In Re Kelly III

841 F.2d 908 18 Collier Bankr.Cas.2d 560 , 17 Bankr.Ct.Dec. 611 , Bankr. L. Rep. P 72,218 In re Thomas G. KELLY III and Pauline A. Kelly, Debtor. Robert W. and Carolyn B. ZOLG and Tucson Realty & Trust Company, Appellants, and United States of America, Intervenor, v. Thomas G. KELLY III and Pauline A. Kelly, Appellees, and Alan Solot, Trustee in Bankruptcy. No. 87-1560. United States Court of Appeals, Ninth Circuit. Argued and Submitted Aug. 13, 1987. Decided March 2, 1988. Michael McGrath, Stompoly & Stroud, Tucson, Ariz., for appellants. Thomas G. Kelly III, Blaser, Kelly & Don, Tucson, Ariz., for appellees. Scott A. Harbottle, Civil Div., Dept. of Justice, Washington, D.C., for intervenor. Appeal from the Bankruptcy Appellate Panel for the Ninth Circuit. Before SCHROEDER, POOLE and KOZINSKI, Circuit Judges. KOZINSKI, Circuit Judge: 1 We consider whether the bankruptcy appellate panel erred in reversing the bankruptcy court's dismissal of appellees' chapter 7 bankruptcy petition as a "substantial abuse" of the Bankruptcy Code. Background 2 Robert and Carolyn Zolg sold their home to the Kellys; Tucson Realty acted as the real estate agent for this transaction.…