Shapiro v. Henson
449 B.R. 109
D. Nev.2011Background
- Debtor Barbara Henson filed Chapter 7 on August 7, 2009; Trustee Brian Shapiro was appointed.
- Debtor revealed non-exempt funds of $6,155.19 at filing; Trustee demanded turnover.
- Debtor did not furnish the funds; $3,239 had been transferred to Debtor’s counsel.
- Trustee amended turnover motion to exclude funds diverted to counsel; turnover pursued separately.
- Bankruptcy court denied turnover on April 19, 2010; order entered May 6, 2010.
- Trustee appealed; district court has jurisdiction to review final turnover order.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether § 542(a) requires possession at time of turnover | Shapiro argues possession not required; can turnover value if proceeds exist. | Henson argues turnover requires present possession or proceeds at filing. | Turnover requires present possession or proceeds when motion filed; affirmed. |
Key Cases Cited
- In re Pyatt, 486 F.3d 423 (8th Cir.2007) (possession not required for turnover in similar facts)
- In re Shearin, 224 F.3d 353 (4th Cir.2000) (possession not required doctrine cited)
- In re USA Diversified Prods., Inc., 100 F.3d 53 (7th Cir.1996) (possession not required doctrine cited)
- In re Bailey, 380 B.R. 486 (6th Cir. BAP 2008) (possession not required doctrine cited)
- Maggio v. Zeitz, 333 U.S. 56 (1948) (pre-Code turnover standard; touches on possession at turnover)