| MINNEAPOLIS PERSONAL INJURY ATTORNEY |
|
|
 |
 |
 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Fokkena v. Klages: BANKRUPTCY - no error revoking discharge for not giving trustee 1.5k tax refundUnited States Bankruptcy Appellate PanelFOR THE EIGHTH CIRCUIT No. 07-6051 SI In re: * * Robert D. Klages, * * Debtor. * * Habbo Fokkena, U.S. Trustee, * Appeal from the United States * Bankruptcy Court for the Plaintiff - Appellee, * Southern District of Iowa * v. ** Robert D. Klages, * * Defendant - Appellant. * Submitted: January 29, 2008 Filed: January 31, 2008 Before SCHERMER, MAHONEY and MCDONALD, Bankruptcy Judges SCHERMER, Bankruptcy Judge 6 discharge. The Debtor also admitted receiving the written warning to that effect. The Debtor acknowledged the Trustee’s request for a copy of his tax returns when prepared. The Debtor clearly knew he had a duty to provide a copy of his tax returns to the Trustee and that he may have a duty to deliver tax refunds to the Trustee. The Debtor’s failure to do so was thus done knowingly. In order to support revocation of the discharge, the Debtor’s failure to deliver the non-exempt tax refund must also have been done fraudulently. Fraudulent intent may be established by showing that the debtor knowingly made an omission that misleads the trustee or that the debtor engaged in a fraudulent course of conduct. In re Kasden, 209 B.R. at 244. A debtor’s intent may be inferred from all the surrounding circumstances where the debtor’s pattern of conduct supports a finding of fraudulent intent. Id. The focus is on whether the debtor’s actions appear so inconsistent with his self-serving statement of intent that the proof leads the court to disbelieve the debtor. Id. Fraudulent intent may also be established by showing that the debtor acted so recklessly that fraud can be implied. Id. at 244-45. Fraud is rarely established by admission. Instead, the trial court must look at the circumstantial evidence and the events that occurred to try to determine intent. In re Kadsen, 209 B.R. at 245. Here the trial court looked at the circumstances and determined that the Debtor knew he had a duty to turn over copies of his tax returns to the Trustee and that he knew that he should not spend any tax refund without first contacting the Trustee’s office. The court determined that the Debtor knew his obligations regarding the tax returns and tax refunds continued even if he received a discharge. The Trustee told the Debtor this and gave him a written admonition to this effect. The Debtor’s assertion that he did not read the handout is irrelevant. A debtor cannot ignore information given to him and then claim ignorance. Such behavior is so reckless that fraud can be implied. Id. 7 The bankruptcy court determined that the Debtor’s explanation that he thought he could spend the tax refund because of his discharge was not credible. The bankruptcy court made this determination after carefully observing the Debtor’s demeanor while he testified. We afford due deference to the bankruptcy court’s determination regarding credibility and find nothing in the record to reverse that determination. Fed.R. Bankr. P. 8013; Richardson v. Suggs, 448 F.3d at 1052; In re Kadsen, 209 B.R. at 241. The bankruptcy court’s factual findings are supported by the evidence. Richardson v. Sugg, 448 F.3d at 1052. The bankruptcy court correctly applied the law. Richardson v. Sugg, 448 F.3d at 1052. Accordingly, we affirm. CONCLUSION The bankruptcy court found that the Debtor knowingly and fraudulently failed to deliver his non-exempt tax refund to the Trustee. Based on these findings, the court revoked the Debtor’s discharge pursuant to Section 727(d)(2) of the Bankruptcy Code. The evidence supports the bankruptcy court’s findings of fact and conclusions of law. Accordingly we affirm the bankruptcy court’s judgment revoking the Debtor’s discharge. |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| By visiting this page or clicking the "submit" button above, you agree that you have read and accept this "disclaimer". |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Copyright ©
Michael E. Douglas, Attorney at Law, Saint Paul MN. All Rights
Reserved. Minnesota Law Firm representing Personal Injury, Car / Auto Accident, Workers Compensation, Medical Malpractice, Social Security Disability claims. Dedicated to Injured Workers, Victims of Negligence, Car Accidents, Victims of Fraud, and those in need of legal assistance. |
