Banco Bilbao Vizcaya Argentari v. Noreen Wiscovitch-Rentas
625 F.3d 34
1st Cir.2010Background
- BBVA garnished funds from Code Inspector, a corporation owned by Net-Velázquez and his wife.
- The sale of a Paseo de la Fuente parcel yielded $354,373.30, of which BBVA had earlier attached $300,000.
- The code-inspector account, titled in the corporate name, was believed by BBVA to be Net-Velázquez’s personal account.
- Net-Velázquez filed Chapter 7 bankruptcy; the estate listed the Code Inspector account as property of the estate.
- Bankruptcy court held Net-Velázquez retained ownership of the Code Inspector funds, making BBVA’s garnishment a preferential transfer under §547(b).
- BBVA appealed, district court affirmed, and BBVA waived several new defenses not raised below; the appellate court sustained waiver and affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the garnished funds were an interest of the debtor in property | Net-Velázquez maintained the funds remained his property in the estate | BBVA asserted ownership had transferred to Code Inspector, depriving the estate of a debtor’s interest | Yes, funds were property of the estate (debtor’s interest preserved). |
| Whether BBVA’s new defenses were waived for not being raised below | Net-Velázquez contends waiver did not bar all arguments on appeal | BBVA argues exceptional circumstances permit consideration of new defenses | Waiver applied; new arguments not raised below were not considered. |
| Whether payment-by-mistake defense was preserved for appeal | Net-Velázquez argues the defense was not properly raised | BBVA claimed defense was raised in answer and trial but not pursued | Defense waived for lack of prosecution; not considered on appeal. |
Key Cases Cited
- Teamsters, Chauffeurs, Warehousemen & Helpers Union, Local No. 59 v. Superline Transp. Co., 953 F.2d 17 (1st Cir. 1992) (waiver rules for arguments not squarely raised below)
- Iverson v. City of Boston, 452 F.3d 94 (1st Cir. 2006) (echolalic regularity in applying waiver rule)
- Harwood v. Nat'l Ass'n of Soc. Workers, 69 F.3d 622 (1st Cir. 1995) (discretionary exception to waiver rule factors)
- Montalvo v. Gonzalez-Amparo, 587 F.3d 43 (1st Cir. 2009) (factors for exceptional waiver relief)
- In re Woodman, 379 F.3d 1 (1st Cir. 2004) (bankruptcy proceedings; trial court vs appellate review roles)
- In re Hill, 562 F.3d 29 (1st Cir. 2009) (standard of review for bankruptcy findings of fact and law)
- In re Lazarus, 478 F.3d 12 (1st Cir. 2007) (earmarking doctrine related to property interests in transfers)