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Opinions

 

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.

Fischer et al v. Wells Fargo Bank (In re Fischer) (Case No. 09-60598-LYN; A.P. No. 09-06048) 10/08/09

Debtors sought to avoid the consensual lien of Wells Fargo Bank under 11 U.S.C. §§ 506(a) and 1322(b)(2) which permit a chapter 13 debtor to modify the rights of holders of claims secured by the debtor’s principal residence only if all other senior liens on the property are greater than the value of the residence. The Court determined that the value of the property was greater than the first priority consensual lien on the property. Therefore, the lien cannot be avoided.

Brown v. Bradley Law Firm, PC (In re Brown) (Case No. 09-61325-LYN; A.P. No. 09-06051) 10/02/09

Debtor sought to avoid the judgement lien of Bradley Law Firm, P.C under 11 U.S.C. § 506, but the facts pleaded formed the basis for a cause of action under 11 U.S.C. § 522(f)(1)(A). Debtor owned property to which a consensual lien was attached and to which Bradley Law Firm sought to attach a judgment lien. The liens together exceed the value of the property. The judgment lien impaired the exemption and was voided to the extent of its impairment. The non-impairing amount of the lien was allowed as a secured claim. The impairing amount of the lien was allowed as an unsecured claim.

In re Wharton (Case No. 09-61741-LYN) 10/02/09

Debtors sought to avoid the lien of Beneficial Discount Company of Virginia under 11 U.S.C. § 522. The Court examined whether the lien impaired an exemption of property in Danville and Callands under 11 U.S.C. §552(f)(2)(A). The Court determined that the Danville properties were not exempt because joint debtors may not claim property exempt where the property is held as tenants by the entirety and the judgment is against both Debtors.

In re English (Case No. 08-60172) 09/23/2009

The debtors objected to three proofs of claim on the basis that no supporting documentation or evidence of contract was attached and that the debts may be barred by the statute of limitations. In response to the objection, each creditor filed an amended proof of claim attaching a copy of the transaction history of the account.  A proof of claim is presumed to be prima facie valid if supported by documentation as required by Rule 3001(c).  If the creditor files a proof of claim not supported by requisite documentation, the debtor's objection will be deemed to have been filed in bad faith if the debtor has scheduled the debt in an amount equal to or greater than the proof of claim and not marked the claim as disputed or if the debtor has no reason to believe that the basis of the objection is true.  If the proof of claim is supported by the required documentation, the presumption of validity may be overcome by the objecting party only if it offers evidence of equally probative value in rebuttal.  The debtors' objection based on no supporting documentation was overruled by the court as the debtors scheduled each of the claims in substantially the same amount as the proofs of claim and did not mark any of the claims disputed on the schedules.  In this case, a writing that included a detailed transaction history over a reasonable period of time was found sufficient to support the proof of claim for an unsecured debt.  As the debtors failed to provide any law or assert any facts to support the statute of limitations defense, the objection on that ground was overruled.

Compton v. Compton (In re Compton) (Case No. 08-72212; A.P. No. 09-07005) 09/16/09

Debtor failed to disclose all property when she attempted to obtain a bankruptcy discharge under chapter 7 of the Bankruptcy Code. Her brother filed an objection to discharge. The Court then heard an adversary proceeding to determine whether the Debtor was entitled to bankruptcy discharge pursuant to 11 U.S.C. §727(a)(4)(A). The Court determined that the element of fraudulent intent was not established by a preponderance of the evidence. Accordingly, the Court held that the Debtor was entitled to bankruptcy discharge.

Scott v. Wells Fargo Bank, Ltd. et al. (In re Herring) (Case No. 07-61673; A.P. No. 08-06091) 09/03/2009

The trustee filed a complaint alleging that the defendant violated 15 U.S.C. § 1635 and C.F.R. § 226.23 by failing to provide the male debtor with two copies of a notice of the right to rescind the transaction and sought to rescind the transaction, avoid the lien on the real property and receive damages for violation of the Truth in Lending Act.  If the creditor fails to provide each debtor with two copies of the notice of the right to rescind, then the period in which the debtor has a right to rescind is extended from three days to three years. If a creditor violates Section 1635, then the court may also award relief under section 1640  for actual damages, statutory damages and costs including attorney's fees. The Court held that the defendant did not violate the TILA and the debtor had no right to effect rescission prior to the filing of the petition; therefore, the trustee had no right to effect rescission post petition.  However, even if the creditor violated the TILA, the Court would not avoid the lien unless the trustee tendered the amount borrowed less any payments that had been made by the debtors.  As the debtors had no such funds and there were no funds in the estate, neither could perform the act necessary to effect rescission.

American Express Bank, FSB v. Cook (In re Cook) (Case No. 08-71839; A.P. No. 08-07077) 08/28/09

The Court heard competing motions for partial summary judgment filed by the parties regarding Count II of the Complaint in which the American Express Bank, FSB, sought judgment against the debtors for amounts which Mr. Cook charged upon an American Express credit card. The court granted partial summary judgment to American Express against Mr. Cook. The Debtors’ motion for partial summary judgment with respect to Count II was denied because it would unduly expand the intended scope of 11 U.S.C. § 523(a)(14).

Belcher et al v. Sallie Mae, Inc. (In re Belcher) (Case No. 06-71448) (A.P. No. 08-07076) 08/19/09

Debtors alleged that Sallie Mae willfully violated the automatic stay by undertaking collection efforts against them following confirmation of their chapter 11 plan. In its answer, Sallie Mae admitted that it continued collection efforts but it denies that it knowingly or willfully violated the automatic stay. The Court granted 90 days for discovery. During discovery, a dispute arose. The matter before the Court then, was a multi-item discovery dispute regarding information sought by the Debtor’s from Sallie Mae. Debtors also sought an extension of time to complete their desired discovery.

In re Brandon (Case No. 08-62969) 08/17/2009

The Court denied the debtor’s motion to reopen her case to amend schedules to add unnamed and previously omitted creditors because this was a “no asset, no bar date” case; consequently, creditors holding claims otherwise dischargeable had their claims discharged even if their claims were not scheduled and even if the omitted creditors had no notice of the case.  See 11 U.S.C. § 727(b).

In re Sauter (Case No. 08-72050) 02/11/09

The United States Trustee objected to the Debtor’s chapter 13 plan to the extent it did not satisfy the chapter 7 liquidation test pursuant to 11 U.S.C. § 1325(a)(4). The Debtor argued that the limit to a chapter 7 Trustee’s compensation is determined by the Trustee’s distributions to both secured and unsecured creditors. The Court decided not to rule how chapter 7 Trustees ought to be compensated in a chapter 13 case because of its proximity to an advisory opinion. However, the Court sustained the Trustee’s objection.

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