Justia U.S. 8th Circuit Court of Appeals Opinion Summaries

Debtor borrowed from Arvest to purchase a newly-constructed home, executing a promissory note and mortgage. After debtor filed a voluntary petition for Chapter 13 bankruptcy relief, Arvest then purchased the mortgaged property at a foreclosure sale for substantially less than what debtor owed on the promissory note and filed this adversary proceeding, seeking a judgment declaring the mortgage debt nondischargeable under 11 U.S.C. 523(a)(2) and (4). At trial, the bankruptcy court directed a verdict for debtor on the section 523(a)(2) claim but concluded that $65,000 of the remaining debt was nondischargeable under section 523(a)(4) because debtor held that amount of settlement proceedings in a fiduciary capacity created by section 4-58-105(b)(2) of the Arkansas Code. The BAP reversed and Arvest appealed. The court agreed with the BAP that the statute did not create the requisite fiduciary relationship, and that debtor was not guilty of embezzlement within the meaning of section 523(a)(4), affirming the judgment.

Debtor appealed an order of the bankruptcy court granting relief from the automatic stay to Bank of the West. At issue was whether the bankruptcy court properly granted relief from the automatic stay to Bank of the West to exercise its rights under state law with respect to real property that it purchased at a foreclosure sale. The court affirmed the decision of the bankruptcy court where Bank of the West was a "party in interest" under Bankruptcy Code 362(d) and where the bankruptcy court acted within its discretion when it granted relief from the stay to Bank of the West for "cause."

Debtors appealed from a bankruptcy court order dismissing their chapter 13 case without prejudice. The court held that, while the final order dismissing the case was timely appealed and was properly before the court, debtors simply did not provide any basis, or even a remote suggestion, that the bankruptcy court abused its discretion by ordering their case dismissed. Accordingly, the court affirmed the decision of the bankruptcy court.

Debtor appealed an order of the Bankruptcy Court directing that a third party receive a portion of a check made payable jointly to the third party and debtor for rent of debtor's property. At issue was whether the third party had a right to funds for rent of debtor's property when the rent check was made payable jointly to debtor and the third party. The court held that the third party had an interest in the funds by virtue of a contract between the parties and, therefore, the third party was entitled to the portions of the funds that the bankruptcy court required debtor to remit to him.

Debtors appealed from the Bankruptcy Court's Order Granting the Trustee's Motion for Approval of Compromise or Settlement of Controversy, relating to claims that they asserted against the Bank for lender liability and discrimination. Debtors also requested oral argument on appeal. The source of the dispute between the parties was a loan secured by debtors' property, which consisted of their residence and an adjacent commercial lot. The court held that the settlement proposed by the Trustee was within the range of reasonable compromises and the Bankruptcy Court did not err in approving it. The court also held that the facts and legal arguments were adequately represented in the briefs and record and that the decisional process would not be significantly aided by oral argument.

Debtor appealed the BAP's decision affirming a bankruptcy court order that her homestead was not exempt from the Bank's antecedent debts. The court agreed with the bankruptcy court and the BAP that the plain language of section 561.20 of the Iowa Code limited the "new homestead" exemption to cases where "a new homestead has been acquired with the proceeds of the old." Therefore, the court rejected debtor's contention that there was a conflict in the published bankruptcy court decisions and held that debtor was properly denied a new homestead exemption. The court also held that the bankruptcy court did not err in concluding that the homestead was not exempt from the Bank's antecedent debts under section 561.21(A) of the Iowa Code as construed by the Supreme Court of Iowa and in lifting the automatic stay in bankruptcy as to that property. Accordingly, the court affirmed the decision.

Northwest and the Pilots Association filed a complaint seeking a declaratory judgment that their post-bankruptcy retirement benefit plan (MP3) complied with the Employment Retirement Income Security Act (ERISA), 29 U.S.C. 1001-1461. Appellants (older Pilots) counterclaimed arguing that the MP3 retirement benefit plan violated ERISA, the Age Discrimination in Employment Act (ADEA), 29 U.S.C. 621-634, and several state laws prohibiting age discrimination. Under the MP3, the contributions of all of the pilots were based on their protected final average earnings, which could not be calculated without the use of age. However, that did not mean that the older Pilots' contributions have been reduced because of their age. There were several factors in the MP3 that could reduce an older pilots' projected final average earnings. While promotions and pay increases were correlated with age, they were analytically distinct and therefore not reductions in contributions because of age. Service ration and the frozen Pension Plan offset also both contributed to potential differences in contribution. Finally, the court rejected older Pilots' argument that the district court improperly disregarded the declaration of their expert witness. Therefore, the court held that the MP3 did not reduce the older Pilots' benefits because of age and therefore affirmed the judgment of the district court.

This was an appeal by Triology from an order of the bankruptcy court holding that certain funds held by Trilogy constituted sale proceeds which were subject to the mechanic liens of J.E. Dunn. The court held that the bankruptcy court's decision was not based on clearly erroneous factual findings or erroneous legal conclusion and affirmed the judgment.

Debtor appealed an order of the bankruptcy court sustaining the objection of the Chapter 7 trustee to her claimed exemption of her interest in an annuity. The court concluded that res judicata applied to the debtor's claim of an exemption; and even if res judicata did not apply the bankruptcy court properly disallowed the debtor's claimed exemption. The court also affirmed the bankruptcy court's decision on the bases that: (1) it properly determined that the record did not show that the Company was "authorized to do business" as a "stipulated premium" or "assessment plan" insurance company, as required for Mo. Rev. Stat. 377.330 and 377.090 to apply to the annuity; and (2) the annuity was not insurance, as required for any of the three statutes at issue.

Debtors appeal the judgment of the bankruptcy court denying in part their motion under 11 U.S.C. 522(f)(1) to avoid certain liens held by the Estate of Leon Jerome Heimer. The court held that the amount the Heimer estate advanced to pay off the loans secured by the bank's lien against debtors' vehicles was not secured by a judicial lien. Accordingly, the court affirmed the bankruptcy court's judgment.