In re: Marcella Lee Barker

• Court: United States Bankruptcy Appellate Panel for the Ninth Circuit
• Decided: March 28, 2014
• Docket: MT-13-1393-JuKuPa
• Status: Unpublished

Opinion

FILED MAR 28 2014 1 NO FO PUBL A IO T R IC T N SUSAN M. SPRAUL, CLERK 2 U.S. BKCY. APP. PANEL OF THE NINTH CIRCUIT 3 UNITED STATES BANKRUPTCY APPELLATE PANEL 4 OF THE NINTH CIRCUIT 5 In re: ) BAP No. MT-13-1393-JuKuPa ) 6 MARCELLA LEE BARKER, ) Bk. No. 12-61445-RBK ) 7 Debtor. ) ______________________________) 8 ) SPOKANE LAW ENFORCEMENT ) 9 FEDERAL CREDIT UNION, ) ) 10 Appellant, ) ) 11 v. ) M E M O R A N D U M* ) 12 MARCELLA LEE BARKER; ROBERT ) G. DRUMMOND, Chapter 13 ) 13 Trustee; OCWEN LOAN SERVICING,) LLC; UNITED STATES TRUSTEE, ) 14 ) Appellees. ) 15 ______________________________) 16 Argued and Submitted on March 20, 2014 at Pasadena, California 17 Filed - March 28, 2014 18 Appeal from the United States Bankruptcy Court 19 for the District of Montana 20 Honorable Ralph B. Kirscher, Bankruptcy Judge, Presiding _________________________ 21 Appearances: Quentin M. Rhoades, Esq., of Sullivan, Tabaracci 22 & Rhoades, P.C. argued for appellant Spokane Law Enforcement Federal Credit Union; Kraig C. Kazda, 23 Esq. argued for appellee Marcella Lee Barker; Robert G. Drummond, Chapter 13 Trustee argued pro 24 se. ___________________ 25 26 * This disposition is not appropriate for publication. 27 Although it may be cited for whatever persuasive value it may have (see Fed. R. App. P. 32.1), it has no precedential value. 28 See 9th Cir. BAP Rule 8013-1.

-1- 1 Before: JURY, KURTZ, and PAPPAS, Bankruptcy Judges. 2 Spokane Law Enforcement Federal Credit Union (SLECU) 3 appeals from the bankruptcy court’s order (1) denying its Motion 4 for Allowance of Claims; (2) sustaining the objection to 5 late-filed claims filed by chapter 131 trustee, Robert G. 6 Drummond; and (3) disallowing SLECU’s proofs of claim nos. 6, 7, 7 and 8 as late filed.2 We AFFIRM. 8 I. FACTS 9 Marcella Lee Barker filed her chapter 13 petition on 10 September 6, 2012. Debtor listed SLECU as a secured creditor 11 owed $6,646.00 in Schedule D and as an unsecured creditor owed 12 $47,402.00 in Schedule F.3 The debts were listed as undisputed 13 and liquidated. 14 SLECU was properly served with notice that the deadline for 15 filing a proof of claim was January 8, 2013. The notice further 16 warned: 17 If you do not file a Proof of Claim by the “Deadline to file a Proof of Claim” listed on the front side, 18 19 1 Unless otherwise indicated, all chapter and section 20 references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532, and “Rule” references are to the Federal Rules of Bankruptcy 21 Procedure. 22 2 Appellees Drummond and Marcella Barker have filed briefs 23 in this appeal. Appellees Ocwen Loan Servicing, LLC and the United States Trustee have not appeared. 24 3 From what we can tell, the debts to SLECU arose from loans 25 made to debtor and her ex-husband, Darryl, for the purchase or 26 refinance of vehicles. At some point, Darryl sold two vehicles without SLECU’s consent. The Barkers then entered into two 27 modification agreements with SLECU for repayment of those loans which are unsecured. SLECU evidently still holds a security 28 interest in the other vehicle, a 2004 Ford F-150 truck.

-2- 1 you might not be paid any money on your claim from other assets in the bankruptcy case. To be paid, you 2 must file a Proof of Claim even if your claim is listed in the schedules filed by the debtor. 3 4 SLECU did not file a proof of claim by the bar date. 5 On September 19, 2012, debtor filed her chapter 13 plan, 6 which she subsequently amended. Paragraph 2(c) titled 7 “Unimpaired Secured Claims” stated that SLECU’s secured claim 8 against the 2004 Ford F-150 truck “will be left unimpaired by 9 the [p]lan, are not provided by the [p]lan and shall receive no 10 payments through the [t]rustee except with regard to those 11 arrearages specified below, if any[.]” No arrearages were 12 listed. The plan was a 100% repayment plan. SLECU had notice 13 of the plan and amended plan. On October 6, 2012, the 14 bankruptcy court confirmed debtor’s plan. 15 In January 2013, Debtor filed a motion to modify her plan 16 along with an amended plan, both of which were served on SLECU. 17 Paragraph 2(c) titled “Unimpaired Secured Claims” deleted SLECU. 18 The bankruptcy court approved the modification by an order 19 entered on February 8, 2013. In March 2013, debtor filed a 20 second motion to modify her plan along with an amended plan, 21 both of which were served on SLECU. The bankruptcy court 22 approved the modification by an order entered on April 2, 2013. 23 On May 30, 2013, SLECU filed formal proofs of claim nos. 6, 24 7 and 8 in the amounts of $5,490.78 (secured); $28,293.84 25 (unsecured); and $24,597.47 (unsecured), respectively. On 26 June 7, 2013, the trustee objected to the proofs of claim on the 27 grounds that they were untimely. SLECU requested a hearing and 28 argued that the late-filed claims should be allowed on the basis

-3- 1 that a disgruntled employee had failed to timely file the proofs 2 of claim. 3 On July 31, 2013, SLECU filed a Motion for Allowance of 4 Claims, asserting that debtor’s Schedules D and F constituted an 5 informal proof of claim and/or judicial admission of its debt 6 because the schedules listed it. Therefore, according to SLECU, 7 its late-filed proofs of claim should relate back to the 8 informal, scheduled claims. In response, debtor argued that the 9 listing of a creditor in schedules does not constitute an 10 informal proof of claim. Debtor further asserted that 11 bankruptcy courts had no discretionary authority to enlarge the 12 time for filing a proof of claim. 13 At the August 2, 2013 hearing on the matter, the bankruptcy 14 court found SLECU had not made a written demand to hold debtor 15 liable for the debts and thus the requirements for an informal 16 proof of claim under Ninth Circuit law were not met. The court 17 denied SLECU’s motion, sustained the trustee’s objection to its 18 late-filed claims, and disallowed SLECU’s claims. 19 The court entered an order consistent with its decision on 20 the same day, finding that: (1) it had no discretion to allow a 21 late filed proof of claim in a chapter 13 case based on the 22 holding in United States v. Osborne (In re Osborne), 76 F.3d 23 306, 310-11 (9th Cir. 1996); and (2) debtor’s scheduling of 24 SLECU’s debt did not satisfy the requirements for an informal 25 proof of claim set forth in Wright v. Holm (In re Holm), 26 931 F.2d 620, 622 (9th Cir. 1991). SLECU timely appealed from 27 this order. 28

-4- 1 II. JURISDICTION 2 The bankruptcy court had jurisdiction over this proceeding 3 under 28 U.S.C. §§ 1334 and 157(b)(2)(B). We have jurisdiction 4 under 28 U.S.C. § 158. 5 III. ISSUE 6 Whether the bankruptcy court erred in disallowing SLECU’s 7 proofs of claim. 8 IV. STANDARD OF REVIEW 9 We review the bankruptcy court’s disallowance of SLECU’s 10 proofs of claim de novo. Cont’l Ins. Co. v. Thorpe Insulation 11 Co. (In re Thorpe Insulation Co.), 671 F.3d 1011, 1020 (9th Cir. 12 2012), cert. denied, 133 S.Ct. 119 (2012); see also Varela v. 13 Dynamic Brokers, Inc. (In re Dynamic Brokers, Inc.), 293 B.R. 14 489, 493 (9th Cir. BAP 2003) (issues related to disallowance are 15 questions of law reviewed de novo). 16 Whether a valid informal proof of claim exists in a 17 bankruptcy case is a question of law reviewed de novo. Pac. 18 Resource Credit Union v. Fish (In re Fish), 456 B.R. 413, 417 19 (9th Cir. BAP 2011) (citing Pizza of Haw., Inc. v. Shakey’s, 20 Inc. (In re Pizza of Haw., Inc.), 761 F.2d 1374, 1377 (9th Cir. 21 1985)). De novo review requires the Panel to independently 22 review an issue, without giving deference to the bankruptcy 23 court’s conclusions. See Cal. Franchise Tax Bd. v. Wilshire 24 Courtyard (In re Wilshire Courtyard), 459 B.R. 416, 423 (9th 25 Cir. BAP 2011) (citing First Ave. W. Bldg., LLC v. James 26 (In re Onecast Media, Inc.), 439 F.3d 558, 561 (9th Cir. 2006)). 27 28

-5- 1 V. DISCUSSION 2 A. The Legal Principles Governing Bankruptcy Claims 3 The Bankruptcy Code and Rules govern the requirements for 4 the filing and allowance of proofs of claim. In a chapter 13 5 case, the trustee may only make distributions “to creditors 6 whose claims have been allowed.” See Rule 3021. 7 To be allowed, the claim must first be filed under § 501. 8 Section 501(a) provides that any creditor may file a proof of 9 claim. Section 501(c) provides that “[i]f a creditor does not 10 timely file a proof of such creditor’s claim, the debtor or the 11 trustee may file a proof of such claim.” “A proof of claim is a 12 written statement setting forth a creditor’s claim.” 13 Rule 3001(a). 14 If the claim meets the requirements of § 501, the 15 bankruptcy court must then determine whether the claim should be 16 allowed. Section 502(a) provides that a claim is deemed allowed 17 unless a party in interest objects. If such an objection is 18 made, the court shall allow such claim “except to the extent 19 that the proof of claim is not timely filed.” See § 502(a)(9). 20 Rules 3002 and 3004 implement the provisions of §§ 501 and 21 502. If an unsecured creditor’s claim is to be allowed in a 22 chapter 13 case, a proof of claim must be filed. See 23 Rule 3002(a). In chapter 13, a proof of claim is timely filed 24 if it is filed not later than 90 days after the first date set 25 for the meeting of creditors called under § 341(a). See 26 Rule 3002(c). If a creditor fails to file a claim within the 27 time periods prescribed, then the debtor (or trustee) may file a 28 claim on the creditor’s behalf within 30 days of the expiration

-6- 1 of the creditor’s bar date. See Rule 3004.4 2 Finally, Rule 9006, in conjunction with Rule 3002(c), 3 precludes the filing of an untimely proof of claim in chapter 7 4 and chapter 13 cases, except in very limited circumstances.5 5 B. The Bankruptcy Court’s Equitable Power To Enlarge The Time for Filing A Proof of Claim Is Limited 6 7 There is no dispute that SLECU failed to timely file its 8 proofs of claim by the January 8, 2013 bar date. Citing 9 Gardenhire v. IRS (In re Gardenhire), 209 F.3d 1145, 1148 (9th 10 Cir. 2000), SLECU acknowledges in its opening brief that the 11 claims bar date is a “rigid deadline” and that late-filed 12 general unsecured claims are disallowed. To be sure, the 13 bankruptcy court lacks any equitable power to enlarge the time 14 for filing a proof of claim unless one of the six situations in 15 Rule 3002(c) exists. None apply to this case. See 16 In re Gardenhire, 209 F.3d at 1148 (“Our precedents support the 17 conclusion that a bankruptcy court lacks equitable discretion to 18 enlarge the time to file proofs of claim; rather, it may only 19 20 4 Rule 3004 states: 21 If a creditor does not timely file a proof of claim 22 under Rule 3002(c) or 3003(c), the debtor or trustee may file a proof of the claim within 30 days after the 23 expiration of the time for filing claims prescribed by Rule 3002(c) or 3003(c), whichever is applicable. The 24 clerk shall forthwith give notice of the filing to the creditor, the debtor and the trustee. 25 5 26 Rule 9006(b)(3) provides:

27 The court may enlarge the time for taking action under Rules . . . 3002(c), . . . only to the extent and under 28 the conditions stated in those rules. . . .

-7- 1 enlarge the filing time pursuant to the exceptions set forth in 2 the Bankruptcy Code and Rules.”) (citing In re Osborne, 76 F.3d 3 306 (9th Cir. 1996), In re Tomlan, 907 F.2d 114 (9th Cir. 1990) 4 and Zidell, Inc. v. Forsch (In re Coastal Alaska Lines, Inc.), 5 920 F.2d 1428, 1432–33 (9th Cir. 1990)). SLECU’s attempt to 6 distinguish Gardenhire and Osborne on their facts is 7 unpersuasive because the rule of law stated in those cases 8 applies with equal force to this case. 9 To the extent SLECU argues that excusable neglect is a 10 basis for enlarging the time for filing a proof of claim, that 11 argument has no merit.6 The excusable neglect standard set 12 forth in Rule 9006(b)(3) does not apply to permit the court to 13 extend the time for filing a proof of claim under Rule 3002(c). 14 In re Coastal Alaska Lines, Inc., 920 F.2d at 1432–33. 15 Therefore, under Rule 3002(c), a proof of claim must be 16 disallowed if it is untimely. Because SLECU had actual notice 17 of debtor’s bankruptcy case in time to file a proof of claim by 18 the claims bar date, the bankruptcy court properly found that 19 its proofs of claims were time-barred. 20 C. The Informal Proof of Claim Doctrine Does Not Apply 21 To avoid disallowance, SLECU argues that its late-filed 22 6 23 SLECU simply mentions excusable neglect as a reason why courts accept late filings caused by inadvertence, mistake, or 24 carelessness, as well as by intervening circumstances beyond a party’s control and cites Pioneer Inv. Servs. Co. v. Brunswick 25 Assocs. Ltd. P’ship, 507 U.S. 380 (1993). SLECU did not argue 26 excusable neglect in the bankruptcy court and the bankruptcy court did not mention it. However, we may consider for the first 27 time on appeal issues of law when the relevant facts are undisputed and/or the factual record has been fully developed. 28 See Vasquez v. Holder, 602 F.3d 1003, 1010 n.6 (9th Cir. 2010).

-8- 1 proofs of claim should be deemed timely under the informal proof 2 of claim doctrine because debtor listed it as a creditor with an 3 undisputed and liquidated claim in her Schedules D and F. The 4 informal proof of claim doctrine is rooted in the policy 5 favoring liberal amendments to creditors’ proofs of claim so 6 that the late-filed formal claim relates back to previously 7 filed informal claim. In re Holm, 931 F.2d at 622. 8 The Ninth Circuit has articulated various tests for 9 determining whether a document constitutes an informal proof of 10 claim. Early on, in Perry v. Certificate Holders of Thrift 11 Sav., 320 F.2d 584 (9th Cir. 1963), the court held that “there 12 must have been presented, within the time limit, by or on behalf 13 of the creditor, some written instrument which brings to the 14 attention of the court the nature and amount of the claim.” Id. 15 at 590. This Panel has interpreted the Perry test to include 16 five requirements: (1) presentment of a writing; (2) within the 17 time for the filing of claims; (3) by or on behalf of the 18 creditor; (4) bringing to the attention of the court; (5) the 19 nature and amount of a claim asserted against the estate. 20 In re Fish, 456 B.R. at 417 (citing Dicker v. Dye 21 (In re Edelman), 237 B.R. 146, 155 (9th Cir. BAP 1999)). 22 In Cnty. of Napa v. Franciscan Vineyards, Inc. 23 (In re Franciscan Vineyards, Inc.), 597 F.2d 181, 182 (9th Cir. 24 1979), the Ninth Circuit recited the Perry test, but also 25 refined it, noting: “‘Whether formal or informal, a claim must 26 show . . . that a demand is made against the estate, and must 27 show the creditor’s intention to hold the estate liable.’” 28 Several years later in Sambo’s Rests., Inc. v. Wheeler

-9- 1 (In re Sambo’s Rests., Inc.), 754 F.2d 811 (9th Cir. 1985), the 2 Ninth Circuit did not mention the Perry test at all, but relied 3 on its previous statement in Franciscan Vineyards to hold: “For 4 a document to constitute an informal proof of claim, it must 5 state an explicit demand showing the nature and amount of the 6 claim against the estate, and evidence an intent to hold the 7 debtor liable.” Id. at 815. 8 In this case, the only “writing” SLECU relies upon for 9 application of the informal proof of claim doctrine is debtor’s 10 Schedules D and F. However, the mere scheduling of a debt by a 11 debtor does not pass any test in the Ninth Circuit for an 12 informal proof of claim. Under the Sambo’s Rests. test, the 13 scheduling of a debt does not constitute an “explicit demand” by 14 SLECU. Stating a demand does not mean the debtor giving mere 15 notice (such as on the schedules), but also requires a showing 16 that the creditor intends to hold the estate liable. 17 In re Sambo’s Rests., Inc., 754 F.2d at 815; see also United 18 States v. Int’l Horizons, Inc. (In re Int’l Horizons), Inc., 19 751 F.2d 1213, 1217 (11th Cir. 1985). Accordingly, debtor’s 20 scheduling of the debt cannot reasonably be construed as 21 evidence of SLECU’s intent to pursue its claims. 22 The scheduling of a debt also does not meet all the 23 requirements under the Perry test. In the order disallowing 24 SLECU’s claims, the bankruptcy court found that debtor’s 25 schedules “are not statements of the creditor.” SLECU contends 26 that the informal proof of claim need not be filed by the 27 creditor. This statement is only partially correct. Under the 28 Perry test, the writing must be presented “by or on behalf of

-10- 1 the creditor.” Obviously it was the debtor, not SLECU, who 2 filed the schedules. Further, although a debtor may file a 3 proof of claim on behalf of a creditor under § 501 and 4 Rule 3004, that filing must occur after the bar date. See 5 Rule 3004. Here, debtor filed her schedules well before the bar 6 date and thus it is unreasonable to conclude that the schedules 7 constituted an informal proof of claim filed on SLECU’s behalf 8 pursuant to Rule 3004. Therefore, because the schedules were 9 not presented “by or on behalf of” SLECU, this element of the 10 Perry test is not met.7 11 More to the point, the relationship between the Bankruptcy 12 Code and the Federal Rules of Bankruptcy Procedure, which 13 together lay the foundation for the disallowance of late-filed 14 claims in chapter 13 cases, also demonstrates that the 15 scheduling of a debt standing alone does not equate to the 16 filing of a proof of claim pursuant to § 501. 17 Otherwise, there would in effect be no claims deadline (all subsequently filed proofs of claim relating back 18 to the informal, scheduled claims), and the Bankruptcy Rule requiring the filing of proofs of claim in 19 Chapter [13] cases (Rule 3002) would have no meaning. 20 In re Crawford, 135 B.R. 128, 132 (D. Kan. 1991). 21 SLECU cites several cases in its opening brief for the 22 proposition that the listing of claims in a debtor’s schedules 23 amounts to an informal proof of claim. But these cases actually 24 25 7 The schedules could reasonably be construed as meeting the 26 other four elements of the Perry test: The schedules constitute a writing filed prior to the bar date, and the listing of the 27 debt as undisputed and liquidated is arguably enough to show the nature and the amount of the claim asserted against the estate 28 and bring it to the attention of the court.

-11- 1 require more. Although the scheduling of a debt is not itself 2 an informal proof of claim, one may be found when the schedules 3 combine with other documents or evidence of the creditor’s 4 intent to pursue the claim. 5 For example, in Scottsville Nat’l Bank v. Gilmer, 37 F.2d 6 227, 229 (4th Cir. 1930), the Fourth Circuit reversed the 7 district court’s decision disallowing a late-filed claim by the 8 bank: 9 In the case presented here the debt due appellant bank was listed in the schedule filed by the bankrupt, and 10 appears in the record. The letter of the trustee to the bank and the bank’s answer thereto, which must be 11 read together, show clearly that both the trustee and bank treated the bank’s claim as valid as against the 12 bankrupt estate; the trustee conferred with the officers and the attorney for the bank frequently with 13 regard to matters connected with the estate; the president of the bank knew that the bank’s debt was 14 included in the schedule filed by the bankrupt; and it is admitted by the trustee that through the effort of 15 the bank the value of bankrupt’s estate was increased at least 50 per cent. All these things lead to the 16 conclusion that there was sufficient in the record to justify the permission to the bank to file an amended 17 claim at the time it presented same for filing, and that the action of the referee in allowing said filing 18 was right. 19 Id. (emphasis added). Thus, besides being listed in the 20 debtor’s schedules, there was far more in the record to support 21 allowance of the late-filed claim. 22 In In re Clapp, 57 B.R. 921 (Bankr. D. Minn. 1986), 23 although creditor was listed in the debtor’s schedules, the 24 debtor sought to disallow the creditor’s claim in its entirety 25 because the creditor did not file a formal proof of claim by the 26 bar date. In allowing the creditor’s claim, the bankruptcy 27 court found that it “clearly and frequently asserted its 28 intention to pursue its claim,” by writing letters to the

-12- 1 debtor’s attorney and having its officer appointed to the 2 Unsecured Creditors Committee prior to the bar date. 3 In In re Hart Ski Mfg. Co., Inc., 5 B.R. 326, 327 (Bankr. 4 D. Minn. 1980), the bankruptcy court stated that the bar date 5 “does not apply to claims clearly and sufficiently asserted 6 within the filing period set.” Id. at 328. “‘[I]f there is 7 upon the record in the bankruptcy proceedings’ within the time 8 limitations, ‘anything sufficient to show the existence, nature 9 and amount of a claim, it may be amended even after the 10 expiration of the period.’” Id. There, the creditor was listed 11 in the debtor’s schedules, but the court also found that the 12 creditor had continually asserted its claims in various 13 pleadings filed in the case. 14 Finally, in Dresser Indust., Inc. v. Rite Autotronics Corp. 15 (In re Rite Autotronics Corp.), 27 B.R. 599 (9th Cir. BAP 1982) 16 the court recognized an amendable claim, in the absence of the 17 timely filing of a formal “Proof of Claim,” where the debtor 18 listed a creditor in its petition and the creditor later 19 participated on a creditor’s committee despite the fact there 20 was no writing. The Panel later limited the holding in Rite 21 Autotronics to its facts because there was no writing and the 22 case was filed under chapter 11. See Lees-Carney & Co. v. 23 Morrow (In re Kenitra, Inc.), 64 B.R. 841, 842 (9th Cir. BAP 24 1986). Indeed, in chapter 11, § 1111(a) provides that a proof 25 of claim is deemed filed under § 501 when it appears in the 26 schedules, except when it is scheduled as disputed, contingent, 27 or unliquidated. There is no parallel statute in the context of 28 chapter 13. Thus, well-settled statutory construction

-13- 1 principles point away from construing the mere listing of an 2 undisputed debt in a chapter 13 debtor’s schedules as an 3 informal proof of claim. See Griffith v. United States 4 (In re Griffith), 206 F.3d 1389, 1394 (11th Cir. 2000) (“where 5 Congress knows how to say something but chooses not to, its 6 silence is controlling”). 7 In the end, none of these cases help SLECU’s position. The 8 schedules here do not combine with other documents or evidence 9 of SLECU’s intent to pursue the claims. In sum, we hold that 10 the scheduling of a debt does not by itself constitute an 11 informal proof of claim. Therefore, the bankruptcy court 12 properly disallowed SLECU’s proofs of claims as time-barred. 13 C. The Judicial Admissions Doctrine Does Not Apply 14 SLECU also relies on the judicial admissions doctrine to 15 support allowance of its claims. Its argument goes like this: 16 Creditor failed to timely file a proof of claim; debtor listed 17 the debts in her schedules; under the doctrine of judicial 18 admissions, debtor is bound by this listing; ergo, the listing 19 functions as if the creditor had timely filed the proofs of 20 claim under Rule 3002(c) or 3003(c).8 To recognize this 21 argument would allow through the back door what SLECU cannot 22 accomplish through the front door — the mere scheduling of a 23 debt to constitute an informal proof of claim. This would 24 circumvent not only the requirements for an informal proof of 25 claim under Ninth Circuit case law, but would also render 26 27 8 SLECU’s citation to Rule 3003(c) is puzzling. That rule 28 applies only in chapter 9 and 11 cases.

-14- 1 Rule 3002(c) essentially meaningless. 2 VI. CONCLUSION 3 For the reasons stated, SLECU’s late-filed proofs of claim 4 have nothing to relate back to. Accordingly, we AFFIRM the 5 bankruptcy court’s order disallowing SLECU’s proofs of claim.9 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 9 27 Although proof of claim no. 6 is disallowed, the underlying lien (to the extent one exists) is not extinguished by 28 the mere fact of disallowance.

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