellate Panel, CC-13-1104-PaKiTa (August 7, 2014) [Not for Publication]
- Tag(s):
-
- Ruling:
- The United States Bankruptcy Appellate Panel for the Ninth Circuit (the “BAP”) affirmed the holding of the United States Bankruptcy Court for the Central District of California (the “Bankruptcy Court”), finding the Debtor: (a) made misrepresentations to his Creditors; (b) knew the statements to be false; (c) intended to deceive his creditors; (d) caused his creditors to justifiably relied upon the misrepresentations due to the familial nature of the relationship; and (e) caused the creditors to be damaged by loaning money to the Debtor by means of a Promissory Note.
- Procedural context:
- Appeal to the BAP from the Bankruptcy Court, which found the debt owed to the creditors was exempted from discharge pursuant to 11 U.S.C. §523(a)(2)(A). The BAP reviewed the Bankruptcy’s Court’s findings of fact for clear error and conclusions of law de novo.
- Facts:
- In 2000, Ashvinder Singh (the “Debtor”) moved in with Gurmukh Singh and Jasbir Kaur, (respectively, the “Uncle” and “Aunt”), and was still living with them in 2005. In 2005, the Debtor asked to borrow $30,000.00 from his Uncle, but his Uncle declined as the Debtor already owed him $32,000.00. The Debtor then told his Aunt that his Uncle was going to leave her, take all of the family money, and return to India, suggesting she draw funds from her Wells Fargo Bank (“Wells Fargo”) line of credit (the “LOC”). The Debtor promised to take care of his Aunt and her daughters if she did this. Relying on the Debtor’s statements, the Aunt drove with the Debtor to withdraw $140,000.00 from Wells Fargo, and deposited the money into a joint account with the Debtor at Washington Mutual. When the Uncle learned of the funds drawn from the LOC, he questioned the Aunt and Debtor. The Debtor said he would return $110,000.00 if the Uncle and Aunt (collectively, the “Creditors”) agreed to lend him $30,000.00. Thinking the Debtor would not return any of the money, the Creditors entered into a promissory note with the Debtor (the “Promissory Note”). The Debtor made payments, but later defaulted under the Promissory Note. The Creditors then sued the Debtor in state court for breach of contract and fraud (the “State Court Action”). Relative to the State Court Action, the parties entered into a settlement agreement (the “Settlement Agreement”) for $39,000.00, representing the total amount the Debtor owed the creditors. Pursuant to the Settlement Agreement, the Debtor made payments for two years, but again defaulted, forcing the creditors to seek enforcement of the Settlement Agreement in state court. Thereafter, the Debtor filed a chapter 7 bankruptcy. On schedule F, the Debtor listed his Uncle and Aunt as creditor for a “personal loan” in the amount of $35,000.00. The Creditors then filed a timely adversary proceeding pursuant to 11 U.S.C. §523(a)(2)(A).
- Judge(s):
- Honorable Judge Jim D. Pappas, Honorable Judge Ralph B. Kirscher and Honorable Judge Laura S. Taylor
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