Opinion
No. 03-15574-PHX-GBN.
December 14, 2004
John J. Hebert, HEBERT SCHENK P.C., Phoenix, Arizona, Attorneys for Debtor.
James O. Ehinger, ROBBINS GREEN, P.A., Phoenix, AZ, Attorneys for Paul F. Glenn.
Russell A. Brown, Phoenix AZ, Chapter 13, Trustee.
FINDINGS OF FACT, CONCLUSIONS OF LAW AND FINAL ORDER
The motion of Paul F. Glenn and related creditors ("Glenn") to convert Robert R. Horton's ("debtor") case to a Chapter 7 liquidation was tried to the court as a bench trial on August 23-24 and September 8, 2004. Post trial briefing was completed and an interim order was entered on December 2, 2004 announcing the court's decision.
The court has considered the August 20, 2004 joint corrected pretrial statement, sworn witness testimony and the facts and circumstances of this case. The following findings and conclusions are now entered:
FINDINGS OF FACT
1. Robert R. Horton is one of several defendants in litigation brought by Glenn that is pending in Maricopa County Superior Court as case CV 99-08295. Plaintiffs allege fraud, securities fraud and other matters. Trial dates had been previously established and continued. Trial was to begin on September 30, 2003. Joint corrected pretrial statement ("JPS") at I. The litigation commenced on May 13, 1999. Admitted exhibit ("ex.") FFFF at attachment A, p. 1.
2. Plaintiff Glenn's state court litigation arose from debtor's promotion of the Genesis Coals project, an unsuccessful attempt to economically remove sulfur from coal through operation of a $40 million Pennsylvania plant. The project failed due to declining coal prices. One hundred participants, including the federal government, lost their multi-million dollar investment. Cross examination trial testimony ("test") of Robert R. Horton on August 24, 2004.
3. Debtor filed his individual Chapter 13 petition on September 2, 2003. His wife did not file bankruptcy. Mr. Horton's testimony is that he could not pay his attorneys to represent him at the September 30 trial. Debtor had paid $700,000 in attorney fees to date in the litigation. His counsel requested an additional $300,000 to $400,000 payment to represent him at a trial expected to last between six and eight weeks. Debtor testified he first considered filing bankruptcy when state court mediation in May of 2003 failed. However, his accountant recalls a July 30, 2002 meeting in which asset protection was discussed in connection with pending litigation. Debtor retained bankruptcy counsel in June or July of 2003. Bankruptcy counsel attempted to settle, offering Glenn $250,000 for a global settlement and release of all defendants in August of 2003. Plaintiff rejected the offer as inadequate. Plaintiff's counsel requested that if a bankruptcy case was to be filed, that it be filed as soon as possible, so trial preparation expenses could be avoided. Test. id., test. of James O. Ehinger, test. of Jeffrey Corallo, ex. 52 at last three pages. Debtor objected to the Glenn bankruptcy claim on August 18, 2004. Ex. FFFF, administrative docket item ("dkt.") 107.
4. Debtor is employed as chairman, founder, principal shareholder and currently the only board member of Alchemex Corporation, a small company that is attempting to develop a low-cost method of producing commercial amounts of hydrogen from high sulphur coal. He is the firm's only full time employee and last received a salary draw of $7,865.03 in September of 2002. Since then, he has deferred his salary. His income currently consists of draws from Medici Associates LLC, a Delaware limited liability company that holds approximately 11 million shares of Alchemix stock. Over the years, he has received hundreds of thousands of dollars from this entity. Medici funds were even used to pay debtor's $85,000 gambling debt in July of 2002. Prior to its incorporation in 1998, Medici was a "d/b/a" controlled by debtor. Mr. Horton owns 92.2% of Medici, following an August 7, 2003 restructuring in which three relatives were each given 2.6% interests. In exchange, debtor's wife Cheryl Horton, daughter Sarah Horton-Imaz and son-in-law Ignacio Imaz each contributed 300,000 shares of Alchemix stock. As the controlling majority interest holder, debtor can take any action he wishes with Medici, including its termination. In May of 2002, debtor used Medici's Alchemix holdings to gift his future wife with a million shares of stock. He also used Medici to gift Alchemix stock to his daughter and son-in-law. Horton direct test. of August 23, 2004, ex. 38, ex. 63 at p. 2 and attachment A, ex. 26, ex. 17 at p. 9 entry for September 30, 2002.
5. Debtor considers the promise of Alchemix to be his principal personal asset. The company currently is experiencing hard times. It has run out of money, has not generated operating income in its seven to eight year existence, its liabilities exceed its assets, its hydrogen technology is not commercially proven and it would cost hundreds of millions to build a plant to implement its technology. Its privately held stock is a high-risk investment, similar to a lottery ticket. Potential investors tend to be risk takers and are told by debtor that they'll either lose their investment or make a large profit. Horton cross examination test. of August 24 and September 8, 2004, test. of John F. Olive.
6. Notwithstanding the company's current status, the Alchemix stock did have value, as debtor should have known. On June 14, 2002, Western Oil Sands, Inc. agreed to purchase 1.5 million shares of Alchemix for a price of $2 per share. The agreement included an option allowing Western Oil to purchase an additional 2.5 million shares at the same $2 price until July 31, 2002. Western Oil did not exercise the option. Ex. 1.
Around this time, John F. Olive, a former Alchemix board member, had raised three million dollars he was prepared to lend Alchemix for six months, secured by the company's intellectual property. Although the Alchemix board had already approved this loan, debtor convinced the board at the last moment that the Western Oil equity investment was superior to Olive's proposed secured loan. As a consolation for arranging the attempted financing, Olive's group was permitted to purchase three million Alchemix shares personally owned by debtor at $1 per share. Mr. Olive or his group wired $2,910,000 to Medici on June 25 and 26, 2002. He currently holds 1.5 million shares and keeps aware of Alchemix developments. Even given the company's current depressed state and mindful of the risks, Olive would pay between $100,000 and $200,000 for an additional ten to eleven million shares. Mr. Olive, like debtor, believes in the potential of the company. He has never been told by debtor or anyone else that the stock is worthless. The fact finder finds this testimony credible. Olive test., Ex. 2.
Debtor is confident he'll be paid his deferred Alchemix salary in the future. He expects the company to start receiving $750,000 annually from a licensing agreement signed with a Canadian company known as Alchemix Energy, which has separate management. He verified Medici received payments of $2.4 Million and an another $510,000 in June of 2002 for Alchemix stock purchases by Olive's group. Additional $1 per share stock purchases are reflected in Medici records. On October 6, 2003, a month after debtor filed bankruptcy, Medici borrowed money and granted a $1 per share Alchemix acquisition option to Canadian investor Meyer Herzberg. Debtor gave approximately one million shares of Alchemix stock to his wife in May of 2002 as a wedding gift. As previously noted, he has also given stock to his daughter and son-in-law, using Alchemix shares held by Medici. Within the last 90 days before bankruptcy, 112,500 shares were sold at $2 per share, along with an option for additional $2 per share purchases. Finally, as previously noted, shortly before bankruptcy, debtor transferred 2.6% interests in Medici to relatives as an estate planning tool, requiring them to contribute 300,000 shares of Alchemix stock in exchange. Ex. 67, Finding of fact 4 supra, Horton test. of August 23, 2004. The Court finds the Alchemix stock had value at the time of filing bankruptcy and debtor had personal knowledge of this value.
7. Notwithstanding his personal knowledge of the above transactions, debtor scheduled his 114,000 personally held shares of Alchemix stock, as having no current value. Schedule B, item 12. The court finds debtor to be a sophisticated financial professional, represented by knowledgeable, experienced bankruptcy counsel. He previously filed a bankruptcy case in Denver, Colorado in 1977. Mr. Horton explains he scheduled his holdings as lacking current value because the stock was restricted, had no public market and the company owed more money than it had. Accordingly he ignored his knowledge of the prior sales at $1 to $2 per share and the expected $750,000 annual revenue expected for the company from the licensing agreement he personally negotiated with Alchemix Energy. Test. of August 23 and 24, 2004, finding 6 Id. The court does not find this testimony credible.
Debtor proposes not to make available to his creditors the 10.6 million shares of Alchemix stock he controls through Medici. Test. of September 8, 2004.
8. On September 9, 2003, debtor scheduled his controlling interest in Medici Associates LLC as having no current value. Schedule B, item 13. This was done regardless of its holdings of 10.6 million shares of Alchemix stock, its funding of hundreds of thousands of dollars of income to debtor over the years and its use the month before as an estate planning device for debtor and his immediate family. Findings of fact 4, 6 id. Additionally, Medici held a security interest in Alchemix's intellectual property, securing a June 26, 2002 loan of $900,000. The lien was in place when debtor filed bankruptcy and was exercisable since Alchemix had defaulted a year and a half earlier. The loan was increased on June 30, 2004 to $990,000. Debtor's test. of August 23, 2004.
Debtor subsequently caused Medici to release this security interest to facilitate the Alchemix Energy Canadian licensing transaction. Since debtor contends Medici is an independent entity, not subject to this bankruptcy or liable for his personal debts, he did not seek court approval to release the lien. Test. of August 23 and September 8, 2004.
On August 31, 2003 Medici had $54,680.68 in its checking account and $42,869.64 in savings. Ex. 67 at checking register and money market entries for August 31, 2003. Additionally Medici had $17,717.22 in an investment account as of September 26, 2003. Ex. 71 at statement period August 30 to September 26, 2003. It paid debtor $30,000 on September 22, 2003 for travel expenses, including $25, 687.71 due on his American Express credit card. Ex. 67 at September 22, 2003 entry, Ex. 25 at p. 1. Medici was used to pay debtor's wife $20,000 post petition on November 25, 2003. Ex.65 at November 1-28, 2003 check copies and p. 6718, test. of Cheryl A. Horton. Medici was also used pre petition to pay Ms. Horton $300,000 in cash as part of an oral prenuptial agreement on October 3, 2002. Glenn's state court fraud action was pending against debtor at the time. Test. of August 23 and 23, 2004, Cheryl A. Horton test.
Medici's only liability is $250,000 owed to Meyer Herzberg, a resident of Australia. Debtor uses this liability to argue Medici is valueless. However, debtor chose for Medici to formally acquire this debt from Alchemix a month after the bankruptcy filing. September 8, 2004 test. Herzberg was also given a $1 per share option for Alchemix stock through Medici on October 6, 2003, approximately a month after the bankruptcy was filed. Test. of August 23, 2004. Debtor's scheduling of no current value for an entity he controlled since at least 1998, used as a repository for millions of shares of Alchemix stock, used to funnel hundreds of thousands of dollars to himself and his wife and used to gift more than a million shares of Alchemix stock to his family is not credible to this fact finder.
9. In a September 9, 2003 bankruptcy filing, debtor listed his occupation as an executive with Alchemix Corporation, receiving a gross income of $16,667 monthly and net monthly income of $9,267. For purposes of his 36-month Chapter 13 plan, he projects his monthly income will continue to be $9,267. In reality this figure is only an expectation. His salary is accruing and unpaid. Debtor was last paid by Alchemix in September of 2002. Instead his income is from unreported draws from Medici, an entity he lists as having no current value. Schedule I, Current Income of Individual Debtor, Schedule J at Chapter 13 debtor projected income, test. of August 24, finding of fact 4.
On the same date, debtor scheduled his average monthly rent or mortgage payment as $3,800. He additionally listed monthly housing expenses of $266 for electricity and heating, $88 for water and sewer and $400 for home maintenance. Total monthly expenses are listed as $7,669. The budget includes $1,500 monthly for recreation. Based on his purported income and expenses, debtor projects disposable income of $1,598 and proposes a monthly chapter 13 payment to his creditors of $1,500, the same amount as his monthly recreational expense. Test. of August 24, Schedule J, Current Expenditures of Individual Debtor.
However, debtor neither rents nor owns a home. His wife owns a Carefree, Arizona residence as her separate property. Her mortgage, secured by her personal stock portfolio, is automatically paid from her separate National Bank account. The residence was purchased in January of 2003 for $1,075,000. The majority of the couple's living expenses is paid by Ms. Horton. She pays for utilities, landscaping, the mortgage, security and most household expenses. They own no community property. Debtor testified he helps with expenses when he can, but is unable to state what on average he pays. He describes his contributions as irregular. Ms. Horton likewise cannot provide an average of what debtor provides for the household. She last received money from him a couple of months prior to her August, 2004 testimony. Debtor test of August 24 and September 8, Ms. Horton test., Ex. 96 at p. 7440 (reflecting July 10, 2003 example of automatic mortgage deduction), Ex. 100 (Merrill Lynch Credit Corporation trust deed identifying borrower as Ms. Horton, as her sole and separate property).
Debtor amended some of his bankruptcy schedules on August 18 and 20, 2004. Dkts. 106, 110. These amendments did not correct or clarify his personal income and expense information. The court finds debtor's scheduling of income and expenses is inaccurate, misleading and not made in good faith.
10. To the extent any of the following conclusions of law should be considered findings of fact, they are hereby incorporated by reference.
CONCLUSIONS OF LAW
1. To the extent any of the above findings of fact should be considered conclusions of law, they are hereby incorporated by reference.
2. Jurisdiction of debtor's bankruptcy case is vested in the United States District Court for the District of Arizona. 28 U.S.C. § 1334(a) (1994). That court has referred all cases under Title 11 of the United States Code and all adversary proceedings and contested matters arising under Title 11 or related to a bankruptcy case to this court. 28 U.S.C. § 157 (a) (1994), Amended District Court General Order 01-15. This contested matter having been appropriately referred, the court has core bankruptcy jurisdiction to enter a final order regarding creditor's motion to convert this case to a Chapter 7 liquidation. 28 U.S.C. § 157(b) (2) (0). See also JPS at ¶ IV. A and B. (Stipulating to jurisdiction as a core proceeding).
3. This court's conclusions of law are reviewed de novo and its factual findings are reviewed for clear error. Hanf v. Summers (In re Summers), 332 F.3d 1240, 1242 (9th Cir. 2003). The appellate court accepts the bankruptcy court's findings, unless upon review, it is left with the definite and firm conviction that a mistake has been committed. Ganis Credit Corp. v. Anderson (In re Jan Weilert RV, Inc.), 315 F. 3d 1192, 1196 (9th Cir.) amended by 326 F.3d 1028 (9th Cir. 2003).
4. A debtor's bad faith in filing a chapter 13 petition is "cause" under 11 U.S.C. § 1307 (c) to either dismiss the case or convert it to Chapter 7. Ho v. Dowell (In re Ho), 274 B.R. 867, 877 (Bankr. 9th Cir. 2002). In determining whether a Chapter 13 case has been filed in bad faith, a bankruptcy court must consider the totality of the circumstances, in light of all militating factors. Factors to be considered include (1) Whether debtor misrepresented facts in his petition, unfairly manipulated the Bankruptcy Code or otherwise filed the petition or plan in an inequitable manner; (2) Debtor's history of filing bankruptcy cases; (3) Whether debtor's only purpose in filing for Chapter 13 protection is to defeat state court litigation and (4) whether egregious behavior is present. 274 B.R. at 876 (citing cases).
5. A finding of bad faith does not require fraudulent intent by debtor. Neither malice nor actual fraud is required to find a lack of good faith. The bankruptcy judge is not required to have evidence of debtor ill will directed at creditors. Neither must it be shown that debtor was affirmatively attempting to violate the law. Malfeasance is not a prerequisite to bad faith. Leavitt v. Soto (In re Leavitt), 171 F.3d 1219, 1224-25 (9th Cir. 1999). Debtor bears the burden of proving that the petition was filed in good faith. Leavitt v. Soto (In re Leavitt), 209 B.R. 935, 940 (Bankr. 9th Cir. 1997), aff'd 171 F.3d 1219 (9th Cir. 1999).
6. Chapter 13 eligibility should normally be determined by the debtor's originally filed schedules, checking only to see if they have been filed in good faith. Scovis v. Henrichsen (In re Scovis), 249 F. 3d 975, 982 (9th Cir. 2001). A debtor who signs schedules under penalty of perjury containing asset valuations and budget figures bases on "guesses" may not be given another opportunity to file amended schedules. In re Henson, 289 B.R. 741, 750 (Bankr. N.D.Cal. 2003).
7. The Court will not condone nor overlook the filing of false, inaccurate and misleading schedules. The importance of a debtor's actual income and expenses in Chapter 13 cases cannot be overstated. Probably the most important papers that are filed by a debtor in a chapter 13 case are schedules I and J, listing current income and expenses. It is imperative that schedules I and J are reasonably accurate. The court, trustee and creditors evaluate debtor's ability to propose and effectuate a confirmable plan based on the truthfulness and accuracy of the disclosures in these documents. Under 11 U.S.C. § 521(1) (1986), debtor is required to file schedules of assets and liabilities. The law requires such schedules to be as reasonably complete and accurate as possible. That did not occur in this case. In re McNichols, 254 B.R. 422, 432 (Bankr. N.D.Ill. 2000) (Dismissing case for lack of good faith). Also see In re McNichols, 255 B.R. 857, 876-77 (Bankr. N.D.Ill. 2000) (Reiterating importance of accurate schedules in denying debtor's motion for reconsideration).
8. Here the court, trustee and creditors cannot evaluate debtor's ability to confirm and consummate a feasible plan, given a fantasy salary that hasn't been paid for a year before the bankruptcy. Schedules that do not even correctly identity the entity providing debtor's income are worthless. Equally fanciful is the listing of monthly expenses debtor does not pay regularly, and hadn't paid for months prior to his testimony. The actual amounts debtor previously paid in household expenses for a home he neither owns nor rents, could not be stated by either debtor or his spouse. Finding of fact 9.
9. Debtor's principal asset is Alchemix, a closely-held entity, he controls, whose stock he schedules as currently valueless. He knows or should know better. Findings of fact 6, 7. This is not simply a dispute over opinions regarding asset valuation. Cf. Cox v. Cox (In re Cox), 247 B.R. 556, 564-65 and n. 11 (Bankr. D.Mass. 2000) (Without more, a difference in a valuation determination is insufficient to demonstrate debtor's bad faith). Instead, this is a bad faith valuation by probably the most knowledgeable person of this closely held, privately traded stock's value.
Clearly Alchemix is an unproven, development company that must overcome serious financial and technological hurdles before its product will be commercially viable. Debtor testified he informed his investors of the enterprise's risk. Nonetheless they agreed to invest between one and two dollars per share for the opportunity. Additionally, he used the stock as gifts for family members and for estate planning. The stock's "promise" is his principal asset. Whatever the current value of Alchemix might be, debtor presented no credible evidence that it has zero value or that this valuation was made in good faith. See creditor's closing memorandum filed October 8, 2004 at pgs. 11-13, dkt. 126; Findings 4-8, id.
10. There is a final aspect of debtor's pre petition conduct that needs to be considered in connection with the good faith analysis. Debtor sought protection from the financial burdens of defending the state court securities fraud action, asserting that litigation would require the payment of additional hundreds of thousands of dollars he didn't have. Findings of fact 1-3. He obtained this protection by voluntarily choosing to file Chapter 13. Standing alone, seeking relief from litigative costs can be a proper basis for bankruptcy and not necessarily indicative of bad faith. However in this context, Chapter 13 can also be abused, depending on the circumstances. In re James, 260 B.R. 498, 510-11 (Bankr. D. Idaho 2001). Here, after staying the state court action through the bankruptcy, debtor objected to creditors' claim, asserting all ". . . the detailed defenses and pleadings set forth in the State Court proceeding, out of which the Glenn Creditors' claims arise, being case no. CV 1999-08295." Ex. FFFF. Accordingly the same litigation is to begin anew, this time in bankruptcy court under the claims objection process.
Instead of using bankruptcy to end the financial drain of litigation, debtor intends to continue the fight, only in bankruptcy court instead of the state court system. This case can be seen not as a sincere request for financial relief, but as a litigation tactic to transfer to a possibly friendlier or more convenient forum and venue. This hardly amounts to good faith. In re James, id. at 511. The court concludes debtor's purpose in filing for Chapter 13 protection was to defeat state court litigation.
11. After considering the totality of the circumstances and in light of all militating factors, the court concludes that debtor misrepresented facts in his petition, unfairly manipulated the Bankruptcy Code, filed his petition in an inequitable manner, with a principal purpose of defeating state court litigation and failed to carry his burden of proving his petition was filed in good faith.
12. The Glenn creditors assert an amended bankruptcy claim of $12,468,625.95, which debtor disputes. Creditors' plan confirmation objection of January 23, 2004 at p. 2, dkt. 51; Ex. FFFF. Creditors' amended proof of claim, based on allegations of securities and common law fraud, breach of fiduciary duty, negligence, conversion and breach of contract is supported by detailed computations of extensions of credit principal amounts, pre petition interest accruals, pre petition attorneys' fees and costs arising from the state court litigation, state court taxable costs (consisting of expert witness fees and deposition expenses) and crediting the debt for recoveries from co-defendants and dividends from another bankruptcy estate. Second amended claim of July 23, 2004 at exhibits A-revised G.
Creditor also asserts a claim for an unspecified amount for alleged misappropriated intellectual property. Amended claim at revised exhibit B. Since the specific amounts creditor can quantify exceed Chapter 13 debt limits, this unspecified claim component need not be liquidated for eligibility purposes. See discussion infra.
Only an individual with regular income that owes, on the date of filing bankruptcy, non-contingent, liquidated, unsecured debts of less than $290,525 and non-contingent liquidated secured debts of less than $871,550 may be a debtor under Chapter 13. 11 U.S.C. § 109(e) (2000). Section 109(e) excludes unliquidated or contingent debts from the eligibility computation, but does not exclude debts that are merely disputed. Nicholes v. Johnny Appleseed of Washington (In re Nicholes), 184 B.R. 82, 88 (Bankr. 9th Cir. 1995) (Claim asserting debtor's personal liability for corporate debt is neither contingent nor unliquidated). A debt is contingent if it is one that debtor will be called upon to pay only upon the happening of an extrinsic event which triggers liability. Fostvedt v. Dow (In re Fostvedt), 823 F. 2d 305, 306-7 (9th Cir. 1987) (Fact that amount debtor must pay under promissory notes is dependent on whether creditor actually demands payment and on amount his co-obligors pay does not make debt unliquidated and contingent), Nicholes at 88, Loya v. Rapp (In re Loya), 123 B.R. 338, 340 (Bankr. 9th Cir. 1991) (Disputed professional malpractice claims are not contingent). A tort claim ordinarily is not contingent as to liability. The events that give rise to the tort usually have occurred. Liability is not dependent on some future event that may not happen. Id. The fact that a claim has not been reduced to judgment does not make it contingent. Nicholes, Loya, id.,
A debt is liquidated if its amount, at the time of bankruptcy filing, is ascertainable with certainty. Even if debtor disputes liability, if the amount is calculable with certainty, it is liquidated for purposes of § 109(e). Scovis v. Henrichsen (In re Scovis), 249 F.3d 975, 983-84 (9th Cir. 2001) (Junior lien that is not yet avoided is nonetheless considered unsecured in eligibility computation when lien is clearly undersecured).
Here, there are no extrinsic events yet to occur to trigger asserted liability on the disputed Glenn claim. The events that give rise to the alleged fraud have all occurred. Loya, id. Accordingly it is not contingent. Given the detailed proof of claim and attachments, it is subject to ". . . ready determination and precision in computation of the amount due." Fostvedt at 306. Therefore it is liquidated and is to be included in the eligibility computation. The asserted claim's amount dwarfs Chapter 13 debt limits. This is not a claim asserted in an arbitrary amount or fashion. Rather it is a claim pending in litigation since 1999, ready for trial, but for debtor's last minute bankruptcy, carefully documented in a detailed proof of claim. The court concludes that debtor is ineligible for Chapter 13 relief.
13. A debtor has an absolute right to dismiss a Chapter 13 case. 11 U.S.C. § 1307(b) (1986). The better reasoned view is that a court must dismiss a Chapter 13 case, upon debtor's request, if that request is made prior to the effective time of an order converting the case to Chapter 7. This view comports with the plain language of § 1307(b) and the voluntary nature of that chapter. Beatty v. Traub (In re Beatty), 162 B.R. 853, 857 (Bankr. 9th Cir. 1994). See also, Croston v. Davis (In re Croston), 313 B.R. 447, 451 (Bankr. 9th Cir. 2004).
ORDER
The court finds for creditor and against debtor. The Glenn motion to convert will be granted and debtor's Chapter 13 case will be converted to Chapter 7, unless within ten days of the date of this order, debtor moves to dismiss his case.
Creditor, an energetic litigator, raises additional issues of tax fraud, false loan application, corporate alter ego, improper valuation of debtor's interest in Phasexx Corporation, non disclosure of pending Phasexx litigation, unscheduled gifts and misrepresentation of the true sales price of a Carefree, Arizona residence. Debtor thinks creditor has it in for him. Debtor's opening brief at pgs. 22-23, closing brief at pgs. 1-2 and n. 2. Dkts. 125, 128. Perhaps creditor does, but his proof regarding these additional issues fail, in the opinion of this fact finder.