Queen v. TA Operating, LLC

734 F.3d 1081, 70 Collier Bankr. Cas. 2d 109, 2013 WL 4419322, 2013 U.S. App. LEXIS 17296
CourtCourt of Appeals for the Tenth Circuit
DecidedAugust 20, 2013
Docket11-8090, 11-8098
StatusPublished
Cited by46 cases

This text of 734 F.3d 1081 (Queen v. TA Operating, LLC) is published on Counsel Stack Legal Research, covering Court of Appeals for the Tenth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Queen v. TA Operating, LLC, 734 F.3d 1081, 70 Collier Bankr. Cas. 2d 109, 2013 WL 4419322, 2013 U.S. App. LEXIS 17296 (10th Cir. 2013).

Opinion

EBEL, Circuit Judge.

INTRODUCTION

Plaintiffs Richard and Susan Queen (“Queens”) sued Defendant TA Operating, LLC (“TA”) in federal district court in Wyoming (“District Court Action”). They brought various claims against TA based on an injury Mr. Queen sustained when he slipped and fell in a parking lot operated by TA. During the course of the District Court Action, the Queens filed for Chapter 7 bankruptcy in California (“Bankruptcy Action”), but did not disclose the District Court Action in their bankruptcy filings. When TA discovered this failure, TA brought it to the attention of the trustee for the Bankruptcy Action (“Trustee”). The Queens subsequently amended their bankruptcy filings to include the District Court Action, but they provided an estimate of its value that was far below what they had indicated in the proceedings before the Wyoming district court, and they claimed that the lawsuit was entirely exempt. Subsequently, the Queens were granted a no-asset discharge in bankruptcy-

In the District Court Action, TA filed a motion for summary judgment on the grounds that the doctrine of judicial estop-pel should be applied to dismiss the District Court Action, because the Queens had not disclosed the lawsuit in their bankruptcy proceedings. The district court granted summary judgment in favor of TA on this basis, dismissing the Queens’ claims with prejudice. The Queens appealed the district court’s ruling, arguing that the district court erred in applying the doctrine of judicial estoppel.

Having jurisdiction under 28 U.S.C. § 1291, we affirm the district court’s ruling. Because the Queens adopted an inconsistent position that was accepted by the bankruptcy court, and because the Queens would receive an unfair advantage if not estopped from pursuing the District Court Action, we hold that it was not an abuse of discretion for the court to apply the doctrine of judicial estoppel and grant summary judgment in favor of TA. We also reject the Queens’ arguments of mistake and inadvertence, because the record shows that the Queens had knowledge of the claim and a motive to conceal it in their bankruptcy proceedings. Because we decide this appeal on the basis of judicial estoppel, we dismiss as moot TA’s cross-appeal. 1

BACKGROUND

I. Factual Background

On February 27, 2007, Plaintiffs Richard and Susan Queen were working as a semi-truck driving team. They parked in a parking lot at the Rawlings Travel Center in Wyoming, which was operated by TA. That night, Mr. Queen slipped and fell *1085 while walking in the parking lot. As a result, he broke his ankle and had to be taken by ambulance to the hospital.

II. Procedural Background

A. The Wyoming Lawsuit

The Queens filed a lawsuit against TA in federal district court for the District of Wyoming. In this District Court Action, among other , things, the Queens argued that Mr. Queen had been injured as a result of TA’s negligence in maintaining the parking lot. The Queens requested an award for damages that included: (1) Mr. Queen’s past and future medical expenses; (2) Mr. Queen’s lost past and future wages; (3) Mr. Queen’s pain and suffering; (4) Mr. Queen’s loss of enjoyment of life, (5) Mrs. Queen’s loss of consortium, and (6) an award of punitive damages.

B. The Bankruptcy Action

While the District Court Action against TA was proceeding in Wyoming, the Queens filed for Chapter 7 bankruptcy in the United States Bankruptcy Court for the Eastern District of California. Although the Queens claim that they disclosed the District Court Action to their bankruptcy attorney, it was not listed in their bankruptcy filings. Specifically, the Queens did not list the lawsuit in their Schedule B — Personal Property, even though Item 21 of the schedule specifically asked the Queens to identify “[ojther contingent and unliquidated claims of every nature, including tax refunds, counterclaims of the debtor, and right of setoff claims,” and “[gjive an estimated value of each.” Aplt.App. at 1112. The Queens also did not list the District Court Action as an exempt asset on their Schedule C— Property Claimed as Exempt. Moreover, in response to the item on the Statement of Financial Affairs requiring the Queens to “[l]ist all suits and administrative proceedings to which the debtor is or was a party within one year immediately preceding the filing of this bankruptcy case,” the Queens marked, “None.” ApltApp. at 1146.

In signing their bankruptcy filings, the Queens declared under penalty of perjury that they had read those documents, and that the information in the filings was true to the best of their knowledge, information, and belief. Further, at a standard creditors’ meeting, Mr. Queen completed a questionnaire (“Debtor Questionnaire”), in which he again, affirmed that he had signed the bankruptcy petition after reviewing it, that the accompanying Schedules and Statement of Financial Affairs were complete and accurate, and that he did not need to make any corrections or changes.

One of the questions on the Debtor Questionnaire asked the Queens, “Are you suing anyone?” Aplt.App. at 1153. Mr. Queen responded, “Insurance company suing to get money refunded for my injury.” Id. No questions were asked at this meeting about the lawsuit that the Queens mentioned on the Debtor Questionnaire, and the Queens provided no other information. After the meeting, the Trustee determined that there were no assets available from the estate to distribute to the creditors.

C.The Queens’ Amended Bankruptcy Filings & Discharge in Bankruptcy

Subsequently, TA became aware of the Bankruptcy Action. TA emailed the Trustee for the Bankruptcy Action, informing the Trustee that the Queens had not disclosed the District Court Action in their bankruptcy filings. After some communication between TA and the Trustee regarding the District Court Action, the Trustee emailed the Queens and TA, pointing to the question and response in the Debtor Questionnaire, and stating that he *1086 had no other notes on this. The remainder of the Trustee’s email states: “Given this quasi-disclosure, I am inclined not to take any action in this matter until debtors have amended their schedules and claimed the lawsuit as exempt, assuming they wish to. I will then decide if I am going to object to the exemption.” Aplt.App. at 946.

After this email, the Queens filed amended Schedules B and C and an amended Statement of Financial Affairs. In the Amended Schedule B, they listed a “Personal Injury Claim” and placed a total value on that claim of $400,000. On Amended Schedule C, the Queens claimed the District Court Action as entirely exempt under three provisions of the California Code of Civil Procedure. On the Statement of Financial Affairs, the Queens also listed the District Court Action. Under the heading “Nature of the Proceeding,” they stated “Law Suit, Personal Injury Claim, Negligence,” and they indicated that the case was in the discovery stage. Following the amended filings, neither the Trustee nor any creditors filed an objection to the claimed exemptions.

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734 F.3d 1081, 70 Collier Bankr. Cas. 2d 109, 2013 WL 4419322, 2013 U.S. App. LEXIS 17296, Counsel Stack Legal Research, https://law.counselstack.com/opinion/queen-v-ta-operating-llc-ca10-2013.