In re: GREGORY CHERNUSHIN, Debtor.
ANDREA CHERNUSHIN; JUDY T. COX REVOCABLE TRUST; ALLEN E. COX REVOCABLE TRUST, Defendants - Appellees. ROBERTSON B. COHEN, as Chapter 7 Trustee Plaintiff - Appellant,
from the United States District Court for the District of
Colorado (D.C. No. 1:17-CV-00962-RBJ)
A. Larson, Larson Law Firm, LLC, Louisville, Colorado (James
S. Helfrich, Allen Vellone Wolf Helfrich & Factor P.C.,
Denver, Colorado, with him on the brief), for Plaintiff -
Michael J. Gates, Foster Graham Milstein & Calisher, LLP,
Denver, Colorado, for Defendant - Appellee Andrea Chernushin.
BRISCOE, MURPHY, and McHUGH, Circuit Judges.
MCHUGH, CIRCUIT JUDGE.
and Andrea Chernushin owned a second home in Colorado in
joint tenancy with right of survivorship. Eventually, Mr.
Chernushin (but not Ms. Chernushin) filed for bankruptcy.
During the bankruptcy proceedings, Mr. Chernushin died. The
bankruptcy trustee, Robertson B. Cohen, then filed an
adversary complaint against Ms. Chernushin, seeking to sell
the home. Ms. Chernushin argued the bankruptcy estate no
longer included any interest in the home because Mr.
Chernushin's joint tenancy interest ended at his death.
The bankruptcy court agreed with Ms. Chernushin, as did the
district court on appeal. Mr. Cohen now appeals to this
the bankruptcy estate had no more interest in the home than
Mr. Chernushin and Mr. Chernushin's interest extinguished
when he died, we affirm.
August 17, 2015, Mr. Chernushin filed a voluntary Chapter 13
bankruptcy petition. Ms. Chernushin did not join his
bankruptcy petition, nor did she file her own. Mr. Chernushin
listed two real properties in his petition-a primary
residence not at issue and a second home that is the subject
of this appeal. Both homes were owned in joint tenancy with
right of survivorship. Mr. Chernushin claimed a bankruptcy
exemption for the primary residence but not for the second
home. A little over a month later, on September 30, 2015, Mr.
Chernushin moved to convert his Chapter 13 reorganization
proceeding to a Chapter 7 liquidation proceeding. The
bankruptcy court converted the case and appointed Mr. Cohen
about June 9, 2016, Mr. Chernushin committed suicide. One
week later, Mr. Cohen initiated an adversary proceeding and
filed a complaint against Ms. Chernushin in bankruptcy court
seeking authorization to sell the second home. In response,
Ms. Chernushin argued the second home was "no longer an
asset of the Debtor's Estate since the Debtor's death
in June 2016." App. at 159. The bankruptcy court agreed
with Ms. Chernushin and granted summary judgment in her
favor. Mr. Cohen appealed to the district court, and the
court affirmed the bankruptcy court. Cohen v.
Chernushin (In re Chernushin), 584 B.R. 567 (D.
Colo. 2018). Mr. Cohen then filed a timely appeal from the
district court's decision.
Standard of Review
review of the bankruptcy court's decision is governed by
the same standards of review that govern the district
court's review of the bankruptcy court." Conoco,
Inc. v. Styler (In re Peterson Distrib., Inc.),
82 F.3d 956, 959 (10th Cir. 1996). "[W]e review the
bankruptcy court's legal determinations de novo
and its factual findings under the clearly erroneous
standard." Id. Here, there are no disputed
factual issues-we are reviewing only the bankruptcy
court's legal determination. "Although we may look
to the district court's intermediate appellate analysis
to inform our review, we owe no deference to that court's
decision." Search Mkt. Direct, Inc. v. Jubber
(In re Paige), 685 F.3d 1160, 1178 (10th Cir. 2012).
Before proceeding to our de novo review of the bankruptcy
court's decision, we pause to provide an overview of the
relevant legal principles.
commencement of a bankruptcy case "creates an
estate." 11 U.S.C. § 541(a). "Section
541(a)(1) provides that the property of the estate includes
'all legal or equitable interests of the debtor in
property as of the commencement of the bankruptcy case."
Parks v. FIA Card Servs., N.A. (In re
Marshall), 550 F.3d 1251, 1255 (10th Cir. 2008). In
bankruptcy proceedings, "[p]roperty interests are
created and defined by state law." Butner v. United
States, 440 U.S. 48, 55 (1979); In re Marshall,
550 F.3d at 1255 (quotation marks omitted). "Unless some
federal interest requires a different result, there is no
reason why such interests should be analyzed differently
simply because an interested party is involved in a
bankruptcy proceeding." Butner, 440 U.S. at 55.
"Uniform treatment of property interests by both state
and federal courts within a State serves to reduce
uncertainty, to discourage forum shopping, and to prevent a
party from receiving 'a windfall merely by reason of the
happenstance of bankruptcy.'" Id. (quoting
Lewis v. Mfrs. Nat'l Bank of Detroit, 364 U.S.
603, 609 (1961)). But "[o]nce that state law
determination is made, . . . we must still look to federal
bankruptcy law to resolve the extent to which that interest
is property of the estate." In re Marshall, 550
F.3d at 1255 (internal quotation marks omitted).
"emphasize[d] § 541(a)(1) limits estate property to
the debtor's interests 'as of the commencement of the
case.'" Sender v. Buchanan (In re
HedgedInvs. Assocs., Inc.), 84 F.3d 1281, 1285 (10th
Cir. 1996). And "[t]his phrase places both temporal and
qualitative limitations on the reach of the bankruptcy
estate." Id. Temporally, "it establishes a
clear-cut date after which property acquired by the debtor
will normally not become property of the bankruptcy
estate." Id. And qualitatively, "the
phrase establishes the estate's rights as no stronger
than they were when actually held by the debtor."
Id. "Congress intended the trustee to stand in
the shoes of the debtor and 'take no greater rights than
the debtor himself had.'" Id. (quoting H.R.
Rep. No. 595, 95th Cong., 1st Sess. 368, reprinted
in 1978 U.S.C.C.A.N. 5963, 6323); see id. at
1284 (the trustee "stands in the shoes of the debtor . .
. and takes no greater rights than the [debtor] had as of the
uncontested that Mr. Chernushin and Ms. Chernushin owned the
second home in joint tenancy with right of survivorship and
the joint tenancy was not severed by Mr. Chernushin's
bankruptcy petition nor at any time prior to his
death.And "since there is no federal law of
property, it is necessary to look to state law to determine
the nature, extent, and effect of the debtor's interest
in a [joint tenancy with right of ...