United States v. Jo Anna Bame
2013 U.S. App. LEXIS 16510
8th Cir.2013Background
- Fred Bame received an erroneous tax refund over $500,000 in 2005; IRS discovered the error in 2006.
- After Fred’s death, the government sued Jo Anna Bame and two Jo Anna–owned entities to recover the refund; district court granted summary judgment on unjust enrichment and awarded $526,022.13; Jo Anna and entities appeal.
- Jo Anna had brought nonmarital assets into the marriage, including her home at 5110 Meadville; she added Fred’s name to the title to secure a loan against its value, and a 1995 mortgage funded Fred’s sole debts with tax liens attached to the property.
- Fred’s 1999 involuntary bankruptcy left his personal debts intact; Jo Anna filed a Proof of Claim seeking recovery related to the property lien and other debts; a settlement resolved related adversary proceedings but Fred did not receive a discharge.
- In 2003 Jo Anna sold Meadville for $1.52 million; proceeds largely paid tax liens and Fred’s creditors.
- The 2005 refund was deposited in a joint Ontario account while Fred resided in Canada; withdrawals were used to settle Jo Anna’s debts and other transfers benefited Jo Anna; the United States later obtained a judgment against Fred’s estate but could not collect.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Jo Anna has a valid good-faith defense to unjust enrichment | Bame contends Jo Anna’s good faith defeats unjust enrichment. | Bame argues good faith is not a valid defense or not applicable here. | Genuine issue of fact exists; remand for further fact-finding. |
| Whether Jo Anna is entitled to the money transferred | Bame asserts Jo Anna was entitled to funds she helped pay toward Fred’s debts. | Jo Anna contends she had a valid entitlement despite lack of a contract. | Genuine issue of fact exists; remand for further fact-finding. |
| Whether unjust enrichment is precluded by an adequate legal remedy | Government argues statutory remedies (fraudulent transfer acts) preclude unjust enrichment. | Jo Anna argues remedies may be pursued concurrently and unjust enrichment can still apply in some circumstances. | Not resolved; remand for district court to reconsider in light of adequate remedies. |
| Whether the damages award against Jo Anna is appropriate, including alter ego liability of Hook ‘N Horn | Government seeks full transfer value; warrants joint and several liability. | Jo Anna challenges the amount and questions alter ego liability. | No clear basis for the award as stated; remand to address damages and potential alter ego issues. |
Key Cases Cited
- Specht v. City of Sioux Falls, 639 F.3d 814 (8th Cir. 2011) (summary judgment standard and de novo review of facts)
- Weber v. American Express Co., 994 F.2d 513 (8th Cir. 1993) (summary judgment considerations; record viewed in light of non-movant)
- Quick v. Donaldson Co., 90 F.3d 1372 (8th Cir. 1996) (avoid taking credibility determinations at summary judgment)
- ServiceMaster of St. Cloud v. GAB Bus. Servs., Inc., 544 N.W.2d 302 (Minn. 1996) (unjust enrichment relief requires lack of adequate remedy at law)
- Cummins Law Office, P.A. v. Norman Graphic Printing Co., 826 F. Supp. 2d 1127 (D. Minn. 2011) (adequate statutory remedies preclude unjust enrichment when available)
- Grp. Health Plan, Inc. v. Philip Morris, Inc., 68 F. Supp. 2d 1064 (D. Minn. 1999) (subrogation/adequate remedies; unjust enrichment barred)
- In re Viagra Prods. Liab. Litig., 658 F. Supp. 2d 950 (D. Minn. 2009) (unjust enrichment fails where adequate legal remedy exists)