Bankruptcy Articles & Information

The creditor is arguing that the debtor should have to surrender or pay for the TV that was used as collateral because she has more than one, and that the new statutory definition of "household goods" only allows for a single TV. My argument is going to be that the amendment to section 522(f)(4)(A) did not change the treatment of "household furnishings" or "appliances" in the main part of 522(f). There is also a second issue involving a riding lawn mower which was originally a PMSI loan, but that account was later rolled into a second non-PMSI loan with the same creditor. I’m confident that this defeats their PMSI status, but I don’t know how we can fit this into 522(f). It’s not a household good or furnishing, but it could qualify as an appliance. Is anyone aware of any 522(f) cases involving lawn equipment?

Fort Worth lawyer advisory committee is on the "No Look" Chapter 13 fee arrangement. Specifically, looking at specifically what work should be included under the No Look fee agreement and what work can or should be excluded from the flat, no look, fee. Does anyone have a copy of the list, or contract or other document that your Bankruptcy Court has adopted relating to the work to be performed both within and outside of the confines of the "No Look" fee?

Debtor is now in default, with nothing more. Does not specifically trigger any enforcement mechanism of default against the debtor if you literally read the provisions. Maybe this triggers remedies against a cosignor outside of Texas bankruptcy attorney, or default swap agreement, etc. The problem is that the statute talks about a contractual provision that operates to say default. This is much different than enforcement of the default. If they meant enforcement of a provision after default, it could have easily have been written “nothing in this title will prevent [the remedies under contract, state law, or repossession arising from] the operation of a provision to place a debtor in default…….”

11 USC 541(b)(1) states that property of the state does not include “any power the debtor may exercise soley for the benefit of an entity other than the debtor.” Additionally, 541 (d) states that property in which debtor holds “. . . only legal title and not an equitable interest. . .” is not property of the bankruptcy estate. In this case, debtor opened a separate bank account for her son and placed the child’s future child support monies in that account. Debtor has no equitable right to that money other than to provide for the support of the child. She holds mere legal title to the account because her minor child cannot legally maintain the account.
Support payments to the debtor on behalf of a child are considered trust funds which are beyond the reach of the bankruptcy trustee. In re: Gardner, 243 F. Supp 258 (D. Or. 1965); see also, Boston v. Gardner, 365 F.2d 242 (9th Cir 1966). These trust fund monies are not property of the estate. 11 USC 541(b)(1) and (d). In Dallas, the lawyer bankruptcy trustee attempted to gain control of child support payments: both current obligations and arrears. Id. at 259. The Court held that the custodial parent lacked ownership of child support payments because she held the money for the care, maintenance, education and support of her child. Id. At 258.

On January 10, 2008, Cleveland sued Plaintiffs’ parent, Wells Fargo & Company,together with twenty other defendants, alleging, in a public nuisance action under Ohio law, that“subprime lending abuses” have inflicted “damage” upon Cleveland. See Cleveland v. DeutscheBank Trust Company, et al., Case No. 1:08-cv-00139-DCN, ¶ 4. Among other things,Cleveland’s complaint in that case (“the Complaint” or “Cleveland’s Complaint”) alleges (¶ 32)that “[b]etween 2002 and 2006, [Wells Fargo] issued more than 30 billion in securities backed bysub-prime mortgages”; that “Wells Fargo itself also has originated tens of thousands of sub-prime mortgages”; and that “[o]ver the last four years, Wells Fargo has filed more than 4,000foreclosure actions in Cuyahoga County.” Cleveland’s Complaint seeks equitable relief and damages for “a foreclosure crisis as the inescapable consequence of” the defendants’, includingWells Fargo & Company’s, alleged conduct.23.Wells Fargo & Company does not originate, purchase, service, sell or securitizeresidential mortgage loans. However, Plaintiffs Wells Fargo Bank and WFASC do, and basedon the allegations in Cleveland’s Complaint, Plaintiffs face an imminent threat that Clevelandwill apply the state-law public nuisance theory in its Complaint to their real-estate mortgage loanorigination, purchasing, servicing, sales and securitization activities. Cleveland’s nuisanceaction thereby threatens to impair and interfere with Plaintiffs’ federally authorized powers tooriginate real-estate mortgage loans and determine the interest rates for such mortgage loans, aswell as to purchase, service, sell and securitize such mortgage loans. Plaintiffs bring this suit toprevent Cleveland’s imminent threat to Plaintiffs’ federal rights.24.In Ohio, “a ‘public nuisance’ is ‘an unreasonable interference with a rightcommon to the general public.’ 4 Restatement, Section 821B(1). ‘Unreasonable interference’includes those acts that significantly interfere with public health, safety, peace, comfort, orconvenience, conduct that is contrary to a statute, ordinance, or regulation, or conduct that is of acontinuing nature or one which has produced a permanent or long-lasting effect upon the publicright, an effect of which the actor is aware or should be aware.” City of Cincinnati v. BerettaU.S.A. Corp., 768 N.E.2d 1136, 1142 (Ohio 2002).25.Because Cleveland’s action has purportedly been brought to enforce state law,and seeks to vindicate an alleged right common to the general public, its action constitutes“visitation” on Plaintiffs. 12 C.F.R. § 7.4000(a)(2). As such, Cleveland’s nuisance actionthreatens to interfere with the OCC’s exclusive visitorial authority over the Plaintiffs’ banking-related activities.

A secured judgment holder files an unsecured claim (which was allowed) in a chapter 13 and receives a distribution and the case is discharged. The judgment remains of record on non-homstead property.

The 4th Circuit has ruled that an intervening chapter 13 bankruptcy case does not toll the time period for discharge under 727(a)(8).

The Chapter 13 plans of two debtors in separate cases were not proposed in good faith and thus could not be confirmed. Although the court did not doubt the “real world bona fides” of the debtor, they were seeking another round of debt forgiveness despite being ineligible for Chapter 7 relief, due to past filings. Moreover, the debtors were not adjusting their debts through their proposed plans, consistent with the purpose of Chapter 13, but instead sought to cancel and eliminate creditor claims via plans with durations tied only to the payment of the debtors’ attorney fees. In addition, allowing the cases, which were basically Chapter 7 cases hidden within Chapter 13 petitions, to go forward would effectively invalidate the statutory eight-year hiatus between Chapter 7 discharges and replace it with another, shorter statutory period applicable to Chapter 13 cases.

Observing that the case law surrounding the issue was “scarce,” a Pennsylvania bankruptcy court has held that the section of the Bankruptcy Code which tolls statutes of limitation upon the filing of bankruptcy petitions, 11 U.S.C.A. 108(a), may be invoked by Chapter 13 debtors-in-possession prosecuting actions that constitute estate property. Although the issue was less clear than in the Chapter 11 context, the court found no reason why 108 should not also apply to Chapter 13 debtors-in-possession, as the debtor is the representative of the estate in prosecuting the action. The debtor in a Chapter 13 case has the ability to sue on behalf of the estate, and essentially “steps into the role of the trustee” when doing so, the court reasoned. Hence, the debtor is eligible for the same provisions of the Code affecting the trustee’s power to sue, including the extension of time provisions in 108. A split of authority was noted

By virtue of his failure to appear and testify at a deposition conducted by the Chapter 7 trustee, the husband of a corporate debtor’s chief executive officer was in civil contempt of court. The husband did not appear despite having multiple opportunities to comply with the trustee’s subpoena, and despite the court’s efforts to accommodate his medical conditions. The bankruptcy court therefore ordered the rescheduling of the husband’s deposition under detailed terms, and warned that it would exercise its power to impose sanctions if the husband again failed to attend and testify.