In Re Basil N. Spirtos, Debtor. Basil N. Spirtos v. Irene Moreno

Dr. Basil N. Spirtos, Debtor, appeals the Bankruptcy Appellate Panel’s (BAP) decision that Debtor’s interest in two pension plans maintained by Debtor’s medical corporation was not exempt under California law. We conclude that this appeal is not moot, but we vacate the decisions of the bankruptcy court and the BAP regarding exemption and remand the case for a determination of whether the plans are property of the bankruptcy estate.

BACKGROUND FACTS

Debtor was the owner of Montebello Ob-Gyn Medical Group, Inc. In 1975, the corporation established two pension plans. Debtor was the administrator and major beneficiary of both plans.

From 1975 to 1981, the plans loaned $429,-805.16 to Debtor. On April 12, 1983, Irene Moreno obtained a medical malpractice judgment against Debtor. Debtor appealed and posted a bond in the amount of $1,239,000, which operated to stay execution on the judgment. In August 1985, Debtpr secured his loans from the plans by executing a deed of trust on his home in Arcadia, California, in favor of the plans. In November 1985, Debt- or transferred his interest in real property in Carlsbad, California, valued at -$250,000, to the plans. Moreno’s judgment was…