517 B.R. 228
Bankr. S.D. Cal.2014Background
- Debtor Isaías Arellano filed a chapter 7 case and sought a filing fee waiver due to limited income.
- Initial Schedule C showed limited exemptions, supporting the waiver.
- At the 341 meeting, the Debtor disclosed additional assets and amended Schedule B to add a $4,958.65 account and a $2,000 tax refund expectation.
- Concurrent amendments claimed exemptions for the omitted assets under CCP § 703.140(b) and the Debtor paid the filing fee in full.
- Trustee objected to the newly claimed exemptions based on alleged bad faith; the Debtor opposed the objection.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether bad-faith exemptions objections may deny or bar amendments | Trustee | Arellano | No; exemptions cannot be denied solely on bad faith under the Code. |
| Whether Law v. Siegel forecloses Doan/Michael-style exemptions limits | Trustee | Arellano | Yes; Law v. Siegel abrogates bad-faith/prejudice exemptions limits. |
Key Cases Cited
- Law v. Siegel, 134 S. Ct. 1188 (Supreme Court 2014) (supersedes equitable-based exemption denial; Code governs exemptions only as stated)
- In re Nicholson, 435 B.R. 622 (9th Cir. BAP 2010) (bad-faith/privacy/ prejudicial objections limited by Code and prior authority)
- In re Doan, 672 F.2d 831 (11th Cir. 1982) (established bad-faith/prejudice exceptions to exemptions)
- In re Michael, 163 F.3d 526 (9th Cir. 1998) (adopted bad-faith/prejudice exceptions to exemptions")
- Rodriguez v. AT & T Mobility Servs. LLC, 728 F.3d 975 (9th Cir. 2013) (reexamination of precedent when clearly irreconcilable with intervening authority)