In re Sowers (Case No. 04-02837) 04/25/2005
Under the totality of the circumstances and standard of living test, Debtor's obligation to former spouse that arose from divorce decree excepted from discharge by 11 U.S.C. section 523(a)(15).
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Under the totality of the circumstances and standard of living test, Debtor's obligation to former spouse that arose from divorce decree excepted from discharge by 11 U.S.C. section 523(a)(15).
The court approved a settlement proposal regarding a preferential transfer after determining that it was in the best interest of the creditors, would avoid potentially significant litigation expenses, and fell well above the bottom range of outcomes that would be considered reasonable.
In Chapter 11 case, Court ordered Debtor to file Amended Disclosure Statement detailing terms for sale of collateral and intended use of proceeds in response to creditor motion challenging the proposed sale. Creditors should be advised of Debtor's continued operation of its business.
The Court denied the debtors' Motion to Quash Garnishment of child support arrearages because the confirmed Chapter 13 plan failed to "provide for" the debtor’s ex-wife's claim by not including the amount or sufficient payments to fund all plan obligations.
The Chapter 7 Trustee filed a motion to dismiss the Debtor's case for substantial abuse under 11 U.S.C. § 707(b). The Court found that the Debtor wished to use bankruptcy to service indebtedness for which she is not legally obligated, pay transportation costs of the non-debtor spouse, and expense the start up of a business enterprise for the non-debtor spouse by discharging her own debt. The Court, applying the factors enumerated by the Fourth Circuit in Green v. Staples (In re Green), 934 F.2d 568 (4th Cir. 1991), concluded that this constitutes bad faith, and therefore, it would be a substantial abuse to permit the Debtor to continue under Chapter 7.
The Court denied the debtors' Motion for Reconsideration of dismissal because the debtors cited no manifest error of law or fact or asserted the existence of any new evidence.
Liquidation value as of filing date is the proper standard for valuing vehicle for purpose of redeeming under 11 U.S.C. section 722. Debtor bears burden of proving that the value is less than the debt secured thereby.
A deed of trust held by the debtor was conveyed to her for the sole purpose of being held as collateral for bond for the defendant in the defendant's criminal case. Shortly before her bankruptcy filing, the debtor reconveyed the property back to the defendant. The Chapter 7 trustee sought to recover the parcel of real estate pursuant to 11 U.S.C. § 548(a)(1)(B)(i)(ii)(I) as a fraudulent conveyance. The Court held that the evidence supported the contention that the debtor never had an actual interest in the property but was merely a bailee for the defendant; thus, the debtor held no interest in the property which the trustee could recover under Section 548. Accordingly, the Court denied the trustee’s motion to avoid the fraudulent conveyance.
The plaintiff sought removal of the litigation from circuit court to the bankruptcy court pursuant to 28 U.S.C. § 1452 and Federal Rule of Bankruptcy Procedure 9027. The defendant opposed removal, arguing that removal from the circuit court to the bankruptcy court was impossible because the debtor filed the notice of removal with bankruptcy court clerk rather than the district court clerk in contravention of Rule 9027(a)(1), and because the 90-day time frame mandated by Rule 9027(a)(2) had expired, thereby barring removal. The Court held that removal was proper because the Federal Rules of Bankruptcy Procedure define "clerk" as the bankruptcy court clerk, the majority of case law supports this position, and modal errors of process are not jurisdictional. Therefore, since the plaintiff’s notice and motion for removal were properly submitted to the bankruptcy court clerk, and is in compliance with Rule 9027(a)(1) and (2), the removed litigation will be heard in the bankruptcy court.
The Court denied a secured creditors Motion for Adequate Protection because the creditor had a sufficient equity cushion to protect its interest.