472 B.R. 815
9th Cir. BAP2012Background
- Debtors filed a chapter 13 petition on July 30, 2008.
- They purchased a 2007 Mobile Kitchen Trailer for a mobile BBQ business and used it about twelve times before stopping due to licensing issues and health.
- Debtors listed the Mobile Kitchen at $25,000 and the BBQ business at $0; Schedule C claimed a $20,000 exemption for the Mobile Kitchen as a tool of the trade under NRS 21.090(1)(d).
- Trustee objected to the exemption as either a tool of the trade or a necessary household good; value was later agreed at $17,000.
- At the August 25, 2010 confirmation hearing, the court directed briefing on how similar mobile kitchens had been treated and ultimately ruled the Mobile Kitchen was exempt as a vehicle under NRS 21.090(1)(f), overruling Trustee’s objections to that exemption.
- Trustee appealed the ruling on vehicle exemption; the bankruptcy court also discussed whether the Mobile Kitchen could be exempted as a necessary household good, but the panel lacked jurisdiction to decide that issue due to procedural shortcomings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Mobile Kitchen qualifies as a vehicle for exemption. | Trustee argued vehicle definition should be limited and relied on Chapter 482 for strict meaning. | Alexander entities argued vehicle under NRS 21.090(1)(f) includes trailers; DMV registration supports vehicle status. | Yes; Mobile Kitchen is exempt as a vehicle under NRS 21.090(1)(f). |
| Whether the Mobile Kitchen is exemptible as a necessary household good under NRS 21.090(1)(b). | Trustee contended it is not a household good or necessary. | Debtors argued it should be treated in some fashion as a household good. | Claims regarding necessary household good were not decided due to lack of jurisdiction for cross-appeal. |
| Whether the Mobile Kitchen could be exempted under any other provision (e.g., tool of the trade). | Trustee contended it did not qualify as a tool of the trade. | Debtors argued alternative exemption theories; not decisive given vehicle result. | Not necessary to decide beyond vehicle exemption ( settled vehicle issue). |
Key Cases Cited
- Savage v. Pierson, 157 P.3d 697 (Nev. 2007) (liberal construction of Nevada exemptions; policy favoring debtor)
- In re Arrol, 170 F.3d 934 (9th Cir. 1999) (debtor-friendly interpretation of exemptions; burden on objector)
- In re Resort at Summerlin Ltd., 127 P.3d 1076 (Nev. 2006) (plain meaning of terms; reliance when term undefined in chapter)
- Sticka v. Casserino, 290 B.R. 735 (9th Cir. BAP 2003) (statutory construction inside state-law exemption context)
- Spurlock v. FBI, 69 F.3d 1010 (9th Cir. 1995) (cross-appeal and standing principles in appellate review)