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Wolfork v. Tackett12/3/1999
WHOLE COURT
Georgia applies the federal doctrine of judicial estoppel to preclude the prosecution of unliquidated tort claims that discharged debtors failed to list as assets in their federal bankruptcy petitions. Southmark Corp. v. Trotter, Smith & Jacobs, 212 Ga. App. 454, 455-456 (442 SE2d 265) (1994). The question in this appeal is whether a debtor's failure to supplement a Chapter 13 bankruptcy petition or to reopen the bankruptcy proceedings so as to list a cause of action accruing after the filing of the petition but before the discharge of the bankruptcy precludes the debtor from pursuing the cause of action in a Georgia state court.
In August 1994 Lucille Wolfork filed a Chapter 13 bankruptcy petition. In November 1995 she and her daughter allegedly suffered injuries in a collision involving autos driven by Tackett and Dunn. On behalf of herself and her daughter, Wolfork sued them in October 1997 for negligence. After the bankruptcy was discharged in March 1998, Dunn moved for summary judgment on Wolfork's personal claim on grounds of judicial estoppel. Finding Wolfork had not supplemented her petition or moved to reopen the bankruptcy so as to list the cause of action as an asset of the estate, the trial court granted summary judgment to Dunn.
All legal and equitable interests of the debtor in property as of the filing of the bankruptcy petition are considered property of the bankruptcy estate. 11 USC § 541 (a) (1). Unliquidated tort claims are personal property included as part of the estate. Byrd v. JRC Towne Lake, Ltd., 225 Ga. App. 506 (484 SE2d 309) (1997). Federal bankruptcy law strictly requires the debtor to disclose all assets as part of the bankruptcy petition. Southmark, 212 Ga. App. at 455-456.
Explaining the federal doctrine of judicial estoppel, Southmark stated that a party may not assert a position in a judicial proceeding which is inconsistent with a position successfully asserted by it in a prior proceeding. Id. at 455. The failure to disclose an asset (such as a cause of action) in a bankruptcy proceeding amounts to a denial that such a claim exists and bars subsequent attempts to pursue it. Id. at 456. Accordingly, the Court in Southmark affirmed summary judgment in favor of the alleged tortfeasor where the claim, having arisen pre-petition, had not been listed in the schedule of assets in the plaintiff's Chapter 11 bankruptcy petition. Accord, Byrd, 225 Ga. App. at 508 (failure to list pre-petition tort claim in Chapter 13 petition is grounds for summary judgment).
In a Chapter 13 bankruptcy case, property of the estate also includes all property acquired by the debtor during the bankruptcy proceeding. 11 USC § 1306 (a) (1). A tort claim in favor of the debtor arising after the filing of the Chapter 13 bankruptcy petition but before the bankruptcy is closed is considered after-acquired property that is part of the estate. In re Rivera, 186 BR 505, 507 (D. Kan. 1995); see In re Brown, 159 BR 1014, 1018 (Bankr. S.D. Ga. 1993); In re Cox, 214 BR 635, 649 (Bankr. N.D. Ala. 1997). The same is not true of Chapter 7 cases. Compare In re Bobroff, 766 F2d 797, 803 (3rd Cir. 1985) and In re Fleet, 53 BR 833, 838 (Bankr. E.D. Pa. 1985).
The duty to amend Chapter 13 bankruptcy schedules is clear. A debtor may not conceal property belonging to the estate. 18 USC § 152 (1). A debtor has an affirmative duty to supplement the list of assets with any claims arising during the pendency of the bankruptcy proceeding. Chandler v. Samford Univ., 35 FSupp2d 861, 864 (N.D. Ala. 1999); see 11 USC § 541 (a) (7); In re Easley, 205 BR 334, 335 (Bankr. M.D. Fl. 1996). Failure to timely amend or supplement the list of assets amounts
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