Stokes et al v. Goodrich

SUPPLEMENTAL MEMORANDUM OF DECISION - 1
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF IDAHO
______________________________________________________
In Re:
Bankruptcy Case
TOM GOODRICH, 	No. 03-42078
Debtor.
______________________________________________________
DEAN STOKES, et al.
Plaintiffs,
Adv. No. 04-6033
vs.
TOM GOODRICH, an
individual,
Defendant.
______________________________________________________
TOM GOODRICH, an
individual,
Third Party Plaintiff,
vs.
EAGLE ROCK ACCEPTANCE
LTD., CO., an Idaho Limited
Liability Company, et al.,
Third Party Defendants.
________________________________________________________
Case 04-06033-JDP Doc 126 Filed 09/28/05 Entered 09/28/05 11:00:04 Desc Main
Document Page 1 of 9

1 Fed. R. Civ. P. 25 is made applicable in adversary proceedings by Fed. R.
Bankr. P. 7025. Rule 25 allows the Court discretion to substitute the “proper party” for a
party who has died, so long as the claim is not extinguished as a result of the party’s
death.
SUPPLEMENTAL MEMORANDUM OF DECISION - 2
EAGLE ROCK ACCEPTANCE,
LTD., CO., an Idaho Limited
Liability Company, et al.
Third Party Defendants/
Third Party Plaintiffs,
vs.
DEAN STOKES, et al.,
Plaintiffs/Third Party
Defendants.
______________________________________________________
SUPPLEMENTAL MEMORANDUM OF DECISION
______________________________________________________
Background
The Court conducted a consolidated hearing on July 26, 2005,
concerning pro se Plaintiffs’ motions to substitute Mrs. Teddy Goodrich for the
deceased pro se Defendant, Chapter 7 Debtor Tom Goodrich. On August 4,
2005, the Court entered a Memorandum of Decision wherein it made certain
factual findings and concluded that Plaintiffs had not adequately shown that Ms.
Goodrich was the “proper party” under Fed. R. Civ. P. 25 1 to substitute for Mr.
Case 04-06033-JDP Doc 126 Filed 09/28/05 Entered 09/28/05 11:00:04 Desc Main
Document Page 2 of 9

SUPPLEMENTAL MEMORANDUM OF DECISION - 3
Goodrich in this action. 	Mem. Decision, Docket No. 122. The Court allowed
Plaintiffs additional time to submit proof as to who, if anyone, should be
substituted for Defendant. The Court cautioned that in the absence of such proof,
it would dismiss the action with prejudice. Id. at 9.
Plaintiffs Connie Hafen and Gary Stokes filed affidavits containing
additional information concerning Ms. Goodrich. Docket Nos. 123–125.
However, after reviewing the affidavits, the Court concludes this action should be
dismissed. What follows constitutes the Court’s findings of fact and conclusions
of law. Fed. R. Bankr. P. 7052; 9014.
Facts
The Court’s prior Memorandum of Decision sets forth the facts
relevant to Plaintiffs’ motions. Docket No. 122. Plaintiff Connie Hafen’s motion
alleges that Ms. Goodrich is Defendant’s wife, thereby implying that she is the
personal representative of Defendant’s probate estate and that she has possession
of certain assets of that estate. Docket No. 112. The remaining Plaintiffs, in
substantially identical motions to substitute, join Ms. Hafen’s position. Docket
Nos. 114, 116, 118.
In her affidavit filed on August 17, 2005, Docket No. 123, Ms.
Hafen submits a certified copy of a motor vehicle report regarding a certain Ford
Case 04-06033-JDP Doc 126 Filed 09/28/05 Entered 09/28/05 11:00:04 Desc Main
Document Page 3 of 9

SUPPLEMENTAL MEMORANDUM OF DECISION - 4
Taurus allegedly owned by Defendant. The Certificate of Title for the car shows
that “Thomas L. Goodrich,” residing at 1462 Three Fountains Drive, Idaho Falls,
Idaho owned a 1999 Ford Taurus. “T. Claudean Palmer,” who the Certificate
indicates also resided at 1462 Three Fountains Drive in Idaho Falls, Idaho, applied
to transfer the Certificate of Title into her name as the purchaser of the vehicle. In
conjunction with the request to apply for the new title certificate, Ms. Palmer
completed an “Affidavit of Inheritance,” a form maintained by the Idaho
Transportation Department, wherein she identified herself as the “spouse/widow”
of the deceased Thomas Goodrich and signed an affidavit certifying, among other
things, that she is a “survivor or heir” of the deceased and that the deceased died
intestate.
In his bankruptcy petition and schedules, Defendant listed his
address as 1462 Three Fountains Drive in Idaho Falls, Idaho. He claimed a 50%
ownership interest in a 1999 Ford Taurus. Docket No. 1, Bankr. Case No. 03-
42078. Ms. Hafen and Mr. Stokes argue, by implication, that the motor vehicle
records prove Ms. Claudean Palmer is Defendant’s widow and sole surviving heir,
and that by taking possession of Defendant’s property, namely his interest in the
car, that she is the proper party to be substituted in this adversary proceeding. Aff.
Case 04-06033-JDP Doc 126 Filed 09/28/05 Entered 09/28/05 11:00:04 Desc Main
Document Page 4 of 9

2 The Court will not recite the other information contained in the three affidavits
filed by Ms. Hafen and Mr. Stokes, even though the Court carefully reviewed the
material submitted. Much of this other information amounts to inadmissible hearsay, and
Plaintiffs offered no authority to show it is reliable. 	See e.g., Aff. of Hafen ¶¶ 2, 5, 6, 14,
Docket No. 125 (relating what third parties said to or were told by others). Other
portions of the testimony contained within the affidavits do not appear to be based upon
the personal knowledge of the affiants. See e.g., Aff. of Stokes ¶ 7, Docket No. 124
(describing the actions of Ms. Palmer without relating how he knew of the event).
Moreover, most of this information is not relevant to deciding Plaintiffs’ motions and
instead relates either to Plaintiffs’ claims that Ms. Palmer allegedly violated the
automatic stay by taking possession of Defendant’s possessions after his death, or the
fraud allegations in Plaintiffs’ complaint. See e.g., Aff. of Hafen ¶¶ 3–12, Docket No.
125.
SUPPLEMENTAL MEMORANDUM OF DECISION - 5
of Stokes ¶ 8, Docket No. 124; Aff. of Hafen ¶¶ 1–6, Docket No. 123; Aff. of
Hafen ¶ 16, Docket No. 125. 2
Disposition
In its Memorandum of Decision, the Court explained that Plaintiffs
had not given the Court sufficient, competent or credible evidence establishing
that Mrs. Teddy Goodrich, a/k/a “Claudine Palmer,” should be substituted for the
late Mr. Goodrich in this action. Mem. of Decision at 8–9, Docket No. 122. The
Court then gave Plaintiffs an additional opportunity to produce such evidence.
Plaintiffs have failed to do so.
While Fed. R. Civ. P. 25 grants the Court flexibility in deciding
whether substitution should be allowed, see Zeidman v. Gen. Accident Ins. Co.,
122 F.R.D. 160, 161 (S.D.N.Y. 1988) (citing Rende v. Kay, 415 F.2d 983, 986
(D.C. Cir. 1969)), only a “proper party” may be substituted. Fed. R. Civ. P.
Case 04-06033-JDP Doc 126 Filed 09/28/05 Entered 09/28/05 11:00:04 Desc Main
Document Page 5 of 9

3 Other courts have come to a similar conclusion. In a comprehensive written
opinion discussing, among other issues, the substitution of the defendant’s wife for her
late husband, the Hawaii Supreme Court in Roxas v. Marcos, 969 P.2d 1209, 1238–39
(Haw. 1998), analyzed Hawaii’s equivalent to Fed. R. Civ. P. 25. As there was no
authority interpreting Hawaii’s rule, the court conducted an exhaustive analysis of how
other state and federal courts interpreted similar rules. The Hawaii court noted that the
majority of courts, including those in the Ninth Circuit, restricted the substitution of the
parties in the event of death to the deceased’s legal representative, “meaning the
judicially appointed representative,” and noted that only one narrow exception to the
foregoing rule exists so as to allow the substitution of the primary distributee of an
already-distributed estate. Roxas, 969 P.2d at 1238–39. The court did not, therefore,
allow Mrs. Marcos to substitute for her late husband simply because she was his wife.
Id. at 1237.
SUPPLEMENTAL MEMORANDUM OF DECISION - 6
25(a)(1). One decision recently summarized the position of the majority of courts,
including those within this Circuit, that a “proper party” for purposes of Fed. R.
Civ. P. 25 requires the substitution of the deceased’s “legal representative,” i.e., an
executor or administrator of a deceased party’s estate, or in the case of a probate
estate that has already been distributed, the distributee of the estate. Sequoia Prop.
& Equip. Ltd. P’ship v. United States, No. 97-5044, 2002 WL 32388132, at *2
(E.D. Cal. June 3, 2002) (citing Sinito v. U.S. Dept. of Justice, 176 F.3d 512, 516
(D.C. Cir. 1999)). See also Mallonee v. Fahey, 200 F.2d 918, 919 (9th Cir. 1952)
(concluding that the plain language of Rule 25(a)(1) applies “only to the
substitution of legal representatives.”).3 In its previous ruling, the Court explained
the Rule’s requirements. Mem. of Decision at 7–8, Docket No. 122.
Construing the evidence in a light most favorable to the Plaintiffs, at
best they have shown that someone named Claudean Palmer represented to the
Case 04-06033-JDP Doc 126 Filed 09/28/05 Entered 09/28/05 11:00:04 Desc Main
Document Page 6 of 9

4 This is an extremely liberal interpretation of the limited evidence. While a
certified copy of the motor vehicle title records may, “if otherwise admissible,” be
offered as evidence, see Fed. R. Evid. 1005 (allowing certified copies of official records
to be admitted), Plaintiffs are offering the records to prove the truth of the matters
asserted by Ms. Palmer within the records themselves. The statements made by Ms.
Palmer in the Affidavit of Inheritance are therefore hearsay under Fed. R. Evid. 801(c),
as the statements were made outside the proceedings in which they are offered to prove
the truth of the matters asserted therein. See Stroud v. Cook, 931 F.Supp. 733, 735 (D.
Nev. 1996) (explaining that a certified copy of a judgment of conviction for a
misdemeanor offered to prove the guilt of a defendant in other proceedings constitutes
hearsay) (citing United States v. Abascal, 564 F.2d 821, 830 (9th Cir. 1977), cert denied,
435 U.S. 953 (1978)). Arguably, the motor vehicle records, including the affidavit Ms.
Palmer completed, may be admissible under Fed. R. Evid. 803(15) as statements
purporting to establish or affect an interest in property. United States v. Boulware, 384
F.3d 794, 807 (9th Cir. 2004) (explaining that Fed. R. Evid. 803(15) allows the admission
of hearsay statements contained within a document that affects an interest in property, if
the statements are relevant to the purpose of the document). However, under that
exception to the hearsay rule it is not clear whether the statements made by Ms. Palmer
would be admissible only to the extent they show what happened to Defendant’s car, and
inadmissible to prove the truth of the matters Ms. Palmer stated within the affidavit itself.
Plaintiffs in this case are attempting to use the affidavit to prove the truth of Ms. Palmer’s
statements, not just to show what happened to the car.
SUPPLEMENTAL MEMORANDUM OF DECISION - 7
Idaho Department of Motor Vehicles that she was Defendant’s surviving spouse
and his heir, that Defendant died intestate, and that Ms. Palmer therefore believes
she is entitled to record title to a Ford Taurus previously titled in Defendant’s
name.4 Even making this conclusion, however, does not help Plaintiffs because it
does not prove that Ms. Palmer is Defendant’s “legal representative.” For
Plaintiffs to prove that Ms. Palmer is Defendant’s legal representative, they would
have to produce admissible and competent evidence that she has been appointed
by a court or by law to administer Defendant’s assets upon his death. That Ms.
Case 04-06033-JDP Doc 126 Filed 09/28/05 Entered 09/28/05 11:00:04 Desc Main
Document Page 7 of 9

SUPPLEMENTAL MEMORANDUM OF DECISION - 8
Palmer may have been authorized under Idaho law to transfer title to a car
previously owned by Defendant is insufficient to show she is his “legal
representative.”
Nor have Plaintiffs shown that the exception to the general rule
applies. In cases where a decedent’s entire estate has been distributed, the primary
recipient can perhaps be substituted. But that would require Plaintiffs to prove to
the Court that all of the assets in Defendant’s estate have been distributed upon his
death, and that Ms. Palmer was the primary recipient of that distribution. Again,
all Plaintiffs have shown is that Ms. Palmer may have received Defendant’s car
after his death.
Conclusion
The Court cautioned Plaintiffs that by representing themselves, they
may suffer a great disadvantage in this complex litigation. In acting pro se, they
are held to the same standards as attorneys, and the Court is under no obligation to
advocate for, or otherwise assist them. Jacobsen v. Filler, 790 F.2d 1362, 1365
n.5 (9th Cir. 1986) (citing United States v. Pinkey, 548 F.2d 305, 311 (10th Cir.
1977)). The Court has given Plaintiffs an adequate opportunity to show that while
Case 04-06033-JDP Doc 126 Filed 09/28/05 Entered 09/28/05 11:00:04 Desc Main
Document Page 8 of 9

5 While it harbors serious concerns, the Court does not reach whether an action
to determine the dischargability of debts survives the death of the debtor. See Mem. of
Decision at 9 n.1, Docket No. 122 (explaining that substitution of a party may only be
allowed if the claims have not been extinguished by the party’s death).
6 The claims of all the parties will be dismissed, including those made by the
third party complainants, Docket Nos. 2 and 11. Under Fed. R. Civ. P. 13(i), made
applicable by Fed. R. Bankr. P. 7013, if the claims of the opposing party have been
dismissed, the Court can enter a separate judgment on a counterclaim only if the court
has ordered separate trials and the court has jurisdiction to hear the case. Here, the Court
never ordered a separate trial on the counterclaims. The third party plaintiffs sought
indemnification if Plaintiffs were successful in proving the debts Defendant owed to
them were nondischargeable; thus the indemnification claims were dependent upon a
finding in Plaintiffs’ favor. Upon dismissal of Plaintiffs’ nondischargeability complaint,
the indemnification claims asserted in the third party complaints become moot.
SUPPLEMENTAL MEMORANDUM OF DECISION - 9
Mr. Goodrich has died, this action should continue5 as against some appropriate
substituted party. They have not shown that substitution should occur.
Plaintiffs’ complaint and the other claims asserted in this action will
be dismissed by separate order.6
Dated: September 28, 2005
Honorable Jim D. Pappas
United States Bankruptcy Judge
Case 04-06033-JDP Doc 126 Filed 09/28/05 Entered 09/28/05 11:00:04 Desc Main
Document Page 9 of 9