The Unsecured Creditor's Committee negotiated a carveout agreement whereby a secured creditor would pay the fees of the Committee's professionals pursuant to a Rule 9019 settlement agreement. Because no estate funds were being used to pay the Committee's professionals, the court determined that it was not required to examine those fees under section 330 of the Bankruptcy Code, or to require that any disbursement to the Committee's professional comply with the Bankruptcy Code's required distribution scheme. The court also determined that the allocation being made to unsecured creditors under the settlement's carveout agreement included both those unsecured creditors that were in existence at the time the settlement agreement was negotiated, and those creditors that subsequently became unsecured as a result of a foreclosure action.
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Patrick M. Flatley
Date: 01/24/2008
Exempt monthly VA benefits are considered income for purpose of the section 1325(b) disposable income test regardless of their exempt status. The Chapter 13 trustee's disposable income objection to confirmation of the debtor's plan on the basis that the debtor was not committing her VA benefits to make payments under the plan is overruled because the debtor, who was unemployed for five of the six months before filing bankruptcy, had already included the receipt of her VA benefits on Form B22C.
Date: 01/23/2008
Form B22C is the method by which an above the median income debtor's disposable income is to be determined; Schedules I and J may not be used for this purpose. A debtor is entitled to claim the standard vehicle expense deduction provided by the means test regardless of whether the debtor also owes a secured debt obligation on the vehicle. The Internal Revenue Manual is not an appropriate tool for determining the extent to which a debtor may claim deductions for applicable National and Local Standards. Confirmation of the debtor's Chapter 13 plan is continued to take evidence and testimony on the debtor's claim of home energy, food, and clothing expenses in excess of the National and Local Standards.
Date: 01/10/2008
The debt owed to Plaintiffs is excepted from discharge pursuant to § 523(a)(4) because the Debtor was unable to account for funds used while acting under a power of attorney.
Date: 12/18/2007
Landlord's section 523(a)(6) cause of action against a debtor/tenant for wilful and malicious injury to property is denied.
Date: 12/18/2007
The Chapter 13 trustee's motion to modify the debtor's confirmed plan on the basis that the value of the property increased from $112,000 in Novmeber 2004 to $204,000 by July 2007 is denied because the trustee failed to prove that the increase in the value of the property was unanticipated given the pre-petition, and pre-confirmation, local real estate trends in Ranson, West Virginia. Without a showing that the property's increase in value was unanticipated, the trustee could not overcome the res judicata effect of confirmation.
Date: 12/17/2007
The debtor's request that the creditor's proof of claim be disallowed based on an alleged failure to include appropriate supporting documentation, or a notice of an assignment, is overruled. The debtor failed to allege any grounds under section 502 of the Bankruptcy Code for the disallowance of the claim, and the debtor's objection, even if valid, would only affect the creditor's entitlement to a Rule 3001(f) prima facie presumption as to the claim's validity and amount. Because the debtor failed to assert any basis for departing from the American Rule on attorney's fees, the debtor's request that the creditor pay his attorney's fees of $250 is denied.
Date: 12/06/2007
Litigation initiated by the Attorney General in state court is excepted from the automatic stay under section 362(b)(4) of the Bankruptcy Code. The Debtor's claim for damages for alleged breaches of the automatic stay is denied.
Date: 11/18/2007
The debtor filed a motion to voluntarily dismiss his Chapter 13 case, and sold real property during the time when the Clerk noticed out his motion to dismiss to parties in interest. A creditor then sought to set aside the sale of the property as being unauthorized under section 363(b) of the Bankruptcy Code. The court ruled that a Chapter 13 debtor has an absolute right to dismiss his case under section 1307(b), which right is not restricted by a creditor's competing motion to convert under section 1307(c). The Clerk, however, acted appropriately in sending out notice of the debtor's motion to dismiss because, at a minimum, other parties should be allowed the opportunity to request that the debtor's dismissal be conditioned under section 349. Considering the voluntary nature of Chapter 13, the order dismissing the debtor's case is effective nunc pro tunc to the date of the filing of the motion. Consequently, the creditor's motion to set aside the sale of property as being unauthorized under section 363(b) is denied.
Date: 10/26/2007
Debtor's motion for summary judgment for the creditor's alleged violaiton of the discharge injunction is denied on the basis that the debtor failed to demonstrate that the creditor had knoweldge that the discharge injunction applied to the debt it sought to collect. Creditor's motion for summary judgment is granted on the grounds that debtor could not prove that Valley Credit was seeking to collect on what it knew to be a discharged debt.
Date: 10/08/2007
Because the Debtor's exemption in real property that he owned as of the petition date was impaired by the judicial lien, the Debtor's motion to avoid judicial lien is granted. Sale of the property after the petition date and subsequent conversion from Chapter 13 to Chapter 7 do not impact the analysis of the judicial lien because the petition date is the appropriate time for calculations concerning judicial lien avoidance.
Date: 08/30/2007
Debtor's student loans were excepted from discharge because he presented insufficient medical evidence to satisfy the second prong and he failed to demonstrate a good faith effort to repay his loans in light of his lack of communication with the Department of Education and minimal payments.
Date: 08/01/2007
The Plaintiff's claims to except an alleged debt under 11 U.S.C. § 523(a)(2)(A) or to deny entry of a discharge pursuant to § 727(a)(4)(A) are denied. Plaintiff failed to prove that he allegedly loaned the Debtor money when she fraudulently misrepresented her intention to repay him. Plaintiff also failed to prove that the Debtor knowingly and fraudulently undervalued her home on Schedule A of her bankruptcy petition.
Date: 07/11/2007
The trustee's motion for partial summary judgment on a section 548 fraudulent transfer cause of action is denied on the basis that genuine issues of material fact exists regarding whether the alleged fraudulent transfer concerned property of the debtor, or property that the debtor was holding for the benefit of another under an oral trust of personal property.
Date: 07/06/2007
The court dismissed the case for lack of subject matter jurisdiction when the dispute involved the non-payment of a cure amount for the assignement of an executory contract. Payment of the cure amount was delegated to the Debtor's bankruptcy purchaser with the non-debtor party to the executory contract giving a full release of liability to the Debtor. The outcome of the contract dispute would have no effect on the Debtor's bankrutpcy estate.
Date: 06/25/2007
Debtor's motion to reconsider is denied. A "discharge" in bankruptcy, as the term is defined by section 524(a) of the Bankruptcy Code, does not "discharge" a judgment lien within the meaning of section 38-3-6 of the West Virginia Code.
Date: 06/20/2007
The debtor stated a cause of action for a violation of the discharge injunction when the debtor alleged that the creditor failed to timely update information that the creditor furnished to credit reporting agencies pre-pretition. The debtor is entitled to conduct further discovery on that cause of action before the court rules on the creditor's motion for summary judgment.
Date: 06/19/2007
The Debtors cannot waive 11 U.S.C. § 524(c)(1) in order to file reaffirmation agreements made after the court enters the Debtors' discharge order. The court would not vacate the Debtors' discharge for the purpose of approving reaffirmation agreements in the absence of a valid reason under Rule 60(b). Because the reaffirmation agreements are untimely, the court lacks jurisdiction to consider them.
Date: 06/15/2007
Debtor's student loans were discharged because she satisfied the three prongs of the Brunner test.
Date: 06/06/2007
The debtor's discharge is denied under section 727(a)(2)(A) for concealing property, and, in the alternative, under section 727(a)(4)(A) for making a false oath or account.