John M. Woodburn

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UNITED STATES BANKRUPTCY COURT
CENTRAL DISTRICT OF CALIFORNIA
LOS ANGELES DIVISION
In re
JOHN M. WOODBURN,
Debtor.
Case No. 2:10-bk-41251-RK
Chapter 7
SEPARATE STATEMENT OF
DECISION IN SUPPORT OF
GRANTING TRUSTEE’S MOTION TO
COMPEL DEBTOR TO TURN OVER
HOMESTEAD PROCEEDS
The motion of the Chapter 7 trustee to compel debtor to turn over homestead
proceeds came on for hearing on September 17, 2013 and October 22, 2013 before the
undersigned United States Bankruptcy Judge. For the reasons stated in the papers filed
by the trustee in support of his motion, the court grants the trustee's motion for turnover
of $50,000, including relief that to the extent that debtor no longer has the funds,
judgment should be entered in favor of trustee for such amount. The previously exempt
funds were either spent by the debtor or applied for his benefit, such as the funds used to
pay debtor's bill to his bankruptcy attorney, and were not reinvested within the six month
time period provided for under California Code of Civil Procedure, § 704.720. Debtor's
argument that he is excused from entry of judgment is foreclosed by England v. Golden
(In re Golden), 789 F.2d 698, 701 (9th Cir. 1986), which rejected the same argument now
FILED & ENTERED
OCT 30 2013
CLERK U.S. BANKRUPTCY COURT
Central District of California
BY DEPUTY CLERK	tatum
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being made by the debtor ("The award of a judgment for the amount claimed exempt at
filing, however, furthers the purpose of the California exemption to preserve the proceeds
of the sale for reinvestment in another home, and to prevent expenditures for nonexempt
purposes.").
After reviewing the supplemental briefing of the parties, the court further
concludes that the trustee's motion should be granted because the trustee's position is
correct on grounds that the uncontroverted evidence before the court, including the
exhibits and statements in the moving and opposing papers, and the statements of the
debtor at the hearings, is that debtor had effective possession and control of the funds
because the homestead exemption funds were paid by the trustee to debtor's attorney,
debtor's agent, on debtor's behalf, who in turn disbursed some of the exempt funds to the
debtor, who has admitted to spending the funds disbursed to him, and the attorney is
holding some of the funds in his client trust account to be applied to payment of debtor's
legal fee obligations to the attorney if the debtor so authorizes (debtor stated during a
hearing that he has not so authorized this despite his attorney’s letter requesting such
authorization). The court concludes that the receipt of the exempt funds by debtor’s
attorney disbursed by the trustee on debtor’s behalf constitutes actual receipt by debtor
for purposes of California Code of Civil Procedure, § 704.720. While debtor does not
dispute that he actually received the exempt funds in part from his attorney, he disputes
that the funds disbursed by the trustee to the attorney on his behalf not distributed to him
constitutes actual receipt by him for purposes of § 704.720 (including the funds now held
in the attorney’s client trust account, awaiting debtor’s authorization to be applied to his
legal fee bill), and this court does not agree with this argument. When the attorney
received debtor’s exempt funds from the trustee on debtor’s behalf, that is the date of
actual receipt, and it is not disputed that six months has passed since this date.
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This separate statement of decision adopts and incorporates the tentative rulings
issued by the court before the hearings as well as supplements the court’s reasons for
decision stated at the hearings.
IT IS SO ORDERED.
###
Date: October 30, 2013
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NOTICE OF ENTERED ORDER AND SERVICE LIST
Notice is given by the court that a judgment or order entitled (specify) SEPARATE STATEMENT OF
DECISION IN SUPPORT OF GRANTING TRUSTEE’S MOTION TO COMPEL DEBTOR TO TURN OVER
HOMESTEAD PROCEEDS was entered on the date indicated as “Entered” on the first page of this
judgment or order and will be served in the manner indicated below:
I. SERVED BY THE COURT VIA NOTICE OF ELECTRONIC FILING (“NEF”) – Pursuant to controlling
General Order(s) and Local Bankruptcy Rule(s), the foregoing document was served on the following
person(s) by the court via NEF and hyperlink to the judgment or order. As of October 30, 2013, the
following person(s) are currently on the Electronic Mail Notice List for this bankruptcy case or adversary
proceeding to receive NEF transmission at the email address(es) indicated below:
Helen R Frazer hfrazer@aalrr.com
David A Gill (TR) mlr@dgdk.com, dgill@ecf.epiqsystems.com;DanningGill@Gmail.com
Barry S Glaser bglaser@swesq.com
Sylvia Lew Sylvialew@tilemlaw.com,
malissamurguia@tilemlaw.com;dianachau@tilemlaw.com;joanfidelson@tilemlaw.com
Alvin Mar alvin.mar@usdoj.gov
Ron Maroko ron.maroko@usdoj.gov
Anthony J Rothman anthony@arothmanlaw.com
David A Tilem davidtilem@tilemlaw.com,
malissamurguia@tilemlaw.com;dianachau@tilemlaw.com;joanfidelson@tilemlaw.com
United States Trustee (LA) ustpregion16.la.ecf@usdoj.gov
Barry R Wegman barrywegman@tilemlaw.com,
malissamurguia@tilemlaw.com;dianachau@tilemlaw.com;joanfidelson@tilemlaw.com
II. SERVED BY THE COURT VIA U.S. MAIL: A copy of this notice and a true copy of this judgment or
order was sent by U.S. Mail, first class, postage prepaid, to the following person(s) and/or entity(ies) at the
address(es) indicated below:
Debtor
John M. Woodburn
272 South Los Robles Avenue
Pasadena, CA 91101-2872
JOHN J MENCHACA
835 Wilshire Boulevard, Suite 300
Los Angeles, CA 90017
Menchaca & Company LLP
835 Wilshire Blvd Suite 300
Los Angeles, CA 90017
Najila K Brent
Najila K Brent APLC
3424 Carson St Ste 500
Torrance, CA 90503
III. TO BE SERVED BY THE LODGING PARTY: Within 72 hours after receipt of a copy of this judgment or
order which bears an “Entered” stamp, the party lodging the judgment or order will serve a complete copy
bearing an “Entered” stamp by U.S. Mail, overnight mail, facsimile transmission or email and file a proof of
service of the entered order on the following person(s) and/or entity(ies) at the address(es), facsimile
transmission number(s) and/or email address(es) indicated below:
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