In re Charlene M. Milby, Debtor,
Patricia A. Templeton, individuals on behalf of the Bankruptcy Estate of Debtor Charlene M. Milby, and derivatively on behalf of Charlene's Transportation, Inc.; G. Cresswell Templeton, III, Bankruptcy Estate of Debtor Charlene M. Milby, and derivatively on behalf of Charlene's Transportation, Inc., Appellees/Cross-Appellants. Jon A. Milby; D&J Trucking Company, a California corporation; Sandra Holder Milby, an individual; Sanjon, Inc., a California corporation; 5th Street Condo, LLC, California Limited Liability Company; Charlene M. Milby; Charlene's Transportation, Inc., a California corporation, Appellants/Cross-Appellees,
and Submitted September 1, 2017 Pasadena, California
from the Ninth Circuit Bankruptcy Appellate Panel No. 15-1180
Taylor, Faris, and Corbit, Bankruptcy Judges, Presiding
L. Grant (argued), Law Offices of Karen L. Grant, Santa
Barbara, California; Janet K. McGinnis, Law Office of Janet
K. McGinnis, Santa Barbara, California; for
Joseph McCarthy (argued), Hill Farrer & Burrill LLP, Los
Angeles, California, for Appellees/Cross-Appellants.
Before: Kim McLane Wardlaw and Jay S. Bybee, Circuit Judges,
and Harvey Bartle III, [*] District Judge.
panel affirmed the judgment of the Bankruptcy Appellate
Panel, which (1) reversed the bankruptcy court's
dismissal as time-barred of a bankruptcy estate's claims
seeking avoidance of fraudulent transfers and (2) affirmed
the bankruptcy court's dismissal of other claims based on
transfers not made by the debtor.
the time bar, the bankruptcy court held that the bankruptcy
estate's delay in filing after discovering the transfers
precluded equitable tolling of the statute of limitations.
The BAP reversed, holding that such post-discovery delay is
irrelevant to whether equitable tolling applies. The panel
wrote that neither court correctly applied the law on
equitable tolling. Under the correct standard, post-discovery
delay does not preclude equitable tolling but is still
relevant to assessing a party's overall diligence. The
panel affirmed the judgment of the BAP because the
estate's overall diligence, combined with extraordinary
circumstances preventing earlier discovery of the transfers,
warranted equitable tolling.
panel affirmed, for the same reasons stated in the BAP's
opinion, the BAP's affirmance of the bankruptcy
court's dismissal of claims based on transfers that were
made by individuals and entities other than the debtor and
therefore could not serve as predicates for a claim under 11
U.S.C. § 544(b). The panel remanded the case to the
bankruptcy estate of Debtor Charlene Milby discovered
allegedly fraudulent transfers days before the statute of
limitations on avoidance claims was set to expire. This
action was not filed until almost a year later. The
bankruptcy court dismissed the action as time barred and held
that the estate's delay in filing after discovering the
transfers precluded equitable tolling. The Bankruptcy
Appellate Panel ("BAP") reversed, holding that such
post-discovery delay is irrelevant to whether
equitable tolling applies.
court correctly applied our law on equitable tolling. Under
Gibbs v. Legrand, post-discovery delay does not
preclude equitable tolling but is still relevant to assessing
a party's "overall diligence." 767 F.3d 879,
891-93 (9th Cir. 2014). We affirm the judgment of the BAP
because, here, the estate's overall diligence, combined
with the extraordinary ...