(Seventh Circuit Issued June 24, 2014)
The Seventh Circuit reverses the district court’s grant of summary judgment in favor of the defendant employer. The plaintiff had previously filed bankruptcy and failed to schedule as an asset an employment discrimination claim. The defendant employer moved for summary judgment on the basis that the plaintiff should be estopped from asserting the claim after omitting it from her schedules. The district court granted the motion, but the appellate court reversed, finding the transcript from the 341 meeting reflected that the plaintiff had disclosed the claim and thus there was a genuine issue of material fact as to whether the plaintiff intentionally omitted the claim such that estoppel would apply. Opinion below.
2014-06-24 – spaine v community contacts
(Bankr. S.D. Ind. Issued June 23, 2014)
The bankruptcy court denies the debtors’ motion to exclude turnover of the portion of their tax refund based on a child tax credit. Even though the bankruptcy petition was filed prior to December 31, 2013, the date the debtors became eligible to receive the refund, the debtors had a contingent interest in the refund on the petition date. Thus, to the extent the refund was for an overpayment of taxes, it is property of the bankruptcy estate. Opinion below.
2014-06-23 – in re atwood
(Bankr. W.D. Ky. Issued June 16, 2014)
Judge Lloyd denies the debtor’s motion to reconsider the Court’s order granting summary judgment to the plaintiff, finding the plaintiff’s claim against the debtor was nondischargeable under 11 U.S.C. 523(a)(6). The Court rejects the debtor’s arguments, stating that the nondischargeability action could not serve as an appeal of the state court’s judgment establishing the debt. Opinion below.
2014-06-16 – dunn v campbell
(Bankr. W.D. Ky., Issued June 11, 2014)
Judge Lloyd denies the debtor’s motion to dismiss the adversary proceeding, in which the title company sought a judgment that its claim on a promissory note was non-dischargeable under Section 523 of the Bankruptcy Code. The debtor argued the complaint was time barred based on Kentucky’s five and ten-year limitations periods for claims based on fraud. The Court held that, while the debtor’s signature did not appear on the promissory note, the debtor’s signature on the mortgage—which contained a covenant that the debtor would pay the amount owed under the note—was sufficient to establish a claim upon a written agreement, which has a fifteen-year limitations period. The nondischargeability claim was also filed timely under the applicable bankruptcy rules. Opinion below.
2014-06-11 – stewart title v cruz
(U.S. Supreme Court, Issued June 12, 2014)
The U.S. Supreme Court holds that funds in an inherited IRA cannot be exempted from property of the estate as “retirement funds.” Congress did not intend for inherited IRAs to be exemptable property because of the inherent differences between an inherited IRA and a traditional IRA, including that funds from inherited IRAs may be withdrawn at any time. Opinion below.
2014-06-12 – clark v rameker
(U.S. Supreme Court, Issued June 9, 2014)
The U.S. Supreme Court holds that when a bankruptcy court is prohibited from entering a final judgment on certain claims under the Court’s prior Stern opinion, the bankruptcy court may still enter proposed findings of fact and conclusions of law to be reviewed de novo by the district court. This opinion gives some guidance to bankruptcy courts as to how to proceed when faced with a “Stern claim.” Opinion below.
2014-06-09 – executive benefits insurance agency v arkison
(Sixth Circuit B.A.P. Issued June 3, 2014, appeal from Bankr. E.D. Ky.)
The Sixth Circuit B.A.P. affirms the bankruptcy court’s order overruling the debtor’s objection to his ex-wife’s priority domestic support claim for $12,500. The debtor’s obligation to pay half of a mortgage was not a property settlement, but rather is in the nature of a domestic support obligation (as defined by the Bankruptcy Code) based on the intent of the parties in making the agreement. Opinion below.
2014-06-03 – in re thomas