§ 46.11 — Causes of Action—Including Judicial Estoppel Issues

Revised: May 21, 2004

[1]

Whether arising before or after the petition, a Chapter 13 debtor’s causes of action are property of the estate.1 For example, a Chapter 13 debtor’s tort action for medical malpractice is property of the estate.2 A debtor’s cause of action for employment discrimination is property of the estate.3 The collection of fees for personal services by the debtor after the petition is a cause of action that passes to the Chapter 13 estate.4 A Chapter 13 debtor’s cause of action against a lender for fraud and misrepresentation in connection with credit life insurance included in a prepetition loan agreement is property of the estate.5 Similarly, a debtor’s cause of action against a lender for failure to provide the written notice of sale required by state law with respect to a repossessed automobile is property of the Chapter 13 estate.6 A Chapter 13 debtor’s § 523(a)(15) adversary proceeding against a former spouse to determine the dischargeability of debt is property of the estate, and any recovery would become property of the estate.7 Settlement proceeds from the debtor’s postpetition action for violation of the automatic stay are property of the Chapter 13 estate.8

[2]

The general rule that causes of action become property of the Chapter 13 estate is subject to exceptions at confirmation. Depending on the rule in the jurisdiction with respect to the vesting effect of confirmation under § 1327(b),9 some or all of a debtor’s causes of action, even if properly characterized as property of the estate at the petition, will vest in the debtor at confirmation and cease to be property of the estate. Similarly, causes of action arising after confirmation may or may not become property of the Chapter 13 estate in the first instance, depending on the effect of confirmation.10

[3]

There is some controversy in the case law whether the debtor or the trustee is the proper party to continue litigation that becomes property of the Chapter 13 estate. Some courts have observed that a debtor’s prepetition cause of action is appropriately maintained by the Chapter 13 trustee after the petition, unless the debtor exempts the lawsuit or reserves control through the confirmed plan.11 This controversy is somewhat hard to understand because only the debtor can use property of the Chapter 13 estate12 and, at least until confirmation, the Code vests possession of all estate property in the debtor, not in the trustee.13 It is not obvious how the debtor could exclusively use and possess a lawsuit and yet not be the party responsible for prosecuting the lawsuit during the Chapter 13 case.14

[4]

A fascinating twist on the question whether a cause of action is property of the Chapter 13 estate was kicked off by the appellate courts of Georgia in 1999. Lucille Wolfork filed a Chapter 13 petition in 1994. In 1995, Wolfork was injured in a car accident. In 1997, Wolfork sued the drivers of the other cars for negligence. While that suit was pending, Wolfork received a discharge in her Chapter 13 case. After that discharge, a defendant in the negligence action moved for summary judgment on the ground of judicial estoppel. As explained by the Georgia Court of Appeals, the defendant was entitled to summary judgment because Wolfork was judicially estopped from maintaining a cause of action that was not disclosed during the Chapter 13 case:

In a Chapter 13 bankruptcy case, property of the estate also includes all property acquired by the debtor during the bankruptcy proceeding. . . . 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. . . . The duty to amended Chapter 13 bankruptcy schedules is clear. A debtor may not conceal property belonging to the estate. . . . A debtor has an affirmative duty to supplement the list of assets with any claims arising during the pendency of the bankruptcy proceeding. . . . Failure to timely amend or supplement the list of assets amounts to a denial that such a claim exists. . . . Because Wolfork failed to supplement her Chapter 13 bankruptcy petition with the postpetition tort claim, she is barred by the principle of judicial estoppel from pursuing her claim after the bankruptcy proceeding was closed.15
[5]

News of Wolfork spread quickly—perhaps most quickly across the insurance defense bar. The U.S. Court of Appeals for the Eleventh Circuit has twice applied judicial estoppel after Wolfork to preclude a debtor from litigating a claim that was unrevealed during a Chapter 13 case.16

[6]

Commentators were quick to point out that the Georgia courts used an odd configuration of the judicial estoppel concept and may have been misled by a superficial understanding of Chapter 13 bankruptcy.17 Several decisions reported after Wolfork have more carefully analyzed judicial estoppel to conclude that the failure to schedule a cause of action during a Chapter 13 case is not always an “inconsistent position” that triggers estoppel in subsequent litigation.18 Several bankruptcy courts have reported decisions whether reopening a Chapter 13 case to an unrevealed cause of action overcomes the judicial estoppel analysis of Wolfork.19

[7]

Although the holding in Wolfork is questionable, the message is clear: Don’t take chances with the (non)disclosure of causes of action in Chapter 13 cases. The possibility that a pre- or postpetition cause of action will be property of the Chapter 13 estate should inspire debtor’s counsel to carefully explain to debtors the need to reveal any potential actions that arose before the petition or that arise during the Chapter 13 case. Counsel should always amend the schedules and statement to reveal an omitted cause of action, reopening a closed Chapter 13 case, if necessary, to add the missing information.


 

1  Fleet v. United States Consumer Council, Inc., 53 B.R. 833 (Bankr. E.D. Pa. 1985) (Debtors’ causes of action, whether they arise prepetition or postpetition, are property of the Chapter 13 estate by virtue of § 1306(a).).

 

2  Medina-Figueroa v. Heylinger, 63 B.R. 572 (D.P.R. 1986). Accord Cabral v. Shamban (In re Cabral), 285 B.R. 563, 579 n.6 (B.A.P. 1st Cir. 2002) (Property of the estate in a Chapter 13 case “includes a debtor’s claim for personal injuries whether the claim is unliquidated or settled at the time of filing the bankruptcy petition.”); In re Martinez, 293 B.R. 387, 390 (Bankr. N.D. Tex. 2003) (“As of the commencement of the case, the personal injury claim became property of the estate by virtue of section 541 of the Code. . . . [B]ecause the personal injury claim was successfully exempted in its entirety, the claim and its proceeds ceased to be property of the estate, instead becoming property of the debtor.”); In re Graham, 258 B.R. 286 (Bankr. M.D. Fla. 2001) (Cause of action for personal injury from accident that occurred after the petition becomes property of the Chapter 13 estate; settlement proceeds received two years later are also property of the estate but are not captured for distribution to creditors because the cause of action was exempted by the debtor.); Travelers Indemnity Co. of Illinois, Inc. v. Griner (In re Griner), 240 B.R. 432 (Bankr. S.D. Ala. 1999) (Prepetition lawsuit against insurance company for failure to treat a work related injury is property of the Chapter 13 estate.); In re Studer, 237 B.R. 189, 192 (Bankr. M.D. Fla. 1998) (Proceeds from settlement of postpetition car accident are property of the Chapter 13 estate and are captured for creditors on trustee’s postconfirmation motion to modify the plan. “Because the Settlement Proceeds were received prior to the entry of the Confirmation Order, the proceeds clearly should have been included in distributions to creditors. Unfortunately, in this case, the Debtors were not timely or forthcoming in informing the Trustee of the Settlement Proceeds, and the Confirmation Order was entered before an appropriate determination was made as to whether the Settlement Proceeds should alter the Debtors’ disposable income.” Evidentiary hearing ordered to determine what portion of the settlement proceeds must be paid to creditors.).

 

3  Richardson v. United Parcel Serv., 195 B.R. 737 (E.D. Mo. 1996). Accord Cable v. Ivy Tech State College (In re Cable), 200 F.3d 467 (7th Cir. 1999) (Debtor’s ADA action is property of the Chapter 13 estate after conversion from Chapter 7 and the debtor has standing to prosecute the suit for the benefit of creditors in the Chapter 13 case.); Donato v. Metropolitan Life Ins. Co., 230 B.R. 418, 421 (N.D. Cal. 1999) (Cause of action for employment discrimination that arose after the petition is property of the Chapter 13 estate; debtor is not judicially estopped to continue lawsuit despite failure to schedule. “In a Chapter 13 case, the property of the estate includes causes of action that arise after the commencement of the case and until the case is closed, dismissed or converted. . . . If the debtor is not knowledgeable of all the facts giving rise to a civil action before the filing of his or her petition and financial schedules, the debtor must amend those schedules when he or she becomes aware of the existence of the action because it is an asset of the bankruptcy estate.”); Rivera v. Proctor (In re Rivera), 186 B.R. 505, 507 (D. Kan. 1995) (Debtor’s postconfirmation lawsuit against an employer for wrongful termination is property of the estate, is a “related to” proceeding, and can be tried upon withdrawal of the reference in the U.S. District Court. “Although Rivera’s § 1983 claim arose postpetition and after confirmation of the plan, under Chapter 13, ‘[p]roperty of the type specified in [11 U.S.C.] section 541 that a debtor acquires after the commencement of the case but before conversion, dismissal or closing of the case, is also property of the estate.’”).

 

4  Olick v. Parker & Parsley Petroleum Co., 145 F.3d 513 (2d Cir. 1998).

 

5  American Gen. Fin., Inc. v. Tippins (In re Tippins), 221 B.R. 11 (Bankr. N.D. Ala. 1998). Accord Beasley v. Personal Fin. Corp. (In re Sanders), 279 B.R. 523 (S.D. Miss. 2002) (Prepetition lawsuit against lender for misconduct in connection with the sale of insurance is property of Chapter 13 estate; failure to schedule the lawsuit is evidence of abuse sufficient to justify denying the debtor’s motion to be voluntarily dismissed from the lawsuit.); Campion v. Credit Bureau Servs., Inc., 206 F.R.D. 663 (E.D. Wash. 2001) (Debtor’s interest in class action against Credit Bureau Services, Inc., for misrepresentations in connection with the issuance of writs of garnishment is property of the Chapter 13 estate and remains in the debtor’s possession or control.).

 

6  Koresko v. Chase Manhattan Fin. Servs., Inc. (In re Koresko), 91 B.R. 689 (Bankr. E.D. Pa. 1988).

 

7  Michael v. Forcier (In re Forcier), Nos. 02-10670, 02-1050, 2003 WL 22846359 (Bankr. D. Vt. Nov. 26, 2003) (unpublished).

 

8  In re Furgeson, 263 B.R. 28 (Bankr. N.D.N.Y. 2001).

 

9  See § 230.1 [ 11 U.S.C. § 1327(b): Vesting Effect on Property of Estate ] § 120.3  11 U.S.C. § 1327(b): Vesting Effect on Property of Estate.

 

10  See § 230.1 [ 11 U.S.C. § 1327(b): Vesting Effect on Property of Estate ] § 120.3  11 U.S.C. § 1327(b): Vesting Effect on Property of Estate. See, e.g., In re Ross, 278 B.R. 269 (Bankr. M.D. Ga. 2001) (Applying Telfair v. First Union Mortgage Corp., 216 F.3d 1333 (11th Cir. 2000), cert. denied, 531 U.S. 1073, 121 S. Ct. 765, 148 L. Ed. 2d 666 (2001), because a tort claim that arose after confirmation is not property of the Chapter 13 estate, the debtor had no duty to disclose the postconfirmation claim and thus no reason to reopen the closed Chapter 13 case to overcome judicial estoppel.); In re Brown, 260 B.R. 311, 313 (Bankr. M.D. Ga. 2001) (Cause of action for personal injuries in an automobile accident after confirmation does not become property of the Chapter 13 estate because under Telfair v. First Union Mortgage Corp., 216 F.3d 1333 (11th Cir. 2000), cert. denied, 531 U.S. 1073, 121 S. Ct. 765, 148 L. Ed. 2d 666 (2001), “after confirmation, all that remained as property of the estate was the income required for plan payments. Everything else was property of the debtor.”); In re Carter, 258 B.R. 526 (Bankr. S.D. Ga. 2001) (Cause of action for injuries from an automobile accident that occurred three years after confirmation of a 100% plan did not become property of the estate under Telfair v. First Union Mortgage Corp., 216 F.3d 1333 (11th Cir. 2000), cert. denied, 531 U.S. 1073, 121 S. Ct. 765, 148 L. Ed. 2d 666 (2001).). See also In re Tomasevic, 279 B.R. 358, 362 (Bankr. M.D. Fla. 2002) (Action against bank for postpetition violations of Real Estate Settlement Procedures Act is not within jurisdiction of the bankruptcy court under Telfair v. First Union Mortgage Corp., 216 F.3d 1333 (11th Cir. 2000), cert. denied, 531 U.S. 1073, 121 S. Ct. 765, 148 L. Ed. 2d 666 (2001). Confirmed plan provided that debtor would make payments directly to second mortgage holder “outside the plan.” “The bankruptcy court has no jurisdiction over ‘litigation that would not impact upon the administration of the bankruptcy case, or on property of the estate, or on the distribution to creditors.’ . . . The debtor’s motion . . . for sanctions for Wilshire’s alleged violations of RESPA falls into this last category. It concerns post-petition disputes between the debtor and Wilshire that do not impact or impair the court’s administration of the bankruptcy case. These disputes have no connection with the debtor’s performance or payment under the debtor’s Chapter 13 plan. In addition, these disputes implicate no issue with respect to property of the estate. See Telfair . . . . Finally, the motion does not implicate any issue that impacts or impairs distribution to creditors. Wilshire is not being treated in the plan, and this dispute therefore does not affect the debtor’s payments to other creditors under the plan.”).

 

11  See Richardson v. United Parcel Serv., 195 B.R. 737 (E.D. Mo. 1996) (Debtor’s cause of action for employment discrimination is property of the Chapter 13 estate. Chapter 13 trustee steps into the shoes of the debtor for purposes of maintaining suit. Debtor’s failure to schedule the cause of action as an asset could judicially estop the debtor from maintaining the lawsuit, but creditors would be penalized if the court dismissed the claim to punish the debtor.); American Gen. Fin., Inc. v. Tippens (In re Tippens), 221 B.R. 11 (Bankr. N.D. Ala. 1998) (Chapter 13 debtor’s state court cause of action against lenders for fraud, misrepresentation and conspiracy in connection with credit life insurance included in prepetition loan agreement is property of the estate and would ordinarily be maintained by the Chapter 13 trustee; however, debtor amended schedules to reveal the lawsuit after confirmation and claimed the lawsuit as exempt property, thus debtor had a property interest in the lawsuit and had standing to maintain the lawsuit.). See also Showalter v. Rinard, 126 B.R. 596, 600 (D. Or. 1991) (Chapter 13 debtor’s tort action against driver of a car “cannot be properly viewed . . . as property of his bankruptcy estate.” Personal injury claim was listed as personal property on the debtor’s statements and schedules; however, provision of confirmed plan vested the cause of action in the debtor free and clear of claims of creditors or the trustee.).

 

12  11 U.S.C. § 1303, discussed in § 44.1 [ Debtor Has Exclusive Control of Estate Property ] § 45.1  Debtor Has Exclusive Possession and Control of Estate Property.

 

13  11 U.S.C. § 1306(b), discussed in § 52.1 [ Turnover of Property ] § 50.1  Turnover of Property.

 

14  See § 54.1 [ Can Debtor Sue and Be Sued? ] § 51.1  Can Debtor Sue and Be Sued? for discussion of a Chapter 13 debtor’s right to sue and be sued.

 

15  Wolfork v. Tackett, 526 S.E.2d 436, 437–38 (Ga. Ct. App. 1999), aff’d, 540 S.E.2d 611 (Ga.), cert. denied, 534 U.S. 819, 122 S. Ct. 51, 151 L. Ed. 2d 21 (2001). Accord Back v. Cloverdale, No. TH 99-215-C-T/H, 2001 WL 987832, at *3 (S.D. Ind. July 30, 2001) (unpublished) (Debtor’s failure to list civil rights action in prior Chapter 13 case judicially estops the debtor from bringing civil rights action notwithstanding filing of second Chapter 13 petition in which the civil rights action is revealed. Debtor did not list civil rights action in the Chapter 13 statement and schedules. Chapter 13 case was converted to Chapter 7. A no-asset report was filed, and the debtor received a discharge. After discharge, debtor brought the civil rights action in district court. On the defendant’s motion, the civil rights action was dismissed with prejudice. Debtor filed a second Chapter 13 petition listing the civil rights action and confirmed a plan providing that the net proceeds from the civil rights action would be paid to the Chapter 13 trustee. Debtor then moved under Fed. R. Civ. P. 60(b)(5) for relief from the district court order dismissing the civil rights action. “Numerous courts have applied judicial estoppel to bar a party from asserting a claim where the party knew of the claim but failed to disclose it in a bankruptcy proceeding. . . . The reopening of a closed bankruptcy case to disclose a claim previously known but not disclosed as an asset does not render judicial estoppel inapplicable. . . . [J]udicial estoppel bars [the debtor] from asserting his civil rights claim . . . . [The debtor’s] assertion of a claim against Defendants in this case is inconsistent with his position in the prior bankruptcy proceeding that he had no assets; [the debtor] obtained relief in that bankruptcy case on the basis of his representation of no assets; and the facts regarding the claim are the same in this case as in the bankruptcy case.”).

 

16  De Leon v. Comcar Indus., Inc., 321 F.3d 1289, 1292 (11th Cir. 2003) (Applying Billups v. Pemco Aeroplex, Inc. (In re Burnes), 291 F.3d 1282 (11th Cir. 2002), discrimination claims against former employer are barred by judicial estoppel notwithstanding amendment to Chapter 13 schedules to reveal the prepetition cause of action. “[W]e hold that the rule established in Burnes, that judicial estoppel bars a plaintiff from asserting claims previously undisclosed to the bankruptcy court where the plaintiff both knew about the undisclosed claims and had a motive to conceal them from the bankruptcy court, applies equally in Chapter 13 bankruptcy cases. . . . Despite De Leon’s continuing duty to disclose all assets or potential assets to the bankruptcy court, he did not amend his bankruptcy documents to add a potential employment discrimination claim until after Comcar relied on it in its motion to dismiss the case. . . . Because De Leon certainly knew about his claim and possessed a motive to conceal it because his amount of repayment would be less, we can infer from the record his intent ‘to make a mockery of the judicial system.’”); Billups v. Pemco Aeroplex, Inc. (In re Burnes), 291 F.3d 1282, 1288 (11th Cir. 2002) (Failure to reveal employment discrimination lawsuit filed during Chapter 13 case judicially estops debtor from seeking damages after conversion from Chapter 13 to Chapter 7; injunctive relief “offered nothing of value to the estate” and could proceed. Six months after Chapter 13 petition, debtor filed charge of discrimination with EEOC. Debtor did not amend schedules or statement to include lawsuit before or after conversion to Chapter 7. Citing New Hampshire v. Maine, 532 U.S. 742, 121 S. Ct. 1808, 149 L. Ed. 2d 968 (2001), “the doctrine of judicial estoppel applies in situations involving intentional contradictions, not simple error or inadvertence. . . . Billups had knowledge of his claims during the bankruptcy proceedings. . . . Billups stood to gain an advantage by concealing the claims from the bankruptcy court. . . . [D]isclosing this information would have likely changed the result of his bankruptcy . . . . Allowing Billups to back-up, reopen the bankruptcy case, and amend his bankruptcy filings, only after his omission has been challenged by an adversary, suggests that a debtor should consider disclosing potential assets only if he is caught concealing them. This so-called remedy would only diminish the necessary incentive to provide the bankruptcy court with a truthful disclosure of the debtors’ assets.”).

 

17  Louis M. Phillips, Continuing Ruminations on Judicial Estoppel: Barging Into the Consumer Field, 2 Norton Bankr. L. Adviser 10 (2004); Louis M. Phillips, Judicial Estoppel: Is It Krystal Clear Now?, 12 Norton Bankr. L. Adviser 1 (2003); William H. Brown & Lundy Carpenter, Judicial Estoppel in State Courts: A Sequel, 2 Norton Bankr. L. Adviser 8 (2002); William H. Brown & Donna T. Snow, Judicial Estoppel in State Courts: One More Thing for Debtor’s Counsel to Worry About, 1 Norton Bankr. L. Adviser 4 (2001).

 

18  See In re Ross, 278 B.R. 269, 273–75 (Bankr. M.D. Ga. 2001) (Judicial estoppel is not implicated when Chapter 13 debtor failed to schedule a tort claim that arose after confirmation because, applying Telfair v. First Union Mortgage Corp., 216 F.3d 1333 (11th Cir. 2000), cert. denied, 531 U.S. 1073, 121 S. Ct. 765, 148 L. Ed. 2d 666 (2001), the debtor had no duty to disclose the postconfirmation claim. Plan was confirmed in 1998. Debtor was involved in a car accident in 1999. Schedules were not amended. Case was dismissed for nonpayment. Debtor moved to reopen when judicial estoppel was raised as a defense in state court lawsuit. “Under [Wolfork v. Tackett, 540 S.E.2d 611 (Ga.), cert. denied, 534 U.S. 819, 122 S. Ct. 51, 151 L. Ed. 2d 21 (2001)], a debtor’s tort claim may be barred by judicial estoppel if she successfully asserted a contradictory position in bankruptcy court, i.e., if she failed to schedule the claim. . . . [A] state court should not assume that merely because the court confirmed a plan or granted a discharge to the debtor that it was aware of and adopted a particular position asserted by the debtor as set out in the schedules. . . . When dealing with a claim arising post-confirmation in a Chapter 13 case, the Court has not, by having previously confirmed the Chapter 13 plan, adopted a position taken by the debtor that contradicts a position the debtor takes in state court by asserting that claim. The law in the Eleventh Circuit is settled that assets acquired post-confirmation are not property of the bankruptcy estate unless they are necessary to maintain the plan. . . . Because Debtor has no duty to disclose the tort claim to the Court, the Court has no reason to allow Debtor to reopen her case to make such a disclosure. Stated another way, nondisclosure of the claim in the bankruptcy case is not inconsistent with asserting the claim in another forum.”); In re Brown, 260 B.R. 311, 313 & n.3 (Bankr. M.D. Ga. 2001) (Cause of action for personal injuries in an automobile accident after confirmation does not become property of the Chapter 13 estate because under Telfair v. First Union Mortgage Corp., 216 F.3d 1333 (11th Cir. 2000), cert. denied, 531 U.S. 1073, 121 S. Ct. 765, 148 L. Ed. 2d 666 (2001), “after confirmation, all that remained as property of the estate was the income required for plan payments. Everything else was property of the debtor.” The personal injury claim is not exemptable because it is not property of the Chapter 13 estate. In a footnote, the court cautions that it is not addressing whether amending the schedules to reflect the tort claim is necessary to avoid the judicial estoppel imposed in Wolfork v. Tackett, 540 S.E.2d 611 (Ga.), cert. denied, 534 U.S. 819, 122 S. Ct. 51, 151 L. Ed. 2d 21 (2001). “The extension of the holding of Telfair in this case . . . is at odds with the understanding of the Georgia Supreme Court in Wolfork that a Chapter 13 debtor’s disposable income, including income from claims acquired after confirmation and before the case is closed, is to be used to pay creditors.”); In re Carter, 258 B.R. 526, 527–28 (Bankr. S.D. Ga. 2001) (On debtors’ motion to reopen a closed Chapter 13 case, cause of action for injuries from an automobile accident that occurred three years after confirmation of a 100% plan did not become property of the estate under Telfair v. First Union Mortgage Corp., 216 F.3d 1333 (11th Cir. 2000), cert. denied, 531 U.S. 1073, 121 S. Ct. 765, 148 L. Ed. 2d 666 (2001); debtors need not fear judicial estoppel in state court litigation because it is not necessary to amend the schedules to reflect the lawsuit that was not property of the estate. “The doctrine of judicial estoppel does not apply in this case because the debtors have not asserted a position in one judicial proceeding which is inconsistent with a position asserted in an earlier judicial proceeding. At the time the debtor’s case and schedules were filed no tort claim existed. At the time the tort claim arise, the debtors’ plan was already confirmed and all property that was not necessary for the maintenance of the plan became property of the debtors and no longer property of the bankruptcy estate. . . . In Telfair, the court adopted the ‘estate transformation’ approach as the law of the Eleventh Circuit, whereby Bankruptcy Code § 1306(a)(2) and 1327(b) are read to mean that ‘the plan upon confirmation returns so much of that property to the debtor’s control as is not necessary to the fulfillment of the plan.’ . . . Applying Telfair, any property interest acquired by the debtors after November 21, 1995, not necessary to fulfill the plan, became property of the debtors. The tort claim arose in October 1998, almost three years after confirmation and was not necessary for the plan; therefore, the claim was not property of the bankruptcy estate. . . . The tort claim belongs to the debtors and not the bankruptcy estate.”); Johnson v. Si-Cor, Inc., 28 P.3d 832, 835–37 (Wash. Ct. App. 2001) (Failure to disclose postpetition claim against McDonald’s for tooth broken on stone in sandwich does not preclude cause of action because debtor was not obligated to disclose, debtor was not benefited by nondisclosure and bankruptcy court did not adopt debtor’s nondisclosure. A month after filing Chapter 13, debtor broke a tooth on a small stone in a McDonald’s breakfast sandwich. Debtor did not amend schedules. Plan was confirmed but case converted to Chapter 7. After discharge, debtor brought lawsuit against McDonald’s. “[J]udicial estoppel applies only if a litigant’s prior inconsistent position benefited the litigant or was accepted by the court. . . . Under the right circumstances, Chapter 13 of the bankruptcy code may present a strong case for the application of judicial estoppel. . . . [I]f the debtor wrongfully failed to disclose a personal injury asset that would have affected the liquidation analysis, judicial estoppel should preclude the debtor from subsequently litigating the personal injury claim. . . . [Section] 541(a)(5) does not include other interests acquired by the debtor after the commencement of the case, such as Mr. Johnson’s claim against McDonald’s. . . . [O]ther property acquired by the debtor after the commencement of a Chapter 13 case may be retained by the debtor and would not be available for distribution to unsecured creditors in the event of Chapter 7 liquidation. . . . . There is no evidence that when the bankruptcy court confirmed the Chapter 13 plan, it somehow accepted a position that was inconsistent with Mr. Johnson pursuing his personal injury lawsuit against McDonald’s. Likewise, there is no evidence that Mr. Johnson somehow received a benefit by not disclosing his claim against McDonald’s. . . . The existence of a post-petition personal injury claim, which would not have been property of the Chapter 7 estate or available for distribution to unsecured creditors, would not have been relevant to the bankruptcy court’s decision either to close the case or to grant Mr. Johnson a discharge.”).

 

19  See In re Ross, 278 B.R. 269 (Bankr. M.D. Ga. 2001) (Although a dismissed Chapter 13 case can be reopened under § 350(b) to reveal a tort claim that arose after confirmation, applying Telfair v. First Union Mortgage Corp., 216 F.3d 1333 (11th Cir. 2000), cert. denied, 531 U.S. 1073, 121 S. Ct. 765, 148 L. Ed. 2d 666 (2001), the debtor had no duty to disclose the postconfirmation claim, and thus there is no reason to reopen.); In re Tarrer, 273 B.R. 724, 733 (Bankr. N.D. Ga. 2001) (Chapter 13 discharged and closed in 2000 is reopened in 2001 to permit debtors to amend schedule of assets to reveal prepetition lawsuit after defendant raised judicial estoppel; debtors also agreed to amend plan to pay discharged creditors from any recovery. “Georgia courts have recognized that such an amendment effectively nullifies the original position taken in the bankruptcy case, and therefore, the failure initially to list the asset cannot serve as the basis upon which the second court applies the doctrine of judicial estoppel. See . . . Jowers v. Arthur, 245 Ga. App. 68, 537 S.E.2d 200, 202 (2000) . . . . However, at least one federal district court has found that the debtor’s request to amend his schedules came too late to rectify the earlier inconsistency. See Scoggins v. Arrow Trucking Company, 92 F.Supp.2d 1372, 1376 (S.D. Ga. 2000).”). See also In re Lott, 277 B.R. 871, 874 (Bankr. S.D. Ga. 2001) (Motion to amend Chapter 13 schedules to add a medical malpractice claim that the debtor did not realize he had until after confirmation is denied because Bankruptcy Rule 1009(a) permits amendment of schedules without leave of court; acknowledging concern about Wolfork v. Tackett, 540 S.E.2d 611 (Ga.), cert. denied, 534 U.S. 819, 122 S. Ct. 51, 151 L. Ed. 2d 21 (2001), “the Court is confident that a state court would accept proof of actual amendment as equivalent to an order allowing amendment.”).