Boehrer et al v. Boehrer et al

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UNITED STATES BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
In re No. 96-47887 TR
Chapter 7
MICHAEL ROBERT BOEHRER, and
JENNIFER LYNN BOEHRER,
Debtors.
______________________________/
MICHAEL ROBERT BOEHRER A.P. No. 04-4299 AT
Plaintiff,
vs.
ROBERT I. BOEHRER, etc.,
Defendant.
_____________________________/
ROBERT I. BOEHRER, etc.,
Counterclaimant,
vs.
WILLIAM BROACH, Chapter 7
Trustee,
Counterdefendant.
____________________________/
MEMORANDUM OF DECISION
In this adversary proceeding, William Broach (the “Trustee”),
the chapter 7 trustee in the above-captioned case, seeks
authorization to sell certain real property (the “Property”) in
which the estate claims a half-interest free and clear of the
Signed: May 09, 2005
________________________________________
LESLIE TCHAIKOVSKY
U.S. Bankruptcy Judge
________________________________________
Entered on Docket
May 10, 2005
GLORIA L. FRANKLIN, CLERK
U.S BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
Case: 04-04299 Doc# 53 Filed: 05/09/05 Entered: 05/10/05 12:39:09 Page 1 of 8

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2
interest of a co-owner. Alternatively, the Trustee seeks to
partition the Property under California law. The Trustee filed a
motion for summary judgment on the first of these two claims. The
co-owner, Robert Boehrer (“Robert”), the father of the above-
captioned debtor (the “Debtor”), opposed the motion. For the
reasons stated below, the motion for summary judgment will be
granted.
DISCUSSION
A. STANDARDS GOVERNING MOTIONS FOR SUMMARY JUDGMENT
Summary judgment is appropriate “if the pleadings,
depositions, answers to interrogatories, and admissions on file,
together with affidavits, if any, show that there is no genuine
issue as to any material fact and that the moving party is
entitled to a judgment as a matter of law.” Fed. R. Civ. P.
56(c). The moving party has the burden of establishing the
absence of a genuine issue of material fact. Celotex Corp. v.
Catrett, 477 U.S. 317, 323 (1986). If the moving party meets this
burden, the nonmoving party must go beyond the pleading and
identify facts demonstrating a genuine issue for trial. Id. at
324.
Summary judgment should be entered against a “party who fails
to make a showing sufficient to establish the existence of an
element essential to that party’s case, and on which that party
will bear the burden of proof at trial. Id. at 322. The
nonmoving party has a duty to present affirmative evidence in
order to defeat a properly supported motion for summary judgment.
Case: 04-04299 Doc# 53 Filed: 05/09/05 Entered: 05/10/05 12:39:09 Page 2 of 8

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1If a property interest is duly scheduled and the trustee
does not administer it, the property is deemed abandoned to the
debtor when the case is closed. However, if the property
interest is not scheduled, it remains property of the estate
3
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986).
“[S]ummary judgment will not lie if the dispute about a material
fact is ‘genuine,’ that is, if the evidence is such that a
reasonable jury could return a verdict for the nonmoving party.”
Id. at 248.
B. STATEMENT OF UNDISPUTED FACTS
Prior to 1992, title to the Property was held in equal parts
by Robert and the two children of Robert’s former wife, Denise and
Craig. In 1992, Robert, Denise, and Craig executed a grant deed
(the “1992 Grant Deed”), transferring title to the Property in
equal parts to Robert and the Debtor, Robert’s biological son.
The Debtor filed a chapter 7 bankruptcy petition in September
1996. He did not list his interest in the Property in his
bankruptcy schedules. It is undisputed that, at that time, he
held a fifty percent record title interest in the Property. His
bankruptcy case was closed in February 2004.
In 2004, the Debtor filed an action in state court against
Robert, seeking to partition the Property. During the course of
discovery, the Debtor’s failure to schedule his interest in the
Property was revealed. The bankruptcy case was reopened, the
action was removed to bankruptcy court, and a claim for sale of
the Property pursuant to 11 U.S.C. § 363(h) was added to the
complaint (the “Complaint”).1
Case: 04-04299 Doc# 53 Filed: 05/09/05 Entered: 05/10/05 12:39:09 Page 3 of 8

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despite the fact that the case has been closed. 11 U.S.C. §
554(c),(d).
2In his deposition, excerpts of which were provided by
Robert, the Debtor stated that the purpose of this transfer was
to facilitate a refinance of the secured debt on the Property.
The Debtor’s bad credit history was purportedly interfering with
the refinance. Since any interest of the Debtor in the Property
was still property of his chapter 7 estate at that time, the
purported transfer of that interest by the Debtor pursuant to
the 1999 Grant Deed was void. See 11 U.S.C. § 362(a)(3); In re
Donpedro, 2004 WL 3187072, **2-3 (Bankr. N.D. Cal.).
4
Between the filing of the Debtor’s bankruptcy case in 1992 and
the reopening of the case, two additional deeds were executed and
recorded affecting title to the Property. In 1999, the Debtor
executed a deed (the “1999 Grant Deed”), transferring his interest
in the Property to Robert and Denise. In 2002, Denise executed a
deed (the “2002 Grant Deed”), transferring her interest in the
Property to the Debtor.2
C. ARGUMENT
The Trustee contends that, in 1992, when the bankruptcy case
was filed, the Debtor owned a fifty percent interest in the
Property as reflected in the way legal title was held. The
Trustee bases his contention on two legal theories. First, he
notes that, under California law, there is a presumption that
equitable ownership in property is consistent with the way in
which legal title is held. This presumption can only be overcome
by clear and convincing evidence to the contrary. Cal. Evidence
Case: 04-04299 Doc# 53 Filed: 05/09/05 Entered: 05/10/05 12:39:09 Page 4 of 8

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3See Weaver v. Weaver, 224 Cal. App. 3d 478, 487 (1990),
quoting from Sheean v. Sullivan, 126 Cal. 189, 193 (1899),
(describing the “clear and convincing” standard as requiring
evidence that is “‘sufficiently strong to command the
unhesitating assent of every reasonable mind.’”)
4Because the Trustee had not pleaded an avoidance claim,
the Court agreed to address the Trustee’s argument under
California law first. If this argument was unsuccessful, the
Court would then give the Trustee an opportunity to amend the
Complaint to add an avoidance claim. Because the Court
concludes that the Trustee is entitled to prevail on his first
legal theory, this will not be necessary.
5The Debtor’s deposition testimony supports this contention
to some extent. He testified that, from the time he, Denise,
5
Code § 662; Schindler v. Schindler, 126 Cal. App. 2d 597, 601-02
(1954).3
Second, the Trustee asserts that, pursuant to 11 U.S.C. §
544(a)(3), he may assert the rights of a bona fide purchaser of
real property as of the petition date to avoid any unrecorded
interest of Robert in the remaining portion of the Property. This
Memorandum only addresses the first of these two arguments.4
To the contrary, Robert argues that, in 1996, when the
Debtor’s bankruptcy case was filed, the Debtor held bare legal
title to fifty percent of the Property and that he had no
equitable interest in the Property. First, Robert contends that
he had an agreement with all three children that, regardless of
how legal title was held, they would only acquire an equitable
interest in the Property by remaining on the Property and
assisting him financially. They would lose any equitable interest
in the Property if they moved out.5
Case: 04-04299 Doc# 53 Filed: 05/09/05 Entered: 05/10/05 12:39:09 Page 5 of 8

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and Craig were “little kids,” Robert told them that they each
would receive 5 acres of the Property: i.e., approximately one-
quarter of the Property. As a result, he took their paychecks
while they lived on the Property. For some reason, neither
party has established when Denise and Craig were put on title to
the Property although the Trustee asserted in his reply brief
(page 3, line 10) that, in 1992, Denise and Craig had been on
title for ten years.
6In his declaration, the Debtor stated that he did not
receive any portion of the loan proceeds in 1995 and that
Robert’s version of the facts made no sense since the Debtor
purchased his home in 1992 or 1993. In response, Robert stated
that he had actually loaned the Debtor $20,000 at the time the
home was purchased, that he loaned him an additional $30,000 in
1995, and that the $53,000 represented a consolidation of the
two loans. In his deposition testimony, excerpts of which were
provided by Robert, the Debtor admitted receiving some money
from Robert at the time he purchased his residence. However, he
stated that these funds were gifted to him, in recognition that
Denise had received substantial financial support for her higher
education.
6
Second, Robert contends that the Debtor “cashed out” any
equitable interest in the Property in 1995, when he received
approximately $53,000 in loan proceeds. Robert claims that the
Debtor used the funds to purchase a residence for his family.6
This version of the facts is supported by Robert’s declaration
filed in support of his opposition to the motion and by his
answers to interrogatories. These two theories are logically
inconsistent. If Robert believed that the Debtor had no equitable
interest in the Property, it would make no sense for him to give
the Debtor $53,000 in loan proceeds for a debt that would encumber
the Property.
D. DECISION
Case: 04-04299 Doc# 53 Filed: 05/09/05 Entered: 05/10/05 12:39:09 Page 6 of 8

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7
The evidence summarized above clearly establishes a genuine
issue of material fact with regard to the ownership of the
Property. Absent the presumption created by Cal. Evidence Code §
662, the Court would deny the Trustee’s motion and set the matter
for trial unless the proceeding could be resolved without trial
pursuant to the Trustee’s as yet unpleaded avoidance theory.
However, the presumption created by Cal. Evidence Code § 662
places a heavy burden of proof on Robert which the evidence
presented does not come close to meeting. Consequently, the
motion for summary judgment will be granted.
Counsel for the Trustee is directed to submit a proposed form
of order and judgment in accordance with this decision. The
judgment form should address the disposition of the partition
claim.
END OF DOCUMENT
Case: 04-04299 Doc# 53 Filed: 05/09/05 Entered: 05/10/05 12:39:09 Page 7 of 8

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COURT SERVICE LIST
Samuel S. Goldstein
Samuel S. Goldstein & Associates
1646 N. California Blvd., Ste. 550
Walnut Creek, CA 94596
Christopher R. Lucas
Law Office of Goforth & Lucas
2300 Clayton Rd., Ste. 1460
Concord, CA 94520
Charles Maher
Luce, Forward, Hamilton & Scripts
121 Spear St., Ste. 200
San Francisco, CA 94105
Alan Sternberg
1646 N. California Blvd., Ste. 550
Walnut Creek, CA 94596
Case: 04-04299 Doc# 53 Filed: 05/09/05 Entered: 05/10/05 12:39:09 Page 8 of 8