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.
The Official Committee of Unsecured Creditors filed a Motion for Distribution seeking for its attorneys' fees to be paid from escrowed funds, all of which served as the collateral for secured creditors. The Court held that the Committee may not be compensated from the collateral of secured creditors. Accordingly, the Court denied the Committee's Motion for Distribution.
The debtors filed a complaint to determine the validity and extent of the credit union’s lien on the debtors’ residence and to strip the lien from the debtors’ residence. The credit union responded disputing the debtors’ valuation. The court found that the second lien, which the debtors were attempting to strip off, was secured to the extent of the equity exceeding the balance of the first lien.
Court overruled debtor's objection to proof of claim based on the statute of limitations contained in Va. Code section 8.3A-118. Creditor did not file a response to the objection. Court held that the debt was revived under Va. Code section 8.01-229(G) by the debtor's acknowledgment of the debt in her schedules and chapter 13 plan. Claim was allowed in the full principal amount plus simple interest.
Chapter 7 debtor moved to redeem a 2006 Dodge Durango. The vehicle had been acquired through financing provided by Capital One Auto Finance, which objected to the debtor’s motion disagreeing over the value of the vehicle. The Bankruptcy Code provides in § 722 a right to individual debtors to redeem tangible personal property “intended primarily for personal, family, or household purposes” from a lien secured by such property. The Court concluded that the correct standard was the “replacement” value rather than the “liquidation” value, citing 11 U.S.C. § 506(a)(2); that debtor bears the burden of proving that the property is worth less than the amount owing to the creditor which is secured by a lien upon such property; that proper valuation date is the petition filing date rather than the hearing date upon a redemption motion; and that statements contained in the schedules of a bankruptcy debtor can constitute binding admissions of the factual matters set forth in such schedules. The Court allowed the debtor to redeem the vehicle at a value it determined based on the evidence presented.
Creditor filed adversary proceeding to determine whether her debt was excepted from discharge under section 523(a)(6). Court held that the state court order directing debtor to turn over tax refund did not create property interest in tax refund sufficient to permit the Court to find that debtor's spending of tax refund was conversion of creditor's property; creditor failed to show debtor committed an intentional tort and that the intentional tort was conduct substantially certain to result in injury or was motivated by a desire to inflict injury.
In an adversary proceeding, the debtors sought, among other relief, a declaratory judgment that the female debtor was not a “responsible officer” under section 6672 of the Internal Revenue Code. Both sides filed motions for summary judgment. The court concluded that summary judgment was not appropriate because there were genuine issues of fact as to whether the female debtor actually possessed but failed to exercise power to compel the payment of the withholding taxes owing to the government.
Claimant, who was a customer of the debtor and who had purchased a membership in the franchisor of the debtor, filed a proof of claim seeking a refund of his membership fees after the debtor closed the local showroom. The chapter 7 trustee filed an objection to the claim. The court found that the trustee did not carry his burden in rebutting the presumptive validity of the proof of claim, but did carry his burden as to the amount of the claim and its priority status.
The creditor moved for relief from the automatic stay in order to reduce the debtor's guarantees on a loan to judgment and to record that judgment. The trustee did not oppose granting relief to the creditor to obtain a judgment against the debtor, but objected to the recordation of any judgment obtained. The Court held that the creditor would not be permitted to record any judgment that it obtained because it would create a change in priority of the creditor's claim.
The chapter 7 trustee, Robert E. Wick, objected to a proof of claim on the basis that no supporting documentation was filed with the claim. The debtor had scheduled this debt as an undisputed debt in a slightly higher amount than that listed in the claimant’s proof of claim. The Court overruled the objection because the only basis for objection was lack of supporting documentation, citing the decision in In re Magic Wand, LLC, Case No. 12-70404 (Bankr. W.D. Va. Oct. 10, 2012).
Chapter 7 trustee, Roy V. Creasy, filed an adversary proceeding on behalf of the debtor to recover property obtained by the defendant through a pre-petition garnishment summons. The Court found that the defendant’s lien against the judgment debtor’s bank account became effective on the date the writ of fieri facias was delivered to the county sheriff. Even though the payment at issue occurred within ninety days prior to the debtor’s bankruptcy filing, it represented a transfer in partial satisfaction of an existing lien upon that account which had been created more than ninety days before such bankruptcy filing. For that reason the payment was not preferential within the meaning of § 547 of the Bankruptcy Code because a lien creditor is entitled in bankruptcy to the benefit of its lien against the debtor’s property. The Court dismissed the trustee’s complaint and entered final judgment in favor of the defendant.