Two bankruptcy courts in Massachusetts, faced with objections to confirmation of plans that proposed the debtor’s surrender of residential property and vesting of title in that property in the mortgagee, reached opposite conclusions. In re Brown, No. 14-12357 (Bankr. D. Mass. March 4, 2016). In re Tosi, No. 13-14017 (Bankr. D. Mass. March 4, 2016). [Read more…] about Same District, Same Day, Different Conclusions on Surrender Plus Vesting
Condominium Act Reprioritizes Lien
The New Jersey Condominium Act reprioritizes the condominium association’s lien, making it partially secured and subject to the anti-modification provision of Section 1322(b). Whispering Woods Condominium Assoc. v. Rones, No. 15-4271 (D. N.J. Feb. 17, 2016). [Read more…] about Condominium Act Reprioritizes Lien
Fee-Only Plan Has Purpose beyond Payment of Fee
Although the debtor’s Chapter 13 plan effectively paid nothing to the debtor’s single creditor, it was filed in good faith. In re Banks, No. 15-9819 (Bankr. N.D. Ill. Feb. 8, 2016).
Mr. Banks had no assets and only one debt: $5,080 in city parking tickets. His Chapter 13 plan contemplated paying his entire $120 disposable income for 36 months for a total of $4,320, $4,000 of which would go to his bankruptcy attorney, and $285.12 to the bankruptcy trustee. The trustee challenged the plan as not having been filed in good faith under section 1325(a)(7). [Read more…] about Fee-Only Plan Has Purpose beyond Payment of Fee
Eighth Circuit Takes Hard Line on Judicial Estoppel
Applying little analysis beyond recitation of bullet points, the Eighth Circuit found that bankruptcy debtors have an obligation to report lawsuits filed during the life of the Chapter 13 plan and that failure to do so justifies application of judicial estoppel. Jones v. Bob Evans Farms, Inc, No. 15-2068 (8th Cir. Jan. 26, 2016). [Read more…] about Eighth Circuit Takes Hard Line on Judicial Estoppel
Borrower Has Standing to Challenge Void Assignment
The Supreme Court of California held that a borrower on a home loan secured by a deed of trust has standing to base an action for wrongful foreclosure on allegations that defects in the purported assignment of the note and deed of trust render the assignment void. Yvanova v. New Century Mortgage Corp., No. S218973 (Cal. Feb. 18, 2016). [Read more…] about Borrower Has Standing to Challenge Void Assignment
Adoption Assistance Benefits Properly Excluded from CMI
The BAP for the Ninth Circuit found that Adoption Assistance payments are “benefits received under the Social Security Act” and were properly excluded from the debtor’s calculation of current monthly income. Adinolfi v. Meyer (In re Adinolfi), 2016 Bankr. LEXIS 173, No. 15-1091 (B.A.P. 9th Cir. Jan. 19, 2016). [Read more…] about Adoption Assistance Benefits Properly Excluded from CMI
Debtors May Recover Damages for Emotional Distress from IRS
Sovereign Immunity does not preclude emotional distress damages for violation of the automatic stay by the IRS. Hunsaker v. United States (In re Hunsaker), 2016 Bankr. LEXIS 134, No. 12-64782, Adv. Proc. 14-6218 (Bankr. D. Or. January 13, 2015). [Read more…] about Debtors May Recover Damages for Emotional Distress from IRS
Sixth Circuit BAP to Address Impact of Caulkett in Chapter 13
United Bank has appealed to the Sixth Circuit BAP on the issue of whether Caulkett extends to lien stripping in chapter 13. The bankruptcy court held that it does not. In re Travers, No. 15-50844 (Bankr. E.D. Ky. Nov. 16, 2015) on appeal, No. 15-8051 (B.A.P. 6th Cir. filed Dec. 1, 2015). [Read more…] about Sixth Circuit BAP to Address Impact of Caulkett in Chapter 13
$10,000 Book of Mormon Properly Exempted
The Seventh Circuit found that Illinois’ personal property exemption statute, which provides an exemption for a bible, extended to the debtor’s first edition Book of Mormon, notwithstanding its unusually high monetary value. In re Robinson, 14-3585 (7th Cir. Feb. 4, 2016). [Read more…] about $10,000 Book of Mormon Properly Exempted
Arbitration Clause a “Farce”
“The FAA does not protect the sort of arbitration agreement that unambiguously forbids an arbitrator from even applying the applicable law.” Hayes v. Western Sky Financial, No. 15-1170 (4th Cir. Feb. 2, 2016). [Read more…] about Arbitration Clause a “Farce”