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In re Shotwell (Case No. 09-62300) 08/23/2010

The United States Trustee filed a motion to dismiss the case for abuse under 11 U.S.C. § 707(b).  Section 707(b)(1) provides that a court may dismiss an individual case under Chapter 7 if (1) the debtor’s debts are primarily consumer debts and (2) it would be an abuse of the provisions of Chapter 7 of the Bankruptcy Code to grant relief to the debtor.  Section 707(b)(2) provides that abuse is presumed if a debtor's net monthly income exceeds a certain threshold amount as determined by the means test.  Section 707(b)(3)(B) provides that if the presumption in Section 707(b)(2) does not arise or is rebutted, the court must consider the totality of the debtor's financial circumstances in determining whether proceeding in Chapter 7 would be an abuse.  The Court concluded that the Debtors do not have sufficient disposable income to fund a Chapter 13 plan, and no other factors suggest substantial abuse.  Therefore, the Court denied the United States Trustee's motion to dismiss this case for abuse.

Date: 
Monday, August 23, 2010
Category: 
Abusive Filings
Dismissal
Substantial Abuse
Chapter: 
7