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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. 

Paul M. Black

In a case proceeding under the Bankruptcy Act of 1898, the Court denied counsel for creditors’ motion to approve attorney’s fees pursuant to the common fund theory seeking payment by unrepresented unsecured creditors of a fee enhancement.  The Court held that that no provision of the Bankruptcy Act or its successor, the Bankruptcy Code, provides a method to award fees in the circumstances of this case under the common fund doctrine from estate assets.

The Trustee filed an objection to a claim that was filed late.  The claimant then filed a motion to extend time to file the claim asserting that, because the Debtor provided an incorrect address for the claimant when she filed her petition, the claimant received delayed notice of the filing and of the section 341 meeting of creditors and should be allowed to file her claim late pursuant to Rule 3002(c)(6).   The post office discovered the mistake and put the incorrectly addressed notice in the claimant’s post office box such that she received the notice prior to the first meeting of creditors.  The claimant appeared at the section 341 meeting of creditors, but did not file her proof of claim until almost five months after receiving notice.  The issue before the Court is whether the Debtor’s failure to include a correct address for the claimant warrants an extension of time for the claimant to file her proof of claim under Rule 3002(c)(6).  The Court held that the Claimant had sufficient notice giving her a reasonable time to file her proof of claim.   Therefore, the Court sustained the Trustee’s objection to the claim and denied the claimant’s motion to file the claim late.

The Debtor claimed as exempt on Schedule C garnished funds as an avoidable preference pursuant to Virginia Code § 34-4 and then filed a complaint seeking to avoid and recover what he claimed was a preferential transfer to the judgment creditor under 11 U.S.C. §§ 542 and 547.  The creditor argued that the transfer of funds occurred outside the 90-day preference period. Following In re Wilkinson, 196 B.R. 311 (Bankr. E.D. Va. 1996), the Court found that the relevant transfer date for the purpose of § 547(b) was the date that the garnishment lien attached to the Debtor’s wages under Virginia law.  In this case, the petition was filed on September 24, 2018; therefore the 90-day preference period began on June 26, 2018.  The creditor filed the garnishment summons on February 27, 2018, pursuant to which the creditor’s lien attached to the Debtor’s wages paid between March 26, 2018 and May 11, 2018.  The Debtor thus earned his wages and his employer paid those withheld funds to the General District Court, all prior to the start of the 90-day preference period.  Therefore, the Court denied the Debtor’s request to recover the funds under § 547(b).

The Debtor claimed as exempt on Schedule C garnished funds as an avoidable preference pursuant to Virginia Code § 34-4 and then filed a complaint seeking to avoid and recover what he claimed was a preferential transfer to the judgment creditor under 11 U.S.C. §§ 542 and 547.  The creditor argued that the transfer of funds occurred outside the 90-day preference period. Following In re Wilkinson, 196 B.R. 311 (Bankr. E.D. Va. 1996), the Court found that the relevant transfer date for the purpose of § 547(b) was the date that the garnishment lien attached to the Debtor’s wages under Virginia law.  In this case, the petition was filed on September 24, 2018; therefore the 90-day preference period began on June 26, 2018.  The creditor filed the garnishment summons on February 27, 2018, pursuant to which the creditor’s lien attached to the Debtor’s wages paid between March 26, 2018 and May 11, 2018.  The Debtor thus earned his wages and his employer paid those withheld funds to the General District Court, all prior to the start of the 90-day preference period.  Therefore, the Court denied the Debtor’s request to recover the funds under § 547(b).

Rebecca B. Connelly

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