Daniels v. Agin

In this bankruptcy proceeding involving a turnover action and a revocation action, the bankruptcy court ruled (1) Debtor failed to maintain his profit-sharing plan in substantial compliance with applicable tax laws, which meant that assets in the profit-sharing plan and two IRAs funded with the plan assets were part of the bankruptcy estate; and (2) Debtor intentionally failed to disclose the existence of the two IRAs into which he had transferred assets from his profit-sharing plan, which ruling provided alternative grounds for treating the IRAs as nonexempt and provided the basis for the bankruptcy court to revoke Debtor's discharge. The First Circuit Court of Appeals affirmed both rulings, holding (1) the plan assets were not exempt from the bankruptcy estate; (2) Debtor indisputably demonstrated a reckless indifference to the truth of material information during his bankruptcy proceedings; (3) the bankruptcy court did not abuse its discretion in denying Debtor's Fed. R. Civ. P. 60(b) motion for relief on the turnover judgment on the basis of newly discovered evidence and excusable neglect; and (4) the bankruptcy court did not err in granting summary judgment to the U.S. Trustee in the revocation action. View "Daniels v. Agin" on Justia Law