In re Kalter, 292 F.3d 1350 (11th Cir., 2002)

Jun 07, 2002

OUTCOME: 11th Circuit Court of Appeals affirms District Ct

Motion for sanctions granted in lower court, appealed to MD FL District Ct and reversed, we appealed to 11th Circuit Court of Appeals. Ironically, as ruling based upon Florida law, Fl legislature chang ... ed UCC law next year. These two cases have been consolidated on appeal because they raise the same issue: whether, during bankruptcy proceedings, a debtor can compel a secured creditor to turn over a vehicle repossessed before the debtor filed his bankruptcy petition. Debtors-Appellants Thomas and Debra Kalter and Debtor-Appellant Matthew Chiodo ("the Debtors") argue that the district court erred in finding that their vehicles, repossessed prepetition by Creditor-Appellee Bell-Tel Federal Credit Union and Creditor-Appellee Tidewater Finance Company ("the Creditors"), respectively, were not property of the Debtors' bankruptcy estates at the time that the Debtors filed for bankruptcy. After careful review of the record and the parties' arguments, we find no error and affirm both district court rulings. In short, based on our review of the language of the statute, we reject the bankruptcy court's conclusion that a certificate of title is somehow required for the Creditors to be deemed the "owners" of the repossessed vehicles.10 Not only is a certificate of title unnecessary to establish ownership, but Chapter 319 explicitly recognizes repossession as a transfer of ownership. Indeed, the plain language of the statute even refers to an affidavit describing the repossession event as being "proof of ownership." Fla. Stat. § 319.28. Moreover, Florida case law holds that a certificate of title is merely evidence of, and is not a requirement of, establishing ownership; thus, the fact that the Creditors in these cases had not yet obtained certificates of title or certificates of repossession is insignificant.11 We conclude, therefore, that Fla. Stat. § 319.28 recognizes that ownership passes when the creditor repossesses the vehicle. Accordingly, we affirm the judgment of the district court in both cases, and hold that the vehicles repossessed prepetition were not "property of the [Debtors' bankruptcy] estate[s]" under § 541 of the Bankruptcy Code. AFFIRMED.