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The summaries on this website are summaries of the opinions issued by the judges of the Bankruptcy Court for the Western District of Virginia from October 2004 to date. The opinions may be searched by year, judge, category and chapter. For a more detailed search, enter a keyword in the search box above. This opinion bank, however, is not an exhaustive list of opinions issued by the judges of the Western District. These summaries are not intended to replace other research methods, but may be used as a starting point for your research. These summaries do not contain information as to whether an opinion has been published, appealed or the disposition of any such appeal, or otherwise overruled or affected by subsequent case law or statute. These summaries have been prepared for the convenience of the researcher and in no way constitute an interpretation by the Court of the opinion summarized. Please rely on the opinion not the summary. Please contact Judge Connelly's chambers or Judge Black's chambers regarding any questions or errors.

Sexton v. Internal Revenue Service (In re Sexton) (Case No. 13-70230; A.P. No. 13-07037) 07/21/02014

            The court had entered an order in an adversary proceeding.  After the fourteen-day time period to appeal had lapsed, the court closed the adversary proceeding and subsequently closed the debtor’s main bankruptcy case.  Thereafter, the government filed a motion to reopen the case, asserting that the court had only ruled on one of the two claims in the debtor’s complaint and thus the order was not a final order.  Therefore, the government argued, because the court closed the adversary proceeding and main bankruptcy case without having entered a final judgment, the court did so inappropriately and cause existed to reopen the case. 

            The court found that the government had not met its burden in showing sufficient cause existed to reopen the case and that reopening would be futile and a waste of judicial resources.  The court held that the opinion and order constituted a final judgment and reopening the case would only afford the government additional time to file an appeal, which is not a “compelling circumstance.”

United States Trustee v. Jennings (In re Oliphant) (Case No. 12-70668) 6/23/2014

Based on the respondent's continual efforts to assist the debtors in filing petitions, while accepting compensation, and for giving them inappropriate legal advice, the Court found that the respondent acted as a petition preparer under Bankruptcy Code section 110(e).  Accordingly, the Court fined the respondent a total of $8,000 for his actions as a petition preparer and issued a permanent injunction against him to refrain from acting as a petition prepaarer in the future, based on his "continually engaging" in such improper acts.

In re Ulrey (Case No. 13-70645) 06/02/2014

            SunTrust sought to have the confirmation order revoked because the debtor included real property in her schedules and plan despite the fact that a foreclosure sale was completed prior to the debtor’s filing, thereby extinguishing her property rights.  SunTrust also requested relief from the automatic stay.  The debtor responded, arguing that the foreclosure sale was not completed prior to the bankruptcy filing as no memorandum of sale was executed. 

            “By the thinnest of margins,” the court found that the necessary circumstances sufficient to challenge the confirmation order were not present.  Further, the court found that, even though there is case law providing that the debtor’s house did not become property of the estate, she still had a possessory interest in the real estate and the right to challenge the viability of the foreclosure sale.  As a condition of the stay remaining in effect as to her principal residence, the court required the debtor to tender all payments due to SunTrust and the chapter 13 trustee pursuant to her confirmed chapter 13 plan within thirty days of the date of the opinion or SunTrust would be granted relief from the automatic stay.

In re Jefferson (Case No. 13-62618) 04/04/2014

The matter before the Court is a motion to avoid a judicial lien on jointly owned property.  The Court noted that there is a split in authority on the issue of the application of 11 U.S.C. § 522(f) to jointly owned property.  The Court outlined the two approaches taken in Zeigler Eng'g Sales v. Cozad (In re Cozad), 208 B.R. 495 (B.A.P. 10th Cir. Utah 1997), and In re Staples, 2000 Bankr. LEXIS 2204 (Bankr. M.D.N.C. June 7, 2000).  The Court followed the approach outlined in Staples and allocated the lines on the property proportionate to the fractional interests prior to determining whether to avoid the lien.  Accordingly, the Court partially avoided the judicial lien on the Debtor's property.

United States Trustee v. Jennings (In re Oliphant) (Case No. 12-70668) 4/2/2014

Court granted United States Trustee's motion for disgorgement of fees received, as the Court found that the respondent was a "de facto petition preparer," under Code section 110(e), based on the respondent providing the debtors with blank voluntary petitions, advising the debtors in how to complete various forms, and instructing the debtors not to comply with various court orders.  Furthermore, the respondent took $1,000 per month and instructed the debtors to sign a Statement of No Assistance.  

In re Roberts (Case No. 10-51861) 04/01/2013

Pro se debtor filed a motion to reopen her bankruptcy case.  The court construed the motion as a motion to reopen to determine if a bank’s post-discharge actions involving a deed and trustee’s sale had violated the discharge injunction.  The court determined that in the event that the bank did not currently hold and  did not hold a perfected secured claim at the time of the discharge, any action taken by them to collect on a debt discharged under the debtor’s bankruptcy would potentially be a violation of the discharge injunction.  Therefore, the court found that cause existed to grant the debtor’s motion to reopen her bankruptcy case to determine if the bank’s actions had violated the discharge injunction.

Sexton v. Internal Revenue Service (In re Sexton) (Case No. 13-70230; A.P. No. 13-07037) 04/01/02014

The debtor filed a complaint to enforce the automatic stay against the Internal Revenue Service.  The IRS filed a motion to dismiss under Rule 12(b)(6) for failure to state a claim and under Rule 12(b)(1) for lack of subject matter jurisdiction.  The main question the court had to answer was whether the government’s post-petition setoff of the debtor’s tax refund to satisfy a non-tax debt is a violation of the automatic stay.  The Court found that that the government’s actions of intercepting and withholding the debtor’s tax overpayment violated the automatic stay.  Accordingly, the Court denied the motions to dismiss and granted the relief requested by the debtor in her action to enforce the automatic stay.

Am. Southern Ins. Co. v. Rutherford (In re Rutherford) (Case No. 12-51445; A.P. No. 13-05013) 3/31/2014

Upon American Southern Insurance Company's motion to determine its debt non-dischargeable under Bankruptcy Code section 523(a)(2)(B), the Court granted the Rutherford's motion for summary judgment, finding that American Southern could not have relied upon the Rutherford's allegedly misleading Financial Statements, because it issued the bond rider prior to receiving the writing.  Accordingly, the Court held American Southern could not establish reliance upon such writing and it could not prevail on its non-dischargeability claim for fraud under the Code.

In re Tomer (Case No. 08-61265) 3/14/2014

The Court denied the movant's request for the debtor to produce prior years' tax returns and income and expediture statements, pursuant to Bankruptcy Code section 521(f).  Ultimately, the Court held that the movant had not made a sufficient showing that it could not obtain this information through other means or that there was a need for the information to aid in the administration of the case, especially in light of the fact the debtor had already completed all plan payments and the case almost closed.  To warrant such production of confidential information, the movant must first prove a need that outweighs the debtor's right to privacy.

In re Cassell (Case No. 13-71980) 03/14/14

The creditor, whose claim was secured by a vehicle, filed an objection to confirmation of a proposed chapter 13 plan.  The court considered whether the plan complied with 11 U.S.C. § 1325 and may be confirmed or whether the creditor’s objection should be sustained due to the fact that the plan listed an amount in paragraph 3(D) that was less than the actual debt resulting in an impermissible cram down.  The court concluded that the plan language was clear in that the trustee would commence payments to the holder of each allowed secured claim listed in paragraph 3(D) on the balance owed or the amount specified in paragraph 3(A), whichever is less, until the amount was paid in full.  There was no amount listed in 3(A).  The court thus overruled the creditor’s objection and confirmed the plan.

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