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The Bankruptcy Code did not forestall the automatic operation of Georgia's pawn statute. In this case, debtor entered into a pawn transaction in which he pledged his car in exchange for a loan, defaulted on the loan, and then, shortly before the expiration of the redemption period—during which he could pay off his debt (with interest) and thereby regain title to his car—filed a Chapter 13 bankruptcy petition. The Eleventh Circuit held that the car dropped out of the bankruptcy estate and vested in the pawnbroker when the prescribed redemption period lapsed. Accordingly, with respect to the car, 11 U.S.C. 1322(b)(2) had no field of operation. The court explained that following the expiration of the grace period, the pawnbroker did not have a mere "claim" on debtor's car, but rather had the car itself. View "Title Max v. Northington" on Justia Law

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The Sixth Circuit affirmed the decision of the district court affirming the bankruptcy court concluding that Mountain Glacier properly reserved its arbitration claim in its dispute with Nestle Waters after Mountain Glacier filed for Chapter 11 bankruptcy. The bankruptcy automatically stayed the companies’ arbitration. After the bankruptcy proceedings ended, Mountain Glacier attempted to resume arbitration, but Nestle Waters objected, arguing that Mountain Glacier failed properly to reserve the arbitration in its reorganization plan. The lower courts disagreed, as did the Sixth Circuit, holding (1) Mountain Glacier’s reservation enabled creditors to identify its claim and evaluate whether additional assets might be available for distribution; and (2) neither Browning v. Levy, 283 F.3d 761, 772 (6th Cir. 2002) nor 11 U.S.C. 1123(b)(3) required Mountain Glacier to provide more information than it did. View "Nestlé Waters North America. Inc. v. Mountain Glacier LLC" on Justia Law

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The Bankruptcy Appellate Panel affirmed the bankruptcy court's determination that debtor failed to meet her burden of proof to establish an undue hardship pursuant to 11 U.S.C. 523(a)(8) to discharge her student loans. The panel held that the bankruptcy court did not err in dividing her federal tax refund by each month in the year and including it as monthly income; based upon the evidence of her age, health, skill sets and abilities, debtor failed to meet her burden to demonstrate that her future employment opportunities will not result in higher wages and full time employment; and the bankruptcy court's finding that debtor had sufficient income in excess of her expenses to make modest monthly payments to her lenders was amply supported by the evidence. View "Piccinino v. U.S. Department of Education" on Justia Law

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A court may raise judicial estoppel on its own motion in an appropriate case, and therefore, the doctrine is not waived if not pled by the parties. After Plaintiff initiated Chapter 13 bankruptcy proceedings, he filed a defamation claim against Defendants. Plaintiff subsequently completed the payments required by the Chapter 13 plan, and the bankruptcy court ordered the discharge of his remaining unsecured debts. Defendants moved for summary judgment and then filed a reply brief to Plaintiff’s brief in opposition to the motion, arguing that Plaintiff was judicially estopped from prosecuting his defamation claim because he failed to timely disclose it to the bankruptcy court. The circuit court granted the motion, concluding that the doctrine of judicial estoppel prohibited Plaintiff from prosecuting his defamation claim after taking the position in the bankruptcy court that it did not exist. The Supreme Court affirmed, holding (1) the doctrine of judicial estoppel was not waived by Defendants for their failure to raise it in their pleadings; and (2) Plaintiff identified no reversible error in the circuit court’s application of judicial estoppel. View "Eilber v. Floor Care Specialists, Inc." on Justia Law

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The Fourth Circuit reversed the district court's dismissal of BLC's appeal of the bankruptcy court's confirmed reorganization plan for debtor. The court held that BLC's appeal was not equitably moot. On the merits, the court held that the bankruptcy court did not err in calculating the indubitable equivalent of BLC's claim or in calculating the amount of post-petition interest due to BLC. Therefore, the court affirmed the bankruptcy court's judgment. View "Bate Land Company LP v. Bate Land & Timber LLC" on Justia Law

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Section 362(k)(1) of the Bankruptcy Code specifically departs from the American Rule and authorizes costs and attorneys' fees incurred by the debtor in ending a willful violation of an automatic stay, prosecuting a damages violation, and defending those judgments on appeal. In this case, the Eleventh Circuit affirmed the district court's order awarding defendants attorneys' fees and costs that they incurred because of plaintiff's unsuccessful appeal of the damages award to defendants for her violation of the Bankruptcy Code's automatic stay provision. The court also granted defendants' motion for attorneys' fees incurred in this appeal. View "Mantiply v. Horne" on Justia Law

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The First Circuit affirmed the district court’s judgment affirming the bankruptcy court’s ruling that the largely debt-financed purchase of a family-owned leather manufacturer was not a fraudulent conveyance and was not a violation of the fiduciary duties of the company’s directors. The trustee of a trust established to benefit the creditors of several related insolvent entities filed a complaint alleging that the transaction at issue was a fraudulent conveyance and that the company’s directors were in breach of their fiduciary duties by approving it. The bankruptcy court ruled in the defendants’ favor on every count. The district court affirmed, holding that the bankruptcy court’s factual determinations were not clearly erroneous, and the bankruptcy court found sufficient facts to support its conclusions. View "Development Specialists, Inc. v. Kaplan" on Justia Law

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The M/V Deep Blue purchased fuel from a supplier, the supplier purchased the fuel from an affiliate, and the affiliate subcontracted with Radcliff. Radcliff subsequently asserted a maritime lien on the Deep Blue in a bid to recover directly from the ship, giving rise to this litigation. The Fifth Circuit affirmed the district court's determination that Radcliff did not have a lien on the Deep Blue. Instead, a lien had arisen in favor of the global fuel supplier, and was duly assigned to ING Bank, an intervenor in the suit. View "Barcliff, LLC v. M/V Deep Blue" on Justia Law

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Debtor filed several unsuccessful lawsuits to invalidate Sandlin Farm's Deutsche Bank mortgage. Debtor, d/b/a Sandlin Farms sought Chapter 12 bankruptcy relief but did not propose to pay that mortgage nor a BoA mortgage on other property. Debtor filed adversary complaints to avoid the liens. The Trustee moved to dismiss the case due to inaccurate monthly reports and Debtor’s inability to generate sufficient income to implement his plan if the liens were valid. The Bankruptcy Court dismissed the Deutsche Bank adversary proceeding, citing res judicata. Debtor voluntarily dismissed the BoA proceeding but did not re-notice the confirmation hearing or amend the plan. The court denied Debtor’s motion to stay pending appeal of the Deutsche Bank dismissal and set a hearing on the Trustee's motion. Debtor resisted scheduling depositions and requested time to find new counsel. The Trustee then sought Dismissal as a Sanction for Failure to Cooperate with Discovery. Debtor did not appear at the hearing. The Bankruptcy Court dismissed (11 U.S.C. 1208(c)) based on inability to present a timely confirmable plan; unreasonable delay; and a continuing loss to the estate without reasonable likelihood of rehabilitation. The Bankruptcy Appellate Panel affirmed. Although Debtor had actual notice of the hearing, it was not reasonably calculated to give him sufficient notice of exactly what issues would be addressed nor an opportunity to be heard. Nonetheless, Debtor failed to refute that cause existed to dismiss the case, so the error was not prejudicial. View "In re: Haffey" on Justia Law

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Under Gibbs v. Legrand, post-discovery delay does not preclude equitable tolling but is still relevant to assessing a party's "overall diligence." The Ninth Circuit affirmed the Bankruptcy Appellate Panel's decision reversing the bankruptcy court's dismissal as time-barred of a bankruptcy estate's claims seeking avoidance of fraudulent transfers and affirming the bankruptcy court's dismissal of other claims based on transfers not made by debtor. The panel held that neither court correctly applied the law on equitable tolling. In this case, the estate's overall diligence, combined with the extraordinary circumstances preventing earlier discovery of the subject transfers, warranted equitable tolling. View "Milby v. Templeton" on Justia Law