                                                                    FILED
                                                                    OCT 27 2016
 1                         NOT FOR PUBLICATION
                                                               SUSAN M. SPRAUL, CLERK
 2                                                                 U.S. BKCY. APP. PANEL
                                                                   OF THE NINTH CIRCUIT
 3                  UNITED STATES BANKRUPTCY APPELLATE PANEL
 4                            OF THE NINTH CIRCUIT
 5   In re:                        )        BAP No. EC-16-1065-JuKuMa
                                   )        BAP No. EC-16-1117-JuKuMa
 6   LISA MARIE AHRENS,            )        (consolidated)
                                   )
 7                  Debtor.        )        Bk. No. 14-bk-29813-MSM
     ______________________________)
 8                                 )
     THE GOLDEN 1 CREDIT UNION,    )
 9                                 )
                    Appellant,     )
10   v.                            )        M E M O R A N D U M*
                                   )
11   J. MICHAEL HOPPER, Chapter 7 )
     Trustee,                      )
12                                 )
                    Appellee.      )
13   ______________________________)
14                  Argued and Submitted on October 20, 2016
                          at Sacramento, California**
15
                            Filed - October 27, 2016
16
              Appeal from the United States Bankruptcy Court
17                for the Eastern District of California
18      Honorable Michael S. McManus, Bankruptcy Judge, Presiding.
                         _________________________
19
     Appearances:     Valerie A. Bantner Peo of Buchalter Nemer argued
20                    for appellant The Golden 1 Credit Union; Kristen
                      Renfrow argued for appellee J. Michael Hopper,
21                    chapter 7 trustee.
                           _________________________
22
23
24
        *
           This disposition is not appropriate for publication.
25 Although it may be cited for whatever persuasive value it may
26 have (see Fed. R. App. P. 32.1), it has no precedential value.
   See 9th Cir. BAP Rule 8024-1.
27
        **
            The Panel consolidated BAP Nos. EC-16-1065 and EC-16-1117
28 by order entered on May 19, 2016.

                                      -1-
 1   Before:      JURY, KURTZ, and MARTIN,*** Bankruptcy Judges.
 2
 3            Appellant, The Golden 1 Credit Union (Golden 1), filed a
 4   proof of claim (POC) in the underlying chapter 71 bankruptcy
 5   case of Lisa Marie Ahrens (Debtor) for $17,282.29, which
 6   represented the balance owed to Golden 1 under a contract for
 7   the purchase of a Mazda.      Using the amounts shown on Debtor’s
 8   schedules, Golden 1 bifurcated its claim showing $13,907 as
 9   secured and $3,375.29 as unsecured.
10            Debtor indicated her intent to reaffirm the entire debt
11   owed to Golden 1, but she never did.      She continued to make
12   timely installment payments which were accepted by Golden 1
13   throughout her bankruptcy case and received her discharge.
14   Golden 1 has never declared the contract to be in default.
15            Appellee, chapter 7 trustee J. Michael Hopper (Trustee),
16   objected to the unsecured portion of the POC, contending that
17   there was insufficient evidence regarding the amount of the
18   deficiency in light of the on-going payments and lack of
19   default.      Trustee also asserted that he was entitled to
20   attorney’s fees and costs based on the attorney fee clause in
21   the underlying sale contract and Cal. Civ. Code § 1717 which
22   made the clause reciprocal.
23
24        ***
             Honorable Brenda K. Martin, United States Bankruptcy
     Judge for the District of Arizona, sitting by designation.
25
          1
26        Unless otherwise indicated, all chapter and section
   references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532,
27 “Rule” references are to the Federal Rules of Bankruptcy
   Procedure, and “Civil Rule” references are to the Federal Rules
28 of Civil Procedure.

                                        -2-
 1        After multiple hearings, the bankruptcy court found that
 2   Golden 1 had no unsecured deficiency claim because it had not
 3   declared a default, continued to accept payments from Debtor,
 4   and neither Debtor nor Golden 1 could “strip down” the lien on
 5   the car under the holding in Dewsnup v. Timm, 502 U.S. 410
 6   (1992).    Alternatively, the bankruptcy court concluded that
 7   Golden 1's deficiency claim was contingent or unliquidated and
 8   estimated the claim at $0.    The bankruptcy court entered civil
 9   minutes sustaining Trustee’s objection and closed the record as
10   to all issues except for allowing Trustee to amend his request
11   for attorney’s fees and allowing Golden 1 to challenge the
12   reasonableness of all fees and costs.      Golden 1 filed a notice
13   of appeal from this ruling, commencing BAP No. EC-16-1065.
14        Thereafter Trustee submitted pleadings relating to his
15   additional request for attorney’s fees and costs which Golden 1
16   challenged on reasonableness and other grounds.     After a
17   hearing, the bankruptcy court entered an order (1) sustaining
18   Trustee’s objection; (2) disallowing the unsecured portion of
19   Golden 1's POC; and (3) awarding attorney’s fees and costs in
20   favor of Trustee and against Golden 1 in the amount of
21   $14,436.60.    Golden 1 filed a notice of appeal from that order,
22   commencing BAP No. EC-16-1117.
23        Golden 1 obtained a stay pending appeal from the bankruptcy
24   court as to the payment of the attorney’s fees and costs.     On
25   May 19, 2016, the Panel entered an order consolidating the two
26   appeals.    For the reasons set forth below, we AFFIRM.
27                                I.    FACTS
28        In January 2013, Debtor bought a Mazda with a dealer

                                       -3-
 1   financed loan in the amount of $23,813.99 under a retail
 2   installment sale contract (Sale Contract), which was secured by
 3   the car.      The dealer assigned the Sale Contract to Golden 1 and
 4   Golden 1 perfected its lien on the car.
 5            On September 30, 2014, Debtor filed a chapter 7 petition.
 6   Debtor showed in her schedules that she owed $17,282.29 to
 7   Golden 1 under the Sale Contract and listed the car’s value as
 8   $13,907.      Debtor’s Statement of Intention indicated that she
 9   intended to reaffirm the debt owed to Golden 1.      Her time to
10   reaffirm the debt expired on December 6, 2014,2 without her
11   doing so.      As a result, the car was no longer property of her
12   estate and the automatic stay terminated, allowing Golden 1 to
13   take any action with respect to the car permitted under
14   California law.3
15            Debtor continued to pay the current installments to
16   Golden 1 and Golden 1 never objected to Debtor’s failure to
17   reaffirm.4     In January 2015, Debtor obtained her § 727
18   discharge.
19            Relying on Debtor’s schedules, Golden 1 filed a POC in the
20   total amount of $17,282.29, composed of a $13,907 secured claim
21   and a $3,375.29 unsecured balance, Claim No. 1-1.      Golden 1 thus
22
          2
23          See § 521(6) (requiring the debtor to reaffirm secured
     debt within 45 days of the first § 341(a) meeting of creditors).
24
          3
              See §§ 521(a)(7); 362(h)(1).
25
          4
26        “[N]othing in BAPCPA prevents debtors and secured
   creditors from engaging in what scholars have variously described
27 as ‘voluntary ride-through,’ ‘creditor acquiescence,’ or
   ‘informal reaffirmations.’” In re Jensen, 407 B.R. 378, 389-90
28 (Bankr. C.D. Cal. 2009).

                                       -4-
 1   sought to share pro rata on its unsecured claim in any
 2   distribution to unsecured creditors.5
 3           Trustee informally objected to the unsecured portion of
 4   Golden 1's POC and, through a series of emails, attempted to
 5   convince Golden 1 to reduce its unsecured claim to $0.     Trustee
 6   maintained that Golden 1 was not entitled to an unsecured
 7   deficiency claim because Debtor intended to reaffirm the debt,
 8   had not defaulted on the loan, and continued to make payments.
 9   Further, Trustee explained to Golden 1 that by giving up its
10   unsecured claim, it would receive about $300 less:
11           The trustee has about $4,000 on hand. After
             compensation, there will be about $3,000 to
12           distribute. The 3 unsecured claims on file aggregate
             $10,646.77: (1-1) Golden 1 $3,375.29; (2-1) Golden 1
13           $4,912.03; and (4-1) American Express $2,359.45. If
             POC 1-1 is withdrawn, then Golden 1 would receive
14           about 68% (2,040) instead of 78% ($2,340), a
             difference of $300.
15
16           Trustee later filed a formal objection to Golden 1's
17   unsecured claim but, apparently still hoping the matter would
18   resolve, did not notice a hearing.     There, Trustee argued for
19   disallowance of the unsecured portion of Golden 1's claim
20   because (1) it was based on an obligation that was contingent
21   and not in default and (2) there was insufficient evidence
22   proving the amount of the alleged deficiency, such as fair
23   market value of the car and the present balance owed under the
24   Sale Contract.
25           Since the matter did not resolve, on October 23, 2015,
26
27
         5
          There were three proofs of claim filed in the case, two by
28 Golden 1 and one by American Express.

                                      -5-
 1   Trustee filed his amended objection, including supporting
 2   documents and a notice of hearing.     Trustee argued that the
 3   unsecured portion of Golden 1's claim should be disallowed
 4   because the documents in support of the claim were insufficient
 5   under Rule 3001(c) and Golden 1 was oversecured by $3,000.
 6   Trustee also sought attorney’s fees and costs under the attorney
 7   fee provision in the Sale Contract, contending that it was
 8   reciprocally enforceable under Cal. Civ. Code § 1717.
 9           In support of his objection, Trustee submitted an appraisal
10   showing the car’s value at $16,708 as of October 16, 2015.
11   Trustee also submitted his declaration, stating that the balance
12   owed on the car was $13,736.286 as of September 29, 2015, the
13   car appraised at $16,708 as of October 16, 2015, and Debtor was
14   current on the loan.    Trustee also informed the court about his
15   efforts to informally resolve the dispute.
16           In his memorandum of points and authorities, Trustee argued
17   that since Golden 1 was oversecured, the unsecured portion of
18   its claim should be disallowed in total.     Trustee also
19   maintained that the bankruptcy court had discretion to determine
20   the date for valuation.    He argued that since the purpose of the
21   valuation was for a general unsecured distribution not yet made,
22   the value should be determined as of the date of the hearing on
23   Trustee’s objection - October 16, 2015.     Trustee finally argued
24   that he was entitled to attorney’s fees and costs under the
25
         6
26        This balance evidently reflected the on-going payments
   made by Debtor on the loan. The balance was $18.72 less than
27 what Trustee previously asserted the balance was as of
   September 15, 2015. It is unclear where the discrepancy came
28 from.

                                      -6-
 1   holding and reasoning in Americredit Fin. Servs., Inc. v. Penrod
 2   (In re Penrod), 611 F.3d 1158 (9th Cir. 2015).
 3        Golden 1 opposed, asserting that its POC was supported by
 4   documentation sufficient to allow the unsecured claim in full.
 5   Golden 1 further argued that the valuation date for the car
 6   should be the petition date and not the date of the claim
 7   objection.   Golden 1 requested an opportunity to submit its own
 8   appraisal.   Finally, Golden 1 contended that Trustee could not
 9   avail himself of the attorney fee provision in the Sale Contract
10   because Trustee was not a party to the contract and the Sale
11   Contract was no longer property of the estate under § 362(h).
12   Golden 1 maintained that the attorney fee request was
13   unreasonable and that Trustee had breached his fiduciary duty by
14   spending over $8,600 in objecting to Golden 1's unsecured claim
15   when the estate had only $4,000 for distribution.
16        On December 7, 2015, the bankruptcy court entered civil
17   minutes continuing the hearing on the claim objection to
18   January 19, 2016, to allow Trustee to submit evidence of his
19   attorney’s fees and costs in litigating the claim objection and
20   to allow Golden 1 to obtain an appraisal of the vehicle.
21        Two weeks later, Trustee submitted evidence that his
22   counsel spent 24.3 hours on the matter for a total of $8,640 in
23   attorney’s fees and that he incurred $338.67 in costs.
24        Golden 1 then submitted an appraisal showing the car’s
25   value at $13,833.29 as of January 22, 2016.   Golden 1 also
26   argued that Trustee’s claim objection essentially rendered the
27   estate insolvent and maintained that the fees requested were
28   unreasonable.   According to Golden 1, since the estate had only

                                    -7-
 1   $4,000 on hand at the outset of the dispute, spending
 2   24.3 attorney hours to prepare the claim objection was
 3   excessive.
 4        Prior to the February 29, 2016 hearing on the claim
 5   objection, the bankruptcy court issued a tentative ruling
 6   sustaining Trustee’s objection and reclassifying Golden 1's
 7   claim as fully secured.    In reaching its decision, the court
 8   noted the following:    Based upon Golden 1's January 21, 2016
 9   appraisal, the car’s value was $13,833.29.    The loan balance was
10   less than that amount - $13,736.28 - as of September 29, 2015,
11   and Debtor was current on the loan.    Based on these facts, the
12   bankruptcy court concluded that the loan balance as of
13   January 21, 2016, was less than $13,736.28, and “still clearly
14   less than $13,833.29,” and thus Golden 1 was an oversecured
15   creditor.    Accordingly, the court found Golden 1 had no basis
16   for asserting an unsecured claim against the estate.
17        Alternatively, the bankruptcy court found Golden 1's
18   deficiency claim was “at best” contingent or unliquidated and
19   estimated Golden 1's unsecured claim against the estate at $0
20   based upon the following undisputed facts:    (1) Golden 1 agreed
21   to accept voluntary payments from Debtor; (2) Golden 1 had not
22   proceeded against the collateral; and (3) Debtor had made all
23   installment payments due under the loan both before and after
24   the bankruptcy.    Accordingly, the court concluded that Debtor is
25   “likely to pay Golden 1 in full without resort to its
26   collateral.”
27        The bankruptcy court finally concluded that Trustee’s
28   attorney’s fees and costs were reasonable, subject to some

                                     -8-
 1   adjustments.      In its ruling, the court observed that Golden 1
 2   had sufficient time to resolve the matter and prevent the fees
 3   and costs from accruing.     The bankruptcy court ordered Golden 1
 4   to pay Trustee the fees and expenses no later than seven days
 5   after the entry of the order on the objection.
 6            At the February 29, 2016 hearing, Golden 1's counsel sought
 7   to clarify some points.      First, she argued that Golden 1 was not
 8   obligated to reduce the amount of the claim to account for post-
 9   petition payments received by Debtor based on the Supreme
10   Court’s ruling in Ivanhoe Bldg. & Loan Assn. v. Orr, 295 U.S.
11   243, 246 (1935).      The court was not persuaded, finding the case
12   distinguishable on the facts.7     In addition, during the course
13   of the argument, the bankruptcy court also determined that
14   Golden 1 had waived its right to assert an unsecured claim
15   against the bankruptcy estate by not declaring a default.8
16            On February 29, 2016, the bankruptcy court issued its civil
17
18        7
            In Ivanhoe the claim was reduced by a non-debtor third
19   party who was also liable on the claim. The Ivanhoe court held
     that where a claim is subject to reduction under state law
20   because it was partially paid by a non-debtor co-obligor, the
     amount of the proof of claim need not be reduced for distribution
21   purposes unless the claim was going to be paid in full. The
22   bankruptcy court distinguished the case by noting that here
     Debtor was paying on the loan even though she had no obligation
23   to pay whereas in Ivanhoe there was nothing voluntary about the
     third party paying on a claim which it was legally obligated to
24   pay. In essence, the bankruptcy court determined that the
     voluntary payments by the original obligor - Debtor - were not
25   similar to the required payments by the non-debtor co-obligor in
26   Ivanhoe. The Panel has no issue with that analysis.
          8
27        The waiver ruling was not incorporated into the court’s
   February 29, 2016 civil minute order. The Panel’s decision is
28 not predicated on waiver.

                                       -9-
 1   minutes sustaining Trustee’s claim objection and scheduling a
 2   further hearing on Trustee’s request for additional fees.    The
 3   civil minutes largely incorporated the court’s tentative ruling,
 4   stating in relevant part:
 5        Golden 1 has no deficiency claim against the estate as
          it has elected not to declare a default under the loan
 6        agreement with the debtor, not to repossess the
          subject vehicle, and it has continued to accept
 7        payments form the debtor on account of its
          claim. . . .
 8
          The failure of the debtor to reaffirm Golden 1's debt
 9        does not have the effect of making ‘the Sale Contract
          . . . no longer property of the estate.’ [Section]
10        362(h) says nothing about the loan agreement giving
          rise to the secured creditor’s claim. That provision
11        references only the ‘personal property of the estate
          or of the debtor securing in whole or in part a
12        claim.’ It is only the collateral securing the
          secured creditor’s claim - i.e., the vehicle - that is
13        ‘no longer . . . property of the estate.’ 11 U.S.C.
          § 362(h)(1).
14
15   The bankruptcy court also rejected Golden 1's argument that
16   Trustee had breached his fiduciary duty to unsecured creditors.
17   Finally, in its ruling, the bankruptcy court reopened the record
18   so that Trustee could amend his request for attorney’s fees and
19   costs and for Golden 1 to challenge the reasonableness of the
20   fees and costs, but noted:   “The record is closed as to all
21   other issues.”
22        On March 1, 2016, Golden 1 filed a notice of appeal from
23   this ruling, commencing BAP No. EC-16-1065.
24        On March 7, 2016, Trustee filed a pleading requesting
25   $12,579.60 in attorney’s fees and costs.   In response, Golden 1
26   argued that Trustee was not entitled to invoke the attorney fee
27   provision in the Sales Contract based upon Cal. Civ. Code § 1717
28   and again contended that the requested fees were unreasonable.

                                    -10-
 1   Golden 1 asserted that under Penrod, there was no reciprocity
 2   granted to Trustee because the bankruptcy court had concluded
 3   that Golden 1 had no claim against the estate and thus could not
 4   enforce its rights under the Sale Contract.    If Golden 1 could
 5   not enforce its rights it argued, then Trustee likewise could
 6   not enforce his.   Trustee filed a reply requesting an additional
 7   $2,025 in fees.
 8        In advance of the continued hearing on the claim objection,
 9   the bankruptcy court issued a tentative ruling to sustain the
10   claim objection.   The court’s tentative ruling indicated that
11   Golden 1's challenge to Trustee’s ability to utilize the
12   attorney fee provision in the Sales Contract based on
13   reciprocity and Penrod was untimely.    The court further
14   indicated that with the exception of certain fees
15   inappropriately included in Trustee’s request, the bankruptcy
16   court would allow the requested fees.
17        On April 11, 2016, the bankruptcy court heard the matter.
18   Again, Golden 1's counsel sought clarification on a number of
19   points set forth in the court’s tentative ruling.    Among other
20   things, she maintained that Golden 1 preserved its arguments
21   regarding the applicability of Penrod and Trustee’s request for
22   attorney’s fees.   The bankruptcy court responded:   “Oh, I think
23   it did.”
24        On the same date, the bankruptcy court entered its civil
25   minutes in support of its determination to sustain Trustee’s
26   claim objection and award of attorney’s fees and costs to
27   Trustee.
28        On April 19, 2016, the bankruptcy court entered an order

                                    -11-
 1   sustaining the claim objection, disallowing the unsecured
 2   portion of the claim, and awarding Trustee $14,092.50 in
 3   attorney’s fees and $343.10 in costs.   In that ruling, the court
 4   discussed Golden 1's untimely argument regarding the reciprocity
 5   of the attorney fee clause:
 6        [E]ven if the court were to address the reciprocity
          argument, Golden 1 has missed the point. Golden 1
 7        mischaracterizes the court’s ruling. If the court has
          ruled ‘that Golden 1 cannot enforce its rights under
 8        the sale contract against the estate,’ Golden 1 cannot
          assert even its secured claim against the estate,
 9        clearing the way for the estate to sell the debtor’s
          vehicle free and clear of Golden 1's secured claim.
10        Obviously, Golden 1 still holds its secured claim
          against the estate, and that claim is based on Golden
11        1's rights under the contract.
12        . . .
13        In short, the action initiated by Golden 1 filing an
          unsecured proof of claim is an action on the contract.
14        The trustee is prevailing. See Penrod v. AmeriCredit
          Financial Services, Inc. (In re Penrod), 802 F.3d
15        1084, 1087-88 (9th Cir. 2015). This is an adequate
          basis for applying the reciprocity rule of Cal. Civ.
16        Code § 1717(a).
17        On April 22, 2016, Golden 1 filed its notice of appeal from
18   that order, commencing EC-16-1117.
19        Golden 1 sought a stay pending appeal from the bankruptcy
20   court as to the payment of attorney’s fees and costs, which the
21   bankruptcy court granted.   In its ruling granting the stay, the
22   bankruptcy court reiterated that Golden 1 had waived its
23   argument that Penrod did not apply to Trustee’s request for
24   attorney’s fees because Golden 1 failed to raise the argument in
25   its initial opposition to Trustee’s objection.   The court went
26   on to say that if it indicated Golden 1 had not waived the
27   argument (meaning at the April 11, 2016 hearing), it was
28   unintended.

                                    -12-
 1                                II.   JURISDICTION
 2         The bankruptcy court had jurisdiction pursuant to 28 U.S.C.
 3   §§ 1334 and 157(b)(2)(A) and (B).            We have jurisdiction under
 4   28 U.S.C. § 158.
 5                                  III.    ISSUES
 6         Did the bankruptcy court abuse its discretion in estimating
 7   Golden 1's claim at $0?
 8         Did the bankruptcy court err by awarding attorney’s fees
 9   and costs in favor of Trustee and against Golden 1 based upon
10   the attorney fee provision in the Sale Contract and Cal. Civ.
11   Code § 1717?
12                          IV.    STANDARDS OF REVIEW
13         Orders resolving claims objections can raise both legal
14   issues and factual issues.         We review the legal issues de novo
15   and the factual issues under the clearly erroneous standard.
16   Veal v. Am. Home Mortg. Servicing, Inc. (In re Veal), 450 B.R.
17   897, 918 (9th Cir. BAP 2011).
18         We review a bankruptcy court’s estimation of a claim for
19   abuse of discretion.     Ryan v. Loui (In re Corey), 892 F.2d 829,
20   832   (9th Cir. 1989).
21         We will not disturb the bankruptcy court’s award of
22   attorney’s fees and costs unless the court erroneously applied
23   the law or abused its discretion.            Renfrow v. Draper, 232 F.3d
24   688, 693 (9th Cir. 2000); Fry v. Dinan (In re Dinan), 448 B.R.
25   775, 783 (9th Cir. BAP 2011).
26         Review of an abuse of discretion determination involves a
27   two-pronged test; first, we determine de novo whether the
28   bankruptcy court identified the correct legal rule for

                                           -13-
 1   application.   See United States v. Hinkson, 585 F.3d 1247,
 2   1261–62 (9th Cir. 2009) (en banc).       If not, then the bankruptcy
 3   court necessarily abused its discretion.        Id. at 1262.
 4   Otherwise, we next review whether the bankruptcy court’s
 5   application of the correct legal rule was clearly erroneous; we
 6   will affirm unless its findings were illogical, implausible, or
 7   without support in inferences that may be drawn from the facts
 8   in the record.   Id.
 9                               V.   DISCUSSION
10        The bankruptcy court disallowed Golden 1's unsecured
11   deficiency claim on several bases and, in the alternative, found
12   the claim contingent or unliquidated and estimated it for
13   purposes of allowance at $0.     Although Golden 1 raises numerous
14   issues on appeal relating to both decisions, we need not discuss
15   or decide if every basis for the court’s decision was correct.
16   Rather, we may affirm the bankruptcy court’s decision on any
17   ground fairly supported by the record.        Wirum v. Warren
18   (In re Warren), 568 F.3d 1113, 1116 (9th Cir. 2009).
19   A.   Estimation of Claims
20        We agree with the bankruptcy court’s assessment that since
21   Golden 1 had not declared a default, its unsecured deficiency
22   claim was “at best” contingent or unliquidated.        Golden 1 does
23   not argue otherwise on appeal.     Indeed, at the February 29, 2016
24   hearing, Golden 1's counsel admitted that the deficiency claim
25   was contingent and agreed that the court could estimate the
26   claim.
27        THE COURT: All right. But this is an unliquidated
          contingent claim. Couldn’t I just as easily say I’m
28        estimating your claim at zero?

                                       -14-
 1        MS. PEO:   You could.   You could.
 2        THE COURT: I mean, isn’t that –
          MS. PEO: And -- and I –
 3
          THE COURT:   -- what we’re doing here?
 4
          MS. PEO: -- and that’s the purpose of -- of -- of my
 5        citing to both 506(a) and 502(c) to just, you know,
          the Code contemplates that this can be liquidated
 6        without need of foreclosure. And here I think that
          the relevant figures are the value of the collateral,
 7        which we’ve submitted evidence to, and the amount of
          the claim, which I believe under Ivanhoe is –
 8
          THE COURT:   but you keep –
 9
          MS. PEO:   -- 17,000.
10
          THE COURT: -- leaving out one thing. The debtor’s
11        paying. And you seem to be -- your client seems to be
          perfectly happy with that. So you’re getting payment,
12        and you’ve got collateral. All right? Any claim
          against the estate is dependent on liquidation of your
13        collateral and declaration to default, which isn’t
          going to happen from what I can tell.
14
15        It is generally settled that “if all events giving rise to
16   liability occurred prior to the filing of the bankruptcy
17   petition”, the claim is not contingent.    Nicholes v. Johnny
18   Appleseed of Wash. (In re Nicholes), 184 B.R. 82, 88 (9th Cir.
19   BAP 1995) (citing Fostvedt v. Dow (In re Fostvedt), 823 F.2d
20   305, 306 (9th Cir. 1987) ([T]he rule is clear that a contingent
21   debt is “one which the debtor will be called upon to pay only
22   upon the occurrence or happening of an extrinsic event which
23   will trigger the liability of the debtor to the alleged
24   creditor.”)).   The bankruptcy court correctly observed that
25   Golden 1's deficiency claim under California law was dependent
26   upon its first declaring a default.    See Cal. Civ. Code
27   § 2983.3(a) (“In the absence of default in the performance of
28   any of the buyer’s obligations under the contract, the seller or

                                     -15-
 1   holder may not accelerate the maturity of any part or all of the
 2   amount due thereunder or repossess the motor vehicle.”).
 3   Therefore, “at best” the deficiency claim was a contingent one.
 4        Moreover, a debt is liquidated if it is capable of “ready
 5   determination and precision in computation of the amount due.”
 6   In re Fostvedt, 823 F.2d at 306.    “The test for ‘ready
 7   determination’ is whether the amount due is fixed or certain or
 8   otherwise ascertainable by reference to an agreement or by a
 9   simple computation.”    In re Nicholes, 184 B.R. at 88.    Here, the
10   amount of the deficiency was not readily ascertainable by
11   reference to the Sale Contract or by a simple computation.
12   Indeed, the parties focused on valuation of the car by
13   submitting appraisals, but the date for such valuation was
14   contested.    In addition, the actual amount of the deficiency
15   depended upon a number of factors due to the fact that Debtor
16   was timely making the installment payments and was current on
17   the loan.    As a result, it may be that the value of the car
18   would exceed the amount due under the loan due to the ongoing
19   payments.
20        Under § 502(c)(1), a bankruptcy court may estimate for
21   purposes of allowance “any contingent or unliquidated claim, the
22   fixing or liquidation of which . . . would unduly delay the
23   administration of the case.”    Section 502(c) was enacted to
24   “further the requirement that all claims against a debtor be
25   converted into dollar amounts.”    Interco Inc. v. ILGWU Nat’l
26   Ret. Fund (In re Interco Inc.), 137 B.R. 993, 997 (Bankr. E.D.
27   Mo. 1992).    Courts use estimation “to facilitate the speedy
28   resolution of claims in bankruptcy courts.”    Id.   Such a claim

                                     -16-
 1   is “allowed,” meaning that the Bankruptcy Code expressly
 2   authorizes the trustee to pay it, as if it was not contingent or
 3   unliquidated.
 4            Neither the Code nor the Rules prescribe any method for
 5   estimating a contingent or unliquidated claim.       The bankruptcy
 6   court should use “whatever method is best suited to the
 7   circumstances” in estimating a claim.       Bittner v. Borne Chem.
 8   Co., 691 F.2d 134, 135 (3d Cir. 1982).       Therefore, a court has
 9   broad discretion when estimating the value of an unliquidated
10   claim.9     In re Corey, 892 F.2d at 834.
11            In deciding whether to estimate the deficiency claim, the
12   bankruptcy court observed that Golden 1 had not proceeded
13   against its collateral because Debtor was current on the loan.
14   Therefore, the court found that waiting for Golden 1 to seize
15   and sell its collateral in order to liquidate its deficiency
16   claim would unduly delay the administration of the case.       The
17   court further found that because (1) Golden 1 had agreed to
18   accept voluntary payments from Debtor; (2) the value of the
19   vehicle was at least $13,907; and (3) Debtor had made all
20   installment payments due under the loan both before and after
21   the bankruptcy, Debtor was “likely” to pay Golden 1 in full
22
          9
23          A party in interest generally brings a motion for
     estimation of a claim. In the informal email exchange between
24   the parties, Trustee’s counsel early on stated that he was asked
     to prepare an objection to the $3,375 unsecured portion of
25   Golden 1's POC and a motion to estimate the claim for
26   distribution purposes. Trustee did not file a motion for
     estimation, but did file the claim objection. Nonetheless, an
27   objection to claim and motion to estimate claim are both brought
     pursuant to Rule 3007 and are contested matters within the
28   meaning of Rule 9014.

                                       -17-
 1   without resort to its collateral.      Based on these facts, the
 2   court estimated Golden 1's claim as $0.
 3        Golden 1 asserts that these findings are not supported by
 4   the record.    Golden 1 maintains no reaffirmation agreement was
 5   entered into and Debtor was discharged from personal liability
 6   on the debt.   According to Golden 1, the bankruptcy court gave
 7   no weight to the fact that Debtor was absolved of personal
 8   liability, and it failed to consider that there was a very real
 9   possibility that Debtor may refuse to make voluntary payments if
10   the vehicle broke down or was involved in an accident.
11        We are not convinced.   Golden 1 cannot complain that it
12   will be precluded from collecting any deficiency from Debtor
13   personally which might arise in the future should it repossess
14   the car and sell it for less than the balance due.      This is a
15   risk it chose when it did not pursue reaffirmation or
16   immediately seek stay relief so it could repossess and sell the
17   car as soon as the time to reaffirm expired.      Had it done so,
18   the deficiency would be liquidated and it could share in the
19   estate distribution.    “When a nondefaulting debtor is discharged
20   while retaining the collateral, the principal disadvantage to
21   the creditor is the possibility that the value of the collateral
22   will be less than the balance due on the secured debt.      But this
23   is a risk in all installment loans, and presumably the creditor
24   has structured repayment to accommodate it.”      Home Owners
25   Funding Corp. v. Belanger (In re Belanger), 962 F.2d 345 (4th
26   Cir. 1992).
27        Further, Golden 1's arguments regarding other
28   possibilities, such as Debtor’s refusal to make voluntary

                                     -18-
 1   payments, a vehicle breakdown or an accident, are nothing more
 2   than possibilities.   While anything is possible, the burden of
 3   proof in claims estimation is preponderance of the evidence.
 4   Under the circumstances in this case, we cannot say that the
 5   bankruptcy court abused its discretion in concluding that it was
 6   more likely than not Debtor would continue to pay Golden 1 on
 7   the loan and Golden 1 would not have to look to its collateral.
 8   See In re Corey, 892 F.2d 829, 834 (9th Cir. 1989) (estimating
 9   claims at zero because of their “highly speculative nature”);
10   In re Pac. Gas & Elec. Co., 295 B.R. 635, 675–76 (Bankr. N.D.
11   Cal. 2003) (estimating antitrust claims at zero where claimants
12   failed to make their case, the debtor asserted defenses that
13   appeared to have merit, and the claimants had not established
14   any meaningful measure of damages); In re Kaplan, 186 B.R. 871,
15   874, 878 (Bankr. D.N.J. 1995) (noting that “the court must
16   determine the value of the claim according to its best estimate
17   of the claimant’s chances of ultimately succeeding in a state
18   court action” and estimating the claim at zero because the
19   claimant “most likely would not succeed on a state court
20   action”).
21        Finally, Golden 1 argued that a claim is to be measured as
22   of the petition date and postpetition conduct such as the
23   voluntary payments should be disregarded.   If we look at the
24   facts as known on the petition date, Debtor stated an intention
25   to reaffirm.   Assuming she did that, there would be no
26   deficiency as to the estate and estimating the claim at zero
27
28

                                    -19-
 1   based on petition date facts is also appropriate.10
 2   B.    Attorney’s Fees
 3         The Bankruptcy Code does not provide a general right to
 4   recover attorney’s fees.    Heritage Ford v. Baroff
 5   (In re Baroff), 105 F.3d 439, 441 (9th Cir. 1997).
 6   Nevertheless, a prevailing party on a bankruptcy law claim may
 7   recover attorney’s fees if recovery is permitted under a state
 8   statute or contract.    Cohen v. de la Cruz, 523 U.S. 213, 220-21
 9   (1998); Cardenas v. Shannon (In re Shannon), 553 B.R.380, 2016
10   WL 4009673 at *11 (9th Cir. BAP 2016); Redwood Theaters, Inc. v.
11   Davison (In re Davison), 289 B.R. 716, 722 (9th Cir. BAP 2003).
12         The bankruptcy court awarded Trustee attorney’s fees and
13   costs in the amount of $14,436.60, based on an attorney fee
14   provision in the Sale Contract which stated:    “You will pay our
15   reasonable costs to collect what you owe, including attorney
16   fees, court costs, collection agency fees, and fees paid for
17   other reasonable collection efforts.”    Under some circumstances,
18   Cal. Civ. Code § 1717 renders unilateral fee provisions such as
19   this one reciprocal.    See Santisas v. Goodin, 17 Cal.4th 599,
20   610–11 (1998).
21         “Three conditions must be met before [section 1717]
22   applies.”   Bos v. Board of Trustees, 818 F.3d 486, 489 (9th Cir.
23   2016) (citing In re Penrod, 802 F.3d at 1087).    “First, the
24   action generating the fees must have been an action ‘on a
25
26        10
          Since we conclude that the bankruptcy court did not abuse
27 its discretion in estimating Golden 1's unsecured deficiency
   claim at $0, it is unnecessary to address issues raised by
28 Golden 1 pertaining to § 506.

                                     -20-
 1   contract.’   Second, the contract must provide that attorney’s
 2   fees incurred to enforce it shall be awarded either to one of
 3   the parties or to the prevailing party.     And third, the party
 4   seeking fees must have prevailed in the underlying action.”        Id.
 5   If all three conditions are met, Trustee may recover his
 6   attorney’s fees from Golden 1, “provided that [Golden 1] would
 7   have been entitled to recover its fees had it prevailed.”
 8   In re Penrod, 802 F.2d at 1087.
 9       On appeal, Golden 1 argues that there was no reciprocity
10   with which to invoke Cal. Civ. Code § 1717.     According to
11   Golden 1, the attorney fee provision in the Sale Contract does
12   not run both ways because the bankruptcy court’s final order
13   held that it had no deficiency claim against the estate.
14   Golden 1 maintains that the bankruptcy court’s decision
15   precludes it from enforcing its rights under the Sale Contract
16   against the estate.    Thus, reciprocity is lacking.
17        We are not persuaded.    First, at oral argument, counsel for
18   Golden 1 conceded that if Golden 1 had prevailed in the claim
19   objection, it would have a claim for attorney’s fees under Cal.
20   Civ. Code § 1717.   Thus, reciprocity was present.     Next, the
21   bankruptcy court found that Golden 1's reciprocity argument -
22   the same one it makes on appeal - was untimely and waived
23   because Golden 1 did not make the argument in its initial
24   opposition to Trustee’s objection.     The bankruptcy court
25   reiterated its finding of waiver in its ruling regarding the
26   stay pending appeal.    The record supports this ruling.    See
27   Carroll v. Nakatani, 342 F.3d 934, 945 (9th Cir. 2003) (noting
28   that a motion for rehearing “may not be used to raise arguments

                                     -21-
 1   or present evidence for the first time when they could
 2   reasonably have been raised earlier in the litigation”).
 3   Finally, even if the argument were not waived, as the bankruptcy
 4   court explained, Golden 1 has missed the point.    The court’s
 5   ruling on the deficiency claim did not prohibit Golden 1 from
 6   enforcing its rights under the Sale Contract.    As noted by the
 7   court, Golden 1 still held a secured claim based on its rights
 8   under the Sale Contract and Golden 1 continued to rely on the
 9   contract to assert a secured claim against the estate.
10        In the end, the bankruptcy court concluded that by filing
11   an unsecured proof of claim, Golden 1 initiated an action on the
12   contract and Trustee was the prevailing party.    Had Golden 1
13   prevailed on its deficiency claim against the estate it would
14   have had an entitlement to attorney’s fees; the estate should
15   likewise be able to do so on a reciprocal basis.    See Reynolds
16   Metals Co. v. Alperson, 25 Cal.3d 124, 127–128 (1979).    In
17   short, all three conditions for application of Cal. Civ. Code
18   § 1717 were met.
19        Golden 1's final argument is that the fees arising out of
20   the claim objection are unreasonable under a cost-benefit
21   analysis.   “When a cost benefit analysis indicates that the only
22   parties who will likely benefit from [a service] are the trustee
23   and his professionals,” the service is unwarranted and a court
24   does not abuse its discretion in denying fees for those
25   services.   Estes & Hoyt v. Crake (In re Riverside-Linden Inv.
26   Co.), 925 F.2d 320, 321 (9th Cir. 1991).
27        Clearly, bankruptcy proceedings are intended to benefit the
28   creditors and the estate, and not to benefit the attorneys.

                                    -22-
 1   However, there is no indication in the record that Trustee went
 2   beyond what was necessary to defend his position or have his
 3   attorney render services which would only benefit his attorney.
 4   From the beginning, Trustee thought that the matter could be
 5   resolved without resort to protracted proceedings.   The
 6   increased expense arose because Golden 1 continually chose to
 7   litigate its positions to support a deficiency claim which would
 8   reap $300 from the bankruptcy estate.   Nothing in the record
 9   shows that Trustee could have foreseen this type of protracted
10   litigation or factored it into his initial cost-benefit analysis
11   when deciding to pursue the claim objection.   Without following
12   through with the litigation to the end, there was little Trustee
13   could do short of conceding payment on the claim - a result that
14   would have been detrimental to the estate.
15        Fees allowable pursuant to Cal. Civ. Code § 1717 are
16   subject to a reasonableness requirement.   The bankruptcy court
17   found that the attorney’s fees incurred, with some exceptions,
18   were reasonable and necessary because (1) Trustee had to
19   litigate this objection extensively; (2) there were novel issues
20   presented by the objection; (3) expansive research was required;
21   (4) Golden 1 vehemently opposed; (5) there were extensive
22   communications among the parties; (6) there were numerous
23   pleadings filed by the Trustee; and (7) the protracted nature of
24   the proceedings (lasting nearly 10 months), warranted the fees
25   and costs requested by Trustee.   These factual findings are
26   plausible and logical.
27        In sum, based on our examination of the record, we conclude
28   the bankruptcy court employed the appropriate standards to

                                   -23-
 1   determine the fees were reasonable and did not abuse its
 2   discretion in determining the proper fee allowance.
 3                           VI.   CONCLUSION
 4        For the reasons set forth above, we AFFIRM.
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