648 B.R. 119
Bankr. S.D. Florida2023Background:
- Debtor Victoria Calixto filed Chapter 13 on June 30, 2017; her third amended plan was confirmed April 30, 2018 and provided for vesting of estate property in the debtor.
- Calixto completed plan payments, received a §1328(a) discharge on June 1, 2022, and the case closed on September 28, 2022.
- On March 17, 2021 (post-confirmation, pre-discharge) Calixto alleges she slipped and fell at Gulfstream; she sued Gulfstream on June 30, 2022 but never amended her bankruptcy schedules to disclose the claim.
- Gulfstream moved for summary judgment in state court, arguing lack of standing and judicial estoppel based on nondisclosure; Calixto moved to reopen her Chapter 13 case to file amended schedules.
- The bankruptcy court found the post-confirmation tort claim was property of the estate under §1306(a)(1), agreed Eleventh Circuit law imposes a continuing duty to disclose, but held reopening was warranted because creditors were paid 100% and no creditor or trustee prejudice would result.
- Court granted the motion to reopen, ordered Calixto to file amended schedules and a statement of financial affairs within 14 days, and directed the clerk to re-close the case after amendment.
Issues:
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the post-confirmation negligence claim is property of the bankruptcy estate and had to be disclosed | Calixto: claim is property under §1306(a)(1) and Eleventh Circuit imposes continuing duty to amend schedules; she seeks to comply by reopening | Gulfstream: omission shows failure to disclose and supports estoppel; nondisclosure undermines litigation | Court: claim was estate property under §1306; Eleventh Circuit requires continuing disclosure; debtor must amend schedules |
| Whether the case should be reopened to permit amendment and avoid state-court dismissal/estoppel | Calixto: reopening is authorized by §350(b) and Rule 1009, will allow cure of a disclosure omission | Gulfstream: reopening is an improper attempt to avoid adverse summary judgment and judicial estoppel | Court: reopening granted — debtor will be allowed to amend because creditors not harmed and debtor benefits; reopening is equitable relief |
| Whether nondisclosure prejudiced creditors or affected trustee/estate administration | Calixto: no prejudice — plan paid unsecured creditors 100% and trustee’s administration unaffected; debtor retains right to pursue claims in Chapter 13 | Gulfstream: nondisclosure threatens integrity of bankruptcy process and could indicate manipulation | Court: no creditor or trustee prejudice because full payment occurred; allowing amendment will not change estate distributions |
Key Cases Cited
- Robinson v. Tyson Foods, Inc., 595 F.3d 1269 (11th Cir. 2010) (recognizes continuing duty to disclose post-petition claims in Chapter 13)
- Waldron v. Brown (In re Waldron), 536 F.3d 1239 (11th Cir. 2008) (same)
- Ajaka v. BrooksAmerica Mortg. Corp., 453 F.3d 1339 (11th Cir. 2006) (same)
- De Leon v. Comcar Indus., Inc., 321 F.3d 1289 (11th Cir. 2003) (same)
- Slater v. United States Steel Corp., 871 F.3d 1174 (11th Cir. 2017) (permits liberal amendment and recognizes courts’ broad discretion to reopen cases to administer omitted assets)
- Burnes v. Pemco Aeroplex, Inc., 291 F.3d 1282 (11th Cir. 2002) (dicta cited as a source for the continuing-duty line)
- In re Coastal Plains, Inc., 179 F.3d 197 (5th Cir. 1999) (earlier dictum relied on in subsequent Eleventh Circuit discussion)
- Martin v. Singletary, 965 F.2d 944 (11th Cir. 1992) (describes the prior-precedent rule governing circuit law)
- United States v. Machado, 804 F.2d 1537 (11th Cir. 1986) (same)
