783 F.3d 769
10th Cir.2015Background
- Davis, the Chapter 7 trustee, seeks to avoid Tung Nguyen’s transfer of an interest in Reno County real property under 11 U.S.C. § 548(a)(1)(B).
- Property originated as a joint tenancy between Hoa Thi Pham and Noel Esplund; later, Nguyen transferred his interest to Dang and Esplund by quitclaim for no consideration.
- Nguyen filed for Chapter 7 bankruptcy; the trustee alleged the transfer occurred within two years before filing, with insolvency and inadequacy of value.
- Bankruptcy Court found Nguyen held only bare legal title; Pham’s transfer to Dang and Esplund created a resulting trust under Kan. Stat. Ann. § 58-2408 for Pham’s benefit.
- Bankruptcy Court also held bare legal title of one-third was not an “interest in property” subject to avoidance under § 548(a)(1)(B); BAP affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a resulting trust can coexist with joint tenancy under Kansas law | Davis argues resulting trust negates joint tenancy unity. | Nguyen/Pham contend trusts and joint tenancy are compatible under Kansas law. | Yes; resulting trusts can coexist with joint tenancy under Kansas law. |
| Whether Dexter governs here regarding joint tenancy and resulting trusts | Dexter precludes Kan. § 58-2408 for joint tenancy situations. | BAP/Blevins reinterpret Kan. law; Dexter is superseded by later Kansas decisions. | Dexter is not controlling; Kansas authority permits resulting trusts with joint tenancy. |
| Whether Nguyen’s bare legal title is an includable interest under § 548(a)(1)(B) | If trust exists, Nguyen held equitable title; potentially avoidable. | Bare legal title without interest is not within § 548(a)(1)(B)’s scope. | Bare legal title is not an interest subject to avoidance; the transfer cannot be avoided. |
Key Cases Cited
- Winsor v. Powell, 497 P.2d 292 (Kan. 1972) (equitable trusts compatible with joint tenancies)
- Blevins, 605 P.2d 91 (Kan. 1980) (joint tenancy compatible with resulting trusts; trust can override joint ownership)
- Dexter v. Dexter, 481 F.2d 711 (10th Cir. 1973) (resulting trust statute not applicable to joint tenancy cases (distinguished))
- Stovall v. Walnut Valley State Bank, 574 P.2d 1382 (Kan. 1978) (joint tenancy not a bar to constructive/ieked trusts; recognizes injustices)
- Spark v. Brown, 205 P.2d 938 (Kan. 1949) (joint tenancies are disfavored; constructive trusts possible)
- Lasater, 54 P.3d 511 (Kan. Ct. App. 2002) (presumption of equal shares; discussion of title vs. equitable title)
- Kasparek, 426 B.R. 332 (B.A.P. 10th Cir. 2010) (bona fide purchaser vs. beneficiary of implied trust considerations)