Robert Keith Monroe
The matter before the Court is Debtor‘s Notice and Motion to Avoid Judicial Lien of JB‘s Properties and Investments, LLC (Doc. 18); Debtor‘s Notice and Motion to Avoid Judicial Lien of Jeffrey and Emily Nichols (Doc. 19); Response to Debtor‘s Motion to Avoid Judicial Lien of JB‘s Properties and Investments, LLC (Doc. 22); Memorandum in Support of Response to Debtor‘s Motion to Avoid Judicial Lien of JB‘s Properties and Investments, LLC (Doc. 24); Response to Debtor‘s Motion to Avoid Judicial Lien of Jeffrey and Emily Nichols (Doc.25); Memorandum Reply to Respondent‘s Memorandum in Support of Response to Debtor‘s Motion to Avoid Judicial Lien of JB‘s Properties and Investments, LLC (Doc. 28); Debtor‘s Brief Regarding Property of the Estate (Doc. 33); Response to Debtor‘s Brief Regarding Property of the Estate filed by Jeffrey and Emily Nichols (Doc. 38); and Response to Debtor‘s Brief Regarding Property of the Estate filed by Creditor JB‘s Properties and Investments, LLC (Doc. 39). Upon consideration of the record as a whole, the Court makes the following FINDINGS OF FACT:
Robert Keith Monroe (hereinafter “Debtor“) filed a Voluntary Petition under Chapter 13 of the Bankruptcy Code on July 11, 2024. Doc. 1. On July 25, 2024, Debtor filed Schedules A-J listing an interest in real property located at 4824 Mattis Road, St. Louis, Missouri (hereinafter “Mattis Road Property“). Doc. 11 at 1. On Schedule A, Debtor lists the Mattis Road Property as tenancy by the entirety property while contending that the Mattis Road Property is in fact owned by the Robert K. Monroe and Gina K. Monroe Joint Revocable Trust (hereinafter “Monroe Revocable Trust“). Id. Debtor also states that the Mattis Road Property is subject to a deed of trust in the amount of $97,000.00 with the non-filing spouse being the only obligor on the note.
Prior to filing for Chapter 13 relief under the Bankruptcy Code, Debtor unsuccessfully appeared in St. Louis County Circuit Court (hereinafter “State Court“) to argue the issue of attachment of the judicial liens to the Mattis Road Property. Doc. 28 at 1-2. The State Court ultimately ruled against Debtor, holding that the judicial lien held by JBPI, LLC did attach to the Mattis Road Property. Id. Thereafter, the State Court reached the same conclusion regarding the judicial lien held by the Nichols against the Mattis Road Property. Doc. 25 ¶ 16 at 2-3. The Nichols asserted to the Court that they “are identically situated vis-à-vis [. . .] Debtor and the treatment of their judicial liens.” Id. Upon filing for bankruptcy protection, Debtor acknowledged that the liens of JBPI, LLC and the Nichols attached to the Mattis Road Property but seeks to avoid them pursuant to
On September 5, 2024, Debtor filed Notice and Motion to Avoid Judicial Lien of JB‘s Properties and Investments, LLC, (Doc. 18) as well as Notice and Motion to Avoid Judicial Lien of Jeffrey and Emily Nichols (Doc. 19) (hereinafter, collectively, “Motions to Avoid Liens“). According to Debtor, the judicial liens imposed by JBPI, LLC and the Nichols impair the exemption to which Debtor asserts he is entitled to under Section 522(b) of the Bankruptcy Code. Doc. 18 at 4; Doc. 19 at 3. Debtor maintains that the Mattis Road Property is tenancy by the entirety property under Missouri law, thereby classifying it as property of the estate under
On October 4, 2024, JBPI, LLC filed Response to Debtor‘s Motion to Avoid Judicial Lien of JB‘s Properties and Investments, LLC (Doc. 22) and Memorandum in Support of Response to Debtor‘s Motion to Avoid Judicial Lien of JB‘s Properties and Investments, LLC (Doc. 24), in which JBPI, LLC admitted and denied certain allegations made by Debtor and prayed for denial of Debtor‘s Motions to Avoid Liens. JBPI, LLC asserted that Debtor‘s Motions to Avoid Liens should be denied under the Rooker-Feldman Doctrine, that Debtor grossly understated the fair market value of the Mattis Road Property2 and that Debtor failed to comply with Local Bankruptcy Rule 4003-2(A) requiring an analysis of the alleged impairment of exemptions to which Debtor would otherwise be entitled under
On October 4, 2024, the Nichols filed Response to Debtor‘s Motion to Avoid Judicial Lien of Jeffery and Emily Nichols (Doc. 25), in which the Nichols admitted and denied certain
On October 15, 2024, Debtor filed Memorandum Reply to Respondent‘s Memorandum in Support of Response to Debtor‘s Motion to Avoid Judicial Lien of JB‘s Properties and Investments, LLC (Doc. 28). Regarding JBPI, LLC‘s assertion on the Rooker-Feldman Doctrine, Debtor argued that JBPI, LLC‘s position misinterpreted Debtor‘s goals of seeking avoidance of the judicial liens before the Bankruptcy Court. Doc. 28 at 2. Debtor noted that the Rooker-Feldman Doctrine prohibits lower federal courts from exercising subject matter jurisdiction to review an order issued by a state court. Id. (citing In re Burns, 306 B.R. 274, 277 (E.D. Mo. 2004) and Gisslen v. City of Crystal, 345 F.3d 624, 627 (8th Cir. 2003)). Similarly, the Eighth Circuit Court of Appeals extends the Rooker-Feldman Doctrine to bankruptcy cases, potentially depriving a bankruptcy court of subject matter jurisdiction over a losing litigant‘s attack on a state court judgement. Id. (citing In re Burns, 306 B.R. at 277 and Ferren v. Searcy Winnelson Co., 203 F. 3d 559, 560 (9th Cir. 2000) (per curiam)). Doc. 28 at 2.
On October 22, 2024, the Court held a hearing on Debtor‘s Motions to Avoid Liens, during which the Court determined that there were numerous issues raised by Debtor‘s Motions to Avoid Liens in conjunction with the responses filed by JBPI, LLC and the Nichols. In re Robert K. Monroe, ECF No. 24-42413-169, Bankr. E.D. Mo., (Oct. 22, 2024, 10:43 AM – 11:22 AM). The issues included 1) whether the Mattis Road Property was property of Debtor‘s bankruptcy estate; 2) whether Debtor and his non-filing spouse‘s transfer of the Mattis Road Property to a qualified spousal trust converted Debtor‘s alleged tenancy by the entirety interest into a tenancy in common interest; 3) whether Debtor can validly claim any exemption in the Mattis Road Propoerty; and 4) whether Debtor properly avoided the judicial liens of JBPI, LLC, and the Nichols in his Motions to Avoid Liens. During the pre-trial hearing, the Court asked the parties to provide briefs on Issue No. 1.
On November 18, 2024, Debtor filed Debtor‘s Brief Regarding Property of the Estate (Doc. 33) asserting that Missouri state law and federal income tax law categorize the Mattis
On December 6, 2024, the Nichols filed Response to Debtor‘s Brief Regarding Property of the Estate (Doc. 38), stating that the Nichols disagree with Debtor‘s assertion that the Monroe Revocable Trust is a qualified spousal trust and that the Mattis Road Property is entitled to the tenancy by the entirety exemption. On December 10, 2024, JBPI, LLC filed Response to Debtor‘s Brief Regarding Property of the Estate Filed by Creditor JB‘s Properties and Investments, LLC (Doc. 39), in which JBPI, LLC renewed its argument that the Rooker-Feldman Doctrine applies, because Debtor previously had argued to the State Court that the Mattis Road Property is owned as tenancy by the entirety and the State Court found that this argument failed. JBPI, LLC further argued that if the Rooker-Feldman doctrine does not apply, the Bankruptcy Court should find that the terms of the Monroe Revocable Trust severed any claimed tenancy by the entirety interest in the Mattis Road Property. Id. at 2.
This Court held a hearing on December 18, 2024, on Issue No. 1, e.g., whether the Mattis Road Property is property of Debtor‘s bankruptcy estate. At the hearing, Debtor, JBPI, LLC and the Nichols appeared by counsel. After hearing all parties’ arguments, the matter was taken under submission.3
This Court has jurisdiction over the parties and subject matter of this proceeding under
CONCLUSIONS OF LAW
The issues before the Court are 1) whether Debtor has an ownership interest in the Mattis Road Property that would classify it as property of Debtor‘s bankruptcy estate under
I. Legal & Equitable Interest in the Mattis Road Property
Metaphorically, property ownership is analogous to a bundle of sticks—a “collection of individual rights which, in certain combinations, constitutes property [ownership].” In re Murray Energy Holdings Co., 654 B.R. 110, 117 (Bankr. S.D. Ohio 2023), reconsideration denied in part sub nom. In re Murray Energy Holdings Co., 658 B.R. 133 (Bankr. S.D. Ohio 2024) (citing United States v. Craft, 535 U.S. 274, 278, 122 S. Ct. 1414, 152 L. Ed. 2d 437 (2002). Each stick represents a legal right of the property owner, including the right to possess, control, exclude, enjoy and dispose of the property. Often, it is state law that determines which sticks are in a person‘s bundle, or rather, which rights constitute property ownership.
A debtor‘s relationship to property is the most important determination as to whether property becomes part of the bankruptcy estate. In re Starr, 485 B.R. 835, 838 (Bankr. N.D. Ohio 2012) (citing
Traditionally, legal proceedings involving such trusts are brought by or against the trustee in his or her own name, since “[. . .] trust[s are] not considered [. . .] distinct legal entit[ies], but ‘fiduciary relationship[s]’ between multiple people.” Americold Realty Tr. v. Conagra Foods, Inc., 577 U.S. 378, 383, 136 S. Ct. 1012, 1016, 194 L. Ed. 2d 71 (2016) (quoting inter alia, Restatement (Second) of Trusts § 2 (1957)); see also Klein v. Bryer, 227 Md. 473, 476-77, 177 A.2d 412, 413 (1962). Thus, Debtor‘s interest in the Mattis Road Property is integral to determining whether to include the Mattis Road Property as property of the estate. On March 26, 2009, Debtor and his non-filing spouse, as settlors, transferred the Mattis Road Property to the Monroe Revocable Trust by a quitclaim deed filed in St. Louis County, Missouri. The transfer therefore makes Debtor and his non-filing spouse the Trustees of the Monroe Revocable Trust, holding legal title, a legal interest and management responsibilities of the trust for its duration. First Nat‘l Bank v. Shirla Howard Revocable Living Trust, 561 S.W.3d 434, 436 (Mo. Ct. App. 2018) (citing Moore v. Moore, 111 S.W. 3d 530, 533 (Mo. Ct. App. 2003)); Shaffer as Tr. Of Ruth A. Draut Revocable Tr. v. Tewes, 466 F. Supp. 3d 980, 990 (N.D. Iowa 2020).
As Trustees of the Monroe Revocable Trust, Debtor and his non-filing spouse are afforded a legal interest in the trust property, having the power to manage and make decisions
An equitable interest in a trust property, which affords the holder a beneficial interest and the right to acquire formal legal title, is held by the beneficiaries of trust.5 Accordingly, holding legal title does not exclusively guarantee ownership, which encompasses both legal and equitable title. Despite being trustees, Debtor and his non-filing spouse are simultaneously beneficiaries of the trust property. Thus, as beneficiaries of the trust property, Debtor and his non-filing spouse hold an equitable interest.
In Missouri however, courts have taken a different approach as to the individual‘s role as the settlor of a trust. Some Missouri courts will refrain from allowing the equitable interests of beneficiaries to be considered property of the estate when subject to the discretion of the trustee. In re Reuter, 499 B.R. 655, 671 (Bankr. W.D. Mo. 2013). Specifically, the United States Bankruptcy Court for the Western District of Missouri clarifies the existence of a discretionary interest in trust property when the trustee is not required to make distributions of the trust income or the trust principal to the beneficiary under the trust‘s terms or upon the termination of the trust. Reuter, 499 B.R. at 671 (citing
On the other hand, other Missouri courts have explicitly determined that a trust property can concurrently belong to an individual who functions as the settlor, beneficiary and trustee of a trust. In fact, the Bankruptcy Court for the Western District of Missouri has treated settlors, trustees and beneficiaries all the same. In re Bellingroehr, 403 B.R. 818, 820 (Bankr. W.D. Mo. 2009) (noting that when the settlors, trustees and beneficiaries of a revocable trust are the same persons, efficiency requires that the Bankruptcy Court treat the trust assets as belonging to those persons). Id. at 822. Furthermore, courts in other jurisdictions have held that settlors still hold an ownership interest in a trust property, so long as they hold legal title, a beneficiary interest in the property, the right to revoke the trust and the right to use and control the property as they desire. White v. Gordon, 558 B.R. 15, 21 (D.N.H. 2016); In re Kester, 339 B.R. 749, 752-55 (B.A.P. 10th Cir. 2006), certified question answered sub nom. Redmond v. Kester, 284 Kan. 209, 159 P.3d 1004 (2007), and aff‘d, 493 F.3d 1208 (10th Cir. 2007). In White, the Bankruptcy Court concluded that debtors’ equitable interest as trust beneficiaries of trust properties was enough to provide them with an ownership interest in the trust property that became property of the estate. Id. at 21.
Finally, it is well established that a trustee holds legal title to trust property while the beneficiaries of the trust hold equitable interests in the trust property. First Nat‘l Bank v. Shirla Howard Revocable Living Tr., 561 S.W.3d 434, 436 (Mo. Ct. App. 2018) (citing Moore v. Moore, 111 S.W.3d 530, 533 (Mo. Ct. App. 2013)). Because Debtor and his non-filing spouse serve as settlors, trustees and beneficiaries of the Monroe Revocable Trust, Debtor correctly asserts that he has an ownership interest in both law and equity in the Mattis Road Property.
It has been sufficiently established that Debtor holds a legal interest in the Mattis Road Property as Trustee of the Monroe Revocable Trust.6 Similarly, Debtor holds an equitable interest in the Mattis Road Property via his role as a beneficiary of the Monroe Revocable Trust.7 At the commencement of the case, the Mattis Road Property was owned by the Monroe Revocable Trust, in which Debtor and his non-filing spouse held legal and equitable interests. Doc. 11.
The Bankruptcy Code holds that property of the estate, among other categorizations, consists of “all legal and equitable interests of the debtor in property as of the commencement of the case.”
While state laws determine the nature and extent of a debtor‘s interest in property, it is federal bankruptcy law which dictates whether any interest comprises property of the estate. In re Simply Essentials, LLC, 78 F.4th 1006, 1009 (8th Cir. 2023); In re Klein-Swanson, 488 B.R. 628, 633 (B.A.P. 8th Cir. 2013). Generally, “all legal or equitable interests . . . in property” that a debtor must list at the commencement of the bankruptcy case are rights that are legally enforceable under state law. In re Carlson, 263 F.3d 748, 750 (7th Cir. 2001). At the
Furthermore, although Debtor holds both a legal and equitable interest in the Mattis Road Property, some courts would determine that Debtor‘s legal interest alone in the Mattis Road Property suffices to classify it as property of the estate regardless of the equitable interest Debtor holds in the property. The Bankruptcy Code notes that all property in which a debtor maintains a legal but not an equitable interest becomes property of the estate “only to the extent of the debtor‘s legal interest in the property.” In re B.I. Fin. Serv. Group, Inc., 854 F.2d 351, 354 (9th Cir. 1988). By this logic, the bankruptcy estate has those rights typically associated with legal title—e.g., a debtor‘s right to sell or transfer the property—but not the advantages donned from full ownership afforded to those with an equitable interest.
Nonetheless, the joint spousal interest that Debtor holds in the Mattis Road Property is sufficient to include the Mattis Road Property as property of the bankruptcy estate pursuant to
III. Avoidance of the Lien
A debtor is only permitted to avoid the fixing of a lien on his or her interest in “property” if such lien is characterized as a judicial lien, subject to a narrow exception for judicial liens securing a debt specified in Section 523(a)(5) of the Bankruptcy Code.
Here, Debtor appeared in State Court to argue the issue of attachment of judicial liens on the Mattis Road Property by JBPI, LLC and the Nichols. Ultimately, the State Court ruled against Debtor, holding that the liens of JBPI, LLC and the Nichols did in fact attach to the Mattis Road Property. Debtor then consecutively filed Notice and Motion to Avoid Judicial Lien with respect to JBPI, LLC and Notice and Motion to Avoid Judicial Lien with respect to the Nichols. Nevertheless, the liens of JBPI, LLC and the Nichols were in fact obtained by judgment. The documents in the record provide this Court with sufficient basis for determining the judicial nature of the liens placed on the Mattis Road Property. The Amended Order and Judgment entered by the State Court on February 22, 2023, against Debtor as Co-Trustee of the Monroe Revocable Trust effectuated liens on the Mattis Road Property. Neither of the liens placed on the Mattis Road Property secured a debt for a domestic support obligation pursuant to
In theory, Debtor could be permitted to avoid the judicial liens placed on the Mattis Road Property by JBPI, LLC and the Nichols. However, to avoid a lien, Debtor must sufficiently show the value of the Mattis Road Property and the extent to which the judicial liens of which avoidance is sought impair Debtor‘s exemption. Pursuant to Local Rule 4003-2(A), a motion to avoid lien must be filed “using the Local Form ‘Motion to Avoid Judicial Lien’ found on the
Here, Debtor did file Motions to Avoid Liens; however, Debtor‘s filings were incomplete, as evident through Debtor‘s failure to provide information as to the extent to which JBPI, LLC and the Nichols’ judicial liens on the Mattis Road Property impaired the exemptions to which Debtor claims he is entitled. Because Debtor did not complete Local Form 56 when filing Motions to Avoid Liens, the Court cannot permit Debtor to avoid the judicial liens on the Mattis Road Property.
IV. Qualified Spousal Trust and Tenancy by the Entirety
As mentioned, the Court held a hearing on Debtor‘s Motions to Avoid Liens on October 22, 2024, outlining numerous issues to be addressed at the Court‘s request. Although the Court instructed the parties only to consider whether the Mattis Road Property was property of Debtor‘s bankruptcy estate, the Court must further address Debtor and his non-filing spouse‘s transfer of the Mattis Road Property to a qualified spousal trust and whether Debtor properly claimed a tenancy by the entirety exemption.
On Schedule A, Debtor listed the Mattis Road Property as tenancy by the entirety property while contending that the Mattis Road Property is owned by the Monroe Revocable Trust. In the Response to Debtor‘s Brief Regarding Property of the Estate filed by the Nichols, on December 6, 2024, the Nichols argued that the Monroe Revocable Trust is not a qualified spousal trust, contrary to Debtor‘s assertions, and therefore, that the Mattis Road Property is not entitled to the tenancy by the entirety exemption. Later, on December 10, 2024, JBPI, LLC filed Response to Debtor‘s Brief Regarding Property of the Estate Filed by Creditor JB‘s Properties and Investments, LLC, in which JBPI, LLC cited Debtor‘s failed argument before the State Court that the Mattis Road Property is owned as tenancy by the entirety.
A review of the Monroe Revocable Trust reveals that it explicitly allows for “any specific individual Trustee” to have the full power and authority to do any and all things, including investing trust assets. Monroe Revocable Trust (Doc. 18-1) ¶ 7 at 8. Furthermore, the language of the trust document explicitly provides an individual Trustee with the ability to “rent, mortgage, . . .[or] transfer [. . . real property]. Id. ¶ 7(B)(2) at 9. As such, the express authority that the trust document provides to one Trustee without the authorization of the other is sufficient to sever a tenancy by the entirety interest. Therefore, the Court finds that the terms of the Monroe Revocable Trust severed any claimed tenancy by the entirety interest in the Mattis Road Property—to wit, the Mattis Road Property is not a tenancy by the entirety property.
V. Rooker-Feldman Doctrine
The final issue to be addressed by the Court is whether the Rooker-Feldman Doctrine is applicable to this litigation, thereby prohibiting this Court from exercising subject matter jurisdiction to review the order issued by the State Court. In Response to Debtor‘s Brief Regarding Property of the Estate Filed by Creditor JB‘s Properties and Investments, LLC, JBPI,
As established, the Rooker-Feldman Doctrine prohibits lower federal courts from exercising subject matter jurisdiction to review an order issued by a state court. In re Burns, 306 B.R. 274, 277 (E.D. Mo. 2004); see also Gisslen v. City of Crystal, 345 F.3d 624, 627 (8th Cir. 2003). Precedent established by the Eighth Circuit Court of Appeals extends the Rooker-Feldman Doctrine to bankruptcy cases, potentially depriving a bankruptcy court of subject matter jurisdiction over a losing litigant‘s attack on a state court judgement. In the event that requested bankruptcy relief would effectively reverse a state-court decision or void its ruling, divestment of the Bankruptcy Court becomes actuated. In re Sabertooth, 443 B.R. 671, 679 (Bankr. E.D. Pa. 2011).
JBPI, LLC notes that Debtor‘s arguments were repeatedly and soundly rejected by the State Court. The State Court Order, dated April 11, 2024, recognized that the language in the trust document renders insufficient Debtor‘s claim of a tenancy by the entirety interest in the Mattis Road Property. The State Court Order mentions having ordered and pronounced Judgement on the matter on November 9, 2022, and February 22, 2023, in favor of JBPI, LLC with garnishment having been issued on June 21, 2023, in pursuit of satisfaction for JBPI, LLC and execution of the real estate levy occurring on October 26, 2023.
In light of Debtor‘s repeated actions to litigate the issue before the State Court along with the State Court‘s repeated rulings in favor of JBPI, LLC the Court determines that Debtor is in fact prohibited by the Rooker-Feldman Doctrine from challenging the ruling of the State Court in regard to an alleged tenancy by the entirety interest in the Mattis Road Property, as a previously decided issue of state law. For all the reasons stated above, therefore,
IT IS ORDERED THAT Debtor‘s Notice and Motion to Avoid Judicial Lien of JB‘s Properties and Investments, LLC (Doc. 18) is DENIED; and
KATHY A. SURRATT-STATES
United States Bankruptcy Judge
DATED: May 19, 2026
St. Louis, Missouri
Copies to:
Office of the United States Trustee
Thomas F. Eagleton U.S. Courthouse
111 South 10th Street, Suite 6.353
St. Louis, MO 63102
Robert Keith Monroe
4824 Mattis Rd.
Saint Louis, MO 63128
Andrew R Magdy
Summers Compton Wells LLC
903 S. Lindbergh Blvd. #200
St. Louis, MO 63131
Diana S. Daugherty
Chapter 13 Trustee
P. O. Box 430908
St. Louis, MO 63143
Robert E Eggmann, III
Carmody MacDonald P.C.
120 South Central Avenue, Suite 1800
Clayton, MO 63105
Jeffrey and Emily Nichols
c/o Hein Schneider & Bond P.C.
2244 S. Brentwood Blvd.
Attn: Grant J. Mabie
St. Louis, MO 63144
Grant Joseph Mabie
Hein Schneider & Bond P.C.
2244 S. Brentwood Blvd.
St. Louis, MO 63144