In Re Ronald Gary Watts in Re Yee Kome Kathy Watts, Debtors, Phillip J. Wolfson v. Ronald Gary Watts Yee Kome Kathy Watts

Phillip J. Wolfson, a judgment creditor, appeals the Bankruptcy Appellate Panel’s (“BAP”) decision affirming the cancellation of his judgment lien on debtors Ronald Gary Watts’s and Yee Kome Kathy Watts’s (collectively, “Debtors”) declared homestead. At the time Wolfson recorded his abstract of judgment, the value of the preexisting lien on Debtors’ homestead, together with the homestead exemption, exceeded the fair market value of Debtors’ real property. The bankruptcy court canceled Wolfson’s judgment lien in an avoids anee proceeding pursuant to 11 U.S.C. § 522 (f) under the rationale of Jones v. Heskett (In re Jones), 106 F.3d 923 (9th Cir.1997).

In Jones, we held that, under California Code of CM Procedure (“CCP”) § 704.950(c), a judgment creditor’s lien does not attach to a declared homestead unless surplus equity exists in the homestead at the time the creditor records an abstract of judgment. After Jones, two California appellate courts rejected our interpretation of section 704.950(c) and con- *1079 eluded that a judgment creditor is entitled to surplus equity that accrues after the abstract of judgment is recorded. In light of the intervening California…

concurring in the judgment:

I find myself in the perplexing position of being bound by a precedent counseling that I need not be bound by a precedent.

Although there is much in the court’s fine opinion with which I agree entirely' — I would have no quarrel with its analysis of California law were the issue one of first impression — I am profoundly troubled by the notion of reaching this result by our “overruling,” as a three-judge panel, the precedent set by an earlier panel in Jones v. Heskett (In re Jones), 106 F.3d 923 (9th Cir.1997).

I

It is a bedrock principle of our court that the published decision of one three-judge panel binds every other panel, 1 from *1084 that day forward. 2 Put another way, one panel may not overrule another; the power to overrule' is confided to the en banc court, and the en banc court alone. 3 Panels may distinguish; they may question; they may deploy virtually any of the other verbs in the Shepard’s vocabulary. But they may not overrule.

There are exceptions. We need not convene the en banc court when the Supreme Court reverses us directly. Nor must we do so when that Court, in reviewing a case from another circuit, knocks the props out from…

298 F.3d 1077 In re Ronald Gary WATTS; In re Yee Kome Kathy Watts, Debtors, Phillip J. Wolfson, Appellant, v. Ronald Gary Watts; Yee Kome Kathy Watts, Appellees. No. 00-55207. United States Court of Appeals, Ninth Circuit. Argued and Submitted October 2, 2001. Filed August 6, 2002. J. Edward Switzer, Jr., Vista, CA, for the appellant. Brian M. Mahoney, San Diego, CA, for the appellees. Appeal from the Ninth Circuit Bankruptcy Appellate Panel, Perris, Klein and Ryan, Bankruptcy Judges, Presiding. BAP No. SC-99-01344-KPRy. Before: O'SCANNLAIN and PAEZ, Circuit Judges, and KING, District Judge. * OPINION PAEZ, Circuit Judge. 1 Phillip J. Wolfson, a judgment creditor, appeals the Bankruptcy Appellate Panel's ("BAP") decision affirming the cancellation of his judgment lien on debtors Ronald Gary Watts's and Yee Kome Kathy Watts's (collectively, "Debtors") declared homestead. At the time Wolfson recorded his abstract of judgment, the value of the preexisting lien on Debtors' homestead, together with the homestead exemption, exceeded the fair market value of Debtors' real property. The bankruptcy court canceled Wolfson's judgment lien in an avoidance proceeding pursuant to 11 U.S.C.…