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Judicial estoppel applies without regard to harm to creditors. Rejecting argument that application of judicial estoppel would harm creditors, district court applies doctrine to bar debtor's pursuit of undisclosed cause of action, finding that nondisclosure was intentional. Blaming bankruptcy counsel also doesn't prevent application. Coppedge v. Suntrust Bank, Inc., 2009 WL 111639 (M.D. Ga. Jan. 14, 2009). Compare Melton v. Nat'l Dairy Holdings, L.P., 2009 WL 653024 (M.D. Ala. Mar. 10, 2009), where court declines to apply judicial estoppel to Chapter 13 debtor's failure to amend schedules to disclose employment discrimination claim; while there is evidence to support inference that debtor intended to manipulate the system, court cites prior authority that "failure to amend is not the same as affirmatively misrepresenting the nonexistence of claims that are being pursued in another proceeding."
Debtor has no homestead after conveying property with contingent life possession. When the debtor conveyed her home to her child to enable the child to mortgage property, receiving in return a contingent right to possess the property for her life if the bank became the owner, the debtor had no life estate under South Dakota law and had no right to homestead exemption. She merely had a contractual personal property interest, which became property of the Chapter 7 bankruptcy estate. Fix v. First State Bank of Roscoe, ___ F.3d ___, 674135 (8th Cir. Mar. 17, 2009).
Amendment of exemption permits only objection to amended and not to original exemption claim. Questioning "whether the Supreme Court would, in fact, permit a trustee to use § 105 to object to exemptions to which he declined or failed to properly object pursuant to the Rules," when the Chapter 7 trustee did not timely object to the debtor's original homestead exemption claim, the debtor's amendment of exemptions only opened the door to the trustee objecting to the amended claim. The original exemption claim was to two parcels of real estate, neither of which was actually the debtor's homestead, under § 522(d)(1). The amended exemptions didn't change the homestead claim, but changed the debtor's exemption claim in stock. The trustee was unable to bootstrap an objection to the erroneous homestead claim in his objection to the amended stock exemption. Grueneich v. Doeling (In re Grueneich), ___ B.R. ___, 2009 WL 605774 (B.A.P. 8th Cir. Mar. 11, 2009).
Iowa homestead given extraterritorial effect. Section 522(b)(2)'s choice of exemption law doesn't preempt state law which prohibits application of that state's exemption to property located outside the state; instead, the fall back to federal bankruptcy exemptions becomes effective. However, the BAP interprets Iowa law and concludes that its homestead exemption applied to a Chapter 7 debtor who filed in Oklahoma but had not lived there the 730 days before filing.
©2009 Hon. William Houston Brown
