Filed: Jan. 29, 2020
Latest Update: Mar. 03, 2020
Summary: FILED U.S. Bankruptcy Appellate Panel of the Tenth Circuit NOT FOR PUBLICATION * January 29, 2020 UNITED STATES BANKRUPTCY APPELLATE PANEL Blaine F. Bates OF THE TENTH CIRCUIT Clerk _ IN RE WENDY SUE OWENS, BAP No. WY-19-027 Debtor. _ WENDY SUE OWENS, Bankr. No. 19-20060 Chapter 7 Appellant, v. OPINION RANDY L. ROYAL, CHAPTER 7 TRUSTEE, Appellee. _ Appeal from the United States Bankruptcy Court for the District of Wyoming _ Submitted on the briefs. ** _ Before NUGENT, Chief Judge, MICHAEL, and M
Summary: FILED U.S. Bankruptcy Appellate Panel of the Tenth Circuit NOT FOR PUBLICATION * January 29, 2020 UNITED STATES BANKRUPTCY APPELLATE PANEL Blaine F. Bates OF THE TENTH CIRCUIT Clerk _ IN RE WENDY SUE OWENS, BAP No. WY-19-027 Debtor. _ WENDY SUE OWENS, Bankr. No. 19-20060 Chapter 7 Appellant, v. OPINION RANDY L. ROYAL, CHAPTER 7 TRUSTEE, Appellee. _ Appeal from the United States Bankruptcy Court for the District of Wyoming _ Submitted on the briefs. ** _ Before NUGENT, Chief Judge, MICHAEL, and MO..
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FILED
U.S. Bankruptcy Appellate Panel
of the Tenth Circuit
NOT FOR PUBLICATION ∗
January 29, 2020
UNITED STATES BANKRUPTCY APPELLATE PANEL
Blaine F. Bates
OF THE TENTH CIRCUIT Clerk
_________________________________
IN RE WENDY SUE OWENS, BAP No. WY-19-027
Debtor.
___________________________________
WENDY SUE OWENS, Bankr. No. 19-20060
Chapter 7
Appellant,
v.
OPINION
RANDY L. ROYAL, CHAPTER 7
TRUSTEE,
Appellee.
_________________________________
Appeal from the United States Bankruptcy Court
for the District of Wyoming
_________________________________
Submitted on the briefs. **
_________________________________
Before NUGENT, Chief Judge, MICHAEL, and MOSIER, Bankruptcy Judges.
_________________________________
∗
This unpublished opinion may be cited for its persuasive value, but is not
precedential, except under the doctrines of law of the case, claim preclusion, and issue
preclusion. 10th Cir. BAP L.R. 8026-6.
**
After examining the briefs and appellate record, the Court has determined
unanimously to honor the parties’ request for a decision on the briefs without oral
argument. See Fed. R. Bankr. P. 8019(b). The case is therefore submitted without oral
argument.
MICHAEL, Bankruptcy Judge.
_________________________________
Wendy Sue Owens (the “Debtor”), an attorney employed by Legal Aid of
Wyoming, claimed a motor vehicle as exempt under Wyoming’s tools of the trade
exemption statute in her chapter 7 bankruptcy petition. The chapter 7 trustee objected.
The United States Bankruptcy Court for the District of Wyoming (the “Bankruptcy
Court”) sustained the chapter 7 trustee’s objection and disallowed the exemption. The
Debtor filed a motion to reconsider, which the Bankruptcy Court denied. The Debtor now
appeals both the order sustaining the trustee’s objection and the order denying the motion
to reconsider. Determining the Bankruptcy Court reviewed the exemption under the
appropriate legal standard and did not err in its factual findings, we affirm.
I. Factual Background
The Debtor is an attorney at Legal Aid of Wyoming, a non-profit law firm offering
legal assistance to low income individuals throughout Wyoming. The Debtor filed a
chapter 7 bankruptcy petition, along with various required statements and schedules, in
the District of Wyoming on February 12, 2019. Included with the Debtor’s petition was
Schedule C, a list of property she claimed as exempt under applicable state and federal
“nonbankruptcy” exemptions pursuant to 11 U.S.C. § 522(b)(3). 1 Among other things,
the Debtor claimed as exempt two motor vehicles: a 2008 Ford Mustang (the “Ford”) and
a 2014 Honda Accord (the “Honda”). The Debtor’s schedules indicate that she owns the
1
All future references to “Code,” “Section,” and “§” are to the Bankruptcy Code,
Title 11 of the United States Code, unless otherwise indicated.
2
Ford free and clear of any liens, but that she still owes $3,016 to American Honda
Finance on the Honda. 2 Schedule C claims the Ford, valued at $2,000.00, as fully exempt
pursuant to Wyoming’s motor vehicle exemption statute. 3 Schedule C claims the Honda,
valued at $7,944.00, as exempt pursuant to Wyoming’s “tools of the trade” exemption
statute. 4
The Debtor’s bankruptcy case was assigned to chapter 7 trustee Randy Royal (the
“Trustee”). The Trustee took issue with the Debtor’s claim of exemptions in motor
vehicles early on in the case, initially requesting that the Debtor repurchase the Ford from
the bankruptcy estate for $2,674.00.5 After the Debtor failed to respond to the Trustee’s
request, the Trustee filed an objection to the Debtor’s claim of exemptions in the Ford
and the Honda (the “Objection to Exemption”). 6 In the Objection to Exemption, the
Trustee argued that state law only allows the Debtor to exempt one motor vehicle. In
addition, the Trustee argued that the Debtor had not shown that either the Ford or the
Honda qualified as a tool of the trade. The Bankruptcy Court scheduled a non-evidentiary
telephonic hearing on the Objection to Exemption.
2
Schedule D, in Appellant’s App. at 3.
3
Schedule C, in Appellant’s App. at 1. Wyo. Stat. § 1-20-106(a)(iv) allows a debtor
to claim the value of a motor vehicle not exceeding $5,000 exempt.
4
Wyo. Stat. § 1-20-106(b) allows a debtor to claim the value of “tools . . . in trade
of any person, used and kept for the purpose of carrying on his trade or business” not
exceeding $4,000 as exempt. Wyo. Stat. § 1-20-106(b) (2016). Because the Debtor had
$4,928 in equity in the Honda according to her valuation, presumably had her exemption
been allowed, she would have been required to pay the bankruptcy estate the excess $928
above the amount of the allowed exemption.
5
Trustee’s Directive, in Appellant’s App. at 14.
6
Trustee’s Objection to Claim of Exemption, in Appellant’s App. at 5.
3
The Debtor filed a response to the Objection to Exemption, asserting the Honda is
a tool of the Debtor’s trade. Specifically, the Debtor asserted she is an attorney employed
by Legal Aid of Wyoming and the Honda is used for the purpose of carrying on her
occupation. The Debtor provided an affidavit stating she uses the Honda “for travel
around the state of Wyoming . . . for court hearings, depositions, filing of pleadings,
client conferences and various other legal matters.” 7
The Bankruptcy Court conducted a non-evidentiary telephonic hearing on the
Objection to Exemption on May 15, 2019. At the conclusion of the hearing, the
Bankruptcy Court sustained the Trustee’s objection, making its oral ruling on the record.
Subsequently, the Bankruptcy Court entered its Minutes of Proceeding on the docket. 8
The Bankruptcy Court concluded the Debtor could not claim the Honda as exempt under
the tools of the trade exemption based on its application of Johnston v. Barney. 9 In
Johnston, the United States Court of Appeals for the Tenth Circuit (the “Tenth Circuit”)
held that a debtor could not use Wyoming’s tools of the trade exemption to claim a motor
vehicle used to commute to a debtor’s job as a waiter in a restaurant as exempt. The
Bankruptcy Court found the only difference between Johnston and the Debtor’s case was
that the Debtor used the Honda to travel to multiple work locations. Furthermore, the
Bankruptcy Court found the act of driving was not an exercise of the Debtor’s profession
as an attorney but was only necessary to get from place to place. Therefore, pursuant to
7
Affidavit of Wendy Owens at 1, in Appellant’s App. at 13.
8
Appellant’s App. at 18.
9
Johnston v. Barney, 842 F.2d 1221 (10th Cir. 1988).
4
Johnston and other authority, the Honda could not be claimed exempt as a tool of the
trade. 10
The Debtor filed a Motion to Reconsider the Bankruptcy Court’s denial of the
exemption. 11 The Debtor attached a supplemental affidavit in support of the Motion to
Reconsider. In the supplemental affidavit, the Debtor stated that (i) she generally travels
to her office in Gillette, Wyoming prior to traveling to any other location; (ii) she
receives mileage reimbursement for travel to hearings and court proceedings outside of
Gillette, but no reimbursement for commuting to her office in Gillette; and (iii) she uses
the Honda to transport exhibits, files, and occasionally clients and witnesses to hearings
and court proceedings. 12
The Bankruptcy Court analyzed the Motion to Reconsider under Federal Rule of
Civil Procedure 59, 13 concluding it had already “considered [the] Debtor’s argument at
the non-evidentiary hearing and rejected it.” 14 Accordingly, the Bankruptcy Court denied
10
Tr. at 7-8, in Appellant’s App. at 36-37 (first citing Johnston, 842 F.2d at 1222;
and then citing In re Black,
280 B.R. 258, 260 (Bankr. D. Colo. 2002)).
11
Appellant’s App. at 19.
12
Supplemental Affidavit of Wendy Owens, in Appellant’s App. at 22.
13
Made applicable to bankruptcy cases by Federal Rule of Bankruptcy Procedure
9023.
14
Order Denying Debtor’s Motion to Reconsider, in Appellant’s App. at 23. All
future references to “Bankruptcy Rule(s)” are to the Federal Rules of Bankruptcy
Procedure. All future references to “Civil Rule(s)” are to the Federal Rules of Civil
Procedure.
5
the Motion to Reconsider. The Debtor filed a timely notice of appeal of both the order
denying the claim of exemption and the order denying the Motion to Reconsider. 15
II. Jurisdiction
“With the consent of the parties, this Court has jurisdiction to hear timely-filed
appeals from ‘final judgments, orders, and decrees’ of bankruptcy courts within the Tenth
Circuit.” 16 Neither party elected to have this appeal heard by the United States District
Court for the District of Wyoming; thus they have consented to our review.
“A decision is considered final if it ‘ends the litigation on the merits and leaves
nothing for the court to do but execute the judgment.’” 17 An order denying a debtor’s
claim of exemption is a final order for purposes of appellate review. 18 An order denying a
motion pursuant to Bankruptcy Rule 9023 is also final for purposes of appellate review
provided the underlying order is final. 19 Accordingly, we have jurisdiction to hear the
appeal of both orders.
III. Standard of Review
The Debtor’s brief raises two issues for this Court’s consideration. First, the
Debtor argues that the Bankruptcy Court erred in not applying a “liberal” interpretation
15
Notice of Appeal, in Appellant’s App. at 25.
16
Straight v. Wyo. Dep’t of Trans. (In re Straight), 248 B.R. 403, 409 (10th Cir.
BAP 2000) (first quoting 28 U.S.C. § 158(a)(1); and then citing 28 U.S.C. § 158(b)(1),
(c)(1) and Fed. R. Bankr. P. 8002).
17
In re Duncan, 294 B.R. 339, 341 (10th Cir. BAP 2003) (quoting Quackenbush v.
Allstate Ins. Co.,
517 U.S. 706, 712 (1996)).
18
In re Kester, 339 B.R. 749, 752 (10th Cir. BAP 2006) (quoting In re Carlson,
303
B.R. 478, 480 (10th Cir. BAP 2004)).
19
In re Onyeabor, No. UT-14-047, 2015 WL 1726692, at *3 n.20 (10th Cir. BAP
Apr. 15, 2015) (citing In re Ewing, No. UT-07-074,
2008 WL 762458, at *1 & n.4 (10th
6
of Wyoming’s tool of the trade exemption. Second, the Debtor argues that the
Bankruptcy Court erred in finding that the Debtor did not use the Honda for the purpose
of carrying on her trade as an attorney pursuant to Wyoming’s tools of the trade
exemption statute.
Whether a bankruptcy court correctly interprets and applies a state statute is a
question of law that we review de novo. 20 “De novo review requires an independent
determination of the issues, giving no special weight to the bankruptcy court’s
decision.” 21 Whether a bankruptcy court properly determined a tool or implement is used
in a debtor’s trade is a factual finding that we review for clear error. 22 “A finding of fact
is clearly erroneous if it is without factual support in the record or if, after reviewing all
of the evidence, we are left with the definite and firm conviction that a mistake has been
made.” 23 An order denying relief pursuant to Bankruptcy Rule 9023 is reviewed for
Cir. BAP Mar. 24, 2008) (unpublished)) (concluding order resolving Rule 59(e) and Rule
60(b) motions was final) (unpublished).
20
See In re Geldhill, 164 F.3d 1338, 1340 (10th Cir. 1999); see also In re
Carlson,
303 B.R. at 481 (citing Sloan v. Zions First Nat’l Bank (In re Castletons, Inc.),
990 F.2d
551, 557 (10th Cir. 1993)) (reviewing a court’s interpretation of a state exemption statute
de novo).
21
In re Bryan (Peters v. Clark), 857 F.3d 1078, 1091 (10th Cir. 2017) (citing Salve
Regina Coll. v. Russell,
499 U.S. 225, 238 (1991)).
22
In re Gregory, 246 F.3d 681,
2000 WL 1809081, at *1 (10th Cir. Dec. 11, 2000)
(citing Cent. Nat’l Bank & Tr. Co. of Enid, Okla. v. Liming (In re Liming),
797 F.2d 895,
902 (10th Cir. 1986) (“[w]hether an implement is used in a bankrupt’s ‘trade’ is a fact
question”)) (unpublished). The Bankruptcy Court did not hold an evidentiary hearing on
the Objection to Exemption and it does not appear either party requested such a hearing.
However, the record before us includes the Debtor’s affidavits, which the Bankruptcy
Court appears to have relied upon in finding “[t]he driving a vehicle is not part of the
profession of being an attorney.” Tr. at 7, in Appellant’s App. at 36.
23
In re Miniscribe, 309 F.3d 1234, 1240 (10th Cir. 2002) (quoting Conoco, Inc. v.
Styler (In re Peterson Distrib., Inc.),
82 F.3d 956, 959 (10th Cir. 1996)).
7
abuse of discretion. 24 “Under the abuse of discretion standard ‘a trial court’s decision will
not be disturbed unless the appellate court has a definite and firm conviction that the
lower court made a clear error of judgment or exceeded the bounds of permissible choice
in the circumstances.’” 25
IV. Discussion
a. The Bankruptcy Court Did Not Err in Sustaining the Trustee’s
Objection to the Debtor’s Tools of the Trade Exemption
Section 522 allows a chapter 7 debtor to exempt certain property from the
bankruptcy estate, preventing a trustee from liquidating the property and distributing the
proceeds to creditors. 26 Wyoming limits the exemptions a debtor may claim in
bankruptcy to those exemptions allowed by state law, opting out of the federal
exemptions provided by § 522(d). 27 The Wyoming exemption statute in effect on the
petition date allowed the Debtor to claim “[t]he value in a motor vehicle not exceeding
five thousand dollars” as exempt from “levy or sale upon execution, writ of attachment or
any process issuing out of any court in this state.” 28 The Debtor could also exempt “[t]he
24
In re Onyeabor, 2015 WL 1726692, at *3 (10th Cir. BAP 2015) (first citing
Minshall v. McGraw Hill Broad. Co.,
323 F.3d 1273, 1287 (10th Cir. 2003); and then
citing Servants of the Paraclete v. Does,
204 F.3d 1005, 1009 (10th Cir. 2000)).
25
In re Bryan, 857 F.3d at 1091 (quoting McEwen v. City of Norman,
926 F.2d
1539, 1553-54 (10th Cir. 1991)).
26
See 11 U.S.C. § 522(l).
27
Wyo. Stat. Ann. § 1-20-109 (2004).
28
Wyo. Stat. Ann. § 1-20-106(a)(iv) (2016).
8
tools, team, implements or stock in trade of any person, used and kept for the purpose of
carrying on his trade or business, not exceeding in value four thousand dollars.” 29
The Bankruptcy Court held the Wyoming tools of the trade exemption did not
allow the Debtor to exempt the Honda from the bankruptcy estate as a tool or implement
of her trade as an attorney. Two Tenth Circuit opinions inform our review of the
Bankruptcy Court’s interpretation of the Wyoming statute. The first, Johnston v.
Barney, 30 considers facts somewhat analogous to those in the present case. In Johnston,
the chapter 7 debtor worked as a waiter in a restaurant in Jackson, Wyoming. The Debtor
claimed his 1967 pick-up truck as exempt as a tool of his trade. The debtor lived several
miles from the restaurant and used the pick-up truck to travel to and from work. Apart
from the commute to work, the pick-up truck had no connection to the debtor’s job as a
waiter. The chapter 7 trustee objected to the debtor’s claim of exemption in the pick-up
truck. The Bankruptcy Court for the District of Wyoming sustained the objection, holding
the pick-up truck was not directly used in the performance of the debtor’s employment
duties. At the time, the Wyoming tools of the trade exemption provided an exemption in
“[t]he tools, a motor vehicle, team, implements or stock in trade of any person, used and
kept for the purpose of carrying on his trade or business.” 31
The debtor appealed to the United States District Court for the District of
Wyoming, which affirmed. On appeal to the Tenth Circuit, the parties framed the issue as
29
Wyo. Stat. Ann. § 1-20-106(b) (2016).
30
842 F.2d 1221 (10th Cir. 1988).
31
Wyo. Stat. Ann. § 1-20-106(b) (1983) (emphasis added).
9
whether “[u]nder Wyoming Statutes section 1-20-106(b), when a vehicle is (1) not used
directly in the performance of a person’s employment duties, and (2) required by a person
to commute to his or her sole workplace, can the person claim the vehicle as an
exemption?” 32 In affirming the bankruptcy court decision, the Tenth Circuit applied the
only Wyoming Supreme Court case interpreting the tools of the trade exemption, Pellish
Brothers v. Cooper. 33 In Pellish Brothers, the Wyoming Supreme Court determined the
tools of the trade exemption statute in effect at the time “demonstrat[ed] that the state
legislature ‘clearly had in mind to exempt the means by which a man’s business is carried
on.’” 34 As such, the Wyoming Supreme Court held “a taxi driver’s vehicle was an
implement . . . for which an exemption was appropriate under Wyoming law.” 35
The Tenth Circuit noted the Wyoming Supreme Court “recognized that a court is
limited in its application of an exemption statute by what the terms of that statute can
fairly be said to embrace.” 36 Accordingly, the Tenth Circuit held that the fact a debtor
used a vehicle to commute to work could not—on that basis alone—be used as the basis
for a tool of the trade exemption under Wyoming law. Specifically, the Tenth Circuit
noted that the debtor’s “work duties [did] not involve any use of transportation,” 37 and, if
the debtor “happened to live within reasonable walking distance from the restaurant, [the]
32
Johnston, 842 F.2d at 1222.
33
38 P.2d 607, 609 (Wyo. 1934).
34
Johnston, 842 F.2d at 1222 (quoting Pellish
Bros., 38 P.2d at 609) (applying a
predecessor to Wyo. Stat. Ann. 1-20-106(b) (1983).
35
Id.
36
Id. at 1223 (citing Pellish
Bros., 38 P.2d at 608-09).
37
Id. at 1222.
10
dispute would not even have arisen.” 38 The Tenth Circuit concluded that “[g]iven the
language of the statute, the Wyoming Legislature could not plausibly have intended to
grant an exemption dependent upon the fortuitous circumstance of a debtor’s commute to
his or her work station, although such an exemption could certainly have been drafted.” 39
The second case involves the Tenth Circuit’s review of this Court’s application of
the tools of the trade exemption in In re Gregory. 40 Gregory involved a chapter 7 debtor
who was employed by the United States Air Force as a security officer. The debtor listed
seven firearms as assets in his bankruptcy schedules. The debtor claimed two of the seven
firearms exempt from his bankruptcy estate pursuant to Wyoming’s tools of the trade
exemption—one used in his employment as a security officer and another used as a
practice weapon. Applying Wyoming Statute § 1-20-106(b), this Court held the practice
weapon did not qualify as a tool of the trade because it was “not a means by which the
Debtor’s business [was] carried on.” 41 In affirming this Court’s decision, the Tenth
Circuit reaffirmed its holding in Johnston that a court is “limited in its application for
[sic] an exemption statute by what the terms of that statute can be fairly said to
embrace.” 42
38
Id.
39
Id. (citing Levin v. Mauro,
425 F. Supp. 205, 206 (D. Mass. 1977)).
40
246 F.3d 681,
2000 WL 1809081 (10th Cir. Dec. 11, 2000) (unpublished), aff’g
245 B.R. 171, 173 (10th Cir. BAP 2000)).
41
Id. at *1 (quoting In re Gregory,
245 B.R. 171, 174 (10th Cir. BAP 2000)).
42
Id. (quoting Johnston, 842 F.2d at 1223).
11
i. The Bankruptcy Court Applied the Correct Legal Standard in
Interpreting the Wyoming Tools of the Trade Exemption Statute
The Debtor first argues the Bankruptcy Court applied an incorrect legal standard
and failed to liberally construe the Wyoming exemption. The Debtor argues the Tenth
Circuit articulated the correct legal standard in Gregory when it asked whether the tool is
used in a manner to allow a debtor to carry on his or her trade or business and that the
Debtor’s use of the Honda falls within that standard because it “allows her to carry on her
law practice in several spread out communities.” 43 The Debtor asserts the Bankruptcy
Court created a new legal standard whereby “the ‘tool’ must be an integral or essential
part of the trade or business, but the statute’s phrase ‘carry on’ is more expansive.” 44 In
sum, the Debtor believes the legal standard applied by the Bankruptcy Court is too strict
and effectively shifts the burden of proof from the Trustee to the Debtor, contrary to
Bankruptcy Rule 4003(c). 45
In interpreting Wyoming’s tools of the trade exemption, the Tenth Circuit
concluded the exemption statute limits courts to “what the terms of that statute can fairly
be said to embrace.” 46 Accordingly, the Tenth Circuit recognized the plain language of
the exemption statute provides an exemption in “tools . . . used and kept for the purpose
43
Appellant’s Br. 7.
44
Appellant’s Br. 8.
45
Fed. R. Bankr. P. 4003(c) (“In any hearing under this rule, the objecting party has
the burden of proving that the exemptions are not properly claimed.”).
46
Gregory, 2000 WL 1809081, at *1 (quoting
Johnston, 842 F.2d at 1223).
12
of carrying on [a person’s] trade or business.” 47 The Tenth Circuit emphasized the word
purpose, suggesting the implement or tool must be used as a means to meet the objective
or goal of the trade. 48
We do not agree with the Debtor that the Bankruptcy Court ignored the standard
set forth in Gregory or rewrote the Wyoming exemption statute to require a tool to be
“essential” or “necessary” to the performance of a trade. 49 Our review of the Bankruptcy
Court’s application of the Wyoming tools of the trade exemption statute suggests the
Bankruptcy Court understood the purpose of the Debtor’s trade to be the practice of law.
This, the Bankruptcy Court said, entailed advising clients, conducting depositions, and
appearing in court. The Honda, similar to the waiter’s pick-up truck in Johnston, “is used
to get to the place where [the D]ebtor exercises her profession.” 50 As instructed by
Gregory, the Bankruptcy Court followed the statutory language by identifying the
47
Id. at *2 (quoting Wyo. Stat. § 1-20-106(b) (2016)).
48
See Purpose, Black’s Law Dictionary (11th ed. 2019) (“An objective, goal or
end.”).
49
We note the Debtor’s argument on this issue is conflicting, as she argues the
“Bankruptcy Court has for all practical purposes imposed a ‘necessity’ test in
interpreting” Wyoming’s exemption statute—a standard not espoused by Johnston or
Gregory. Appellant’s Br. 12. However, the Debtor cites cases to support her argument
that would effectively require a court to consider the necessity of the motor vehicle in the
Debtor’s ability to carry on her profession. See Appellant’s Br. at 11-12 (first citing In re
Sackett, 394 B.R. 544, 548, 550 (Bankr. D. Colo. 2008) (finding debtor’s “ability to
conduct business and retain her occupation is dependent upon the use of the” motor
vehicle); and then citing In re Zink,
177 B.R. 713, 714 (Bankr. D. Kan. 1995) (allowing
farmers to exempt pickup trucks as tools of the trade when “regularly and reasonably
necessary in carrying on the person’s . . . trade.”)).
50
Tr. at 8, in Appellant’s App. at 37.
13
purpose of the Debtor’s trade and considering whether the tool was used for the purpose
of carrying on the trade. 51 This was not in error.
We do not read the Bankruptcy Court’s decision as requiring the Debtor to show
the Honda be “integral” or “essential” to the Debtor’s trade to qualify for the Wyoming
exemption. The Bankruptcy Court recognized the purpose of an attorney is to, among
other things, advise clients, conduct depositions, and appear in court, none of which
require a car—other than for commuting purposes. While the Debtor could not appear in
court or other locations without traveling, this fact is not unique to the Debtor’s
profession and is not materially different from the waiter’s situation in Johnston.
Accordingly, we hold that the Bankruptcy Court did not err in its application of the
relevant legal standard, as that standard has been established by the plain language of the
Wyoming statute and interpretative decisions of the Wyoming Supreme Court and the
Tenth Circuit. 52
ii. The Bankruptcy Court Made No Clearly Erroneous Findings of
Fact
The Debtor next argues the Bankruptcy Court committed error when it found the
Honda is not used for the purpose of carrying on the Debtor’s profession. Although the
51
Tr. at 7, in Appellant’s App. at 36 (explaining the tools of the trade exemption
applies to “the tools, team, implements or stock in trade of any person, used and kept for
the purpose of carrying on his trade or business.”).
52
The Debtor also argues the Bankruptcy Court erred in failing to apply factors
articulated in In re Sackett, 394 B.R. 544, 548 (Bankr. D. Colo. 2008) to evaluate whether
a motor vehicle should be considered a tool of the trade. Appellant’s Br. 11-12. We note
the Debtor failed to cite In re Sackett in the proceedings below and likely forfeited this
argument. In re Duncan,
294 B.R. 339, 344 (10th Cir. BAP. 2003) (citing McDonald v.
Kinder-Morgan, Inc.,
287 F.3d 992, 999 (10th Cir. 2002) (“It is clear in this circuit that
14
Bankruptcy Court did not conduct an evidentiary hearing on the Objection to Exemption,
the record before us includes an affidavit describing the Debtor’s use of the Honda,
which the Bankruptcy Court considered without objection. 53 Furthermore, the
Bankruptcy Court found the Honda is not part of the Debtor’s profession. 54 Therefore, we
consider the Bankruptcy Court’s finding that the Debtor does not use the Honda for the
purpose of carrying on her trade for clear error. 55
The Debtor’s affidavit attempts to distinguish her use of the Honda from that of a
simple commuter vehicle. Her affidavit states that she uses the Honda to travel to rural
areas of Wyoming to appear at court hearings, conduct depositions, file pleadings, and
attend client conferences. We are unable to recognize any facts in the affidavit to suggest
the Honda is more than a method of transportation in the Debtor’s case. While the Debtor
claims she must travel for court proceedings, depositions, and conferences, the affidavit
fails to explain how the Honda is actually linked to the purpose of the Debtor’s job as an
attorney other than as a commuter vehicle. Although we recognize other forms of travel,
absent extraordinary circumstances, we will not consider arguments raised for the first
time on appeal”)). In any event, the Bankruptcy Court is not bound by decisions of
bankruptcy courts in different judicial districts. See Camreta v. Greene, 563 U.S. 692,
709 n.7 (2011) (“A decision of a federal district court judge is not binding precedent in
either a different judicial district, the same judicial district, or even upon the same judge
in a different case.” (quoting 18 J. Moore et al., Moore’s Fed. Pract. § 134.02[1][d] (3d
ed. 2011))).
53
Affidavit of Wendy Owens, in Appellant’s App. at 13.
54
Tr. at 8, in Appellant’s App. at 37.
55
See In re Gregory, 246 F.3d 681,
2000 WL 1809081, at *1 (10th Cir. Dec. 11,
2000) (citing Cent. Nat’l Bank & Tr. Co. of Enid, Okla. v. Liming (In re Liming),
797
F.2d 895, 902 (10th Cir. 1986)) (stating whether an implement is considered a tool of the
trade is a factual question) (unpublished).
15
such as public transportation, are scarce in rural Wyoming, the Debtor fails to establish a
connection between the Honda and her trade as an attorney. As the Wyoming exemption
statutes already allow an exemption in a motor vehicle, we cannot read the tools of the
trade exemption as allowing the Debtor to exempt the Honda absent more compelling
facts linking the Honda to the purpose of the Debtor’s profession.
Our decision is compelled by the Tenth Circuit’s decision in Johnston, concluding
that although a restaurant employee required transportation to and from work, his “work
duties d[id] not involve any use of transportation.” 56 The Bankruptcy Court’s decision
implements Johnston’s instructions. 57 The Bankruptcy Court explained that allowing the
Honda “to qualify as a tool of the trade because it is necessary to transport an individual
to locations where they exercise their profession would create a slippery slope that would
make the exemption actable in almost all circumstances for a professional in
Wyoming.” 58 We agree.
The Debtor’s argument that the Honda is used for the purpose of performing the
trade of an attorney would extend Wyoming’s tools of the trade exemption beyond the
limits of the Wyoming legislature’s intent to exempt “tools . . . used and kept for the
56
Johnston v. Barney, 842 F.2d 1221, 1222 (10th Cir. 1988).
57
In Johnston, the Tenth Circuit stated, “the Wyoming legislature could not
plausibly have intended to grant an exemption dependent upon the fortuitous
circumstance of a debtor’s commute to his or her work station, although such an
exemption could certainly have been drafted.” Id. As such, “[g]ranting an exemption in
[such a] case would open up an entirely new class of protected property” and the statute
could not be read “so broadly absent a more definite statement of intent by the Wyoming
courts or its legislature.”
Id.
58
Tr. at 8, in Appellant’s App. at 37.
16
purpose of carrying on [a person’s] trade or business.” 59 However, Wyoming’s
legislature already provides debtors with an exemption in one motor vehicle and we are
not convinced the tools of the trade exemption embraces the exemption of a second motor
vehicle based on the record before us. 60 Accordingly, the Bankruptcy Court did not err in
finding the Honda is not a tool or implement used for the purpose of carrying on the
Debtor’s trade or profession.
b. Denial of the Motion to Reconsider
Motions for reconsideration are not recognized by either the Bankruptcy Rules or
the Civil Rules. 61 However, the Bankruptcy Rules provide that a litigant may seek review
of an order or judgment through Civil Rule 59(e), made applicable by Bankruptcy Rule
9023, or Civil Rule 60(b), made applicable by Bankruptcy Rule 9024.62 Bankruptcy Rule
9023 provides that “[a] motion for a new trial or to alter or amend a judgment shall be
filed . . . no later than 14 days after entry of judgment.” 63 The Debtor’s Motion to
Reconsider sought relief pursuant to Bankruptcy Rule 9023 and was filed within fourteen
59
In re Gregory, 2000 WL 1809081, at *2 (quoting Wyo. Stat. § 1-20-106(b)
(2016)).
60
See Wyo. Stat. Ann. 1-20-106(a)(iv) (2016).
61
Dimeff v. Good (In re Good), 281 B.R. 689, 699 (10th Cir. BAP 2002) (first citing
Van Skiver v. United States,
952 F.2d 1241, 1243 (10th Cir. 1991); and then citing Lopez
v. Long (In re Long),
255 B.R. 241, 244 (10th Cir. BAP 2000)).
62
In re Onyeabor, No. UT-14-047, 2015 WL 1726692, at *4 (10th Cir. BAP Apr.
15, 2015) (unpublished).
63
Fed. R. Bankr. P. 9023.
17
days of the entry of the order sustaining the Objection to Exemption. Therefore review
pursuant to Bankruptcy Rule 9023 was appropriate.
Bankruptcy Rule 9023, applying Civil Rule 59, provides the bankruptcy court may
grant a new trial “for any reason for which a rehearing has heretofore been granted in a
suit in equity in federal court.” 64 “[A] motion for reconsideration is appropriate where the
court has misapprehended the facts, a party’s position, or the controlling law. It is not
appropriate to revisit issues already addressed or advance arguments that could have been
raised in prior briefing.” 65
The Debtor takes issue with the Bankruptcy Court’s application of Johnston based
on facts provided by a supplemental affidavit included with her Motion to Reconsider. 66
The Debtor argues the two cases are factually distinguishable as the Debtor arrives at her
workstation and then uses the Honda to drive to various other locations, unlike in
Johnston, where the debtor used a vehicle for commuting to a single location.
Admittedly, Johnston does not address the situation where a debtor commutes to a
workstation and then must travel to other locations. However, the Tenth Circuit stated the
Wyoming Legislature could have clarified the intent behind the tools of the trade
exemption to include a motor vehicle used to commute to and from work but did not.67
After Johnston, the Wyoming Legislature chose not to expand the tools of the trade
64
Fed. R. Civ. P. 59(a)(1)(B).
65
Servants of the Paraclete v. Does, 204 F.3d 1005, 1012 (10th Cir. 2000) (internal
citation omitted) (citing Van
Skiver, 952 F.2d at 1243).
66
Supplemental Affidavit of Wendy Owens, in Appellant’s App. at 22.
67
Johnston v. Barney, 842 F.2d 1221, 1222 (10th Cir. 1988).
18
exemption to include a motor vehicle used to commute to and from work. Instead, the
legislature eliminated the phrase “a motor vehicle” from the tools of the trade exemption
altogether and created a separate exemption for a motor vehicle. 68 The Bankruptcy Court
understood the Debtor used the Honda to drive from her office in Gillette to other
locations when it initially denied the claim of exemption. 69 Accordingly, we cannot hold
that the Bankruptcy Court abused its discretion in denying the Motion to Reconsider as it
applied the appropriate legal standard and made no clearly erroneous findings of fact. 70
V. Conclusion
The Debtor asks the Court to extend the Wyoming tools of the trade exemption to
a motor vehicle used to travel to court hearings, depositions, and client conferences in
remote regions of the state. The Tenth Circuit has expressly held Wyoming’s tools of the
trade exemption does not extend to a commuter vehicle under similar circumstances. The
Bankruptcy Court applied relevant and controlling authority when it determined the
Wyoming exemption statute did not embrace the Debtor’s proposed application and its
findings and conclusions were not in error. Accordingly, we AFFIRM.
68
Exemption from Execution, ch. 59, § 1 (1989) (codified as amended Wyo. Stat.
Ann. § 1-20-106(b) (1989) (making an exemption in a motor vehicle a standalone
exemption)).
69
Tr. at 7, in Appellant’s App. at 36 (“The only difference in this case is that there
are multiple work stations depending on the demands of [the Debtor’s] jobs.”).
70
Farmer v. Banco Popular N. Am., 791 F.3d 1246, 1256 (10th Cir. 2015) (citing
Chamber of Commerce v. Edmondson,
594 F.3d 742, 764 (10th Cir. 2010) (stating a trial
court “abuses its discretion when it (1) fails to exercise meaningful discretion . . . , (2)
commits an error of law, such as applying an incorrect legal standard or misapplying the
correct legal standard, or (3) relies on clearly erroneous factual findings.”).
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