Posted by NCBRC - April 17th, 2014
The Ninth Circuit has cracked open a door that Sternberg seemed to have slammed shut by holding that a debtor is not precluded from recovering, as damages, attorneys’ fees for defending against a creditor’s appeal of a finding that the creditor violated the automatic stay. America’s Servicing Co. v. Schwartz-Tallard, No. 12-60052 (9th Cir. Apr. 16, 2014). Read More
Posted by NCBRC - April 16th, 2014
Once the trustee abandoned the real property and the debtor was discharged from her chapter 7 case, the court declined to exercise jurisdiction over the pending adversary proceeding involving Truth in Lending Act claims. Bank of Amer. v. Travers, No. 11-12650, A.P. No. 11-1047 (Bankr. D. R.I. March 25, 2014). Read More
Posted by NCBRC - April 12th, 2014
In the most recent case to find its way to the First Circuit Court of Appeals, the BAP rejected McCoy and found that there is no per se rule that a late-filed tax return can only be a “return” for bankruptcy discharge purposes if it is filed by the IRS under the “safe harbor” provision of IRC § 1060(a). Brown v. Mass. Dept. of Rev., No. 13-27 (B.A.P. 1st Cir. April 3, 2014). There, the debtor argued that Massachusetts law “permits a taxpayer, once notified by the commissioner of its failure to file a return, to still file a proper return within 30 days before a tax will be assessed.” Where the debtor complied with all elements of a return as required by state filing laws, the fact that the return itself was filed late, did not change the fundamental nature of the document. Relying on its reasoning in Gonzalez v. Mass. Dept. of Rev., 2014 WL 888460, (March 6, 2014), the Bankruptcy Appellate Panel agreed. The panel found that the bankruptcy court had correctly rejected the “draconian” rule set forth in McCoy v. Miss. State Tax Comm’n, 666 F.3d 924 (5th Cir. 2012). In Gonzalez the court noted that section 523(a)(1)(B)(ii) makes specific provision for nondischargeability of tax returns filed both late and within two years of bankruptcy. Therefore, it found that untimeliness of filing alone was not intended to preclude discharge of tax liabilities.
The MDOC has filed an appeal to the First Circuit, No. 14-9003, where it will join three other cases: In re Perkins, No. 14-1350; In re Fahey, No. 14-1328 (both adopting McCoy); and In re Gonzalez, No. 14-9002 (rejecting McCoy).
Brown opinion 1st BAP
Posted by NCBRC - April 9th, 2014
Under section 506(a)(2), replacement value rather than foreclosure value is the proper measure of property securing an allowed claim where the debtor plans to surrender the property under section 1325(a)(5)(C). Santander Consumer USA v. Brown, No. 13-13013, — F.3d —-, 2014 WL 1245266 (11th Cir. March 27, 2014). Read More
Posted by NCBRC - April 7th, 2014
Three recent cases involve sanctions for violation of the discharge injunction by a creditor filing suit in state court over a debt discharged in bankruptcy. King v. Williams (In re King), No. 12-3701 (8th Cir. March 5, 2014); In re Gracia, No. 13-1373 (B.A.P. 9th Cir. April 4, 2014); In re Hopkins, No. 09-5835 (Bankr. S.D. Ia. April 1, 2014). Read More
Posted by NCBRC - April 3rd, 2014
Under the claims allowance process, a bankruptcy court must consider competing equities even where the mortgage is “inoperative” under state law. GMAC Mortgage v. Orcutt, No. 13-82 and 13-83 (D. Vt. Feb. 28, 2014). Read More
Posted by NCBRC - March 31st, 2014
The Supreme Court denied cert. in the lien strip case of Bank of America v. Sinkfield, No. 13-700, involving the issue of whether section 506(d) permits the strip off of a wholly unsecured lien in chapter 7. Read More
Posted by NCBRC - March 29th, 2014
Adding to a growing trend among the circuits courts, the Fourth Circuit found that above-median debtors with negative disposable income must commit to a 60 month plan under section 1325(b)(1). Pliler v. Stearns (In re Pliler), No. 13-1445 (4th Cir. March 28, 2014), on direct appeal from, In re Pliler, 487 B.R. 682 (Bankr. E.D. N.C. Feb. 21, 2013). Read More
Posted by NCBRC - March 27th, 2014
Prof. Vivian Berger, Nash Professor of Law Emerita at Columbia Law School, writes here about the misuse of civil contempt proceedings to obtain the repayment of debts. She’s right that despite our common belief that debtors’ prisons have been eliminated in America, it just isn’t so.
Posted by NCBRC - March 24th, 2014
A broken chain of title defeated a bank’s right to enforce the Note and mortgage for debtors’ residence. In re Dorsey, No. 13-8036 (B.A.P. 6th Cir. March 7, 2014). Read More