(Bankr. W.D. Ky. Oct. 28, 2016)
The bankruptcy court enters an order holding in abeyance the motion to dismiss the Chapter 13 case. The court also denies confirmation of the proposed plan but holds the case open for further filings. The required maintenance payment could not be satisfied by the monthly payments in the proposed plan. Opinion below.
Judge: Lloyd
Attorneys for Debtor: Naber & Joyner, J. Gregory Joyner
Attorney for Creditor: Joseph S. Elder II
Author: Matt Lindblom
(6th Cir. Oct. 25, 2016)
The Sixth Circuit reverses the bankruptcy court’s order permitting the Chapter 7 trustee to be paid her administrative fee from proceeds of the sale of the debtors’ Michigan real property. The debtors claimed the Michigan exemption for real property they owned. The trustee sold the property, paid creditors, and then obtained an order from the court permitting her administrative fee to be paid from the remaining proceeds. The bankruptcy court reasoned that the debtors used the full benefit of the exemption by the trustee accepting a lower purchase price from the debtors’ preferred purchaser. The Michigan statute provides that the exemption covers sale proceeds, and the bankruptcy court incorrectly applied the statute. Opinion below.
Judge: Cook
Attorney for Debtors: Melonee L. Monson-Holley
Attorney for Trustee: Beadle Smith, Thomas L. Beadle
Author: Matt Lindblom
(Bankr. S.D. Ind. Oct. 19, 2016)
The bankruptcy court enters judgment in favor of the plaintiff in this adversary proceeding arising from a transaction involving the sale of a restaurant and associated assets. The court finds that rights in the purchase agreement were effectively assigned to the plaintiff, and the purchase agreement should be reformed to reflect the proper selling party. Further, the court finds that various defendants are liable to the plaintiff on breach of warranty, conversion, and other claims. Opinion below.
Judge: Lorch
Attorneys for Debtor: Seiller Waterman LLC, Neil C. Bordy
Attorneys for Certain Defendants: Tilford Dobbins & Schmidt, PLLC, Lisa Koch Bryant, Ayala Golding
Author: Matt Lindblom
(6th Cir. Oct. 12, 2016)
The Sixth Circuit affirms the bankruptcy court’s order denying the creditor’s motion to reopen the case. The debtor’s ex-spouse filed the motion four years after the debtor received his discharge. The ex-spouse argued that an obligation arising out of their divorce proceedings should be declared non-dischargeable. The court holds the bankruptcy court did not abuse its discretion in denying the motion. Opinion below.
Per Curiam
Attorney for creditor: Aaron J. Scheinfield
Attorneys for debtor: Silverman & Morris, Geoffrey Lewis Silverman, Karin F. Avery
Attorney: Matt Lindblom
(Bankr. W.D. Ky. Oct. 11, 2016)
The bankruptcy court holds that the plaintiff’s claim is non-dischargeable under 11 U.S.C. §§ 523(a)(2), (4), and (6). The plaintiff and the debtor started a pawn business together. Shortly after it began operating the debtor was arrested on drug charges. The parties then gave conflicting testimony regarding various claims that arose in favor of the plaintiff against the debtor, including for a loan to post bond and theft from the plaintiff. The court finds that the plaintiff’s testimony was more credible and enters judgment in favor of the plaintiff. Opinion below.
Judge: Stout
Attorney for Debtor: Cooley & Offill, Robert A. Cooley, Jesse E. Offill
Attorney for Plaintiff: Steven L. Boling
Author: Matt Lindblom
(Bankr. S.D. Ind. Oct. 6, 2016)
The bankruptcy court sustains the trustee’s objection to confirmation of the debtor’s chapter 13 plan. The proposed plan provided for monthly payments for three years, but the Court finds that the applicable commitment period should be five years. The debtor argued that he should have a “marital adjustment” for loan payments on which his wife is contractually obligated, but the Court holds that those payments should be included in the calculation of the debtor’s combined monthly income, and thus the applicable commitment period is five years. Opinion below.
Judge: Carr
Attorney for Debtor: John Steinkamp & Associates, John T. Steinkamp
Trustee: Ann M. DeLaney
Author: Matt Lindblom
(Bankr. W.D. Ky. Oct. 3, 2016)
The bankruptcy court denies the debtor’s motion to dismiss the nondischargeability action. The debt arose from a burglary of an individual’s home. The individual died prepetition. The deceased individual’s beneficiaries filed the action pro se, naming the individual’s estate as well as themselves as plaintiffs. The debtor argued the complaint should be dismissed because the beneficiaries engaged in the unauthorized practice of law because the estate was included. The Court relies on a recent Sixth Circuit opinion and finds the beneficiaries were permitted to file as they did. The debtor also argued the complaint should be dismissed because of the timing of service of the complaint and summons. The Court holds the proper procedures were followed. Opinion below.
Judge: Lloyd
Attorney for Plaintiffs: Crain, Schuette & Associates, Amanda Lisenby Blakeman
Attorney for Debtor: Alicia C. Johnson
Author: Matt Lindblom
(6th Cir. Oct. 3, 2016)
The Sixth Circuit affirms the district court’s dismissal of the pensioners’ challenge to the confirmation order entered in the Chapter 9 bankruptcy case filed by the City of Detroit, Michigan. The pensioners filed the action to challenge the plan’s reduction of their benefits. The Court holds that the doctrine of equitable mootness applies. The pensioners did not obtain a stay, the plan has been substantially consummated, and many actions have been undertaken or completed under the plan. Opinion below.
Judge: Batchelder
2016-10-03-in-re-city-of-detroit
Author: Matt Lindblom
(6th Cir. B.A.P. Sep. 30, 2016)
The Sixth Circuit B.A.P. affirms the bankruptcy court’s order dismissing the Chapter 7 case for failure to complete the 11 U.S.C § 109(h) pre-petition credit counseling. The debtor argued the requirement should be waived in this case for reasons including that the §109(h)(2) and (3) exceptions should apply. The bankruptcy court held the exceptions did not apply. The debtor could not establish incapacity, because the debtor was able to complete the counseling post-petition, and the debtor failed to establish that the debtor could not obtain pre-petition counseling within seven days of a request or any other exigent circumstances. Opinion below.
Judge: Humphrey
Debtor: pro se
Author: Matt Lindblom
Kentuckiana Bankruptcy Opinions 