Barney v. Talermo

In re
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF WYOMING
HARRY VILLE TALERMO,
Debtor.
Case No. 	11-20806
Chapter 7
GARY A. BARNEY,
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Plaintiff,
v. 	Adv. No. 	11-2033
HARRY VILLE TALERMO,
Defendant.
OPINION ON COMPLAINT
On September 18, 20 12, this matter came before the court for trial on the Complaint
for Delivery or Turnover of Property filed by Gary Barney, the chapter 7 trustee
("Plaintiff') and the answer filed by Harry Talermo ("Defendant"). Upon a review of the
record, testimony and evidence, the court is prepared to rule.
Jurisdiction
This court has jurisdiction over this adversary complaint pursuant to 28 U.S.C. §§
157(a) and 1334(a). This is a core proceeding under §157(b)(2)(E). The complaint is
brought pursuant to 11 U.S.C. §542. 1
Facts
Defendant received a cashier's check in the amount of$140,000.00 on or about April
1 Unless otherwise indicated, all future statutory reference are to the Bankruptcy Code, Title II of the United States Code.
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15, 2009 which were proceeds from a divorce settlement. After Wells Fargo obtained a
judgment against the Defendant and got a writ of garnishment, he deposited the cashier's
check into his son's bank account on April4, 2011 so that Wells Fargo could not get the
funds. Defendant testified that he was authorized to sign on his son's account.
On that same day, Defendant withdrew $50,000.00 from the account. On the
following day, AprilS, 2011, he withdrew the balance of$90,000.00. According to the
Defendant, he kept the cash in a drawer at his home.
On or about April15, 2011, the Defendant testified that he gave the cash to his
mother in repayment of part ofthe debt he has incurred with her beginning in 1975. His
mother returned to Finland not long after the funds were given to her. He does not know
what she did with the $140,000.00.
On July 25, 2011, Defendant filed for chapter 7 bankruptcy protection. Defendant
admits he did not initially disclose the deposit or withdrawals on his bankruptcy petition or
schedules. Nor did he list his mother as a debtor. He testified that he disclosed the
transactions at the §341 meeting of creditors and subsequently amended his schedules on
December 23, 2011.
Discussion
Plaintiff alleges that the $140,000.00 is property ofthe estate and Defendant should
be ordered to tum over the asset to the estate to administer.
Section 542 requires anyone holding property ofthe estate, on the date of filing of
the petition, to deliver that property to the trustee, unless the property is of inconsequential
value to the estate. A trustee may not compel turnover of property of the estate unless the
Page2
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entity against whom the trustee seeks turnover is in possession of the property sought, or its
proceeds, at the time the motion for turnover is filed. 2
The court finds that, based upon Defendant's testimony, he was not in possession of
the funds sought on the day that he filed his bankruptcy petition. Nor was Defendant in
possession of the funds on the day that Plaintiff filed this adversary proceeding. According
to the Defendant's testimony, the funds were given to his mother prior to both of these
actions.
Therefore, the court concludes that the Plaintiff may not compel turnover from the
Defendant of the $140,000.00 as the Defendant did not have possession of the funds.
This opinion constitutes the Court's findings of fact and conclusions oflaw. A
separate order shall be entered pursuant to Fed. R. Bankr. P. 9021.
DATED this 	01.S day of September, 2012
By the Court
Service to:
Page 3
Watkins
Barney
McCartney
2 In re Henson, 449 B.R. 109 (Dist. Nev. 2011).
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