United States Court of Appeals
                         FOR THE EIGHTH CIRCUIT
                                 ___________

                                 No. 04-1522
                                 ___________

In re: Bruce Peter Bren, and Barbara A. *
Bren, as surety for Bruce Bren Homes, *
Inc.,                                   *
                                        *
               Debtor,                  *
-------------------------               *
                                        * Appeal from the United States
Michael F. Jordan,                      * Bankruptcy Appellate Panel
                                        * for the Eighth Circuit.
               Appellee,                *
                                        *       [UNPUBLISHED]
        v.                              *
                                        *
Bruce Peter Bren; Barbara A. Bren,      *
as surety for Bruce Bren Homes, Inc., *
                                        *
               Appellants.              *
                                  ___________

                           Submitted: November 15, 2004
                              Filed: January 27, 2005
                               ___________

Before SMITH, LAY, and BENTON, Circuit Judges.
                            ___________

PER CURIAM.

      Bruce and Barbara Bren (“Debtors” or “Brens”) were equal and sole
shareholders of a closely-held corporation, Bruce Bren Homes, Inc. Bruce was the
president of the corporation, which constructed luxury homes and townhouses from
1979 until December 2001. In December, the Brens filed a joint bankruptcy petition
under Chapter 7 (“petition”).

       Michael Jordan signed a residential building contract with Bruce Bren Homes,
Inc., in September 2000. Pursuant to the contract, Jordan paid the corporation
$750,000 as an initial deposit. Jordan later terminated the contract over an alleged
failure of performance. After the Brens filed their petition, Jordan, who had a
substantial claim for unfinished work, challenged the dischargeability of certain debts
and objected to the Debtors’ discharge.

       The sole issue at the bankruptcy trial was whether the Brens should be denied
a discharge for knowingly and fraudulently making a false oath or account in, or in
connection with, the case pursuant to 11 U.S.C. § 727(a)(4)(A).1 A false oath bars
discharge in bankruptcy if it is both material and made with an intent to defraud. See
Korte v. Internal Revenue Serv. (In re Korte), 

, 474 (B.A.P. 8th Cir.
2001). “Intent can be established by circumstantial evidence, and statements made
with reckless indifference to the truth are regarded as intentionally false.” 

and citations omitted). The materiality threshold is low; even a
fairly modest asset is material because it need only “bear[] a relationship to the
bankrupt’s business transactions or estate, or concern[] the discovery of assets, . . .
or the existence and disposition of his property.” See Mertz v. Rott, 

,
598 (8th Cir. 1992) (internal citations omitted).


      1
       11 U.S.C. § 727(a)(4)(A) provides:

      (a) The court shall grant the debtor a discharge, unless–

             (4) the debtor knowingly and fraudulently, in or in connection with the
             case–

                    (A) made a false oath or account . . . .

                                          -2-
       The United States Bankruptcy Court for the District of Minnesota found that
the Brens’ Statement of Facts, Summary and Schedules, which was filed with their
petition, contained multiple falsehoods.2 The following nine were material:

      •      The Brens declared under penalty of perjury that they read the
             Statement of Facts, Summary and Schedules, and that the
             information therein was true and correct, when they in fact did not
             read these items. See TT at 10, 14, 69.

      •      The Brens owned an interest in the Golden Eagle Golf Properties,
             LLP, from which they received distributions, but did not list the
             interest on their schedules. See TT at 22-30.

      •      The Brens failed to disclose payment of $24,000 to Golden Eagle
             Golf Properties, LLP, made within twelve months pre-petition.
             See TT at 31-36.

      •      The Brens failed to disclose ownership of several assets,
             including a generator, airplane lift, three boat lifts, a golf cart, and

      2
        The original Complaint alleged five undisclosed items in the Brens’ petition.
See Complaint ¶ 30 at 4. As litigation progressed, it turned out that only one of the
original five allegations was accurate. However, more undisclosed assets and
transfers were discovered during hearings and trial. The undisclosed items not
originally listed in the Complaint were offered into evidence and admitted by the trial
court. See, e.g., Trial Transcript dated April 1, 2003 (“TT”), at 31. After trial, the
judge solicited from Jordan a comprehensive list containing all alleged false oaths or
omissions that either or both of the Brens committed. The Brens received an
opportunity to reply. See TT at 75-76. As such, all of the omissions considered by
the trial court and Bankruptcy Appellate Panel (BAP) were appropriately part of this
litigation.

       In light of this record, we feel compelled to mention that the Brens’ claim
(asserted in their brief) that “Judge Kressel found only four instances of omissions in
the schedules of assets or transfers that were both false and material” to be
misleading.

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             cabin contents prior to January 2003. See TT at 36-39; Mem.
             Order at 5.

      •      The Brens did not disclose the sale of about thirty firearms within
             a year pre-petition. See TT at 39-40.

      •      The Brens failed to disclose payment, made within six months
             pre-petition, of approximately $165,000 from personal funds to
             creditors of Bruce Bren Homes, Inc. See TT at 42.

      •      The Brens did not list that they voluntarily agreed to shorten the
             usual six-month redemption period prior to foreclosure on their
             lake home property, in return for personal releases and the right
             of possession after foreclosure. See TT at 43-45.

      •      The Brens did not disclose that they retained possession of a sold
             airplane. See Mem. Order at 6.

      •      The Brens also did not disclose that they retained possession of
             a Mazda B2000 truck owned by Bruce Bren Homes, Inc. 

Mem. Order at 4-8; Bankruptcy Appellate Panel (BAP) Opinion at 8-9.

       Despite the omissions, the bankruptcy trial court found the Brens lacked an
intent to defraud. See Mem. Order at 9. The bankruptcy court noted that the Brens’
inattention to accuracy was “cavalier” and their false oaths were upsetting, but it also
found that (a) the Brens’ “affairs were very complicated,” (b) “the schedules were, in
the main, accurate,” and (c) “the debtors made no attempts to equivocate or hide these
errors once they were called to their attention.” 

this ruling. The
BAP reversed and remanded the case, holding that the trial court’s finding of a lack
of fraudulent intent was clearly erroneous. See BAP Opinion at 9. The Brens
appealed.




                                          -4-
       This court reviews the bankruptcy trial court’s findings of fact for clear error.
See Moon v. Anderson (In re Hixon), 

, 700 (8th Cir. 2004). We reverse
the BAP’s decision in part and affirm in part, holding that the trial court’s finding of
a lack of fraudulent intent was clearly erroneous only as to Bruce Bren. We agree
with the bankruptcy trial court that Barbara Bren lacked the requisite intent to
defraud.

        This panel would not deny discharge solely because the Brens initially declared
that they had inspected their petition when in fact they did not. “[C]ourts are often
understanding of a single omission or error resulting from innocent mistake.” BAP
Opinion at 6. However, it was surprising to learn that the Brens (especially Bruce
Bren) did not take it upon themselves to inspect the petition after they received notice
that others contested the accuracy of their disclosures. See TT at 70; Mosley v. Sims
(In re Sims), 

, 557 (E.D. Ark. 1992) (stating that Sims’s assertion that
he merely “glanced over” the petition but “didn’t really understand it” constituted
proof of a “cavalier and reckless disregard for truth which is inconsistent with the
relief to be afforded the honest debtor” and emphasizing that “the Bankruptcy Code
requires more than a ‘glance over’ in reporting assets and transactions”). The Brens
also never utilized the option of amending their petition.

       The sizeable nature of the Brens’ omissions was troubling and suggested
recklessness. For instance, the Brens’ failure to report retained possession of an
airplane, after it had been sold, was a substantial oversight. Also disturbing was the
Brens’ failure to surrender a Mazda B2000 truck (which was owned by the
corporation) to the corporate trustee; their failure to report a payment of $24,000 to
Golden Eagle Golf Properties, LLP – a partnership in which they owned an interest,
yet failed to report; and their failure to disclose a $165,287.92 payment from personal
funds to creditors of Bruce Bren Homes, Inc. These assets and transfers clearly “bear
a relationship” to the liquidation process. This court remains mindful of the
bankruptcy court’s observation that the Brens’ affairs were quite complex, but this

                                          -5-
is true of most multi-million dollar corporations, and the Brens have not pointed to
any legal sources stating that the complexity of one’s financial affairs is a basis for
leniency under the bankruptcy laws.

       In the case of Bruce Bren, we are unpersuaded by the contention that he is an
“unsophisticated” person and therefore had no idea what was going on in the petition.
Our review of the trial transcripts revealed that Bruce Bren controlled the finances,
yet was rather obstinate in his desire to remain ignorant about, and in his
unwillingness to sort through, the admittedly laborious and confusing financial
details. Indeed, much of his testimony reveals that he did not know whether
significant assets or transfers were reported; or revealed that he would initially assert
his belief that his petition was correct and then, after further questioning, would admit
that a particular asset was not actually disclosed therein. See TT at 10-15, 29-30, 31-
35, 43-46. It is reckless – perhaps even willful – to persist in such a high degree of
ignorance about one’s financial affairs during and after bankruptcy. See 

(noting that “statements made with reckless indifference to the truth are
regarded as intentionally false”) (citations omitted); Camacho v. Martin (In re
Martin), 

, 324 (D. Co. 1988) (stating that a “reckless disregard of both
the serious nature of the information sought and the necessary attention to detail and
accuracy in answering may give rise to the level of fraudulent intent necessary to bar
a discharge”); 

(describing the debtor as either fully aware of the
“seriousness of the Financial Statements, or [] reckless in failing to comprehend their
import . . .”).

      On the other hand, it was undisputed that Barbara Bren exercised no role in the
financial affairs of the business aside from signing checks. See TT at 7. She has
remained equally distant from the bankruptcy petition process. As with Bruce, we
question Barbara Bren’s continued pursuit of ignorance in her own financial affairs,
even after filing for bankruptcy. However, the record shows that Barbara came
forward of her own accord with information about a modest inheritance that she had

                                          -6-
failed to report previously; this information did not have to be dragged into the light
of day through a court hearing. These facts constitute “strong evidence that there was
no fraudulent intent” on Barbara Bren’s part. See Gullickson v. Brown (In re Brown),

, 1295 (10th Cir. 1997).

      The decision of the BAP is REVERSED in part and AFFIRMED in part.

SMITH, Circuit Judge, concurring in part and dissenting in part.

       While I agree with the majority that Bruce Bren’s intent was fraudulent, I
cannot agree that there was “strong evidence” that Barbara Bren lacked fraudulent
intent. “Although a single omission is generally insufficient to support an objection
to discharge, a series of omissions may create a pattern which demonstrates the
debtor’s reckless disregard for the truth.” In re Sadler, 

, 264 (Bankr.
M.D. Fla. 2002) (citing In re Phillips, 

, 369 (Bankr. M.D. Fla. 1995)).
The majority correctly determined that “[t]he sizable nature of the Brens’ omissions
was troubling and suggested recklessness.” However, despite these omissions and co-
ownership of all assets, the majority holds that Bruce Bren was reckless while
absolving Barbara Bren from her reckless behavior. The majority concludes that
Barbara Bren’s intent was not fraudulent because she “exercised no role in the
financial affairs of the business aside from signing checks” and was “equally distant
from the bankruptcy process.” I disagree.

       The majority discounts Barbara Bren’s equally “cavalier” attitude toward the
accuracy of the bankruptcy petition. In fact, Barbara Bren neither read the bankruptcy
petition or schedules, nor did she make any attempt to correct them. Barbara Bren
signed her bankruptcy petition under oath. “Successful administration of the
Bankruptcy Act hangs heavily on the veracity of statements made by the bankrupt."
Diorio v. Kreisler-Borg Construction Co., 

, 1331 (2d Cir. 1969)
(citation omitted). Under the majority’s holding, Barbara Bren’s oath is virtually

                                         -7-
meaningless. We have repeatedly said, “[t]he subject matter of a false oath is
‘material,’ and thus sufficient to bar discharge, if it bears a relationship to the
bankrupt’s business transactions or estate, or concerns the discovery of assets,
business dealings, or the existence and disposition of [her] property.” In re Olson,

, 484 (8th Cir. 1990) (emphasis added) (citing In re Chalik, 

, 618 (11th Cir. 1984) (per curiam)); see also In re Mertz, 

, 598 (8th
Cir. 1992). A clear relationship exists between Barbara Bren’s false oath and
discovery of her business assets and dealings. The subject matter of her false oath was
material and she should also be denied a discharge.

      For these reasons, I dissent in part from the majority’s holding.
                     _______________________________




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