In re Johnson

549 B.R. 907, 2016 Bankr. LEXIS 1833, 2016 WL 1690572
CourtUnited States Bankruptcy Court, D. Montana
DecidedApril 25, 2016
DocketCase No. 15-60227-13
StatusPublished

This text of 549 B.R. 907 (In re Johnson) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, D. Montana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Johnson, 549 B.R. 907, 2016 Bankr. LEXIS 1833, 2016 WL 1690572 (Mont. 2016).

Opinion

MEMORANDUM OF DECISION

Honorable Ralph B. Kirscher, Chief U.S. Bankruptcy Judge

At Butte in said District this 25th day of April, 2016.

After due notice, the Court held a second evidentiary hearing at Missoula on March 10, 2016, on Debtor’s Objection (Document No. 70) to amended Proof of Claim No. 2 filed by Greg Moran (“Greg”) and Rachelle Moran (“Rachelle”) (together “Morans”). Morans each appeared at the hearing pro se; Greg testified. Debtor Martin Raymond Johnson (“Johnson” or “Debtor”) appeared and testified, represented by attorney Andrew W. Pierce of Missoula. Isaac Fritz, Shawn Christensen, Robert Stuckey, Josh Green and Marty Johnson also testified. Exhibits 1, 2, 3 and 4 attached to Morans’ amended Proof of Claim No. 2 were admitted into evidence. After the parties completed their cases-in-chief the Court heard oral argument from the parties, after which it took the Debtor’s Objection under advisement. After review of the Debtor’s Objection, Morans’ amended Proof of Claim No. 2 and the record, the Court sustains Debt- or’s Objection. The Court allows Morans’ amended Proof of Claim No. 2 as an unsecured, nonpriority claim in the net amount [908]*908of $260.44 after deducting the amount of Johnson’s work invoice on Morans’ cabin, in accordance with the parties’ unwritten agreement.

This Court has exclusive jurisdiction of this Chapter 13 bankruptcy case under 28 U.S.C. § 1334(a). Allowance or disallowance of Morans’ claim is a core proceeding under 28 U.S.C. § 157(b)(2)(b).

FACTS

The background facts mostly are not in dispute1 and are set forth in this Court’s prior Memorandum of Decision (Doc. 66), which sustained Debtor’s objection to Mor-ans’ original Proof of Claim No. 2, but granted Morans leave to file an amended claim with documents showing the basis of their claim. Morans filed amended Proof of Claim 2 on January 20, 2016, attached to which are invoices for vehicle repairs which Greg’s business performed for Johnson;2 invoices from Great Northern Tile Co. (“Great Northern Tile”) for repairing Johnson’s work and performing additional remodeling work at Morans’ cabin located on Georgetown Lake; and documents from a lawsuit Morans initiated against Johnson in the Montana Fourth Judicial District Court, No. DV-13-1030. Morans’ amended Proof of Claim 2 asserts an unsecured, nonpriority claim in the amount of $11,942.76. They checked the box “No” at item 11 where they were asked if their claim is subject to a right of setoff.

Johnson has been self-employed in construction since 1985. He does tile and carpentry work out of Seeley Lake, Montana. He owned and operated Marty Johnson, LLC, until it was dissolved in 2010.

Robert Stuckey (“Stuckey”) is an independent contractor with thirty years experience in carpentry and remodeling. Stuckey testified that he has known Johnson for twenty years, that Johnson’s reputation in the construction industry is “good, really good,” and that in Stuckey’s opinion the quality of Johnson’s work is “as good as anyone’s.” Stuckey worked as a subcontractor for Johnson during the remodel of Morans’ cabin.

Josh Green is a self-employed subcontractor with more than fifteen years experience, who works on flooring and showers under the name Green Flooring. Green testified that he has been familiar with Johnson for fifteen years and has done subcontracting work for Johnson involving showers and hardwood.3 In Green’s opinion, Johnson’s work is of high quality.

Morans own an auto repair shop in Mis-soula and a cabin on Georgetown Lake. Johnson testified that he and Greg were friends. In approximately 2007, they worked out a barter/trade agreement to exchange Greg’s work on Johnson’s vehicles4 for Johnson’s carpentry services at Morans’ cabin. Morans kept track of Johnson’s vehicle repair bills; the parties agreed that Johnson would get credit for his carpentry services. Johnson testified that most of the amount owed to Morans for vehicle repairs was owed by his LLC.

A dispute arose between the parties regarding Johnson’s work at Morans’ cabin. Greg testified that Johnson’s work was incomplete, that Johnson installed the [909]*909wrong wood and other materials and that Johnson failed to construct proper structural support for a wall in the master bathroom. Johnson testified that he could have cured the problems complained of by Morans, but that before he could finish Morans ordered him off their property and to stay away. Morans sued Johnson in state court. That lawsuit was stayed by the filing of Johnson’s bankruptcy case.

Johnson filed a voluntary Chapter 13 petition on March 26, 2015, with his Schedules and Statements in which Morans are listed as a creditor. Morans filed Proof of Claim No. 2 on April 20, 2015, asserting a claim in the amount of $11,942.76, the basis for which is stated “carpentry services performed.” Debtor filed an objection, which this Court sustained after hearing. The Court allowed Morans to file an amended proof of claim with appropriate documentation.

Morans filed amended Proof of Claim 2 on January 20, 2016, asserting an unsecured nonpriority claim in the amount of $11,942.76.5 Debtor filed an objection on January 29, 2016, contending that, as a result of his flooring and carpentry work on Morans’ cabin, he owes them nothing.

The agreement between Johnson and Morans to exchange Johnson’s work on their cabin for vehicle repairs is unwritten. Other than the basic barter arrangement, the parties do not agree on material details of the agreement. In response to questions from the Court, Greg testified that he initially agreed to offset his bill for vehicle repairs6 with Johnson’s work on their cabin. Johnson testified that he paid Greg in cash for a new engine and a few other repairs, but otherwise Johnson paid his bill to Morans with work at their cabin.

Johnson performed work at Morans’ cabin through his company Marty Johnson, LLC; and he testified that most of Morans’ claim is for vehicle work for Johnson’s company vehicles. He testified that he worked on Morans’ cabin over a period of a few years, in between working at his other contracting jobs, when he had access to the cabin. He testified that he gave Greg progress invoices for the project.

From the testimony and photographs admitted into evidence, it appears that Johnson’s work on Morans’ cabin included installing tile and a shower enclosure in the spare bathroom; tile, a tub enclosure, shower pan and a “stub wall” or “knee wall” in the master bathroom; oak flooring in the kitchen and flooring and wood trim in the spare bedroom. Stuckey testified that he did some of the work at Moran’s cabin for Johnson, including “maybe” the knee wall,7 and laid backerboard for the bathtub.

The parties agree that each room worked on was to have a border. Johnson testified that Greg had seen border work which Johnson had installed in Johnson’s own home, and that Greg liked it and asked Johnson to install something similar for Morans’ cabin. Morans wanted something different for each room. Johnson had leftover wood from other projects.

Greg testified that the floor work was to have a pattern, which they discussed with Johnson.

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Cite This Page — Counsel Stack

Bluebook (online)
549 B.R. 907, 2016 Bankr. LEXIS 1833, 2016 WL 1690572, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-johnson-mtb-2016.