Stephen Arnot v. Servicelink Title Co. of Or. ( 2018 )

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                                                                            FILED
NOT FOR PUBLICATION
NOV 30 2018
UNITED STATES COURT OF APPEALS                      MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
STEPHEN P. ARNOT, Chapter 7            )      No. 17-35856
Trustee for the Estate of Jason Daniel )
Neel and Connie Lee Neel,              )      D.C. No. 3:17-cv-00591-MO
)
Plaintiff-Appellant,             )      MEMORANDUM*
)
v.                               )
)
SERVICELINK TITLE COMPANY )
OF OREGON, FKA LSI Title               )
Company of Oregon, LLC,                )
)
Defendant-Appellee.              )
)
STEPHEN P. ARNOT, Chapter 7            )      No. 17-35857
Trustee for the Estate of Robert W. )
Christensen and Marlene J.             )      D.C. No. 3:17-cv-00592-MO
Christensen,                           )
)
Plaintiff-Appellant,             )
)
v.                               )
)
DAVID A. WEIBEL; U.S. BANK, )
N.A., as Trustee,                      )
)
Defendants-Appellees.            )
)
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
Appeal from the United States District Court
for the District of Oregon
Michael W. Mosman, Chief Judge, Presiding
Argued and Submitted November 6, 2018
Portland, Oregon
Before: FERNANDEZ and IKUTA, Circuit Judges, and SESSIONS,** District
Judge.
Stephen P. Arnot, as bankruptcy trustee of the reopened bankruptcy estate of
Jason and Connie Neel and the reopened bankruptcy estate of Robert and Marlene
Christensen, appeals the district court’s grant of summary judgments against him.1
The summary judgment in No. 17-35856 was in favor of ServiceLink Title
Company of Oregon,2 the entity named as the foreclosing trustee at the time of the
foreclosure on the Neels’ property. The summary judgment in No. 17-35857 was
in favor of David A. Weibel, the person named as a foreclosing trustee on the
Christensen property, and U.S. Bank, as trustee, which is the successor trustee of
**
The Honorable William K. Sessions III, United States District Judge for
the District of Vermont, sitting by designation.
1
Hereafter references to “the Debtors” will include all of the debtors in the
bankruptcies.
2
ServiceLink was formerly known as LSI. Hereafter ServiceLink will be
referred to as LSI.
2
the trust entity that was the purchaser at the foreclosure sale.3 Arnot asserts that
the district court erred because the causes of action he asserts against the
Foreclosure Parties were not listed in the Debtor’s schedules4 and, therefore, were
not abandoned when the bankruptcy estates were closed.5 We agree and reverse.
When the Debtors filed their bankruptcy petitions, none of their petitions
listed the causes of action6 that Arnot now seeks to pursue. That did not prevent
those causes of action from becoming part of the assets of the bankruptcy estates,
and no party asserts that it did. No doubt the Debtors had the duty to list claims
that they knew about when they filed the petition or learned about during the
bankruptcy proceedings,7 but no party asserts that they breached that duty. Nor is
there a claim that the original bankruptcy trustee knew of those assets. Therefore,
we deem any claims of knowledge to be waived. See Martinez v. Sessions, 873
3
Hereafter references to “the Foreclosure Parties” will include all of the
parties in whose favor summary judgment was given.
4
See 11 U.S.C. § 521(a)(1).
5
See 11 U.S.C. § 554(c).
6
Of course, causes of action are assets of the debtor in bankruptcy. See
United States v. Whiting Pools, Inc.,

462 U.S. 198

, 205 n.9,

103 S. Ct. 2309

, 2313
n.9,

76 L. Ed. 2d 515

(1983).
7
See Hamilton v. State Farm Fire & Cas. Co.,

270 F.3d 778

, 784 (9th Cir.
2001).

3 F.3d 655

, 660 (9th Cir. 2017); Smith v. Marsh,

194 F.3d 1045

, 1052 (9th Cir.
1999). That leaves us with the uncomplicated words of the relevant statutory
provision: “[A]ny property scheduled under section 521(a)(1) of this title not
otherwise administered at the time of the closing of a case is abandoned.”
11 U.S.C. § 554(c); see also

id. § 521(a)(1).

Plainly, the causes of action that
Arnot seeks to pursue were not listed anywhere in the petitions, and it follows that
they were not scheduled.8 Nor were they administered. Therefore, despite the
closing of the cases, they remained part of the bankruptcy estates of the Debtors.
See Cusano v. Klein,

264 F.3d 936

, 945–46 (9th Cir. 2001); Stein v. United Artists
Corp.,

691 F.2d 885

, 891 (9th Cir. 1982); cf. Beezley v. Cal. Land Title Co. (In re
Beezley),

994 F.2d 1433

, 1439 (9th Cir. 1993) (O’Scannlain, J., concurring)
(“Nowhere . . . is the reason why a debt was omitted from the bankruptcy
schedules made relevant to the discharge of that debt.”).9 Therefore, Arnot had
8
Arnot seeks to have us conduct a periplus of the territory covered by the
word “scheduled” in § 554(c), but we decline to do so. Whatever that word
encompasses, the causes of action were not listed at all. Thus, its scope is not
relevant to this disposition.
9
See White v. Nielsen (In re Nielsen),

383 F.3d 922

, 925 (9th Cir 2004)
(generally adopting “the reasoning of the concurrence [in Beezley].”)
4
standing to pursue them.10
REVERSED.
10
We decline to rule upon the various other defenses raised by the
Foreclosure Parties. They should be addressed by the district court in the first
instance. See Diouf v. Mukasey,

542 F.3d 1222