Quin v. County of Kauai Dep't of Transp.

When an omission on a bankruptcy schedule of a pending claim is “mistaken” or “inadvertent,” using the common meaning of those terms, that omission shall not be grounds for applying judicial estoppel to the pending claim.

Kathleen M. Ah Quin sued her employer, the County of Kauai Department of Transportation, for gender discrimination. The district court entered summary judgment in favor of the Department of Transportation on the grounds of judicial estoppel. While the case was pending, Quin also filed for Chapter 7 bankruptcy protection. Quin failed to include the pending lawsuit on her bankruptcy schedule and obtained a discharge. The district court in this case applied the wrong legal standard when it applied the default rule from the Supreme Court's holding in New Hampshire v. Maine that judicial estoppel barred Quin from bringing this action after not listing it on her bankruptcy schedule. The Supreme Court in New Hampshire also stated that "it may be appropriate to resist application of judicial estoppel when a party's prior position was based on inadvertence or mistake." Inadvertence or mistake in a case such as this had not been analyzed by the Ninth Circuit prior to this case. Many sister circuits have analyzed this question and determined inadvertence or mistake do not exist when the debtor knew about the claim when filing for bankruptcy and had a motive to conceal it. The panel held that such an interpretation of “inadvertent” or “mistake” is too narrow. Rather than adopting the interpretation of the other circuits, the panel adopted the common meaning of the terms “inadvertent” and “mistake” because they were more consistent with the Supreme Court's ruling in New Hampshire and would be easier for future courts to apply. The panel held that when there exists a dispute of facts whether the plaintiff/debtor's omission was intentional or inadvertent, summary judgment on the grounds of judicial estoppel is inappropriate. VACATED and REMANDED.