                                                           FILED
                                                            FEB 02 2015
 1                        NOT FOR PUBLICATION          SUSAN M. SPRAUL, CLERK
                                                          U.S. BKCY. APP. PANEL
                                                          OF THE NINTH CIRCUIT
 2
 3                  UNITED STATES BANKRUPTCY APPELLATE PANEL
 4                            OF THE NINTH CIRCUIT
 5   In re:                             )   BAP No. CC-14-1032-PaTaD
                                        )
 6   MOHSEN LOGHMANI,                   )   Bankr. No. 12-12998-VK
                                        )
 7                  Debtor.             )   Adv. No. 12-01419-VK
     ___________________________________)
 8                                      )
     MOHSEN LOGHMANI,                   )
 9                                      )
                    Appellant,          )
10                                      )
     v.                                 )   M E M O R A N D U M1
11                                      )
     UNITED STATES TRUSTEE;             )
12   AMY GOLDMAN, Chapter 7 Trustee,2   )
                                        )
13                  Appellees.          )
     ___________________________________)
14
                        Submitted Without Oral Argument
15                            on January 22, 20153
16                         Filed - February 2, 2015
17             Appeal from the United States Bankruptcy Court
                   for the Central District of California
18
         Honorable Victoria S. Kaufman, Bankruptcy Judge, Presiding
19
     Appearances:    Mohsen Loghmani, Appellant, pro se, on brief;
20                   Russell Clementson, Trial Attorney, United States
                     Trustee, on brief for Appellee United States
21                   Trustee.
22
23        1
             This disposition is not appropriate for publication.
24   Although it may be cited for whatever persuasive value it may have
     (see Fed. R. App. P. 32.1), it has no precedential value. See 9th
25   Cir. BAP Rule 8024-1.
          2
26           Appellee Amy Goldman, Trustee, did not file briefs or
     participate in this appeal.
27        3
             After examination of the briefs and record, and after
28   notice to the parties, in an order entered October 21, 2014, the
     Panel unanimously determined that oral argument was not needed for
     this appeal. 9th Cir. BAP Rule 8019-1.

                                      -1-
 1   Before: PAPPAS, TAYLOR, and DUNN, Bankruptcy Judges.
 2        Chapter 74 debtor Mohsen Loghmani (“Debtor”) appeals the
 3   judgment of the bankruptcy court denying him a discharge under
 4   § 727(a)(2)(A) and (a)(4)(A) in an adversary proceeding prosecuted
 5   by the United States Trustee (“UST”).      We AFFIRM.
 6                                 I.   FACTS
 7        The material facts are not in dispute.      On August 24, 2005,
 8   Debtor, along with his wife, purchased a parcel of vacant land in
 9   San Bernardino County, California (the “Property”).     Debtor and
10   his wife paid $17,000 for the Property and took title as “husband
11   and wife as joint tenants.”
12        In 2009, Debtor was sued by Tessie Cleveland Community
13   Services Corporation (“Tessie”) in California state court.     In the
14   state court action, Tessie alleged, among other things, that
15   Debtor breached a personal services contract.      After trial, a jury
16   rendered a verdict in favor of Tessie on its breach of contract
17   claim and awarded Tessie $388,325.47 in damages on December 28,
18   2011.
19        After the jury’s verdict, but before a judgment was entered,
20   Debtor and his wife transferred the Property to their son via a
21   quitclaim deed signed by Debtor and his wife on February 2, 2012.
22   Debtor asserts that, at the time of this transfer, while he valued
23   the Property at approximately $10,000, he and his wife did not
24   receive any payment from their son for the transfer because they
25   owed him money and this transfer was meant to satisfy a portion of
26
27           4
             Unless otherwise indicated, all chapter, section and rule
     references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532, and
28   to the Federal Rules of Bankruptcy Procedure, Rules 1001-9037.

                                        -2-
 1   that debt.   Debtor’s son was listed on Debtor’s schedule F as
 2   holding a “personal loan” unsecured claim.   On the same day he
 3   signed the quitclaim deed, Debtor drove from his home in North
 4   Hollywood to the San Bernardino County Recorder’s Office and
 5   recorded the deed.5
 6        Two weeks later, Debtor transferred a 2003 BMW Z4 Roadster to
 7   the same son in exchange for $5,200 in cash.   Debtor later used
 8   some of these funds to pay his bankruptcy counsel’s fees.
 9        On March 7, 2012, after Debtor’s transfer of the Property and
10   the BMW, the state court entered a judgment against Debtor.6
11        On March 29, 2012, represented by counsel, Debtor filed a
12   chapter 7 petition.   Debtor’s schedules and statement of financial
13   affairs (“SOFA”) did not disclose the transfers of the Property or
14   the BMW to his son.   The schedules and SOFA, however, did list
15   Debtor’s transfers of his interests in other real property in
16   which he lacked any equity.
17        On May 31, 2012, Debtor testified at his § 341(a) meeting
18   that his schedules and SOFA were true and correct, although he
19   noted that he might add a couple of unsecured creditors.
20   Thereafter, Debtor’s bankruptcy case was selected by the UST for a
21   debtor audit.   See 28 U.S.C. § 586(f).   On July 2, 2012, the
22   auditors filed a report with the bankruptcy court concluding that
23
24
          5
             We take judicial notice of the fact that the distance
25   between North Hollywood, California and San Bernardino, California
     Recorder’s Office is approximately 70 miles. See Federal Rule of
26   Evidence 201.
27        6
             The state court later awarded Tessie attorney’s fees in
     the amount of $1,458,101.25. The state court’s judgment is
28   currently on appeal.

                                     -3-
 1   Debtor’s schedules and SOFA contained a material misstatement
 2   because they did not disclose Debtor’s transfer of the BMW.
 3   Debtor filed an amended SOFA listing the transfer of the BMW to
 4   his son, but the amended SOFA did not disclose the transfer of the
 5   Property.
 6        The UST later discovered Debtor’s prepetition transfer of the
 7   Property to his son.    On November 30, 2012, the UST filed an
 8   adversary complaint against Debtor objecting to entry of a
 9   discharge under § 727(a)(2)(A) and (a)(4)(A).   Eight months later,
10   on July 31, 2013, Debtor filed a second amended SOFA wherein, for
11   the first time, he disclosed the Property transfer.
12        The UST and Debtor filed a joint pretrial stipulation
13   reciting various undisputed facts and identifying issues of fact
14   for trial.    Notably, the UST and Debtor agreed it was undisputed
15   that Debtor and his wife “owed their son money and transferred
16   [the Property] to their son in order to remove the property from
17   their holdings and to give their son priority over their other
18   creditors.”   As to the fact issues, the parties advised the
19   bankruptcy court:
20         The following issues of fact, and no others,
           remain to be litigated. Whether [Debtor]
21         intentionally and fraudulently failed to
           disclose the transfer of [the Property] in
22         his [SOFA]. Whether [Debtor] knowingly and
           fraudulently gave a false oath by failing to
23         disclose the transfer of [the Property] in
           his [SOFA]. Whether [Debtor] transferred
24         [the Property] to his son to hinder, delay or
           defraud a creditor, or the [t]rustee.
25
26
27
28

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 1        Notwithstanding the stipulation, at trial7 Debtor appeared
 2   pro se and testified that he did not disclose the transfer of the
 3   Property in his SOFA, amended SOFA, or at his § 341(a) meeting,
 4   because he had thought the Property was his wife’s separate
 5   property.    Trial Tr. 49:11-12, Dec. 3, 2013.
 6        At the conclusion of the parties’ submission of evidence,
 7   testimony, and argument, the bankruptcy court recited its oral
 8   ruling holding that, pursuant to § 727(a)(2)(A) and (a)(4)(A),
 9   Debtor would be denied a discharge.    On January 7, 2014, the
10   bankruptcy court entered written findings of fact and conclusions
11   of law incorporating its oral ruling.    As it had in its oral
12   ruling, the court determined that Debtor’s “testimony that he did
13   not disclose the transfer of [the Property] because he thought
14   [it] was his wife’s [separate property]. . . is not credible.”    As
15   to § 727(a)(2)(A), the bankruptcy court concluded:
16            The facts and circumstances including (1) the
              closeness of the relationship between
17            [Debtor] and the recipient of the [t]ransfer,
              [Debtor’s] son; (2) the transfer shortly
18            after the jury verdict . . .; (3) [Debtor’s]
              belief that he could not pay his creditors;
19            and (4) that [Debtor] personally signed and
              personally recorded the quit-claim deed to
20            his son, all establish that [Debtor]
              transferred [the Property] with the actual
21            intent to hinder, delay or defraud a
              creditor.
22
23        7
             At a hearing the day before the trial was to begin, Debtor
     advised the bankruptcy court of his plan to file a motion to
24   dismiss his chapter 7 case and thereby eliminate the need for the
     trial on the objection to his discharge. After the hearing,
25   Debtor filed the motion to dismiss his case, and the next day
     Debtor asked the bankruptcy court to rule on his motion before
26   making his opening remarks at the trial. The bankruptcy court
     declined to do so due because Debtor had not given proper notice
27   of the motion to creditors. The bankruptcy court eventually
     denied Debtor’s motion to dismiss his case in an order dated
28   January 29, 2014.

                                   -5-
 1        As to the UST’s § 727(a)(4)(A) claim, the bankruptcy court
 2   concluded: “[t]he evidence shows that [Debtor] made false oaths
 3   and accounts in his original [SOFA], his amended [SOFA], and at
 4   his § 341(a) examination.     [Debtor] knowingly and fraudulently
 5   made these false oaths and accounts in connection with the case.”
 6        On January 7, 2014, the bankruptcy court entered a judgment
 7   denying Debtor a discharge under both § 727(a)(2)(A) and
 8   (a)(4)(A).   Debtor filed a timely appeal.
 9                               II.    JURISDICTION
10        The bankruptcy court had jurisdiction under 28 U.S.C. §§ 1334
11   and 157(b)(2)(J).   We have jurisdiction under 28 U.S.C. § 158.
12                                     III.    ISSUE
13        Whether the bankruptcy court erred in denying Debtor a
14   discharge under § 727(a)(2)(A) and (a)(4)(A).
15                         IV.    STANDARD OF REVIEW
16        We review a bankruptcy court’s decision resolving an
17   objection to discharge as follows:
18         “(1) the bankruptcy court’s determinations of
           the historical facts are reviewed for clear
19         error; (2) the selection of the applicable
           legal rules under § 727 is reviewed de novo;
20         and (3) the application of the facts to those
           rules requiring the exercise of judgments
21         about values animating the rules is reviewed
           de novo.”
22
23   Retz v. Samson (In re Retz), 606 F.3d 1189, 1196 (9th Cir. 2010)
24   (quoting Searles v. Riley (In re Searles), 317 B.R. 368, 373 (9th
25   Cir. BAP 2004), aff’d, 212 Fed. Appx. 589 (9th Cir. 2006)).
26        The bankruptcy court’s determinations concerning the debtor’s
27   intent are factual matters reviewed for clear error.    Beauchamp v.
28   Hoose (In re Beauchamp), 236 B.R. 727, 729 (9th Cir. BAP 1999).     A

                                              -6-
 1   factual finding is clearly erroneous if it is “illogical,
 2   implausible, or without support in the record.”   In re Retz,
 3   606 F.3d at 1196 (citing United States v. Hinkson, 585 F.3d 1247,
 4   1261-62 & n.21 (9th Cir. 2009) (en banc)).
 5                              V.   DISCUSSION
 6        The party objecting to a debtor’s discharge under § 727(a)
 7   bears the burden of proving by a preponderance of the evidence
 8   that the debtor’s discharge should be denied.   In re Retz,
 9   606 F.3d at 1196.   Courts are to “‘construe § 727 liberally in
10   favor of debtors and strictly against parties objecting to
11   discharge.’” Id. (quoting Bernard v. Sheaffer (In re Bernard),
12   96 F.3d 1279, 1281 (9th Cir. 1996)).
13        Here, the bankruptcy court denied Debtor’s discharge pursuant
14   to § 727(a)(2)(A) because he transferred the Property with the
15   intent to hinder, delay, or defraud his creditors, and under
16   § 727(a)(4)(A) because he failed to timely disclose his
17   prepetition transfer of the Property.8   Debtor argues that the
18   court erred because he lacked the required bad intent to deny him
19   a discharge because: (1) he believed the Property was owned solely
20   by his wife; (2) he was under extreme mental stress leading up to
21   and during his bankruptcy case due to the state court litigation
22   and judgment; and (3) he was ineffectively represented by his
23
24        8
             While Debtor’s briefing discusses the Property and his
     reasons for transferring and not disclosing the transfer to his
25   son, it also veers off topic in addressing his reasons for
     transferring the BMW. The brief also includes Debtor’s extensive
26   recitation about the actions and conduct of Tessie’s counsel in
     connection with the state court action. While these matters may
27   arguably provide context, at bottom, Debtor’s perceptions about
     the wrongs imposed upon him are not relevant or helpful in
28   resolving this appeal.

                                      -7-
 1   bankruptcy counsel.   Debtor’s arguments all lack merit.
 2   A.   The bankruptcy court did not err in finding that Debtor
          transferred the Property with the intent to hinder, delay, or
 3        defraud creditors for the purposes of § 727(a)(2)(A).
 4        Section 727(a)(2)(A) provides:
 5         (a) [t]he court shall grant the debtor a
           discharge unless— . . . (2) the debtor, with
 6         intent to hinder, delay, or defraud a
           creditor or an officer of the estate . . .
 7         has transferred, removed, destroyed,
           mutilated, or concealed, or has permitted to
 8         be transferred, removed, destroyed,
           mutilated, or concealed— (A) property of the
 9         debtor, within one year before the date of
           the filing of the petition[.]
10
11   Under § 727(a)(2)(A), a party objecting to a debtor’s discharge
12   must prove by a preponderance of the evidence: “‘(1) disposition
13   of property, such as a transfer or concealment, and (2) a
14   subjective intent on the debtor’s part to hinder, delay, or
15   defraud a creditor through the act of disposing of the property.’”
16   In re Retz, 606 F.3d at 1200 (quoting Hughes v. Lawson
17   (In re Lawson), 122 F.3d 1237, 1240 (9th Cir. 1997)).
18        The presence of “badges of fraud” may support a bankruptcy
19   court’s finding that a debtor acted with fraudulent intent in
20   transferring or concealing property, including:
21         (1) a close relationship between the
           transferor and the transferee; (2) that the
22         transfer was in anticipation of a pending
           suit; (3) that the transferor Debtor was
23         insolvent or in poor financial condition at
           the time; (4) that all or substantially all
24         of the Debtor's property was transferred;
           (5) that the transfer so completely depleted
25         the Debtor's assets that the creditor has
           been hindered or delayed in recovering any
26         part of the judgment; and (6) that the Debtor
           received inadequate consideration for the
27         transfer.
28   In re Retz, 606 F.3d at 1200 (quoting Emmett Valley Assocs. v.

                                     -8-
 1   Woodfield (In re Woodfield), 978 F.2d 516, 518 (9th Cir. 1992)).
 2        In this case, it is undisputed that Debtor transferred his
 3   interest in the Property to his son on February 2, 2012, and that
 4   Debtor filed his bankruptcy petition on March 29, 2012.   Debtor
 5   argues, however, the bankruptcy court erred in finding that he
 6   made this transfer with the intent to hinder, delay, or defraud
 7   his creditors because, at the time, he believed his wife was the
 8   sole owner of the Property and he did not realize his mistake due
 9   to the stress he was under at the time.
10        The bankruptcy court rejected Debtor’s contention.   Because
11   the court’s determination of Debtor’s intent is a finding of fact,
12   we review if for clear error.   In re Beauchamp, 236 B.R. at 729.
13   We find no clear error here.
14        To begin, the bankruptcy court found Debtor’s testimony was
15   not credible when he testified that he did not know he owned the
16   Property when he deeded it away.   As the trier of fact, the
17   bankruptcy court’s findings as to credibility of witnesses are
18   afforded deference because the court had the opportunity “to note
19   ‘variations in demeanor and tone of voice that bear so heavily on
20   the listener’s understanding of and belief of what is said.’”
21   In re Retz, 606 F.3d at 1196 (quoting Anderson v. City of Bessemer
22   City, North Carolina, 470 U.S. 564, 575 (1985)).   As a result, we
23   will not disturb the bankruptcy court’s decision declining to
24   believe Debtor’s testimony concerning his intent in transferring
25   the Property.
26        Beyond the credibility determination, we also agree with the
27   bankruptcy court’s conclusion that the undisputed facts belie
28   Debtor’s assertion that he thought he did not own the Property at

                                     -9-
 1   the time of the transfer.   Debtor executed the quitclaim deed on
 2   February 2, 2012, a short time after the jury had returned a
 3   sizeable verdict against him in the state court action.    The same
 4   day that he signed the deed, he drove from his home in North
 5   Hollywood to the San Bernardino Recorder’s Office, a distance of
 6   approximately seventy (70) miles, to record the deed.
 7        In addition, the bankruptcy court identified several badges
 8   of fraud in this case as support for the inference that Debtor had
 9   acted with the requisite intent under § 727(a)(2)(A), including:
10   (1) the close relationship between Debtor and the transferee of
11   the Property; (2) the timing of the transfer, soon after entry of
12   the large jury verdict; (3) the fact that Debtor believed he could
13   not pay his creditors at the time of the transfer; and (4) the
14   fact that Debtor personally signed the quitclaim deed and
15   personally delivered it to be filed on the same day.    The
16   bankruptcy court emphasized these factors and “all establish that
17   [Debtor] transferred [the Property] with intent to hinder, delay
18   or defraud.”   The bankruptcy court did not clearly err in making
19   these findings.
20        On this record, the bankruptcy court did not err in finding
21   that Debtor transferred his interest in the Property to his son
22   with the intent to hinder, defraud, or delay his creditors, and in
23   concluding that Debtor’s discharge should be denied under
24   § 727(a)(2)(A).
25   B.   The bankruptcy court did not clearly err under § 727(a)(4)(A)
          in finding Debtor knowingly and fraudulently made a false
26        oath or account in his SOFA, amended SOFA, and at the
          § 341(a) meeting.
27
28        Section 727(a)(4)(A) provides: “(a) [t]he court shall grant

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 1   the debtor a discharge, unless— . . . (4) the debtor knowingly and
 2   fraudulently, in or in connection with the case— (A) made a false
 3   oath or account.”    The party objecting to a debtor’s discharge
 4   must prove under § 727(a)(4)(A), by a preponderance of the
 5   evidence, “‘(1) that the debtor made a false oath in connection
 6   with the case; (2) the oath related to a material fact; (3) the
 7   oath was made knowingly; and (4) the oath was made fraudulently.’”
 8   In re Retz, 606 F.3d at 1197 (quoting Roberts v. Erhard
 9   (In re Roberts), 331 B.R. 876, 882 (9th Cir. BAP 2005)).    In order
10   to prove fraudulent intent under this Code provision, the
11   objecting party must show: (1) the debtor made a false statement
12   or omission in the bankruptcy case; (2) that he knew was false at
13   the time of making the statement; and (3) that he made the
14   statement with the “intention and purpose of deceiving the
15   creditors.”   Khalil v. Developers Sur. & Indem. Co.
16   (In re Khalil), 379 B.R. 163, 173 (9th Cir. BAP 2007) (quoting
17   In re Roberts), 331 B.R. at 884); see also In re Retz, 606 F.3d at
18   1199.   “Intent is usually proven by circumstantial evidence or by
19   inferences drawn from the debtor’s conduct.”   In re Retz, 606 F.3d
20   at 1199 (citing Devers v. Bank of Sheridan, Mont. (In re Devers),
21   759 F.2d 751, 753-54 (9th Cir. 1985)).
22        Here, the bankruptcy court did not err in deciding that
23   Debtor made a false oath in connection with his case, and that he
24   did so repeatedly.
25        Debtor filed his initial SOFA on March 29, 2012; it omitted
26   his transfer of the Property to his son.   Debtor then testified at
27   his § 341(a) meeting on May 3, 2012, that his SOFA was true and
28   correct.   After his case was audited by the UST, and he was

                                      -11-
 1   notified that he had not properly disclosed the transfer of his
 2   BMW to his son, Debtor filed an amended SOFA that again omitted
 3   the transfer of the Property.   The bankruptcy court found that,
 4   taken together, these facts were sufficient to show that Debtor
 5   had made false oaths in connection with the case.    We find no
 6   error with this conclusion.
 7        There is also no dispute that these false oaths related to a
 8   material fact.    The Property was purchased for $17,000, and Debtor
 9   testified he believed the value of the Property to be
10   approximately $10,000 at the time of the transfer.   Had the Debtor
11   disclosed the transfer, the trustee may have been able to avoid it
12   and liquidate Debtor’s interest in the Property for the benefit of
13   his creditors.    See § 547(b) (empowering a trustee to avoid
14   prepetition preferential transfers to creditors).    Under these
15   facts, we agree with the bankruptcy court that the Property was a
16   significant asset of Debtor and that his omission of information
17   about the transfer would constitute a material fact under
18   § 727(a)(4)(A).   See In re Khalil, 379 B.R. at 173 (discussing the
19   “broad test of materiality” that “[a] fact is material ‘if it
20   bears a relationship to the debtor’s business transactions or
21   estate, or concerns the discovery of assets, business dealings, or
22   the existence and disposition of the debtor’s property.’”)
23   (quoting Fogal Legware of Switz., Inc. v. Wills (In re Wills),
24   243 B.R. 58, 62 (9th Cir. BAP 1999)).
25        Debtor insists that the bankruptcy court erred in concluding
26   that he made knowing and fraudulent false oaths in connection with
27   his case because he allegedly did not know he owned the Property
28   when he transferred it.   Again, however, we find no error in the

                                      -12-
 1   bankruptcy court’s findings.
 2        The bankruptcy court found, as it did under § 727(a)(2)(A),
 3   that Debtor acted fraudulently.    For the reasons discussed above,
 4   we have concluded that this finding was not clear error.
 5        We also find no error in the bankruptcy court’s determination
 6   that Debtor made the false oaths knowingly because it is supported
 7   by sufficient evidence.   See In re Khalil, 379 B.R. at 173 (“A
 8   debtor ‘acts knowingly if he . . . acts deliberately and
 9   consciously.’”) (quoting In re Wills, 243 B.R. at 62); see also
10   In re Retz, 606 F.3d at 1198 (holding that a debtor acts knowingly
11   if he or she deliberately and consciously signed the schedules and
12   SOFA knowing they were incomplete).      Here, based upon the
13   evidence, the court properly found that Debtor deliberately and
14   consciously omitted the Property transfer in the SOFA, amended
15   SOFA, and in his testimony at the § 341(a) meeting.
16        Debtor argues that he should not be denied a discharge
17   because the omissions in his bankruptcy filings resulted from the
18   ineffective assistance of his bankruptcy counsel.      We disagree.
19   It is generally correct that “‘a debtor who acts in reliance on
20   the advice of his attorney lacks the intent to deny him a
21   discharge of his debts.’”   In re Retz, 606 F.3d at 1199 (quoting
22   First Beverly Bank v. Adeeb (In re Adeeb), 787 F.2d 1339, 1343
23   (9th Cir. 1986)).   But “[t]he advice of counsel is not a defense
24   when the erroneous information should have been evident to the
25   debtor.”   Id. (citing Boroff v. Tully (In re Tully), 818 F.2d 106,
26   111 (1st Cir. 1987)).   Here, Debtor does not claim he informed his
27   counsel of the transfer of the Property, that it was counsel who
28   omitted this important information from the two versions of the

                                       -13-
 1   SOFA, or that counsel advised him not to mention the Property at
 2   the § 341(a) meeting.   Instead, Debtor focuses on other alleged
 3   mistakes by his counsel to justify our reversal of the bankruptcy
 4   court.9   Even if these matters raise some level of concern, they
 5   do not excuse Debtor’s repeated false assertions under oath that
 6   he provided complete information; exactly the opposite was true.
 7        The bankruptcy court did not err in denying Debtor a
 8   discharge under § 727(a)(4)(A).
 9                              VI.   CONCLUSION
10        We AFFIRM the judgment of the bankruptcy court denying Debtor
11   a discharge.
12
13
14
15
16
17
18
19
20
21
22
23
24
          9
             The other alleged failures of counsel Debtor discusses in
25   his brief include: (1) incorrectly claiming a homestead exemption
     on Debtor’s wife’s home; (2) completing and filing means test
26   schedules even though Debtor’s debts were primarily business
     debts; (3) losing the auditor’s paperwork; (4) not listing the BMW
27   as a prepetition transfer, even though Debtor told him about it;
     and (5) being an hour late to his first meeting with Debtor
28   without excuse. Appellant Op. Brief at 9-11.

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