Kendall v. Access Lending Corporation et al

UNITED
STATES
BANKRUPTCY
COURT
NORTHERN DISTRICT OF CALIFORNIA
1300 Clay Street (2d fl.)
Oakland, CA. 94612
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Amended Decision
UNITED STATES BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
In re 	No. 05-40438 JK
Adv. No. 05-4247
CHL MORTGAGE GROUP, INC., 	Chapter 7
Debtor. 	/
JOHN T. KENDALL, Trustee,
Plaintiff,
vs.
ACCESS LENDING CORPORATION,
et. al.,
Defendants. /
and related cross-actions. /
AMENDED DECISION: MOTIONS FOR SUMMARY JUDGMENT
The plaintiff in this adversary proceeding is John T. Kendall
(“Kendall”), trustee in bankruptcy of the estate of CHL Mortgage
Group, Inc., the above debtor (“CHL”). 	The defendants are entities
that may claim a lien on or other interest in one or more of the
various parcels of real property that are included in CHL’s
bankruptcy estate, or the sales proceeds thereof. 	By his First
Amended Complaint, Kendall seeks a determination from this court
Signed: December 27, 2005

EDWARD D. JELLEN
U.S. Bankruptcy Judge

Entered on Docket
December 27, 2005
GLORIA L. FRANKLIN, CLERK
U.S BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
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BANKRUPTCY
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NORTHERN DISTRICT OF CALIFORNIA
1300 Clay Street (2d fl.)
Oakland, CA. 94612
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1Defendants Saxon Mortgage Services, Inc. and Gateway Bank,
creditors herein, also oppose the motions filed by Access and
Impac.
2	Amended Decision
that none of the defendants have any interest in any of such real
properties or sales proceeds, and thus, that the defendants are, at
best, general unsecured creditors.
Kendall named some 28 parties as defendants, two of which,
Access Lending Corporation (“Access”) and Impac Funding Corporation
(“Impac”), have moved for summary judgment. 	By its motion, Access
seeks an order providing that it holds either a resulting trust
interest, constructive trust interest, or equitable lien on the
sales proceeds of the properties situated at 501 Linford, San Ramon,
California (the “Linford Property”) and 9284 Broadmore, San Ramon,
California (the “Broadmoor Property”). 	Impac seeks similar relief
on similar theories as to the Linford Property. 	Kendall opposes the
motions, and has filed a cross-motion for partial summary judgment
against Access and Impac. 1
The court holds that: (a) the properties at issue are not
subject to a resulting trust in favor of Access or Impac,
(b) Access has established its entitlement to imposition of a
constructive trust on the Broadmore and Linford Properties as a
matter of California law, notwithstanding CHL’s bankruptcy case, and
(c) Impac has established its entitlement to imposition of a
constructive trust on the Linford Property as a matter of California
law, notwithstanding CHL’s bankruptcy case. 	For the reasons
discussed at the end of this memorandum, however, the court
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3	Amended Decision
expresses no opinion as to whether Kendall might be able to utilize
Bankruptcy Code § 544(a)(3) (trustee’s power as a bona fide
purchaser of real property under state law) to defeat such
constructive trusts.
A. 	Background
CHL was in the business of originating loans secured by real
property, and selling the loans to institutional investors and
lenders. 	On February 2, 2005 several creditors filed an involuntary
chapter 11 petition against CHL. 	Thereafter, this court entered its
order for relief, soon followed by an order converting the case to
chapter 7.
After his appointment as chapter 7 trustee, Kendall learned
that CHL had been engaged in a number of fraudulent transactions.
In several such transactions, CHL placed record title to a parcel of
real property in the name of a person that had no claim of
ownership, and then generated a promissory note in favor of CHL and
deed of trust appearing to bear the signature of such person. 	CHL
would then assign these phony loans to an investor and pocket the
assignment proceeds. 	Access and Impac are among the victims who
purchased phony loans from CHL.

The Linford Property. 	For purposes of the present motion,
the facts are undisputed. 	CHL placed title to the Linford Property
in the name of Margo Olson (“Olson”), never intending that Olson
have any interest. 	CHL then generated one or more promissory notes
to its order in the sum of $487,950 and several deeds of trust
covering the Linford Property. 	CHL forged Olson’s signature to all
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BANKRUPTCY
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NORTHERN DISTRICT OF CALIFORNIA
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2The loan packages for the loans Access purchased contained
numerous additional documents, and are described in more detail
in a Declaration dated November 9, 2005 signed by David C. Fleig.
The loan packages for the loans Impac purchased contained
numerous additional documents, and are described in more detail
in a Declaration dated November 14, 2005 signed by Kathy Murray.
4	Amended Decision
of these documents, each of which was dated August 23, 2004. 	On
August 23, 2004, Impac purchased one of these fraudulent loans from
CHL for the cash sum of $487,950. 	On August 27, 2004, Access also
purchased a fraudulent loan from CHL for the cash sum of $487,950. 2
In both cases, CHL dissipated the funds.
After the bankruptcy filing, Kendall obtained title to the
Linford Property by means of a stipulation with Olson stating that
she had no interest and never had any interest in the Linford
Property. 	Thereafter, Kendall sold the Linford Property pursuant to
an arrangement under which any claims of creditors of an interest in
the Linford Property were transferred to the sales proceeds, which
Kendall now holds subject to further order of the court.
2. 	The Broadmoor Property. 	The parties agree for purposes of
the pending motions that as of July 21, 2004, record title to the
Broadmoor Property was in the name of Olson pursuant to a
transaction that, whether or not phony, was at least documented as a
purchase by Olson of the Broadmoor Property, financed by CHL. 	On
December 23, 2004, CHL assigned to Countrywide Home Loans, Inc.
(“Countrywide”) a purchase money promissory note to its order in the
sum of $487,950 and a deed of trust covering the Broadmoor Property,
each dated July 19, 2004 and each purporting to bear Olson’s
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5	Amended Decision
signature. 	Kendall and Access concede for present purposes that
this was another phony loan transaction similar to those described
above. 	Countrywide does not so concede.
Thereafter, as part of what all the parties for present
purposes agree was a phony loan transaction to refinance the loan
Countrywide had purchased, CHL generated a promissory note in the
sum of $479,960 together with a deeds of trust, each bearing a date
of August 23, 2004 and each bearing Olson’s signature forged by CHL.
On August 27, 2004, Access purchased the phony loan from CHL. 	CHL
then dissipated the funds.
After the bankruptcy filing, Kendall obtained title to the
Broadmoor Property by means of a stipulation with Olson stating that
she had no interest and never had any interest in the Broadmoor
Property. 	Thereafter, Kendall sold the Broadmoor Property pursuant
to an arrangement by which any claims of creditors of an interest in
the property were transferred to the sales proceeds, which Kendall
now holds subject to further order of the court.
Countrywide contends that it is not bound by Kendall’s
stipulation with Olson, or by Olson’s concession that she never
owned the Broadmoor Property. 	Countrywide does not oppose Access’s
motion to the extent Access claims an interest in the sales proceeds
///
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///
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///
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BANKRUPTCY
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3At this point in the proceedings, Countrywide has not moved
for summary judgment against any other party, and no other party
has sought summary judgment against Countrywide. 	Thus,
Countrywide’s participation in the motions now before the court
is limited to its opposition to Access’s motion regarding the
Broadmoor Property to the extent Access seeks possession of the
sales proceeds Kendall holds, and opposition to Kendall’s motion.
6	Amended Decision
superior to Kendall’s, but because of its own conflicting claim,
opposes distribution of the Broadmoor sales proceeds to Access. 3
B. 	Discussion

Summary Judgment.
"Summary judgment is properly granted when there is no genuine
issue of material fact and moving party is entitled to judgment as a
matter of law." Clipper Express v. Rocky Mountain Motor Tariff
Bureau, Inc., 690 F.2d 1240, 1250 (9th Cir. 1982), cert. denied, 459
U.S. 1227 (1983).
Under Fed.R.Bankr.P. 7056, which incorporates Fed.R.Civ.P. 56,
the court may grant summary judgment or partial summary judgment if
there is no genuine issue of material fact, and the movant is
entitled to the requested judgment as a matter of law. 	In ruling,
the court must view the evidence in the light most favorable to the
nonmoving party. 	The court may not weigh the evidence, or determine
the truth of disputed matters asserted, but must only determine
whether there is a genuine issue for trial. 	See, e.g., Jesinger v.
Nevada Fed. Credit Union, 24 F.3d 1127, 1130 (9th Cir.1994); Summers
v. A. Teichert & Son, Inc., 127 F.3d 1150, 1152 (9th Cir. 1997).
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26 	4Kendall’s Response dated November 30, 2005, pp. 5-6.
7	Amended Decision
2. 	Contentions of the Parties.
The parties for the most part acknowledge that many of the
creditors in this bankruptcy case are victims of CHL’s fraud. 	The
crux of the dispute, and perhaps the major issue in this bankruptcy
case, is whether the proceeds Kendall holds and acquires from sales
of real property should be distributed ratably among all the
creditors without regard to their particular expectations as to, or
investments in, particular loans and specific parcels of real
property.
Access and Impac do not argue that the forged notes and deeds
of trust they purchased were effective to create any contractual
liens. 	Rather, they argue that the facts mentioned above entitle
them to a resulting trust, constructive trust, or equitable lien
under California law in the properties against which they intended
to lend, and that any such trust interest or lien is enforceable in
this bankruptcy case. 	Kendall’s argument, in a nutshell, is that
Access and Impac have not established grounds for the relief they
seek, and that “[e]ven if state law would favor imposing some kind
of equitable lien or constructive or resulting trust between the
parties as a remedy for wrong, . . . federal bankruptcy law’s policy
of equal distribution mandates . . . a ‘different result’”. 4
3. 	Resulting Trust.
Whether the properties at issue are or should be subject to a
resulting or constructive trust depends as an initial matter on
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NORTHERN DISTRICT OF CALIFORNIA
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8	Amended Decision
state law. 	In re North American Coin & Currency, 767 F.2d 1573,
1575 (9th Cir. 1985); In re Sale Guaranty Corporation, 220 B.R. 660,
664 (9th Cir. BAP 1998), aff’d 199 F.3d 1375 (9th Cir. 2000). 	State
law, however, must be applied in a manner consistent with the
provisions and policies of federal bankruptcy law. 	North American
Coin, 767 F.2d at 1575-76. 	The court’s first step, then, is to look
to California law to determine whether the properties at issue are
subject to a resulting trust in favor or Access or Impac.
“A resulting trust arises by operation of law from a transfer
of property under circumstances showing that the transferee was not
intended to take the beneficial interest in the property.” 	Lloyds
Bank California v. Wells Fargo Bank, 187 Cal.App.3d 1038, 1043
(1986). 	“When the transfer of property is made to one person, and
the purchase price is paid by or for another, a trust will
ordinarily be presumed to result in favor of the person by or for
whom the purchase price is paid.” Johnson v. Johnson, 192 Cal.App.3d
551, 556 (1987). 	A resulting trust has been termed an
"intention-enforcing" trust, to distinguish it from the other type
of implied trust, the constructive or "fraud-rectifying" trust. 	The
resulting trust carries out the inferred intent of the parties; the
constructive trust defeats or prevents the wrongful act of one of
them. 	American Motorists Ins. Co. v. Cowan, 127 Cal.App.3d 875,
884-85 (1982) (citations omitted).
Here, the facts do not fit the pattern of a resulting trust.
CHL obviously did not intend for Access or Impac to have a deed of
trust on any properties; it intended to defraud them by selling them
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9	Amended Decision
worthless forged documents. 	And CHL certainly did not intend to
sell Access or Impac a loan; there was no loan to sell as CHL well
knew. 	It follows that Access and Impac are not entitled to a
resulting trust to implement the intention of the parties.
None of the cases cited by Access or Impac are to the contrary.
Sale Guaranty Corporation, which Access and Impac both cite, is an
example of a typical facts justifying imposition of a resulting
trust. 	In Sale Guaranty Corporation, owners of real property had
conveyed the debtor title to their parcels, intending that the
debtor would hold title only as an “accomodator” in connection with
a contemplated tax-free exchange. 	220 B.R. at 662. 	None of the
parties to the transactions at issue intended for the debtor to have
any beneficial interest in the properties conveyed to it. 	Under
these facts, the BAP affirmed the bankruptcy court’s ruling that the
properties were subject to a resulting trust enforceable against the
debtor’s trustee in bankruptcy.
Matter of Torrez, 63 B.R. 751 (9th Cir. BAP 1986), aff’d 827
F.2d 1299 (9th Cir. 1987) presents another example of a typical
resulting trust. 	In Torrez, the original owners of real property,
the parents of one of the debtors, placed title in the debtors so
that the original owners could receive an additional allotment of
water from the local irrigation district. 	Id. at 752. 	They did not
intend for the debtor to obtain any beneficial interest.
Thereafter, the debtors transferred title to a third party. 	After
their bankruptcy filing, the debtors sought to quiet title as
against the third party and the parents. 	The BAP held that the
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5Cal. Civil Code § 2223 provides that "[o]ne who wrongfully
detains a thing is an involuntary trustee thereof, for the
benefit of the owner." 	Section 2224 states that "[o]ne who gains
a thing by fraud, accident, mistake, undue influence, the
violation of a trust, or other wrongful act, is, unless he or she
has some other and better right thereto, an involuntary trustee
of the thing gained, for the benefit of the person who would
otherwise have had it."
10	Amended Decision
property was subject to a resulting trust in favor of the parents.
Id. at 754-55.
In the above cases, a resulting trust was imposed to give
effect to the inferred intention of the parties as to title.
Neither these cases, nor the others cited by Access and Impac,
involved a situation where a resulting trust was imposed in favor of
a transferee, here Access or Impac, when the transferor, here CHL,
did not intend the transferee to obtain any interest in the subject
property.
The court holds that the properties at issue are not subject to
a resulting trust in favor of Access or Impac.
4. 	Constructive Trust.
The essence of the theory of constructive trust under
California law is to prevent unjust enrichment and to prevent a
person from taking advantage of his or her own wrongdoing. 	Martin
v. Kehl, 145 Cal.App.3d 228, 237 (1983); Nevarez v. Nevarez, 202
Cal.App.2d 596, 602 (1962). 	See also California Civil Code §§ 2223
and 2224. 5
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As the California Supreme Court stated in Day v. Greene, 59 Cal.2d
404, 411 (1963):
[T]he imposition of a constructive trust is used to prevent
unjust enrichment or to compel restoration of property by one
who is not justly entitled to it. 	The usual situation in which
the relief is granted is found in cases where the substantive
basis of the action is that the property has been obtained
through actual fraud . . . .
Under Cal. Civil Code §§ 2223 and 2224 and the case law
applying them, a constructive trust may be imposed where the
following three conditions are satisfied: (1) the existence of a res
(property or some interest in property); (2) the right of a
complaining party to that res; and (3) some wrongful acquisition or
detention of the res by another party who is not entitled to it.
See, e.g., Communist Party of the U.S. v. 522 Valencia, Inc., 35
Cal. App. 4th 980, 990 (1995).
Here, Access and Impac have established their entitlement as a
matter of California law to a constructive trust in the properties
against which they intended to lend. 	They expended money in good
faith to acquire what they believed to be legitimate loans secured
by the properties at issue. The documentation and form of the
transaction were standard. 	Instead of receiving the deeds of trust
for which they had bargained, they received forged documents bearing
the name of a record title holder that had no legitimate interest in
the property. 	Under these circumstances, CHL, which presumably was
the actual beneficial owner at the time of the bankruptcy and which
was responsible for the fraud, was not entitled to hold the
properties free of any interest in favor of Access or Impac.
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Kendall acquired his interest in the properties at the date of
the petition pursuant to Bankruptcy Code § 541(a). 	Therefore,
Kendall acquired what CHL owned, in this case, a claim to real
property subject to imposition of a constructive trust in favor of
Access and Impac.
The foregoing, however, does not fully resolve the constructive
trust issue. 	As the Ninth Circuit has observed, in a case where no
court has imposed a constructive trust prior to bankruptcy, and
thus, where constructive trust is an inchoate remedy at the date of
bankruptcy, a court must “act very cautiously in exercising . . . a
relatively undefined equitable power in favor of one group of
potential creditors at the expense of other creditors, for ratable
distribution among all creditors is one of the strongest policies
behind the bankruptcy laws.” 	North American Coin & Currency, 767
F.2d at 1575.
Here, the court believes that imposition of a constructive
trust would not run afoul of any countervailing policies of
bankruptcy law. 	At the date of the petition, record title to the
properties was subject to phony deeds of trust that represented, in
actuality, funds that Access and Impac had advanced and which CHL
received and benefitted from. 	Absent a constructive trust, the
losses Access and Impac suffered become the gain of other creditors
at their expense.
The cases cited by Kendall are inapplicable under the facts
here. 	In North American Coin & Currency, the Ninth Circuit 	upheld
the ruling below that a constructive trust should not be imposed on
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the property at issue. 	In doing so, however, the court emphasized
that there was no evidence in the record that the debtor had
committed any fraud. Id. at 1576. 	The court did acknowledge,
however, that “[b]ankruptcy trustees have been held to have no
interest in property acquired by fraud of bankrupts, as against the
rightful owners of property . . . The principle underlying this rule
is that the creditors should not benefit from fraud at the expense
of those who have been defrauded.” Id.
Other cases cited by Kendall involved a situation where the
constructive trust claimant in the bankruptcy court had failed to
properly perfect its lien on property intended to serve as security
for a debt, and where the court declined to remedy the perfection
defect by imposing a constructive trust. 	See, e.g., In re Lewis W.
Shurtleff, Inc., 778 F.2d 1416 (9th Cir. 1985) (failure to record
warranty deed); In re Foam Systems Co., 92 B.R. 406 (9th Cir. BAP
1988), aff’d (table decision) 893 F.2d 1338 (9th Cir. 1989) (failure
to perfect security interest in funds on deposit supplied as advance
payment for materials).
In re Markair, Inc., 172 B.R. 638 (9th Cir. BAP 1994), also
cited by Kendall, is inapplicable. 	In Markair, a party that had
repaired an aircraft engine claimed a constructive trust interest in
certain insurance proceeds in which it had no contractual interest
and on which it did not rely for payment. 	No fraud by the debtor
was involved. 	Here, Access and Impac had looked to the real
property for payment, and fraud by the debtor was involved.
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In re Carmel of St. Joseph, 237 B.R. 155 (9th Cir. BAP 1999) is
also easily distinguished. In St. Joseph, the constructive trust
claimant had donated money to his church to permit the debtor to
acquire land on which to build a monastery. 	Thereafter, the debtor
acquired several parcels of land, but built the monastery with funds
from another source. 	After the debtor’s bankruptcy, the donor
sought to impose a constructive trust on the property the debtor had
purchased with the donated funds, alleging that the debtor had not
complied with certain conditions to the gift. 	The BAP affirmed the
bankruptcy court’s judgment that grounds for a constructive trust on
the property were not present. 	Id. at 158. 	Again, unlike the case
here, there was no fraud by, or unjust enrichment of, the debtor,
and no res (the donation was cash) in which the claimant had a
special interest.
None of the cases Kendall has cited in opposition to the
motions by Access and Impac involved a situation, as here, where the
debtor engaged in fraud at the expense of the parties seeking to
impose a constructive trust. 	And none of the cases Kendall cited
involved a situation, as here, where the property at issue was used
by the debtor as the debtor’s vehicle to commit a fraud on the party
seeking the constructive trust.
The court holds that under California law, imposition of a
constructive trust in favor of Access as to the two properties, and
in favor of Impac as to the Linford Property, is an appropriate
equitable remedy, notwithstanding CHL’s bankruptcy.
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6Access and Impac raised several additional arguments, e.g.,
that Access holds a contractual general lien on all the assets of
CHL’s estate, and that Impac has certain rights as a “holder in
due course.” 	The court rejects these arguments, primarily for
the reasons advanced by Kendall in his opposing memorandum, and
believes no discussion is warranted. 	As to the equitable lien
arguments raised by Access and Impac, the court believes the
question is moot because of the conclusions expressed herein.
7Bankruptcy Code § 544(a)(3) provides:
(a) The trustee shall have, as of the commencement of
the case, and without regard to any knowledge of the
trustee or of any creditor, the rights and powers of,
or may avoid any transfer of property of the debtor or
any obligation incurred by the debtor that is voidable
by— . . .
(3) a bona fide purchaser of real property, other than
fixtures, from the debtor, against whom applicable law
permits such transfer to be perfected, that obtains the
status of a bona fide purchaser and has perfected such
transfer at the time of the commencement of the case,
whether or not such a purchaser exists.
15	Amended Decision
5. Bankruptcy Code § 544(a)(3).
The final potential issue that the court believes appropriate
to mention 6 is whether Kendall’s power as a hypothetical bona fide
purchaser of real property under California law, as provided by
Bankruptcy Code § 544(a)(3), 7 enables him to defeat the constructive
trust remedy that the court holds is available to Access and Impac
as a matter of California law. 	This issue is material because of
the Ninth Circuit’s decision in In re Tleel, 876 F.2d 769 (9th Cir.
1989), holding that constructive trust claims as to real property
Case: 05-04247 Doc# 152 Filed: 12/27/05 Entered: 12/27/05 14:41:07 Page 15 of
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UNITED
STATES
BANKRUPTCY
COURT
NORTHERN DISTRICT OF CALIFORNIA
1300 Clay Street (2d fl.)
Oakland, CA. 94612
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16	Amended Decision
may be defeated by a bankruptcy trustee’s power under Bankruptcy
Code § 544(a)(3) in a situation where the trustee does not have
actual or constructive notice of the claimant’s interest. 	Id. at
771-72.
As mentioned at the outset of this memorandum, the court does
not believe it appropriate to state a conclusion in the present
context. 	First, the trustee’s complaint herein does not appear to
state any cause of action under Bankruptcy Code § 544(a)(3).
Moreover, even if the pleadings before the court could be broadly
construed to put the § 544(a)(3) at issue, the parties have not
briefed the issue of whether a bona fide purchaser under California
law could have prevailed as of the petition date against the claims
of Access and Impac under the unusual facts present here (although
the prudent purchaser rule discussed in Sale Guaranty Corporation,
220 B.R. at 666, would appear to suggest a negative answer,
especially if Olson was not in possession of the two properties at
the date of the petition. 	Id.). 	The court will therefore leave
this issue, if raised, for determination at a later date, if
necessary.
C. 	Conclusion.
The court will issue its order granting and denying partial
summary judgment to the parties in accordance with this Decision.
END OF ORDER
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UNITED
STATES
BANKRUPTCY
COURT
NORTHERN DISTRICT OF CALIFORNIA
1300 Clay Street (2d fl.)
Oakland, CA. 94612
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17	Amended Decision
Court Service List
Linda Sorensen, Esq.
Stromsheim & Associates
353 Sacramento Street, Suite 860
San Francisco, CA 94111
Michael R. Pfeifer, Esq.
Pfeifer & Reynolds
765 The City Drive, Suite 380
Orange, CA 92868
Christine A. Scheuneman, Esq.
Pillsbury Winthrop Shaw Pittman
650 Town Center Drive, 7 th Floor
Costa Mesa, CA 92626
Edward P. Sangster, Esq.
Kirkpatrick & Lockhart Nicholson
Graham
Four Embarcadero Center, 10 th Fl.
San Francisco, CA 94111
Dennis M. Talbott, Esq.
Severson & Werson
One Embarcadero Center, Ste 2600
San Francisco, CA 94111
Office of the U.S. Trustee
1301 Clay Street, Suite 690-N
Oakland, CA 94612
Aron M. Oliner, Esq.
Buchalter Nemer Fields & Younger
333 Market Street, 25 th Floor
San Francisco, CA 94105
Mike C. Buckley, Esq.
Reed, Smith, Crosby & Heafey
1999 Harrison Street, Suite 2400
Oakland, CA 94612
William C. Saacke, Esq.
Law Offices of McNulty & Saacke
25500 Hawthorne Boulevard #2350
Torrance, CA 90505-6835
David E. McAllister, Esq.
Pite, Duncan & Melmet
525 E. Main Street
El Cajon, CA 92022-2289
Robin M. Pearson, Esq.
Alborg, Veluva & Epstein
200 Pringle Avenue #410
Walnut Creek, CA 94596
Jeffrey H. Lowenthal, Esq.
Steyer Lowenthal Boodrookas
Alvarez
One California Street, 3 rd Floor
San Francisco, CA 94111
Walter J. R. Traver, Esq.
Musick, Peeler & Garrett LLP
120 Montgomery Street, Ste 2550
San Francisco, CA 94104
William M. Rathbone, Esq.
Gordon & Rees LLP
275 Battery Street, Suite 2000
San Francisco, CA 94111
Case: 05-04247 Doc# 152 Filed: 12/27/05 Entered: 12/27/05 14:41:07 Page 17 of
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