Justia Bankruptcy Opinion Summaries

Debtor appealed the bankruptcy court's order overruling her objection to the chapter 7 trustee's final report and denying her motion to compel the chapter 7 trustee to abandon $16,893.44 he had received from the Ruth E. Thompson Revocable Trust. The court agreed with the bankruptcy court that pursuant to paragraph 5.3.4 of the trust agreement, debtor's interest in the Trust was fully alienable by her on the petition date, and her interest in the Trust was not excluded from the bankruptcy estate under 11 U.S.C. 541(c)(2). Accordingly, the court affirmed the bankruptcy court's order. View "Thompson-Rossbach v. Doeling" on Justia Law

Creditor appealed from the bankruptcy court's order denying his motion to dismiss debtor's bankruptcy petition. The bankruptcy court ruled that the Bankruptcy Code merely requires the debtor to establish that she had received a briefing regarding credit counseling in compliance with 11 U.S.C. 109(h)(1). The bankruptcy appellate panel concluded that the bankruptcy court properly found that the certificate of counseling was sufficient to meet the statutory requirements and denied creditor's contention to the contrary because it was based on an erroneous interpretation of law. The panel lacked jurisdiction related to creditor's appeal of an order granting debtor's motion to sell certain real property and the panel declined to address creditor's remaining issues because they were not presented to the bankruptcy court in the first instance or are unrelated to the issue on appeal. Accordingly, the panel affirmed the judgment. View "Curtis v. Segraves" on Justia Law

After debtor, a successful surgeon, died during the pendency of his bankruptcy case, debtor's estranged spouse and debtor's personal representative claimed various allowances and exemptions under the Texas Estates Code in debtor’s bankruptcy case pursuant to Bankruptcy Code 501, 502, and 522. The bankruptcy court ruled that neither was entitled to relief. The court dismissed the appeal to the extent that debtor's spouse seeks a probate allowance to be paid out of debtor's bankruptcy estate because the court lacked appellate jurisdiction to decide this issue. The court does not review bankruptcy court orders that have not been reviewed by the district court. The court affirmed in all other respects. View "Brown v. Sommers" on Justia Law

Debtor filed for Chapter 7 Bankruptcy. Debtor claimed an Individual Retirement Account (IRA) he inherited from his mother upon her death as exempt property from the bankruptcy estate. The Trustee of the case objected to Debtor’s claim of exemption. The United States Bankruptcy Court for the District of Montana certified a question to the Supreme Court regarding whether a Debtor may claim an exemption in an IRA pursuant to Mont. Code Ann. 25-13-608(1)(e). The Supreme Court answered the question in the negative, holding that, under Montana’s liberal construction of exemptions, a debtor may not claim an exemption to an inherited IRA under section 25-13-608(1)(e). View "In re Golz" on Justia Law

Mark Lazzo served as legal counsel for Schupbach Investments, L.L.C. in its Chapter 11 bankruptcy case. After confirming a liquidation plan for the debtor, the bankruptcy court entered a final fee order approving certain disputed fee applications Lazzo filed. Creditor Rose Hill Bank and Carl B. Davis, the trustee of the Schupbach Investments Liquidation Trust, appealed the final fee order to the Bankruptcy Appellate Panel (BAP). The BAP reversed those portions of the bankruptcy court’s order that: (1) confirmed post facto approval of Lazzo’s employment, and allowed fees incurred prior to approval of his employment; and (2) allowed postconfirmation fees. The Debtor, Lazzo, and his law firm, Mark J. Lazzo, P.A. appealed the BAP’s decision. Finding no reversible error, the Tenth Circuit affirmed. View "Davis v. Schupbach Investments" on Justia Law

Debtors appealed the bankruptcy court's confirming of their amended Chapter 13 plan. The court held that when a Chapter 13 debtor’s treatment of a creditor under one subsection of 11 U.S.C. 1322(b) falls within the contours of another subsection of that statute, all standards of both subsections must be satisfied. Specifically, the court examined whether the maintenance of regular payments for unsecured non-priority student loan debt by debtors in this case, while they paid substantially less to other unsecured non-priority debt, satisfied the requirements of Bankruptcy Code 1322(b)(1) and (b)(10). The court held that those requirements were not met. The court agreed with the bankruptcy court’s holding that debtors’ plan was unfairly discriminatory. Accordingly, the court affirmed the judgment. View "Jordahl, Jr. v. Burrell" on Justia Law

Debtor filed a voluntary Chapter 7 bankruptcy petition. On his claimed exemption schedule, Debtor asserted that, pursuant to Nev. Rev. Stat. 21.090(1)(bb), his entire interest in two corporations’ stock was exempt from the bankruptcy estate. The bankruptcy court certified a question to the Supreme Court, asking whether section 21.090(1)(bb) allows a debtor to exempt his entire interest in a closely held corporation or whether the exemption is limited to the debtor’s noneconomic interest in the corporation. The Supreme Court answered that section 21.090(1)(bb)’s language exempting stock of a corporation described in subsection 2 of Nev. Rev. Stat. 78.746 “except as set forth in that section” means that a debtor can exempt stock in the corporations described in Nev. Rev. Stat. 78.746(2), but his economic interest in that stock can still be subject to the charging order remedy in section 78.746(1). View "Becker v. Becker" on Justia Law

This case arose out of the Chapter 7 bankruptcy proceeding filed by debtor. Debtor appealed from the bankruptcy court's order sustaining the bankruptcy trustee’s objection to her claim of an exemption in certain real property and limiting the exemption to $155,675.00. The court concluded that debtor did not acquire the property in which she claims her homestead exemption within the 1215-day period preceding the filing of the petition pursuant to 11 U.S.C. 522(p)(1)(A), thus limiting her homestead exemption to $155,675.00. In this case, the trustee presented evidence from three sources to the effect that instead of recording the deed immediately after execution, Donn Bruess, debtor's father, left it with his attorney until he determined whether to go forward with that conveyance. Upon consideration of the trustee’s evidence, the bankruptcy court found that Donn Bruess had not surrendered control of the deed with the intent to irrevocably convey the property. The court concluded that the bankruptcy court's findings were not clearly erroneous and affirmed the judgment. View "Bruess v. Dietz" on Justia Law

Appellants and the company they own filed suit against David Fisher and other defendants, alleging claims arising from an unfulfilled real estate purchase agreement. Fisher filed an answer and counterclaim. Three years later, Fisher filed for Chapter 7 bankruptcy. Appellants filed an adversary proceeding in the bankruptcy case, requesting a determination that their claims against Fisher were not dischargeable in bankruptcy. The district court subsequently dismissed Appellants’ claims. Thereafter, the bankruptcy court ruled that Appellants’ claims against Fisher were dischargeable in bankruptcy. Appellants then filed a motion to modify the district court’s order dismissing the action and a renewed motion for summary judgment. The district court denied both post-dismissal motions, noting that the matter had already been dismissed. On appeal, the Supreme Court treated Appellants’ motions as motions for relief from the dismissal order pursuant to Wyo. R. Civ. P. 60(b) and affirmed, holding that, under the circumstances of this case, the district court did not abuse its discretion in denying Appellants’ motions. View "Bartel v. West" on Justia Law

Day’s company, Forever Green, sells artificial turf playing fields. It sued its competitor, ProGreen, for $5 million for diversion of corporate assets (Bucks County Action). Dawson, an owner of ProGreen and a former Forever Green sales representative, would be liable if damages are awarded. Dawson sued Forever Green for unpaid commissions and wages (Louisiana Action). Years later, the Louisiana court entered a consent judgment ( about $300,000) in favor of Dawson, which was not paid. Meanwhile, the Bucks County parties agreed to arbitrate. Weeks after the consent judgment entered, ProGreen moved to terminate arbitration, arguing that Forever Green was insolvent and that Day lacked “ability or desire to pay the Arbitrator’s fees and expenses.” Dawson obtained a writ of execution against the arbitrator. Recognizing that he was adverse to Dawson, the arbitrator suspended the arbitration until the fee issue was resolved. Forever Green sued to reinstate the arbitration. Dawson and a law firm that was owed $206,000 from Forever Green, filed an involuntary Chapter 7 bankruptcy petition against Forever Green, which satisfied the statutory criteria, 11 U.S.C. 303(b). The Bankruptcy Court dismissed the filing as being in bad faith. The Third Circuit affirmed, finding that bad faith provides a basis for dismissal independent of the statutory criteria for filing. View "Forever Green Athletic Fields, Inc. v. Dawson" on Justia Law