Thao Tran Nguyen and Andrew HungLam Nguyen

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UNITED STATES BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
In re
THAO TRAN and ANDREW HUNGLAM
NGUYEN, 	No. 09-10549
Debtor(s).
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Memorandum on Motion to Surcharge Exemptions
_________________
In denying the debtors’ discharge, the court found that the debtors had converted about
$20,000.00 belonging to the bankruptcy estate and had failed to account for at least $5,500.00 of it.
While the court does not believe it is appropriate to turn even dishonest debtors away without
exemptions, in this case it appears that until the estate is made whole the debtors have already helped
themselves to more than their legitimate exemptions.
The trustee is holding $2,075.00 in proceeds from the sale of a truck. The debtors have
claimed these funds exempt. While the truck was disclosed, surcharge is not limited to non-disclosed
assets. Surcharge is an exceptional remedy, but an appropriate one where the debtors, due to improper
conduct, have taken from the estate property in excess of that which is properly exempted. In re
Onubah, 375 B.R. 549, 553 (9th Cir.BAP 2007).
The court will accordingly grant the motion and surcharge the exemption, not because the cost
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Entered on Docket
January 21, 2011
GLORIA L. FRANKLIN, CLERK
U.S BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
Case: 09-10549 Doc# 116 Filed: 01/21/11 Entered: 01/21/11 18:20:01 Page 1 of
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bill from the discharge action remains unpaid but because the debtors, through improper conduct, have
already carved more out of the estate than legitimate exemptions permit.
Counsel for the Trustee shall submit an appropriate form of order.
Dated: January 21, 2011
SAlan Jaroslovsky
U.S. Bankruptcy Judge
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Case: 09-10549 Doc# 116 Filed: 01/21/11 Entered: 01/21/11 18:20:01 Page 2 of
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