The debtor’s adversary complaint stated a claim under sections 522 and 524 against a creditor who pursued state court action to avoid the transfer of community property from the non-debtor spouse to the debtor after the debtor had obtained discharge of the creditor’s claim. Rhodes v. Pecanland Village Shopping Center, LLC., No. 19-31559, Adv. Proc. […]
Author Archives: NCBRC
Removal of Trust Contingency Benefits Estate
January 2, 2023 – 4:48 pm
Removal of a contingency in a Trust did not create a new asset such that the resulting increase in value to the debtor/beneficiary would be considered a post-petition asset. In re Wright, No. 19-21544 (Bankr. D. Kans. Dec. 7, 2022). The Wrights filed for chapter 13 bankruptcy with unsecured debts totaling $14,196.53. They confirmed a […]
IRA Withdrawals Create Regular Income for 109(e) Purposes
December 30, 2022 – 5:35 pm
The debtor had “income” for purposes of eligibility to be a chapter 13 debtor where he intended to use regular withdrawals from his IRA to fund his plan. In re Frysinger, No. 20-31202 (Bankr. D. Ore. Dec. 21, 2022). The debtor created a plan which he proposed to fund through: 1) holdings in bank account […]
Wells Fargo and False Loan Forbearance Class Action
December 20, 2022 – 5:58 pm
The court denied a motion to dismiss the debtors’ class action adversary complaint against Wells Fargo based on Wells Fargo’s inaccurate notices to various bankruptcy courts that the debtors’ loans had been placed in COVID forbearance at the debtors’ request. Harlow v. Wells Fargo & Co., No. 17-71487, Adv. Proc. No. 20-7028 (Bankr. W.D. Dec. […]
Unemployment Overpayment Not a Priority Tax Debt
December 13, 2022 – 2:03 pm
Kentucky’s Office of Unemployment Insurance’s claim for an overpayment of unemployment compensation benefits was not entitled to priority in the debtor’s chapter 13 case where the nature of the claim was better characterized as a “penalty” than a “tax.” In re Clardy, No. 22-30089 (Bankr. W.D. Ky. Dec. 1, 2022).
Who Would Win in a Fight, Allowed Claim or Confirmed Plan?
December 9, 2022 – 4:00 pm
The winner? Confirmed plan. Where the mortgagee had notice and opportunity to object to confirmation of the debtors’ chapter 13 plan providing for mortgage arrears in the amount of approximately half the mortgagee’s allowed proof of claim, the mortgagee could not be heard, at the debtors’ successful completion of their plan, to complain that the […]
Post-Petition Fee Agreement a No-Go
December 7, 2022 – 9:20 pm
A fee agreement that purports to attach an attorney’s lien on the debtor’s exempt personal property is unenforceable under section 526(a) where state law allows such liens only on non-exempt property or on exempt personal property for specified exceptions not including attorney’s fees. In re Turner, No. 22-41570 (Bankr. D. Minn. Dec. 2, 2022).
First Circuit Dodges Late-Filed Tax Return Issues
December 2, 2022 – 6:18 pm
Faced with the question of whether the debtor’s tax debt based on a late-filed tax return was excepted from discharge, the circuit declined to reexamine its holding in Fahey where it applied the strict “one day late” rule, found the debtor waived his argument in support of an objective test that does not consider timing […]
Bruce v. Citigroup, Inc., No. 22-1000 (2d Cir.)
November 30, 2022 – 3:45 pm
Type: Amicus Date: November 23, 2022 Description: Whether bankruptcy court has authority to adjudicate a national class action claim for a violation of the discharge injunction. Debtor is the appellee. Result: Pending. Bruce 2d Cir NACBA Amicus Nov 2022
Exemption Amount in Lien Avoidance Action
November 30, 2022 – 3:40 pm
For purposes of lien avoidance under section 522(f), the debtor was able to claim a homestead exemption in the amount of the California exemption in effect at the time of his bankruptcy petition, despite California law that fixed the exemption amount at the time of lien creation. Barclay v. Boskoski (In re Boskoski), No. 22-55098 […]
