In Re: Andrea S. Downs

I. INTRODUCTION

This appeal arises out of a bankruptcy court’s sanction order. Andrea Steinmnann Downs (“Debtor”) filed a voluntary Chapter 11 bankruptcy petition and later converted to a Chapter 7. Thomas H. Casey was appointed as the Chapter 7 trustee (“Trustee”). Trustee filed a complaint against Lora Rae Steinmann (“Appellant”), Debtor’s mother, among others, after she removed Debtor as a beneficiary from her revocable inter vivos trust. The Complaint alleged that the transfer was fraudulent and sought to recover the trust assets for Debtor’s bankruptcy estate. In January 2019, the bankruptcy court authorized a 2004 examination of Appellant. Trustee and Hausman Holdings, LLC, David Moellenhoff, and Pamela Moellenhoff (collectively, “Creditors”) attended the examination. Appellant’s attorney instructed her not to answer Creditors’ questions, forcing Creditors to compel Appellant’s examination and to produce documents. The bankruptcy court granted the motion to compel. Creditors then moved for sanctions for requiring the motion. The bankruptcy court granted that motion and awarded Creditors $62,172.86. This appeal followed. For the following reasons, the Court VACATES and…