William Scott

OCR transcription for search; preserved printed pages are authoritative

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AUTHEN]Y
U.S. GOVE
INFORM,

Case 9:08-bk-10564-RR Doc 64 _ Filed 03/04/09 Entered 03/04/09 11:06:24 Desc
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FILED ENTERED

MAR ~ 4 2009 MAR - 4 2009

CLERA U.S. BANKRUPTCY COURT STEERS, BAP TCT COLT
nN saat Ss

UNITED STATES BANKRUPTCY COURT
CENTRAL DISTRICT OF CALIFORNIA, NORTHERN DIVISION
In re: Case No. ND-08-10564-RR
Chapter 7

WILLIAM SCOTT, JUR., MEMORANDUM OPINION

Debtor. Hearing: Jan. 14, 2009
Time: 10:00 a.m.
Place: Courtroom 201

U.S. Bankruptcy Court
1415 State Street
Santa Barbara, CA

Me et ee ee ee ee ee ee

RIBLET, Bankruptcy Judge:

The issue presented is whether the debtor may utilize 11
U.S.C, $ 522(f) (1) to avoid a Family Law Attorney’s Real Property
Lien recorded, according to California law, by his former
spouse’s family law counsel. I conclude that the debtor may not
avoid such a lien and, accordingly, deny his motion.

I. FACTS

Debtor filed his voluntary chapter 7 petition on March 19,
2008. The initially filed schedules included Schedule A, listing
the debtor’s interest in real property located at 6950 Solano

Drive in Camarillo, California. Schedule A reflected a current

ICATED
MENT
TION
GPO

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value of $950,000, subject to a secured claim of $1,095,084.
Schedule C, filed March 19, 2008, did not claim a homestead
exemption. On June 18, 2008, amended schedules were filed,
including an amended Schedule C which claimed a homestead
exemption under Cal. Code of Civ. Pro. § 703.140(b)(5) in the
amount of $25 in the Solano Drive residence. No objections to
the debtor’s claims of exemption have been filed.

Long before the commencement of debtor’s case, dissolution
proceedings between the debtor and his then wife commenced in the
Fall of 2005. Mrs. Scott engaged Ferguson Case Orr Paterson LLP
(“Ferguson Case” or “claimant”) to represent her in the
dissolution proceedings. Ferguson Case recorded its Family Law
Attorney’s Real Property Lien (“FLARPL”) in accordance with
California law' on April 10, 2007, in the amount of $40,000
against Mrs. Scott’s community property interest in the Solano
Drive residence.

On March 10, 2008, the family law court entered its judgment
of dissolution and awarded debtor the Solano Drive residence,
subject te the encumbrances thereon. The dissolution judgment
ordered property division as set forth in the parties’ Marital
Settlement Agreement. The Marital Settlement Agreement provided:

The following assets . . . are agreed to be Husband’s

B. The former family residence located at 6950

Solano Drive, Camarillo, CA, subject to the

encumbrances on said property, including but not

limited to the first mortgage, the equity line of
credit and any wrap-around loan.

* Cal. Fam. Code §2033 (West 2009).

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Additionally, the Marital Settlement Agreement included
language specifically referencing the FLARPL, stating:

There is currently a Family Law Real Property Lien
in place in favor of Ferguson, Case, Orr Paterson,
et.al., secured by the former family residence in the
amount of $40,000. The court has reserved jurisdiction
over the issue of whether the family law real property
lien should be purged or allowed to remain in place.
This reservation of jurisdiction still exists and the
subject is still before the court. . . The parties
specifically stipulate that regardless of whether
Ferguson, Case, Orr Paterson, et.al. is successful in
obtaining funds due to the Family Law Real Property
Lien, neither party will be entitled to nor responsible
for reimbursement to the other party. Each party
specifically warrants that he or she will not seek
repayment from the other party for any fees and/or
distributions associated with the Family Law Real
Property Lien.

Two months later, and after the commencement of this chapter

7 case, the family law court addressed the reserved issues

relative to the FLARPL. By way of order entered on May 13, 2008,

the family law court ordered as follows:

Petitioner’s motion to expunge the Family Law
Attorney’s Real Property Lien (“FLARPL”) is denied in
full. The court’s prior assertion of a reservation of
jurisdiction over the issue, stated in the prior Order,
issued on October 12, 2007, is dissolved. Jurisdiction
is hereby terminated over the issue and the FLARPL,
which is recorded against the 6950 Solano Drive,
Camarillo, California property, remains in full force
and effect.

On June 6, 2008, claimant Ferguson Case filed a proof of

claim in the debtor’s bankruptcy case in the amount of $55,000,

of which $40,000 was claimed as secured based on the FLARPL.

an Addendum to Proof of Claim, Ferguson Case asserts, “This lien

encumbers Annette Scott’s interest in the community property real

property located at 6950 Solano Drive...”

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On November 3, 2008, the debtor filed the instant motion to
avoid the lien of Ferguson Case in the amount of $40,000.
II. JURISDICTION
The bankruptcy court has subject-matter jurisdiction
pursuant to 28 U.S.C. § 1334 over this core proceeding under 28
U.S.C. § 157 (b) (2) (B).
III. ISSUES

{1) Whether claimant’s FLARPL fixed on an interest of the

(2) Whether the FLARPL is a statutory or a judicial lien.
Iv. DISCUSSION
A. Did the FLARPL fix on an interest of the debtor?

Ferguson Case argues that the debtor cannot avoid the FLARPL
because it was fixed on his former wife’s interest in the
property before the debtor obtained his new sole ownership
interest in the property subject to the FLARPL. Ferguson Case

relies on the holding of Farrey v. Sanderfoot, 500 U.S. 291, 299,

111 S.Ct. 1825, 1830 (1991), that “the critical inquiry remains
whether the debtor ever possessed the interest to which the lien
fixed, before it fixed.” Claimant reasons that the debtor did
hot possess any interest in Mrs. Scott’s community interest in
the Solano Drive residence at the time the lien attached to Mrs.
Scott’s community interest. Claimant also cites to in re
Donovan, 137 B.R. 547 (Bankr. S.D. Fla. 1992), which held that
the debtor wife could not avoid a lien on real property in favor

of the non-debtor husband’s attorney because the lien fixed on

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the non-debtor husband’s interest in the residence prior to the
debtor obtaining the entire interest.

The debtor, on the other hand, argues that the FLARPL fixed
on the Solano Drive community property of the debtor in April
2007, upon recordation, and because debtor owned a community
property interest in the residence at that time, the lien fixed

on an interest of the debtor. Debtor relies on Law Offices of

Moore & Moore v. Stoneking (In re Stoneking), 225 B.R. 690 (9th

Cir. BAP 1998).

The U.S. Supreme Court in Farrey held that “uniess the
debtor had the property interest to which the lien attached at
some point before the lien attached to that interest, he or she
cannot avoid the fixing of the lien under the terms of
§$522(f)(1).” Farrey, 500 U.S. at 296. “[I]t is settled that a
debtor cannot use § 522(f}(1) to avoid a lien on an interest
acquired after the lien attached.” Id., at 299 (citations
omitted). “(T]he critical inquiry remains whether the debtor
ever possessed the interest to which the lien fixed, before it
fixed. If he or she did not, § 522{f)(1) does not permit the
debtor to avoid the fixing of the lien on that interest.” Id.

Relying on Wisconsin state law and the fact that the parties
held title in joint tenancy prior to the divorce judgment, the
U.S. Supreme Court determined that the divorce decree
extinguished both parties’ pre-existing undivided half interests.
The same decree awarded husband his fee Simple interest and

simultaneously granted a lien to the wife. “({Husband] took the

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interest and the lien together, as if he had purchased an already
encumbered estate from a third party. Since [husband] never
possessed his new fee simple interest before the lien ‘fixed,’

§522(f) (1) is not available to void the lien.” Id., at 300.?

* In Farrey, the Wisconsin court granted a judgment of
divorce and awarded the family home to the husband. To equalize
division of the marital estate, the court ordered husband to pay
wife $29,208.44, half the difference in the value of their net
assets. To secure the award, the decree provided that wife was
to have a lien against the real estate in the amount of money due
her, and that the lien would remain attached to the real property
until the total amount of money had been paid in full. The U.S.
Supreme Court determined that the debtor husband was not
permitted to use §522(f)(1) to avoid wife’s lien, reasoning that:

(T]he lien could not have fixed on [husband’s] pre-
existing undivided half interest because the divorce
decree extinguished it. Instead, the only interest
that the lien encumbers is debtor’s wholly new fee
simple interest. The same decree that awarded
[husband] his fee simple interest simultaneously
granted the lien to [wife]. As the judgment stated, he
acquired the property “free and clear” of any claim
“except as expressly provided in this [decree].” .
[Husband] took the interest and the lien together, as
if he had purchased an already encumbered estate from a
third party. Since [husband] never possessed his new
fee simple interest before the lien “fixed,” §522(f) (1)
is not available to void the lien.

The same result follows even if the divorce decree did
not extinguish the couple's pre-existing interests but
instead merely reordered them. The parties’ current
position notwithstanding, it may be that under
Wisconsin law the divorce decree augmented [husband’s]
previous interest by adding to it [wife’s] prior
interest. If the court in exchange sought to protect
[wife’s] previous interest with a lien, §522(f) (1)
could be used to undo the encumbrance to the extent the
lien fastened to any portion of [husband’s] previous
surviving interest. This follows because [husband]
would have possessed the interest to which that part of
the lien fixed, before it fixed. But in this case, the
divorce court did not purport to encumber any part of

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In Donovan, 137 B.R. 547, during the parties’ divorce, the
husband’s attorney requested and was granted a charging lien
against the husband’s one-half interest in the residence. The
charging lien was recorded. Subsequently, the parties entered
into a settlement wherein the husband transferred his undivided
one-half interest in the residence to the debtor wife, subject to
the charging lien of his counsel. After obtaining court approval
of the settlement, the husband executed a quit claim deed which
provided that the conveyance was subject to the charging lien of
the attorney.

Five years later, the debtor wife and her new husband filed
a chapter 7 petition, claiming a homestead exemption in the
residence. They moved to avoid the charging lien claiming that
it impaired their homestead exemption. The creditor opposed the
motion, asserting that the lien attached solely to the ex-
husband’s one-half interest prior to the debtor wife’s
acquisition of the entire interest in the residence.

Alternatively, the creditor argued his charging lien was not a

[husband’s]j previcus interest even on the assumption
that state law would deem that interest to have
survived. The decree instead transferred [wife's]
previous interest to [husband] and, again
simultaneously, granted a lien equal to that interest
minus the small amount of personal property she
retained. [Husband] thus would still be unable to avoid
the lien in this case since it fastened only to what
had been [wife’s] preexisting interest, and this
interest [husband] would never have possessed without
the lien already having fixed.

Farrey, 500 U.S. at 299-300.

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judicial lien and therefore not avoidable.

The Donovan court, applying Farrey, determined that since
the creditor’s lien fixed to the property before the debtor
acquired her interest, the lien did not fix on the debtor's
interest in the property. Thus, the debtor could not avoid the
creditor’s lien.

In Stoneking, 225 B.R. 690, the debtor sought to avoid the
judicial lien of a law firm which had represented the debtor’s
former spouse in divorce proceedings. The Ninth Circuit
Bankruptcy Appellate Panel held that the debtor, who now had sole
ownership of his residence, could avoid the judicial lien imposed
on his residence while he was holding a community property
interest in it. The debtor alleged that his former spouse
executed a guitclaim deed after entry of the fee award to the
firm, but before the abstract of judgment was recorded. The
court observed that there was nothing in the record to support
that allegation, further noting, “In any event, at the time the
Superior Court imposed the lien on the community property
including the Residence . . . Debtor held a community property
interest in the Residence.” Stoneking, 225 B.R. at 691.

The Panel distinguished its facts from those of Farrey,
noting that unlike Farrey, the judicial lien attached to the
debtor’s community property, which interest the debtor held
before the lien attached. As a result of that distinction, the
debtor could avoid the lien. The Panel limited the application

of Farrey to liens created simultaneously with the creation of

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the new property interests.

The Panel further reasoned against making an arbitrary
distinction between a debtor who obtains a divorce after the lien
is affixed and a debtor who remains married after the lien is
affixed:

While a debtor may not avoid a lien that attached

before he held any interest in the property, it does

not necessarily follow that a debtor cannot avoid a

lien merely because his property interests were

augmented after attachment of the lien. If a debtor

could have avoided such a lien on community-held real

property pursuant to section 522(f)(1) before acquiring

sole ownership of the property, that debtor should not
lose the right to avoid that same lien after acquiring
sole ownership. Otherwise, a judgment creditor whose
debtor happens to obtain a divorce after the lien is
affixed on community property is fortuitously excluded

from the lien avoidance scope of section 522(f) (1),

while a creditor whose debtor remains married after the

lien is affixed on real property is subject to having

its lien avoided under that section. There is no basis

in section 522(f) (1) for such an arbitrary distinction.
stoneking, 225 B.R. at 695.

Just as the Stoneking Panel found factual distinctions
between the facts before it and those in Farrey, there are
Significant factual distinctions between the facts of this case
and those of Stoneking, making this case more closely aligned
with Farrey. The creditor law firm in stoneking obtained an
order for recovery of its fees against the debtor and against the
community property of both parties. The Stoneking lien was not
imposed under statute. Rather, the recorded abstract of judgment
was Clearly a judicial lien, as it resulted from a court order.

In contrast, in the facts presented here, during the time

that the residence was held as community property, the Ferguson

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Case lien was recorded solely against Mrs. Scott’s undivided
interest in the community property. The lien was recorded as a
Family Law Attorney’s Real Property Lien under Cal. Fam. Code
$2033, which specifically provides that such encumbrance
“attaches only to the encumbering party’s interest in the
community real property.”

In the parties’ Marital Settlement Agreement, the former
family residence was awarded to the debtor/husband “subject to
the encumbrances on said property, including but not limited to
the first mortgage, the equity line of credit and any wrap-around
loan.” Mrs. Scott was awarded an equalizing payment of $6,000,
payable at $1,000 per month. Additionally, the Marital
Settlement Agreement included language specifically referencing
the FLARPL, stating that the family law court had reserved
jurisdiction over the issue cf whether the FLARPL should be
purged or ailowed to remain in place. The family law court
subsequently denied the debtor husband’s motion to expunge the
FLARPL and ordered that “the FLARPL, which is recorded against
the 6950 Solano Drive, Camarillo, California property, remains in
full force and effect.”

Thus, the circumstances of this case are much more akin to
those of Farrey, wherein the subject lien never encumbered the
debtor’s pre-existing undivided one-half interest. The lien in
Farrey, which was granted in favor of the wife to secure payment
of an equalizing payment, was granted simultaneously with the

awarding of the fee simple interest to the debtor husband.

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“{Husband] took the interest and the lien together, as if he had
purchased an already encumbered estate from a third party. Since
[husband] never possessed his new fee simple interest before the
lien ‘fixed,’ § 522(f)(1) is not available to void the lien.”

Farrey, 900 U.S. at 300. Here, the FLARPL never encumbered the

debtor’s pre-existing community property interest because it
attached only to the encumbering party’s (Mrs. Scott’s) interest
in the community property. Cal. Fam. Code § 2033. As in Farrey,
Debtor here took his interest and the lien together, as if he
purchased an already encumbered estate from a third party. Since
debtor never possessed his new fee simple interest before the
lien fixed, § 522(f}) is net available to void the lien.

The facts here are also strikingly similar to those in
Donovan wherein the debtor wife acquired her ex~husband’s
interest subject to the creditor’s lien. Because the lien fixed
to the former husband’s one-half interest prior to the debtor’s
acquisition of the husband’s interest, the lien did not fix on
the debtor’s interest. The debtor could not avoid the lien under
§522(f). Donovan, 137 B.R. at 550.

Moreover, under the unambiguous language of the California
statute, the FLARPL could attach only to Mrs. Scott’s community
interest. “This encumbrance shall be known as a ‘family law
attorney’s real property lien’ and attaches only to the
encumbering party’s interest in the community real property.”
Cal. Fam. Code § 2033. Simply because debtor had a community

interest in the community real property does not mean that the

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lien attached to his community interest in the property. Rather,
the lien attached to Mrs. Scott’s community interest only.
Because the Ferguson Case FLARPL did not fix on an interest of
the debtor in the residence at the time it was recorded, the
debtor may not utilize 11 U.S.C. § 522(f) (1) to avoid the lien.
B. Is the FLARPL a statutory or a judicial lien?

There are no cases determining whether a California FLARPL
is a statutory lien or a judicial lien.

Under the provisions of Cal. Fam. Code § 2033, a FLARPL
attaches only to the encumbering party’s interest in the
community property and does not require any subsequent action by
the Family Law court to be effective. If the attorney asserting
the lien fails to comply with the notice requirements (including
specifying the amount of attorney fees to be secured by the lien)
of Cal. Fam. Code § 2033, the lien will be invalid ab initio.

Toscana v. Toscana, 2002 WL 226124 (2002); and Kipperman v.

Sutherland (in re Bush), 356 B.R. 28 (Bankr. S.D. Cal. 2006)

{Notice of the § 2033 lien must be served personally on the other

party at least 15 days before recordation of the encumbrance) .?

* In Bush, the chapter 7 trustee filed an adversary
complaint against the attorney who represented the debtor in
prepetition dissolution proceedings, seeking to avoid a charging
lien, a judicial lien, and a FLARPL. The Bankruptcy Court in the
Bush case did not decide whether a FLARPL was a statutory lien
because the attorney in that case did not record a FLARPL.
Rather, she filed an All Inclusive Deed of Trust and Assignment
of Rents. There was no dispute that the document was recorded,
thus giving constructive notice to the chapter 7 trustee. The
court sua sponte granted summary judgment in favor of the
attorney on the non-avcoidance of the All Inclusive Deed of Trust.

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Cases interpreting other state attorney liens are
instructive. The Eleventh Circuit determined that to the extent
an attorney’s charging lien under Florida law was valid, it was
not a judicial lien and therefore not avoidable as impairing the

debtor’s homestead. Weed v. Washington (In re Washington), 242

F.3d 1320 (llth Cir. 2001). The Eleventh Circuit reasoned that
the interest created by a valid attorney’s charging lien arises
by operation of law when all the requirements of such a lien are
satisfied.

In In re Dubois, 2004 WL 343984 (Bankr. D. N.H. 2004}, the

court addressed the issue of whether an attorney’s claim for fees
under a New Hampshire statute was a judicial lien or a statutory
lien. Because the attorney had not been paid from the equalizing
payment by the non-debtor spouse to the debtor, the attorney
sought enforcement in the superior court. The superior court
entered an order determining that the attorney had an attorney’s
lien under New Hampshire law against the debtor’s 401(k) account
ana ordered the debtor to make payments. The debtor then filed a
chapter 7 petition and moved to avoid the attorney’s lien. After
discussing the definitions of security interest, judicial lien
and statutory lien, the bankruptcy court concluded that the
attorney’s lien satisfied each and every element of the
definition of a statutory lien: the lien arose solely under the
Statute; it was not obtained through any judicial proceeding,
court order or agreement, but arose solely because of the

provisions of the statute; and no action by the court was

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necessary to create the lien. Furthermore, the court rejected
the argument that resorting to the courts to perfect, enforce or
determine the nature or extent of the statutory lien transformed
the Lien into a judicial lien.

[T]he statute does not authorize the superior court to

create the lien itself. In this case, the superior

court’s order only confirmed the existence of the

statutory lien and determined the amount and payment

terms for the lien. Those actions were in furtherance

of the enforcement of an existing lien, not the

creation of the lien. Accordingly, the superior

court’s order of August 26, 2003 did not convert the

Creditor’s statutory lien into a judicial lien.
Dubois, 2004 WL 343984, at *3.

Similarly, the Bankruptcy Court for the Western District of
Oklahoma held that an attorney’s charging lien was statutory and
not included among the types of liens that can be avoided under

§522(£) (1) (A). In re Bingham, 344 B.R. 648 (Bankr. W.D. Okla.

2006). “An attorney’s statutory charging lien which is properly
perfected before the client files for bankruptcy is a statutory

lien that cannot be avoided pursuant to 11 U.S.C. $522 (f) (1) (A).”

Id., at 650 (citation omitted).

In In re O’Connell, 167 B.R. 928 (Bankr. D. Mont. 1994), the

chapter 7 debtor sought to avoid an attorney’s lien of her former
dissolution attorney, contending that the attorney’s Lien was an
avoidable judicial lien. The court determined that Montana’s
statute governing attorneys’ liens was a codification of the
common law attorney’s charging lien. The court determined that
under Montana law, the attorney’s charging lien was based on a

statutory right, much like a mechanic’s lien. “Like a mechanic's

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lien, an attorney’s lien arises out of the statute, which creates
the lien, and even the enforcement of the lien by judgment does
not change the character of the statutory lien.” Q’Connell, 167

B.R. at 931, citing Graffen vy. City of Philadelphia, 984 F.2d 91,

96 (3rd Cir. 1992). The O’Connell court found the facts before

it parallel to those in In re Sacco, 99 B.R. 647 (Bankr. W.D. Pa.

1989), wherein the court held that an attorney’s charging lien

under Pennsylvania law was not a judicial lien and could not be

avoided. “An attorney’s charging lien arises by operation of
law. . . . [Njo affirmative action is required to establish an
attorney’s charging lien. . . [W]e hold that a properly

constituted attorney’s charging lien is a secured debt which may
not be avoided pursuant to 11 U.S.C. § 522(f)(1).” ©’Connell,

167 B.R. at $31, citing Sacco, 939 B.R. at 651-52. The O’ Connell

court concluded:

Since Congress has specifically limited § 522 (£) (1}
to judicial liens, the statutory lien of Bell trumps
the Debtor’s motion to avoid Bell’s attorney’s lien.

I conclude Montana’s attorney lien statute Section
37-61-420 creates a statutory lien as that term is
defined in § 101(53) of the Bankruptcy Code which
cannot be avoided under § 522(f) (1).

QO’ Connell, 167 B.R. at 931,

A Family Law Attorney’s Real Property Lien created under
Cal. Fam. Code § 2033 falls squarely within the definition of a
statutory lien. A “statutory lien” is a lien “arising solely by
force of a statute on specified circumstances or conditions,
but does not include security interest or judicial lien.” 11

U.S.C. § 101(53). On the other hand, a “judicial lien” is

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“obtained by judgment, levy, sequestration, or other legal or
equitable process or proceeding.” 11 U.S.C. § 101(36).
California’s FLARPL statute provides as follows:

(a) Either party may encumber his or her interest in
community real property to pay reasonable attorney's
fees in order to retain or maintain legal counsel in a
proceeding for dissolution of marriage, for nullity of
marriage, or for legal separation of the parties. This
encumbrance shall be known as a “family law attorney's
real property lien” and attaches only to the

Desc

encumbering party's interest in the community real property.

(6b) Notice of a family law attorney's real property
lien shall be served either personally or on the other
party's attorney of record at least 15 days before the
encumbrance is recorded. This notice shall contain a
declaration signed under penalty of perjury containing
all of the following:

(1) A full description of the real property.

(2} The party's belief as to the fair market value of
the property and documentation supporting that belief.

(3) Encumbrances on the property as of the date of the
declaration.

(4) A list of community assets and liabilities and
their estimated values as of the date of the
declaration.

(5) The amount of the family law attorney's real
property lien.

(c) The nonencumbering party may file an ex parte
objection to the family law attorney's real property
lien. The objection shall include a request to stay the
recordation until further notice of the court and shall
contain a copy of the notice received. The objection
shall also include a declaration signed under penalty
of perjury as to all of the following:

(1) Specific objections to the family law attorney's
real property lien and to the specific items in the
notice.

(2) The objector's belief as to the appropriate items
or value and any documentation supporting that belief.

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(3} A declaration specifically stating why recordation
of the encumbrance at this time would likely result in
an unequal division of property or would otherwise be
unjust under the circumstances of the case.

{d) Except as otherwise provided by this section,
general procedural rules regarding ex parte motions

apply.

(e) An attorney for whom a family law attorney's real

property lien is obtained shall comply with Rule 3-300

of the Rules of Professional Conduct of the State Bar

of California.

Cal. Fam. Code § 2033 (West 2009).

A California FLARPL requires an agreement between the
attorney and his client for the payment of fees in a dissolution
proceeding. The client can agree to encumber his or her interest
in community property to secure payment of such fees. The lien
attaches only to the encumbering party's interest in the
community real property. To be valid, the statute requires a
notice of the lien to be served personally or on the cther
party’s attorney of record at least 15 days before recordation.
The netice must contain a full description of the real property,
the party’s belief as to fair market value, encumbrances on the
property at the time of the declaration, a list of community
assets and liabilities with estimated values, and the amount of
the attorney’s lien.

Absolutely no intervention is required by the family law
court to create a valid family law attorney’s lien in community
real property. The statute sets forth a procedure for

challenging such a lien by the non-encumbering party.

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The debtor here unsuccessfully challenged the Ferguson Case
FLARPL. The family law court denied his motion to expunge the
lien and ordered that the lien remain in full force and effect.
The state court did not create the lien, nor did the court
transform the lien into a judicial lien merely by determining
that the lien remained in full force and effect.

This Court having determined that the FLARPL is a statutory
lien, the Debtor may not attempt to utilize 11 U.S.C. § 922 (f£) (1)
to avoid it.

Vv. CONCLUSION

The debtor’s motion to avoid the Ferguson Case FLARPL is
DENIED on two separate bases: first, the FLARPL is a statutory
lien and not avoidable under 11 U.S.c. § 522(f) (1); and second,
because the debtor here did not possess the interest being
attached at the time the FLARPL fixed (which fixed only on Mrs.
Scott’s community property interest in the residence), the fixing
was not on the debtor’s interest. Accordingly, the Ferguson Case
FLARPL cannot be avoided under the specific provisions of 11

U.S.C. § 522(f) (1).

Dated: March 4, 2009 Corto YeL btu.

Robin L. Riblet
United States Bankruptcy Judge

i8

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Main Document Page 19 of 20

Inre: Willian Scott, Jr.
CHAPTER: 7

Debtor(s). CASE NUMBER: ND-08-10564-RR

NOTE TO USERS OF THIS FORM:
1} Attach this form to the last page of a proposed Order or Judgment. Do not file as a separate document.
2) The title of the judgment or order and all service information must be filled in by the party lodging the order,
3) Category |. below: The United States trustee and case trustee (if any) will always be in this category.
4) Category il. below: List ONLY addresses for debtor (and attorney), movant (or attorney) and person/entity (or attorney) who filed ar
opposition to the requested relief. BO NOT list an address if person/entity is listed in category |.

NOTICE OF ENTERED ORDER AND SERVICE LIST

Notice is given by the court that a judgment or order entitled {specify) Memorandum Opinion

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:

|, 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 J/4fuy , 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.

Richard J Bauer rbauer@mileslegal.com

John H Kim — jkim@cookseylaw.com

Sandra McBeth —jwalker@mcbethlegal.com, CA65@ectcbis.com
John Patton —jpatton@cookseylaw.com

United States Trustee (ND) ustpregion16.nd.ecf@usdoj.gov

WJ Service information continued on attached page

il. 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
United States Mail, first class, postage prepaid, to the following person(s) and/or entity(ies) at the address(es) indicated below:

Wi Service information continued on attached page

lll. 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:

Ol Service information continued on attached page

This form is mandatory. It has been approved for use by the United States Bankruptcy Court for the Central District of California.

January 2009 F 9021 -1 |

Case 9:08-bk-10564-RR Doc 64 Filed 03/04/09 Entered 03/04/09 11:06:24 Desc

Main Document Page 20 of 20
Inve: Wiltian Scott, Jr.
CHAPTER: 7
Debtor(s). CASE NUMBER: ND-08-10564-RR

ADDITIONAL SERVICE INFORMATION (if needed):

Giibert B Weisman _ notices@becket-lee.com
William E Winfield = wwinfieid@nchc.com

William E. Winfield, Esq.

NORDMAN CORMANY HAIR & COMPTON

1000 Town Center Drive, 6th Floor
P 0 Box 9100
Oxnard, CA 93031

Gregory W. Herring, Esq.
Ferguson Case Orr Paterson LLP
1050 South Kimball Road
Ventura, CA 93004

Sandra K, McBeth

Ch 7 Trustee

2450 Professional Parkway
Santa Maria, CA 93455

Office of the U.S. Trustee Region 16
21051 Warner Center Lane, Ste 115
Woodland Hills, CA 91367

Brian Fittipaldi, Esq.
Office of the U.S. Trustee
128 East Carrillo Street
Santa Barbara, CA 93101

This form is mandatory. It has been approved for use by the United States Bankruptcy Court for the Central District of California.

January 2009

F 9021-1.1