Jeanne A. Duvall

1 	The court’s notes reflect that Henrietta Duvall retained
her maiden name after the death of her husband, but the D.C.
Superior Court referred to her as “Henrietta Duvall Bumbray.”
The court intends no slight to any of the parties in referring to
Henrietta Duvall by her maiden name.
UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF COLUMBIA
In re
JEANNE A. DUVALL,
Debtor.
)
)
)
)
)
Case No. 04-01519
(Chapter 7)
MEMORANDUM DECISION REGARDING MOTION FOR RECONSIDERATION
On May 31, 2006, this court entered two orders (Docket Entry
(“DE”) Nos. 59-60) overruling the debtor’s objections to proofs
of claim filed by Sharon B. Watts and Kevin Bumbray (collectively
the “Claimants”) for amounts owed them, pursuant to a contract,
calling for the debtor to pay each of them 14% of certain amounts
that were otherwise distributable to the debtor as an inheritance
from the estate of Henrietta Duvall, deceased (the “Duvall
Estate”). 1 	This decision addresses a motion (DE No. 63) seeking
reconsideration of those orders.
The decision below is hereby signed. Dated:
December 6, 2006.
_____________________________
S. Martin Teel, Jr.
United States Bankruptcy Judge
Case 04-01519 Doc 82 Filed 12/07/06 Entered 12/07/06 09:25:05 Desc Main
Document Page 1 of 9

2 	In 1982, the Maryland Workers’ Compensation Commission
(“WCC”) ordered Hartford to pay Henrietta Duvall a one-time lump
sum payment of $18,500 and monthly payments of $1,200 for a
period of twenty years. 	When Henrietta Duvall died, Hartford
ceased paying the monthly payment. 	Elmer Bumbry persuaded the
debtor as personal representative of the Duvall Estate to sue
Hartford, and the WCC ordered Hartford to pay the Duvall Estate
$1,200 per month dating back to the date of Henrietta Duvall’s
death and for the future duration of the 1982 order, plus a 40%
penalty plus attorney fees to the attorney for the Duvall Estate.
Reply to Opposition to Objection to Claim (DE No. 36) at 4.
2
I
Henrietta Duvall was the mother to the debtor and step-
mother to the Claimants. 	The debtor was the personal
representative of the Duvall Estate and its sole beneficiary.
She received certain amounts from the Duvall Estate and failed to
pay any portion of those amounts to the Claimants. 	The amounts
distributed from the Duvall Estate derived from recoveries made
by the Duvall Estate in enforcement of certain worker
compensation annuity claims against Hartford Accident and
Indemnity Company (“Hartford”). 2
In addition to the Claimants, the debtor had three other
siblings. 	In Bumbray v. Duvall, No. 02-CV-1263 (D.C. Sup. Ct.),
one of the siblings, Elmer Bumbry, sued the debtor on his claim
that pursuant to an oral agreement reached in 1997, he was
entitled to receive a portion of any of the worker compensation
annuity enforcement proceeds distributable to the debtor from the
Duvall Estate. 	The jury returned a verdict finding that Elmer
Bumbry was entitled to 14% of such proceeds resulting from any
Case 04-01519 Doc 82 Filed 12/07/06 Entered 12/07/06 09:25:05 Desc Main
Document Page 2 of 9

3
judgment against Hartford, and that Jeanne Duvall was entitled to
16%. 	On appeal, the Court of Appeals for the District of
Columbia upheld the jury verdict in Elmer Bumbry’s favor,
concluding that the debtor had indeed agreed to pay Elmer Bumbry
a portion of her expected distribution from the Duvall Estate.
However, the Superior Court did not adjudicate the rights of the
Claimants here in the proceeds as they were not parties to that
action.
This court heard evidence on the objections to the
Claimants’ claims and found that they were entitled to enforce
the oral agreement Kevin Bumbry and the debtor had entered into
and under which the debtor agreed that she would be entitled to
16% of all proceeds of the Duvall Estate’s worker compensation
claims enforcement recoveries that she inherited, with the
remainder of the proceeds to be divided equally among the
debtor’s five siblings (a pro rata distribution of 14% per
sibling). 	The court thus concluded that each of the two
Claimants involved here was entitled to a 14% interest in the
Duvall Estate worker compensation enforcement recoveries
distributable to the debtor from the Duvall Estate. 	This
disposed of all of the arguments the debtor had pressed in
objecting to the claims, and the court thus held that the proofs
of claim filed by the Claimants accurately reflected those
interests, and the amounts owed them as a result of the debtor’s
Case 04-01519 Doc 82 Filed 12/07/06 Entered 12/07/06 09:25:05 Desc Main
Document Page 3 of 9

4
failure to pay over the 14% to which each of them was entitled.
It overruled the debtor’s objections to their claims on that
basis.
Subsequent to the court’s orders, the debtor filed her
motion for reconsideration (DE No. 63), in which she indicated
that a portion of the amounts owed the Duvall Estate was held in
escrow as part of the interpleader stakeholder action captioned
Hartford Accident and Indemnity v. Bumbray, Case No. CAE99-00071
(Md. Cir. Ct. (Prince George’s County)). 	Specifically, the
debtor alleged that $19,200 in workers’ compensation insurance
owed to the Duvall Estate was placed in an escrow account
maintained by Hartford’s attorneys pending disposition of the
interpleader suit. 	DE No. 63 at 20. 	The debtor also requested
reconsideration with respect to the merits of the court’s earlier
decision and the amount of pre-judgment interest awarded to the
Claimants.
In two orders entered on June 19 and July 24, 2006 (DE Nos.
66 and 70), the court denied the debtor’s motion for
reconsideration except with respect to the question of the
$19,200 currently held in escrow, and the issue of pre-judgment
interest. 	On October 19, 2006, the parties presented evidence
Case 04-01519 Doc 82 Filed 12/07/06 Entered 12/07/06 09:25:05 Desc Main
Document Page 4 of 9

3 	During the course of that hearing, the court explained at
length that the $19,200 in escrow, like the rest of the proceeds
from the Duvall Estate, must be distributed by the debtor
according to the terms of the oral contract calling for each of
the two Claimants here to receive 14%. 	See Montana v. United
States, 440 U.S. 147, 153 (1979) (“once an issue is actually and
necessarily determined by a court of competent jurisdiction, that
determination is conclusive in subsequent suits based on a
different cause of action involving a party to the prior
litigation”). 	The court suggested to the parties that they
stipulate to a distribution of the escrowed amount according to
those terms as part of the court’s order on the debtor’s motion
for reconsideration, but the debtor declined the court’s offer.
5
and argument regarding the escrowed amount and interest owed. 3
The court agrees with the debtor that because $19,200 of the
debtor’s estate was never released to the debtor, the debtor
could not have any liability as any portion of those funds by
refusing to distribute the portion of the funds owed to her
siblings. 	This will benefit the debtor in the short term because
it reduces the amounts owed each of the Claimants, but in the
long run it will benefit the Claimants because they will be
entitled to their portions of the escrowed amounts in total once
those funds are released rather than claims against the
bankruptcy estate for such unpaid portions (claims entitling them
to only a pro rata share of the bankruptcy estate’s funds, if
any, that will remain after payment of the administrative claims
Case 04-01519 Doc 82 Filed 12/07/06 Entered 12/07/06 09:25:05 Desc Main
Document Page 5 of 9

4 	If the funds are released to the debtor, she will still
be contractually required to pay each of her siblings 14% of the
proceeds, leaving the debtor with only 16% of the proceeds. 	To
the extent that the debtor does not make such payment, her
siblings will have causes of action against the debtor that, as
postpetition claims, are unaffected by the debtor’s bankruptcy
discharge. 	The oral agreement appears to have effected an
assignment of 14% to each Claimant or created a trust in each
Claimant’s favor, such that the debtor would face potential
criminal charges based on theft of property were she to dissipate
the Claimants’ 14% shares. 	No matter what she does, the debtor
cannot avoid the preclusive effects of this court’s findings.
5 	Unmatured interest as of the petition date is not part of
an allowed claim by virtue of 11 U.S.C. § 502(b)(2), but if a
trustee’s distribution pays allowed claims in full, then interest
at the legal rate is paid on the allowed claims under 11 U.S.C. §
726(a)(5).
6
of the chapter 7 trustee and his law firm). 4
II
At the hearing of October 19, 2006, the debtor provided an
affidavit for purposes establishing the amount and date of each
payment the debtor received from Hartford, a predicate to
calculating interest. 	That affidavit showed that she received
$203,760.00 from Hartford. 	That $203,760.00 does not include the
$19,200.00 that Hartford placed in escrow. 	For reasons discussed
in a prior order, the Claimants would be entitled under District
of Columbia law to recover pre-judgment interest on their claims
at 6% per annum, and, accordingly, as part of their allowed
claims they are entitled to such pre-judgment interest to the
petition date. 5 	The Claimants have prepared a calculation of
interest to the petition date on the portion recoverable by each
Case 04-01519 Doc 82 Filed 12/07/06 Entered 12/07/06 09:25:05 Desc Main
Document Page 6 of 9

6 	The debtor presented no evidence that there were any
expenses of administration of the Duvall Estate that were
incurred and paid and that reduced the inheritance amount of
which 14% had been promised each of the Claimants.
7 	Each Claimant stated on the Claimant’s proof of claim
that $26,960.98 in principal was owed, but, as noted above, the
debtor’s own affidavit establishes amounts received from Hartford
that result in $28,526.40 of principal being owed to each
Claimant as the Claimant’s 14% share of the recoveries. 	The
reconsideration motion (DE No. 63 at 19) states that the
Claimants represented that the $26,960.98 figure they used was
the principal amount awarded Elmer Bumbry in the Superior Court.
That figure would not have taken account of amounts paid by
Hartford after the Superior Court action concluded. 	Even though
principal was understated on each proof of claim, the much larger
overstatement of prepetition interest on the proof of claim
results in each Claimant’s allowed claim being less than the
$46,973.10 claimed to be owed on the proof of claim.
7
Claimant out of the $203,760 in payments the debtor received from
Hartford, and the debtor has not challenged that calculation.
Pursuant to that calculation, each Claimant is entitled to
recover $11,230.34 in pre-judgment interest. 	To that must be
added the principal amount recoverable, namely, 14% of the
$203,760.00 received by the debtor, which equals $28,526.40. 6
Adding principal and interest together results in an allowed
claim for each Claimant of $39,756.74 (versus the $46,973.10
claimed on each Claimant’s proof of claim). 7
III
The Claimants’ interest calculation submission notes their
belief that $229,260.00 in payments were due from Hartford, and
that the debtor has accounted for only $222,960.00 (consisting of
the $203,760.00 she acknowledges she received plus the $19,200
Case 04-01519 Doc 82 Filed 12/07/06 Entered 12/07/06 09:25:05 Desc Main
Document Page 7 of 9

8 	If the debtor received an additional $6,500 beyond the
$203,760 she concedes having received, that would increase the
principal amount owed the Claimants by $910 as well as affect the
interest calculation. 	If any of the $6,500 was received by the
debtor postpetition, however, that would give rise to a
postpetition claim unaffected by the debtor’s discharge, not an
additional allowed claim against the bankruptcy estate.
9 	The court notes that the debtor’s Reply to Opposition to
Objection to Claim (DE No. 36) states that: “The Estate of
Henrietta Duvall received the payments in arrears from The
Hartford. 	Sixteen payments totaling $19,200.00 were never paid
to the estate or to the Debtor. 	They belong to the Estate of
Henrietta Duvall and are being held by The Hartford pending
resolution of all claims.” 	DE No. 36 at 4. 	The debtor appears
to concede that whatever was owed by Hartford, other than the
$19,200.00 in escrow, has been paid to her, but she has not
conceded that $229,260.00 in payments was the total amount due
from Hartford.
8
that Hartford’s attorneys are holding in escrow), a shortfall of
$6,500.00. 	They then state:
Either (1) the Debtor has received payments for which she
has not accounted in her Affidavit, or (2) the Hartford has
not paid all the sums due and owing pursuant to the Workers’
Compensation Commission award of August, 1997. 	To the
extent that it is determined that Debtor in fact received
more than she has acknowledged in her Affidavit, Claimants
therefore reserve the right to submit a supplemental
interest calculation based on the date(s) of receipt of the
additional $6,500 or whatever portion thereof is determined
to have actually been received by the Debtor.
To the extent that this is an invitation to the court to set a
further hearing in this matter to ascertain what happened to the
alleged $6,500 shortfall, and to determine whether that requires
a re-calculation of the amounts owed the Claimants, 8 the court
declines the invitation as it was not made pursuant to a motion
to which the debtor would then have an opportunity to respond. 9
Case 04-01519 Doc 82 Filed 12/07/06 Entered 12/07/06 09:25:05 Desc Main
Document Page 8 of 9

9	O:\Andrew Fausett Temp Docs\Decisions with Related Orders\In re Duvall\decision_reconsideration_Duvall_v3.wpd
The proper course is for the court to enter an order adjudicating
the controversy on the record before it. 	If the Claimants have
reason to seek modification of the order, they may file a motion.
IV
An order follows.
[Signed and dated above.]
Copies to: Debtor; debtor’s attorneys; Jonathan S. Shurberg,
Esq.; chapter 7 trustee; Office of the U.S. Trustee.
Case 04-01519 Doc 82 Filed 12/07/06 Entered 12/07/06 09:25:05 Desc Main
Document Page 9 of 9