                                                               FILED
                                                               MAR 17 2017
 1                         NOT FOR PUBLICATION
 2                                                        SUSAN M. SPRAUL, CLERK
                                                            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.     CC-16-1241-TaFC
                                   )
 6   JON W. CHAFFEE,               )      Bk. No.     8:14-bk-12834-SC
                                   )
 7                   Debtor.       )      Adv. No.    8:14-ap-01215-SC
     ______________________________)
 8                                 )
     B. CASEY YIM,                 )
 9                                 )
                     Appellant,    )
10                                 )
     v.                            )      MEMORANDUM*
11                                 )
     JON W. CHAFFEE,               )
12                                 )
                     Appellee.**   )
13   ______________________________)
14                 Argued and Submitted on February 23, 2017
                            at Pasadena, California
15
                             Filed – March 17, 2017
16
                 Appeal from the United States Bankruptcy Court
17                   for the Central District of California
18      Honorable     Scott C. Clarkson, Bankruptcy Judge, Presiding
19
     Appearances:     B. Casey Yim, pro se.
20
21   Before:     TAYLOR, FARIS, and CLEMENT,*** Bankruptcy Judges.
22
23
          *
             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.
25
     See 9th Cir. BAP Rule 8024-1(c)(2).
26        **
                Debtor–Appellee did not file a brief.
27
          ***
              The Hon. Fredrick E. Clement, United States Bankruptcy
28   Judge for the Eastern District of California, sitting by
     designation.
 1                              INTRODUCTION
 2        B. Casey Yim appeals from the bankruptcy court’s judgment
 3   in favor of debtor Jon Chaffee in an adversary proceeding
 4   objecting to discharge of Yim’s claim under § 523(a)(2)(A) and
 5   (a)(2)(B).1   We AFFIRM the bankruptcy court.
 6                                   FACTS
 7        On June 10, 2013, Yim agreed to sell Debtor property in
 8   Newport Beach for $2,475,000.    To memorialize the agreement,
 9   they entered into a purchase and sale agreement (the “PSA
10   Contract”).   For the purposes of this nondischargeability
11   action, Debtor and Yim stipulated to, among others, the
12   following facts:
13   5.   The transaction was to be performed as an “All Cash”
14        transaction without loan or financing contingencies
15        permitted to the buyer (Chaffee).    PSA Contract, paras. 3.
16        J. and K (Plaintiff’s Trial Exhibit 1).
17   6.   Specifically, under the aforesaid PSA Contract, para. 3.j.,
18        the transaction was expressly stated to be an “All Cash”
19        transaction, without loan or financing contingencies.
20   7.   Under para. 3.K. of the PSA Contract (Plaintiff’s Trial
21        Exh. 1), debtor-defendant agreed and represented, in
22        writing, that “Buyer’s failure to secure alternate
23        financing does not excuse buyer from the obligation to
24        purchase the property and close escrow as specified in this
25        purchase agreement [the ‘PSA Contract’ herein]”
26
27        1
             Unless otherwise indicated, all chapter and section
28   references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532.

                                       2
 1   8.    At the time the parties entered into the PSA Contract, the
 2         debtor-defendant did not intend to perform the contract as
 3         an “All Cash” transaction without a loan or funding
 4         contingency to be obtained from a third party lending or
 5         financing source.
 6   9.    At the time the parties entered into the PSA Contract, the
 7         debtor defendant did not have liquid assets or cash of his
 8         own to purchase the subject property as an “All Cash”
 9         transaction.
10   10.   At the time the parties entered into the transaction, the
11         debtor defendant did not have any written or contractual
12         commitment from any third party lending or financing source
13         to provide the funds need to permit defendant to purchase
14         the subject property as an “All Cash” transaction.
15   11.   At the time the parties entered into the PSA Contract,
16         defendant could not and had no financial ability to perform
17         the contact as an “All Cash” transaction as represented in
18         his written PSA Contract signed by him on or about June 10,
19         2013. (Exhibit 1)
20   12.   Defendant Chaffee never intended to perform the subject PSA
21         contract dated June 10, 2013, as an “All Cash” transaction
22         without any third-party loan or financing contingency at
23         the time the parties entered into the PSA Contract and at
24         all times thereafter.
25   13.   Defendant instead intended to perform by making financing
26         arrangements for payment funding from some other third
27         party lending or financing source.
28   14.   Defendant did not disclose to Plaintiff his intent to not

                                     3
 1         perform as an “All Cash” transaction.
 2   15.   Defendant did not disclose to plaintiff-Seller his true
 3         intent to condition his performance upon loans or financing
 4         arrangements from third-party lending or financing sources.
 5   16.   Plaintiff relied on Defendants “selected method of
 6         financing” under the PSA Contract as “All Cash” in entering
 7         into the PSA Contract with defendant.
 8   17.   Under the PSA Contract, para. 3 (K) (Plaintiff's Exhibit
 9         1), the parties expressly covenanted and represented, in
10         writing, as follows:
11              “Seller has relied on Buyer’s representation of the
12         type of financing specified (including, . . . all cash).
13         If buyer seeks alternate financing, (i) Seller has no
14         obligation to cooperate with Buyer’s efforts to obtain such
15         financing; and (ii) Buyer shall also pursue the financing
16         method specified in this Agreement.   Buyer’s failure to
17         secure alternate financing does not excuse Buyer from the
18         obligation to purchase the Property and close escrow as
19         specified in this Agreement.”
20   18.   Defendant did not have his own funds, nor did he obtain
21         third-party loan financing to pay the purchase price, and
22         therefore breached the subject PSA Contract by failure to
23         pay by the contracted closing date, July 10, 2013.
24   19.   Plaintiff was able to find and arrange for another buyer
25         for the property to mitigate his damages; however the
26         replacement buyer’s contracted re-sale price was only
27         $2,375,000, or $100,000 lower that Defendant’s contract
28         price; and did not close until Dec. 13, 2013.

                                     4
 1        In September 2013, Yim sued Debtor in California state
 2   court for breach of contract and specific performance.    Yim
 3   obtained a default judgment for $328,166.08, plus post-judgment
 4   interest.
 5        Debtor files bankruptcy; Yim brings a nondischargeability
 6   action.   In May 2014, Debtor filed a voluntary chapter 7
 7   petition.   Yim later commenced an adversary proceeding seeking
 8   to hold the default judgment nondischargeable under § 523(a)(2).
 9   Eventually, the parties prepared a joint pretrial stipulation
10   and proposed order.   After some procedural missteps, the matter
11   was set for trial by declaration.     Yim submitted a trial brief,
12   his declaration, and his trial exhibits.    Debtor also submitted
13   a declaration and trial exhibits.
14        The bankruptcy court heard the matter, but Debtor did not
15   appear.   On Yim’s oral motion, the bankruptcy court struck
16   Debtor’s declaration and trial exhibits.    The bankruptcy court
17   reviewed the pretrial order and factual admissions; it then
18   engaged in an extensive colloquy with Yim about the case.
19   Finally, the hearing concluded with the bankruptcy court’s oral
20   ruling that Yim failed to prove the required elements by a
21   preponderance of the evidence.   The bankruptcy court later
22   issued a memorandum decision.    Bankruptcy Court’s Memorandum of
23   Decision Regarding Non-Dischargeability Proceeding Under
24   §§ 523(a)(2)(A) and (a)(2)(B), Aug. 19, 2016 (“Mem. Dec.”).     Yim
25   does not challenge the decision under § 523(a)(2)(B) on appeal.
26   The bankruptcy court then entered judgment in Debtor’s favor and
27   against Yim.   Yim timely appealed.
28

                                      5
 1                               JURISDICTION
 2        The bankruptcy court had jurisdiction under 28 U.S.C.
 3   §§ 1334 and 157(b)(2)(I).   We have jurisdiction under 28 U.S.C.
 4   § 158.
 5                                   ISSUE
 6        Whether the bankruptcy court erred in determining that
 7   Yim’s claim is dischargeable.
 8                           STANDARD OF REVIEW
 9        We review the bankruptcy court’s conclusions of law de novo
10   and its factual findings for clear error.    Carrillo v. Su
11   (In re Su), 290 F.3d 1140, 1142 (9th Cir. 2002); Anastas v. Am.
12   Sav. Bank (In re Anastas), 94 F.3d 1280, 1283 (9th Cir. 1996)
13   (“A finding of whether a requisite element of section a [sic]
14   523(a)(2)(A) claim is present is a factual determination
15   reviewed for clear error.”); see also Eugene Parks Law Corp.
16   Defined Benefit Plan v. Kirsh (In re Kirsh), 973 F.2d 1454, 1456
17   (9th Cir. 1992) (“The determination of justifiable reliance
18   [under § 523(a)(2)(A)] is a question of fact subject to the
19   clearly erroneous standard of review.”).
20        “Clearly erroneous review is significantly deferential,
21   requiring that the appellate court accept the [trial] court’s
22   findings absent a definite and firm conviction that a mistake
23   has been made.”   United States v. Syrax, 235 F.3d 422, 427 (9th
24   Cir. 2000).   The bankruptcy court’s choice among multiple
25   plausible views of the evidence cannot be clear error.    United
26   States v. Elliott, 322 F.3d 710, 714 (9th Cir. 2003).    A factual
27   finding is clearly erroneous, however, if, after examining the
28   evidence, the reviewing court “is left with the definite and

                                       6
 1   firm conviction that a mistake has been committed.”     Anderson v.
 2   City of Bessemer City, 470 U.S. 564, 573 (1985) (internal
 3   citation omitted).
 4                              DISCUSSION
 5        Section 523(a)(2)(A) excepts from discharge a debt
 6   resulting from “false pretenses, a false representation, or
 7   actual fraud, other than a statement respecting the debtor’s or
 8   an insider’s financial condition.”   11 U.S.C. § 523(a)(2)(A).
 9   The creditor bears the burden of proving § 523(a)(2)(A)’s
10   applicability by a preponderance of the evidence.   Ghomeshi v.
11   Sabban (In re Sabban), 600 F.3d 1219, 1222 (9th Cir. 2010).    In
12   the Ninth Circuit, the five elements for a § 523(a)(2)(A)
13   nondischargeability claim are:
14        (1) misrepresentation, fraudulent omission or
          deceptive conduct by the debtor; (2) knowledge of the
15        falsity or deceptiveness of [the debtor’s] statement
          or conduct; (3) an intent to deceive; (4) justifiable
16        reliance by the creditor on the debtor's statement or
          conduct; and (5) damage to the creditor proximately
17        caused by its reliance on the debtor's statement or
          conduct.
18
19   Turtle Rock Meadows Homeowners Ass’n v. Slyman (In re Slyman),
20   234 F.3d 1081, 1085 (9th Cir. 2000); see In re Sabban, 600 F.3d
21   at 1222; Oney v. Weinberg (In re Weinberg), 410 B.R. 19, 35 (9th
22   Cir. BAP 2009).
23        We start with a notable absence: Debtor.   Debtor did not
24   file a brief in this appeal.   He also failed to show up at the
25   July 27, 2016 hearing, which was to be a trial on the merits.2
26
27        2
             In affirming, we do not condone Debtor’s non-
28   participation.

                                      7
 1   Accordingly, the bankruptcy court essentially transformed the
 2   trial into a default prove-up hearing and engaged Yim (an
 3   attorney) in a substantive conversation about his case’s merits.
 4   That said, we do not treat the discussion as evidentiary because
 5   the bankruptcy court did not receive Yim’s testimony under oath
 6   (other than through his declaration).
 7        The bankruptcy court concluded that Yim failed to prove any
 8   of the elements by a preponderance of the evidence.   Thus, to
 9   prevail in this appeal, Yim must show that the bankruptcy court
10   erred in every respect.
11   A.   The bankruptcy court properly concluded that Yim failed to
          establish the first and second elements of § 523(a)(2)(A).
12
13        Considering the first and second elements in tandem, the
14   bankruptcy court concluded that Yim failed to prove either that
15   Debtor made a representation that he knew at the time was false
16   or that Debtor made a fraudulent omission.   We consider each
17   separately.
18        A knowing misrepresentation.   The bankruptcy court
19   explained:
20        Plaintiff never alleged that Defendant made an oral
          promise or representation at all. The only source of
21        any alleged misrepresentation is the Agreement, the
          AKM Letter, and the joint pretrial stipulation. In
22        other words, Plaintiff does not point to any other
          source (oral or written) for Defendant’s alleged
23        misrepresentation. However, none of the sources cited
          by Plaintiff support his assertion that Defendant
24        “Represented that he had sufficient liquid cash assets
          to perform without requiring loan financing.”
25
26   Mem. Dec. at 6.
27        On appeal, Yim argues that the bankruptcy court erred by
28   substituting its interpretation of the Agreement for the

                                    8
 1   parties’ “mutual understanding” of the Agreement as reflected in
 2   the joint stipulation.    He asserts the “fraud, false pretense
 3   and false representation claim in this case is simple.”      Aplt’s
 4   Opening Br. at 5.   In particular, he argues:
 5        The PSA represented an offer made by debtor to
          purchase the property as an “All Cash” transaction,
 6        which the parties stipulated meant that there would be
          no loan or financing contingency allowed to the
 7        debtor-buyer. . . . The parties stipulated to the
          meaning of these terms of the PSA contract—“All Cash;
 8        no loan contingency.”
 9   Id. at 11—12 (record citations omitted).    Yim essentially
10   interprets Debtor’s checking the “all cash” box as a
11   representation that when Debtor signed the Agreement on June 10,
12   2013, he had the cash on hand to pay $2,475,000.    But nothing
13   Yim points to establishes this representation; we thus agree
14   with the bankruptcy court.    As the bankruptcy court observed,
15   Yim pointed to only three sources: the PSA Contract; the joint
16   pretrial stipulation; and a “line of credit” letter (the “AKM
17   Letter”).
18        First, we turn to the PSA Contract.    Yim and Debtor signed
19   a California form residential real estate purchase agreement.
20   They agreed, among other things, that Debtor would buy a
21   property for $2,475,000.    PSA Contract ¶ 1.B and 1.C.    Under the
22   finance terms section, they provided for no deposit and agreed
23   that the contract was not contingent on an appraisal.      PSA
24   Contract ¶ 3.A and 3.I.    They checked the “ALL CASH OFFER” box,
25   which also provides: “Buyer shall, within 7 . . . Days After
26   Acceptance, Deliver to Seller written verification of sufficient
27   funds to close this transaction.”    PSA Contract ¶ 3.J.    The very
28   next line states:

                                      9
 1        BUYER STATED FINANCING: Seller has relied on Buyer’s
          representation of the type of financing specified
 2        (including but not limited to, as applicable, amount
          of down payment, contingent or non contingent loan, or
 3        all cash). If Buyer seeks alternate financing,
          (i) Seller has no obligation to cooperate with Buyer’s
 4        efforts to obtain such financing, and (ii) Buyer shall
          also pursue the financing method specified in this
 5        Agreement. Buyer’s failure to secure alternate
          financing does not excuse buyer from the obligation to
 6        purchase the Property and close escrow as specified in
          this Agreement.
 7
 8   PSA Contract ¶ 3.K.   The PSA Contract does not require or
 9   represent that the buyer has sufficient cash on hand to purchase
10   the property on the day of execution.   As the bankruptcy court
11   explained, the Agreement “contemplates that even a buyer with an
12   ‘all cash’ offer may seek alternate financing, so long as the
13   buyer also pursues the ‘all cash’ method of financing.”    Mem.
14   Dec. at 9.   Indeed, the Agreement’s default terms (which Yim and
15   Debtor agreed to) give Debtor seven days to provide proof of
16   funds.
17        Second, the pretrial order’s stipulated facts do not
18   contradict this.   They rightly reflect that the transaction was
19   “All Cash” and “without loan or financing contingencies”.    They
20   also state that, under ¶ 3.K, Debtor agreed that his failure to
21   obtain alternate financing would not excuse his obligation to
22   purchase the property.   But the pretrial order does not
23   establish that Debtor represented that he had $2,745,000 in cash
24   or other liquid assets on June 10, 2013.
25        Last, the AKM Letter does not represent that Debtor had
26
27
28

                                     10
 1   $2,745,000 cash on hand.   Yim does not argue otherwise.3
 2        What, then, did Debtor represent?    He represented that he
 3   would purchase the property from Yim on July 10, 2013.      As it
 4   turns out, Debtor was unable to purchase the property on
 5   July 10.    But, as Yim concedes in the stipulated facts, Debtor
 6   “intended to perform by making financing arrangements for
 7   payment funding from some other third party lending or financing
 8   source.”    Thus, at the time Debtor made the representation, he
 9   did not know it would be false.    Indeed, the facts reflect the
10   opposite: Debtor intended to perform.
11        Yim’s insistence that Debtor made a misrepresentation
12   derives from his misinterpretation of what “all cash” and
13   “without loan or financing contingencies” mean.4   From Debtor’s
14   perspective, if there are loan or financing contingencies,
15   Debtor’s inability to satisfy the contingency (i.e., to timely
16   obtain a loan) would excuse him from having to pay the full
17   $2,745,000 on July 10 (in a typical scenario, he might forfeit a
18   deposit).   Absent these contingencies, Debtor’s failure to
19   procure a loan or other financing does not excuse his payment;
20   he is obligated for the full amount.    From Yim’s perspective:
21   with contingencies, Yim does not have a claim for breach of
22
          3
             At oral argument, Yim pointed to paragraph 7 of his
23
     trial declaration. But this, also, does not contain a
24   representation from Debtor that he had sufficient cash on
     June 10, 2013.
25
          4
             Yim is clearest in paragraph 6 of his trial declaration:
26   “This ‘all cash’ term meant to me that . . . [Debtor] had
27   sufficient liquid assets or cash to pay the purchase price
     without qualifying for or obtaining a loan or outside financing
28   from any third party source.” (Emphasis added.)

                                       11
 1   contract because the contract is not breached; without
 2   contingencies, Yim has a claim for breach of contract.
 3        The stipulated facts do not even establish that Debtor
 4   intended to condition his liability under the contract on his
 5   obtaining a loan; rather, they show that he intended to
 6   “condition” his performing on his obtaining third-party
 7   financing.   As it turns out, this was naive on Debtor’s part:
 8   Yim held Debtor to the contract and obtained a judgment.
 9        In short, by checking the “all cash” box, Debtor
10   represented that he would pay Yim $2,745,000 on July 10 and that
11   an inability to obtain funding would not excuse this.     Under the
12   stipulated facts, Debtor intended to pay Yim $2,745,000 on
13   July 10.    Accordingly, the bankruptcy court did not err when it
14   concluded that Yim failed to prove, by a preponderance of the
15   evidence, that at the time Debtor made the representation he
16   knew it was false.
17        A Fraudulent Omission.    The bankruptcy court concluded that
18   Yim failed to prove that Debtor made a fraudulent omission:
19   “Here, [Yim] has not established that [Debtor] had a duty to
20   disclose his intention to pursue financing or that such fact was
21   basic to the transaction.”    Mem. Dec. at 11.   The bankruptcy
22   court went even further: “Even if [Debtor] was under a duty to
23   disclose, [Yim] cannot claim that he was ignorant of [Debtor’s]
24   intention to pursue financing . . . .”    Id.
25        On appeal, Yim seems to argue that Debtor made a fraudulent
26   omission:
27        Debtor admitted that he did not have sufficient cash
          to perform, and had no ability to get the cash from a
28        third party lending source. The Debtor also admitted

                                      12
 1        that he failed to disclose to Yim (concealed) his
          intent not to perform under the PSA terms, and he
 2        failed to disclose his true intentions to condition
          his performance upon obtaining third-party financing
 3        in blatant contradiction of the agreed contract terms.
 4   Aplt’s Opening Br. at 15 (record citations omitted).    But Yim
 5   does not argue that Debtor was under a duty to disclose.      This
 6   is fatal.   “A debtor’s failure to disclose material facts
 7   constitutes a fraudulent omission under § 523(a)(2)(A) if the
 8   debtor was under a duty to disclose and the debtor’s omission
 9   was motivated by an intent to deceive.”    Harmon v. Kobrin
10   (In re Harmon), 250 F.3d 1240, 1246 n.4 (9th Cir. 2001) (citing
11   Citibank (South Dakota), N.A. v. Eashai (In re Eashai), 87 F.3d
12   1082, 1089–90 (9th Cir. 1996)).    Nor does Yim challenge the
13   bankruptcy court’s further finding that, even if Debtor were
14   under a duty to disclose, Yim was not ignorant of Debtor’s
15   “true” intent.
16        In sum, we agree with the bankruptcy court that Yim failed
17   to prove the first and second elements of § 523(a)(2)(A).
18   Having determined that the bankruptcy court did not err when it
19   concluded that Yim failed to establish a knowingly false
20   representation by a preponderance of the evidence, we could stop
21   here.   Yim’s case fails without a misrepresentation.   That said,
22   we briefly consider another element — one where Yim disagrees
23   with the bankruptcy court’s application of the underlying legal
24   standard.   He is wrong there, as well.
25   B.   The bankruptcy court properly concluded that Yim failed to
          establish justifiable reliance by a preponderance of the
26        evidence.
27        On the fourth element, the bankruptcy court found that Yim
28   “is a sophisticated and experienced business attorney who has

                                       13
 1   conducted many trials in state and federal court, including real
 2   estate trials.”   Mem. Dec. at 14.    And it “h[e]ld Plaintiff to
 3   that level of capacity, knowledge, and sophistication.”       Id.
 4   Next, the bankruptcy court found that “there were numerous,
 5   obvious ‘red flags’ which should have compelled [Yim] to
 6   investigate further.”    Id. at 14–17.   For example, Debtor and
 7   Yim did not have a prior relationship.     Id. at 14–15.   Yim did
 8   not perform any due diligence or investigate Debtor’s
 9   creditworthiness.   Id. at 15.   Yim did not seek a deposit.     Id.
10   Instead, Yim relied on a letter that, by its very terms, should
11   have raised red flags.    Id.
12        On appeal, Yim contends that the bankruptcy court imposed
13   on him a heightened standard of reliance, when under relevant
14   case law “only a relaxed ‘justifiable reliance’ standard need be
15   shown . . .”   Aplt’s Opening Br. 32.    Yim correctly observes
16   that justifiable reliance is not an objective standard; it is a
17   subjective standard.    But he perhaps misunderstands what a
18   subjective standard is: he suggests that a subjective standard
19   is always more relaxed than an objective, reasonable person
20   standard.   Not always so.
21        “[A] creditor’s reliance on a debtor’s misrepresentation
22   need be only justifiable, not reasonable,” for § 523(a)(2)(A)
23   purposes.   In re Eashai, 87 F.3d at 1090.    Justifiable reliance
24   “turns on a person’s knowledge under the particular
25   circumstances.”   Id.   The bankruptcy court “must look to all of
26   the circumstances surrounding the particular transaction, and
27   must particularly consider the subjective effect of those
28   circumstances upon the creditor.”     In re Kirsh, 973 F.2d

                                      14
 1   at 1460.    It “is a matter of the qualities and characteristics
 2   of the particular plaintiff, and the circumstances of the
 3   particular case, rather than of the application of a community
 4   standard of conduct to all cases.”    In re Eashai, 87 F.3d at
 5   1090 (internal quotation marks and citations omitted).    In some
 6   cases, justifiable reliance requires the creditor to investigate
 7   somewhat.   Field v. Mans, 516 U.S. 59, 76 (1995) (“[These
 8   particular creditors] may recover, at common law and in
 9   bankruptcy, but lots of creditors are not at all naive.    The
10   subjectiveness of justifiability cuts both ways . . . .”).5
11        Here, the bankruptcy court properly identified justifiable
12   reliance as a subjective standard and then properly applied the
13   facts.   First, Yim does not dispute that he is an attorney with
14   substantial litigation and real estate experience.6   Second, Yim
15   does not challenge the bankruptcy court’s numerous findings of
16   obvious red flags in this particular case that should have
17   compelled him, an experienced real estate attorney,7 to
18
19        5
             In others, a “person is justified in relying on a
20   representation of fact although he might have ascertained the
     falsity of the representation had he made an investigation.”
21   In re Eashai, 87 F.3d at 1090 (internal quotation marks and
     citations omitted).
22
          6
             To the extent the bankruptcy court based its factual
23
     finding on the argumentative colloquy at the hearing, this was
24   harmless because Yim had earlier provided the bankruptcy court a
     declaration: “I have over 35 years of litigation experience, and
25   have actual trial and arbitration experience, in commercial,
     contract, real estate, and Professional Liability cases.”
26
          7
27           See, e.g., In re Kirsh,973 F.2d at 1460 (“Parks was no
     ordinary person. In fact, he was not even an ordinary attorney.
28                                                      (continued...)

                                      15
 1   investigate further.   Mem. Dec. at 14.   Third, Yim argues that
 2   the bankruptcy court inappropriately rejected his undisputed
 3   testimony that he was fully justified in relying on the AKM
 4   Letter.   We do not agree with Yim’s implicit argument that his
 5   conclusory8 testimony prevents the bankruptcy court from
 6   evaluating justifiable reliance; in any event, he fails to
 7   challenge the bankruptcy court’s identification of the
 8   transaction’s other red flags, such as the lack of a deposit,9
 9   which should have compelled him to investigate further.    Fourth,
10   Yim’s reliance on Barnes v. Roberts (In re Roberts), 538 B.R. 1
11   (Bankr. C.D. Cal. 2015), is misplaced.    It does not stand for
12   the legal proposition that justifiable reliance will never
13   require a creditor to investigate further.    Instead,
14   In re Roberts rightly states that justifiable reliance depends
15   on the particular circumstances of each case.    Id. at 10–11.
16   What’s more, its facts show a creditor who, unlike Yim,
17
18
19
          7
20         (...continued)
     He had been practicing for twenty years and concentrated on
21   business law. He was well aware of the fact that standard
     practice in California was for lenders to obtain title reports.
22   Lenders do not merely rely upon the representations of
23   borrowers. . . . A person with Parks’ knowledge, experience and
     competence should have ordered [a title report].”).
24
          8
             Yim’s conception of justifiable reliance is suspect;
25   accordingly, his “testimony” about it is equally suspect.
26        9
             Mem. Dec. at 15; id. at 15 n.2 (“A debtor’s ability to
27   fund a deposit is relevant to the justifiable reliance
     analysis.” (citing In re McClendon, 415 B.R. 170 (Bankr. D. Md.
28   2009)).

                                     16
 1   investigated extensively.10
 2        In short, Yim believes that justifiable reliance means no
 3   creditor will ever have to investigate a debtor’s
 4   representations — put differently, he believes a subjective
 5   standard should be applied uniformly across all cases.     But a
 6   subjective standard does not apply categorically.     And Yim
 7   otherwise fails to dispute the bankruptcy court’s particular
 8   application of the subjective standard to him.
 9        Yim alternatively argues that he did not need to establish
10   justifiable reliance because Debtor failed to disclose a
11   material fact.   Aplt’s Opening at 25.    But Yim must show that
12   Debtor was under a duty to disclose.     Apte v. Japra
13   (In re Apte), 96 F.3d 1319, 1323 (9th Cir. 1996) (“Indeed, the
14   nondisclosure of a material fact in the face of a duty to
15   disclose has been held to establish the requisite reliance and
16   causation for actual fraud under the Bankruptcy Code.” (emphasis
17   added)).   And Yim concedes the bankruptcy court’s conclusion
18   that he failed to establish: (1) that Debtor was under a duty to
19   disclose; and (2) even if Debtor were under a duty to disclose,
20   that Yim was ignorant of Debtor’s intent to seek alternate
21
22
          10
             See id. at 13 (“Barnes investigated all the disclosed
23   parties and because he found no red flags initially, he invested
24   in the Venture.”); id. at 18 (“Barnes is a sophisticated
     investor but he had no previous experience with investing in
25   this type of venture. . . . Barnes did his due diligence in
     investigating the key partners in the Venture and looked at
26   Manjar and CFI prior to investing. Barnes was thorough in his
27   investigation and follow-up questioning into the Venture prior
     to investing and did not act in an unusual or unreasonable
28   manner.”).

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 1   financing.   Thus, Debtor’s alleged non-disclosure does not
 2   establish justifiable reliance.
 3        In sum, the bankruptcy court properly found that Yim failed
 4   to prove the fourth element of a § 523(a)(2)(A) claim.
 5   C.   Husky does not alter our conclusion.
 6        Yim also argues that the bankruptcy court misapplied the
 7   Supreme Court’s then-recent decision in Husky International
 8   Electronics, Inc. v. Ritz, 136 S. Ct. 1581 (2016).       His analysis
 9   is not clear, and he completely misreads the case in part.
10   Compare Aplt’s Opening Br. at 19 (“The Court further held that
11   ‘actual fraud’ . . . also covers ‘acts of deception that ‘may
12   exist without the imputation of bad faith or immorality.’”),
13   with Husky, 136 S. Ct. at 1586 (“‘Actual’ fraud stands in
14   contrast to ‘implied’ fraud or fraud ‘in law,’ which describe
15   acts of deception that ‘may exist without the imputation of bad
16   faith or immorality.’”).   That aside, he argues the bankruptcy
17   court erred in two respects: first, “by refusing to accept the
18   admitted terms of the parties’ contract itself (all cash, no
19   loan contingency) as evidence of the fraud and of Debtor’s
20   intent to deceive”; and second, by refusing “to accept Debtor’s
21   own admission of his actual fraud in the Joint Stipulation.”
22        We disagree.   First, as a general matter, Husky holds that
23   the “term ‘actual fraud’ in § 523(a)(2)(A) encompasses forms of
24   fraud, like fraudulent conveyance schemes, that can be effected
25   without a false representation.”       Husky, 136 S. Ct. at 1586.
26   This does not alter the Ninth Circuit’s elemental recitation for
27   misrepresentation or false pretenses.       Second, we have already
28   addressed how Yim misunderstands the PSA Contract’s terms and

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 1   the pretrial stipulation’s facts.   The bankruptcy court did not
 2   misapply Husky.
 3                              CONCLUSION
 4        Based on the foregoing, we AFFIRM.
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