United States Bankruptcy Appellate Panel of the Eighth Circuit
Submitted: November 5, 2019
from United States Bankruptcy Court for the Eastern District
of Missouri - St. Louis
SALADINO, Chief Judge, NAIL and DOW, Bankruptcy Judges.
Waltrip ("Waltrip") appeals the order of the
Bankruptcy Courtgranting a motion by Ruby Sawyers
("Debtor") to avoid a judicial lien. We have
jurisdiction over this appeal. See 28 U.S.C.
§158(b). For the reasons that follow, we affirm.
a dispute between the Debtor and Waltrip, who held a judicial
lien ("Judicial Lien") against the Debtor's
primary place of residence (the "Property"). The
Property suffered significant fire damage prior to the
bankruptcy filing, and the insurance proceeds were paid to
the Debtor. The Property was not restored during the
bankruptcy proceeding. The Trustee made no distributions and
abandoned all assets, and the case was closed. After
receiving notice of a sheriff's sale of the Property, the
Debtor reopened the case and instituted a lien avoidance
action. The bankruptcy court granted the Debtor's motion
for summary judgment and avoided the Judicial Lien, valuing
the Property as of the date of the filing of the petition and
rejecting Waltrip's position that the value of the
Property should be enhanced by the amount of the insurance
proceeds. Waltrip appealed.
review a bankruptcy court's grant of summary judgment
de novo. Mwesigwa v. DAP, Inc., 637 F.3d
884, 887 (8th Cir. 2011)(citing Anderson v.
Durham D & M, L.L.C., 606 F.3d 513, 518
(8th Cir. 2010). We will affirm if "there is
no genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law." Fed.R.Civ.P.
56(a). "We may affirm on any basis supported by the
record." Seaver v. New Buffalo Auto Sales, LLC
(In re Hecker), 459 B.R. 6, 10-11 (8th
Cir. BAP 2011). Here we review de novo whether the
bankruptcy court's conclusions interpreting the relevant
statutes and applying them to the undisputed facts are
correct. Fisette v. Keller (In re Fisette),
455 B.R. 177, 180 (8th Cir. BAP 2011).
review a bankruptcy court's findings of fact for clear
error. In re Potts, 421 B.R. 518, 521
(8th Cir. BAP 2010). "A finding is
'clearly erroneous' when although there is evidence
to support it, the reviewing court on the entire evidence is
left with the definite and firm conviction that a mistake has
been committed." United States v. United States
Gypsum Co., 333 U.S. 364, 395 (1948).
Debtor filed her Chapter 7 petition in February, 2017.
Waltrip was a creditor by virtue of a prepetition consent
judgment in the amount of $256, 739.31 entered in a civil
action. The judgment constituted a judicial lien. The Debtor
claimed her homestead exemption of $15, 000 pursuant to RSMo
§513.475. There were no objections to the exemption.
to the bankruptcy filing, a fire caused significant damage to
the Property. The Debtor was the named insured under a
homeowner's policy and was paid $132, 392.99 for the
purpose of repairing and restoring the Property. Waltrip was
not a loss payee under the policy, and his Judicial Lien did
not extend to the insurance proceeds.
Trustee filed a Report of No Distribution abandoning all
assets; no objection was filed. The Debtor received her
discharge, and the case was closed. The Property was later
repaired and restored using the insurance proceeds. An
appraisal valued it between $95, 000 and $103, 640 in
fully-restored condition, as opposed to between $3, 000 and
$6, 000 on the petition date.
later instituted a sheriff's execution sale on the
Property. On the day before the sale, the Debtor filed an
emergency motion to reopen her case and a motion to avoid
Waltrip's judicial lien pursuant to §522(f). The
case was reopened, and the parties filed competing motions
for summary judgment. The parties stipulated that the Judicial