The opinion of the court was delivered by: William M. Skretny Chief Judge United States District Court
The Estate of Frances A. Conigliaro ("the Conigliaro Estate") appeals the bankruptcy court's denial of its Motion for Turnover of a $100,000 pre-paid annuity policy. The bankruptcy court held that the Conigliaro Estate's claim to this asset is precluded. For the reasons stated below, the bankruptcy court's decision is affirmed.
The Debtor, J. Anthony DiGiulio, filed his Chapter 7 petition on December 15, 2006. Before that filing, his aunt, Frances Conigliaro, gave him a power of attorney ("POA") in which he was one designated agent and his aunt's attorney and later executor, Arnold Goldman ("Goldman"), was the other. The POA provided that either agent could act.
Before his aunt's death in 2003, DiGiulio used the POA to withdraw $50,000 from her account at Fleet Bank. This amount, along with $50,000 from another source, was used to pay the premium for a 60-month annuity contract issued by Presidential Life Insurance Company ("Presidential"). The annuity contract provided for payments to Conigliaro as annuitant, with DiGiulio as the owner and beneficiary upon her death.
After Conigliaro's death, Goldman commenced three proceedings on behalf of her estate in the Surrogate Court for Monroe County, New York: a discovery proceeding in 2003; a turnover proceeding in 2004; and a N.Y. CPLR 5225 money judgment enforcement/turnover proceeding in 2006. Goldman submitted no proof concerning the Fleet Bank account to the Surrogate Court in the discovery proceeding, and that court made no findings and granted no relief concerning that account. The Conigliaro Estate obtained a money judgment against DiGiulio, but that judgment did not implicate the Fleet Bank account.
The issue in the turnover proceeding was DiGiulio's use of the POA to withdraw funds from the Fleet Bank account. The Surrogate determined that DiGiulio's use of the POA was proper because only one signature was required under its terms. Presidential was therefore not required to return the $50,000 from the Fleet Bank account to the Conigliaro Estate.
In the third proceeding, Conigliaro sought an order directing Presidential to pay the monthly annuity installments to the Conigliaro Estate based on the money judgment obtained against DiGiulio in the discovery proceeding. This proceeding was stayed by DiGiulio's Chapter 7 filing, and the matter was transferred to the bankruptcy court for further proceedings.
In the bankruptcy court, the Conigliaro Estate argued that it was entitled to have a constructive trust imposed on $50,000 of the Presidential annuity's value. The Trustee responded that any request for relief in the bankruptcy court was barred by the doctrine of claim preclusion under New York law. The bankruptcy court accepted this argument, and entered its Opinion and Order on August 19, 2008, and its Amended Opinion and Order on September 17, 2008, denying the Motion for Turnover. This timely appeal followed.
The bankruptcy court's order, which turns on a legal conclusion, is reviewed de novo. Porges v. Gruntal & Co., Inc. (In re Porges), 44 F.3d 159, 162 (2d Cir. 1995); In re Thompson, 217 B.R. 375, 378 (2d Cir. B.A.P. 1998). The bankruptcy court's determinations are examined independently, but reviewed under a deferential standard and ...