In re Wentz

(Bankr. E.D. Ky. Nov. 6, 2014)

The bankruptcy court grants the creditor’s motion to dismiss the chapter 13 case because the debtor was not eligible for chapter 13, as his unsecured debt exceeded the debt limit of 11 U.S.C. § 109(e). The court recognizes that based only on the debtor’s schedules, the debt limit was not exceeded. While the Sixth Circuit has stated a bankruptcy court should look primarily to the debtor’s schedules to make the chapter 13 eligibility determination, the bankruptcy court holds that a state court judgment against the debtor is sufficiently reliable to establish that the debtor omitted unsecured debt that would cause his total unsecured debt to exceed the § 109(e) debt limit. Opinion below.

2014-11-06 – in re wentz

In re Paschal

(Bankr. W.D. Ky. Nov. 5, 2014)

The bankruptcy court awards the chapter 13 debtor attorney fees and punitive damages to be paid by the creditor for its willful violation of the automatic stay. The creditor had made an unauthorized debit transaction of $400 from the debtor’s bank account after the petition was filed. The debtor’s attorney notified the creditor of the stay but the creditor, who was already aware of the bankruptcy filing, refused to refund the payment. Opinion below.

2014-11-05 – in re paschal

Keeley v. Grider

(Sixth Circuit Nov. 3, 2014)

The Sixth Circuit affirms the bankruptcy court’s denial of the adversary proceeding plaintiff’s motion to amend the default judgment she obtained nearly a year earlier. The plaintiff had sought a judgment against the debtor for his liability on a promissory note and a declaration that such debt was nondischargeable. The debtor defaulted, and the plaintiff obtained a default judgment entry by the clerk for the amount owed on the note. The plaintiff then sought to amend that judgment to include language declaring the debt nondischargeable. The court affirms the bankruptcy court’s denial of the motion, noting that Civil Rule 60(a) (through Bankruptcy Rule 9024) is appropriate to correct clerical and similar errors in judgments but should not be used to change substantive rights between the parties. Further, because the plaintiff had sought entry of the default judgment by the clerk, the nondischargeability determination could not have been included in the judgment, as the court must enter a default judgment if anything more than an award for a sum certain is sought. Opinion below.

2014-11-03 – keeley v grider