Laughlin v. Nouveau Body & Tan - The Appellate Record

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Case: 09-10622 Document: 00511064454 Page: 16 Date Filed: 03/29/2010No. 09-10622renounced them in whole or in part to the prejudice of his creditor’srights. In such a case, the renunciation may be annulled in favor ofthe creditor to the extent of his claim against the successor, but itremains effective against the successor.LA. CIV. CODE ANN. art. 967. The Louisiana Supreme Court has interpreted thisarticle as requiring “a creditor [to] prove that an heir renounced his inheritancefraudulently or with an intent to wrongfully deprive the creditor of his claim onthe debtor’s property in order for the creditor to have a right to have therenunciation annulled and to accept the inheritance in the heir’s stead.”Succession of Neuhauser, 579 So. 2d 437, 441 (La. 1991). 12We determine that, for the purposes of our inquiry today, Louisiana lawis indistinguishable from the Texas law at issue in Simpson, and we hold that,under Louisiana law, a valid pre-petition renunciation of an inheritance interestis not a transfer of the debtor’s property under § 727(a)(2). Section 727(a)(2)denies a discharge to a debtor who has “transferred . . . property of the debtor,within one year before the date of the filing of the petition,” 11 U.S.C.§ 727(a)(2)(A) (emphasis added); Pratt, 411 F.3d at 565 (requiring that propertyof the debtor be transferred). The question then is whether article 967recognizes or creates rights in the renounced inheritance that disturb therelation-back fiction. Absent such rights, the relation-back fiction controls andthe renouncing debtor is deemed never to have had rights in the renouncedinheritance. See LA. CIV. CODE ANN. art. 954.12Neuhauser dealt with differently numbered and worded civil code sections. In 2000,the relevant civil code provisions were “simplified”; but there is no suggestion—either by caselaw, commentators, or the parties here—that the “simplifications” abrogated Neuhauser’sholdings. See LA. CIV. CODE ANN. art. 967 revision comment (“This Article clarifies the priorrules and uses simpler terminology. As in prior law, judicial authorization for an acceptanceby a creditor in the name of a successor is required, and that principle is set forth in theArticle.”); LORIO, 10 LA. CIV. L. TREATISE § 6:8 (noting that nothing substantively changed withthe revisions and renumbering of article 967).16
Case: 09-10622 Document: 00511064454 Page: 17 Date Filed: 03/29/2010No. 09-10622To analyze this issue, we first look to the text of the Louisiana Civil Code.Article 967 states that, even when a renunciation is “annulled in favor of thecreditor to the extent of his claim against the successor, [such a renunciation]remains effective against the successor.” LA. CIV. CODE ANN. art. 967 (emphasisadded). As such, the article’s text suggests that an annulment action underarticle 967, though it concerns the actions and intent of the renouncingsuccessor, resolves only the right to the renounced interest as between therenouncing successor’s creditors and the substituted successors. The text doesnot suggest that a renouncing successor gains an interest in the inheritancebecause, even if the annulment action is successful, article 967 specifies that thesuccessor’s renunciation remains effective against him. Id. And though the“creditor . . . accept[s] succession rights in the successor’s name,” id., we do notthink that this clause, read in context, suggests that it is the debtor’s rights thatthe annulling creditor accepts. Instead, we interpret that provision as specifyingthe prerequisite for the creditor bringing an action; the creditor must be acreditor of the renouncing successor. In sum, we read article 967 together witharticles 954 and 947 to mean that a successful annulment of a renunciation doesnot disturb the fiction that the renouncing successor predeceased the decedentand thus never had rights in the inheritance interest. Thus, we do not thinkthat the text of article 967 clearly recognizes or creates rights in the renouncingsuccessor.Second, the manner in which Louisiana courts have characterized therenunciation annulment action does not disturb our interpretation of article 967.Specifically, Louisiana courts have stated that the rights under article 967 arecreditor’s rights. See Aurienne, 96 So. at 30 (“Plaintiffs do not claim that theyhave the right, which is given by article [967] . . . to creditors of a person who hasrenounced an inheritance, to accept it to the extent of their claims.” (emphasisadded)); Succession of Andrews, 604 So. 2d 194, 198 n.2 (La. Ct. App. 1992) (“In17
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Laughlin v. Nouveau Body & Tan - The Appellate Record

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