Vaughan v. Weinstein (In re Vaughan)

BAP No. NV-15-1254-JuKiD (BAP 9th Cir. Feb. 29, 2016) (unpublished)
The BAP for the 9th Circuit affirmed summary judgment entered by the bankruptcy court (D. Nev.) revoking the discharge of a chapter 7 debtor for failing to appear at a 2004 exam. The BAP agreed that following the debtor's failure to appear at a 2004 exam, the bankruptcy court's entry of an order compelling the debtor's appearance contained implicit factual findings that satisfied the elements for revocation of the debtor's discharge under 11 USC 727, and that consequently, summary judgment was proper under law of the case doctrine. The debtors' failure to appear at the initial 2004 exam was sufficient to satisfy the elements of 11 USC 727 because it was undisputed that the debtors were aware of the order and willfully or intentionally failed to obey the order.
Procedural context:
Chapter 7 trustee obtained order directing debtors to appear at 2004 exam, but debtors failed to appear. Chapter 7 trustee commenced revocation of discharge adversary, then filed motion for summary judgment after bankruptcy court issued order compelling debtor to attend 2004 exam. Bankruptcy court granted motion for summary judgment revoking discharge. Debtors appealed to BAP for 9th Circuit.
After co-chapter 7 debtors obtained their discharge, the chapter 7 trustee discovered that they had failed to disclose potential assets and creditors, including disputed interests in the trademark "World Chess Federation Hall of Fame," and claims related to dispute with the World Chess Museum, Inc. The debtors had sought to transfer The trustee sought and obtained, over debtors' opposition, an order authorizing her to schedule Rule 2004 exams for both debtors. The trustee served notice of the exams on the debtors, but the debtors failed to appear. Debtors filed numerous motions in an attempt to prevent or stay the examinations, demonstrating their awareness of the scheduled date. Trustee filed an adversary complaint seeking to revoke debtors' discharge under 727(d)(1)(discharge obtained by fraud) and (d)(3) refusal to obey a lawful order of the court). Debtors failed to appear for the scheduled R. 2004 exam. Debtors filed a motion to compel debtors' attendance, which the bankruptcy court granted finding that debtors evaded the R. 2004 exam. The trustee moved for partial summary judgment on the 727(d)(3) claim based on debtors' failure to obey the original R. 2004 order. The bankruptcy court granted the motion, finding there were no genuine issues of disputed fact regarding debtors' awareness of the R. 2004 order, and their willful and intentional refusal to obey it.
Jury, Kirscher, Dunn

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