Posted by NCBRC - November 3rd, 2022
Two chapter 13 plans providing for maintenance of the debtors’ student loans outside the plan satisfied section 1325(b)(1)(A)’s requirement that claims be paid at 100%, and did not unfairly discriminate against the class of student lenders even though they would receive smaller monthly payments than other unsecured claims and not be fully paid at the end of the plan. In re Durand-Day, No.22-40089 (Bankr. N.D. Tex. Oct. 26, 2022). Read More
Posted by NCBRC - November 2nd, 2022
A post-discharge liability arising out of pre-petition personal guaranty was not discharged in the debtors’ bankruptcy where the debt was based on transactions occurring four years after the debtors received their discharge. Reinhart Foodservice, LLC v. Schlundt, No. 21-1027 (E.D. Wisc. Oct. 27, 2022). Read More
Posted by NCBRC - October 28th, 2022
Where the state workers’ compensation procedure involves quasi-judicial steps including the right to notice, an opportunity to be heard, and the right to appeal an unfavorable decision, a lien arising out of that process is “judicial” rather than “statutory.” In re Shippy, No. 22-40706 (Bankr. W.D. Wash. Oct. 24, 2022). Read More
Posted by NCBRC - October 26th, 2022
Stating that it “is always in a Chapter 13 petitioner’s interest to minimize income and assets,” and speculating that “had the bankruptcy court and Stanley’s creditors known about [his civil] claim, the outcome of Stanley’s bankruptcy petition could have been less favorable to Stanley,” the Sixth Circuit all but eliminated a bankruptcy debtor’s defense against judicial estoppel based on lack of motive to conceal the claim. Stanley v. FCA US, LLC, No. 21-4238 (6th Cir. Oct 18, 2022). Read More
Posted by NCBRC - October 24th, 2022
A prepetition fee agreement where the debtor agreed to have the law firm pay the filing fee postpetition at which time the debtor would reimburse the firm, was unenforceable in that it was predicated on ignoring Bankruptcy Rule 1006(a) which requires the fee to be paid when the petition is filed. In re Digregorio, No. 21-79 (Bankr. M.D. Fla. Oct 19, 2022). Read More
Posted by NCBRC - October 19th, 2022
Does a state law permitting the government to take and sell a debtor’s home to satisfy a tax debt, and keep the surplus value as a windfall, violate the Takings Clause? That is the question before the Supreme Court in two separate cert. petitions. Fair v. Continental Resources, No. 22-160 (filed Aug. 19, 2022) and Tyler v. Hennepin Cty, No. 22-166 (filed Aug. 19, 2022). It is also the question that was recently answered affirmatively by the Sixth Circuit in the case of Hall v. Meisner, No. 21-1700 (6th Cir. Oct. 13, 2022). These cases could have significant consequences in the bankruptcy context where debtors often challenge tax sales under avoidance principles (the issue raised in another Supreme Court cert petition, County of Ontario v. Gunsalus, No. 22-294). Certainly the Sixth Circuit case adds ammunition to the Michigan bankruptcy debtor’s arsenal.
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Posted by NCBRC - October 14th, 2022
The plaintiff’s allegations of embezzlement with respect to a business debt the debtor, her ex-husband, owed to her were sufficient to withstand a motion to dismiss, where the plaintiff co-owned the business with the debtor and the debtor failed to comply with the family court’s order to set aside income from the business for the plaintiff. Bailey v. Bailey, No. 22-10013, Adv. Proc. No. 22-1001 (Bankr. E.D. Ky. Sept 26, 2022). Read More
Posted by NCBRC - October 12th, 2022
The district court found that the “mansion loophole” cap on exemptions provided for in section 522(p) applies even in opt-out states where the debtor does not have the option to choose between state and federal exemptions. It also held that rule 4003(b)(4) does not impose a deadline on notice to the debtor of filing an objection to exemptions. In re Kane, No. 21-8209 (N.D. Cal. Sept. 2022). Read More
Posted by NCBRC - October 7th, 2022
The bankruptcy court abused its discretion when it granted the trustee’s motion to modify the debtor’s chapter 13 plan to capture the $300.00/month the debtor saved when he refinanced his home loan where the change in the debtor’s financial circumstances was not “substantial” as a matter of law. Martinez v. Gorman (In re Martinez), No. 21-1077 (E.D. Va. June 16, 2022). Read More
Posted by NCBRC - October 5th, 2022
The debtors were entitled to exempt only their one-half interest in one of the two residences where they owned both properties jointly but the husband lived in one residence and the wife lived in the other. They could avoid the creditor’s judgment lien to the extent the lien impaired those exemptions. In re Snyder, No. 21-31521 (Bankr. N.D. Ohio Sept. 23, 2022). Read More