IN THE UNITED STATES BANKRUPTCY COURT
FOR THE NORTHERN DISTRICT OF CALIFORNIA
ALBERT ALLEN MARTIN, No. 91-12112
LINDA EKSTROM STANLEY, United
v. A.P. No. 93-1247
ALBERT ALLEN MARTIN,
Memorandum of Decision
In this adversary proceeding, the U.S. Trustee seeks to revoke the discharge of Chapter 7
debtor Albert Martin for his failure to obey orders of the court obtained by the Chapter 7 trustee
directing Martin to turn over documents. Now before the court are countermotions for summary
There are no substantial issues of fact. This case is basically a judgment call by the court as
to whether the debtor's failure to comply with all the terms of the court's orders justifies the
extreme penaltyofrevocation of discharge.
After considerable reflection, the court will deny both motions. While the U.S. Trustee's
motion does not establish a strong enough case to justify denial of a discharge, the possibility
exists that a stronger showing can be made at trial after considering this memorandum. While
there was a failure to obey an order of the court, the U.S. Trustee has not proved that the failure
amounted to a refusal. The debtor did comply with a good deal of the order, and it appears that
he was substantially abandoned by his attorney during the period when compliance was required.
Both of these factors weigh against a finding of the sort of willful refusal which justifies the
denial or revocation of a discharge.
An important factor in the court's decision is a lack of evidence that the information ordered
to be given to the case trustee was in any way crucial, or that the failure to strictly comply with
the orders prejudiced the estate. Like fraud, refusal as opposed to mere failure to obey an order
of the court may be inferred from the circumstances. The court might infer refusal if, for
instance, information about an insider transfer was withheld until after the statute of limitations
for recovery of transfers had run.
In this case, the U.S. Trustee has not established that the information the court ordered the
debtor to produce actually existed and that the estate was precluded from recovering money for
the benefit of creditors because the information was not produced in a timely manner. If such
evidence is produced at trial, there may be enough evidence for the court to infer refusal to
comply rather than mere failure to comply. In the absence of such evidence, judgment will be
rendered in favor of the debtor.
For the foregoing reasons, both motions for summary judgment will be denied. Either
counsel may submit an appropriate form of order.
Dated: September 11, 1994 _______________________