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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.

Am. Express Fin. Advisors, Inc. v. Sears (In re Sears) (Case No. 03-03328; A.P. No. 05-07029) 08/10/2005

A creditor filed a Complaint seeking to determine dischargeability of debt.  Seventy-eight (78) days later, the Debtor filed a Motion to Dismiss the Complaint, citing Federal Rule of Bankruptcy Procedure 7012(b) and Federal Rule of Civil Procedure 12(b)(6).  The Court denied the Debtor's Motion to Dismiss pursuant to Rule 12(b) on the ground that it was untimely filed.

Rockingham Memorial v. Moore (In re Moore) (Case No. 04-01012; A.P. No. 04-00049) 7/29/2005

Upon the Plaintiff's Complaint to determine the dischargeability of a judgment under 11 U.S.C. § 523(a)(6) for willful and malicious injury, the Court held that the judgment is excepted from discharge pursuant to Section 523(a)(6).  To be excepted from discharge under Section 523(a)(6), the debtor’s act has to be one in which the debtor intended to cause harm to the entity, or to a property interest of the entity, not just an intentional act where harm resulted.  The Fourth Circuit has held that the equivalent of actual malice may be inferred from the circumstances; thus, malice may be implied from deliberate and intentional act done with "knowing disregard for the right of others."  See In re McNallen, 62 F.3d 619, 626 (4th Cir. 1995).  Therefore, because the debtor knew that the hospital had a valid lien on the tax refund, she acted willfully acted against the interest of the hospital when she received and spent her refund.  Accordingly, the Court found that this intentional action was sufficient to deny discharge of the debt under Section 523(a)(6).

Andrew v. Educ.Credit Mgmt. Corp. (In re Andrew) (Case No. 04-01685; A.P. No. 04-00062) 07/25/2005

A creditor sought a declaration that debts arising from an educational loan is non-dischargeable under 11 U.S.C. § 523(a)(8).  The Plaintiff asserted that the debt was discharged in her Chapter 7 case.  Since the debt arose from an education benefit "made, insured, or guaranteed by a governmental unit," the burden shifts to the Plaintiff to demonstrate that excepting the debt from discharge will impose an undue hardship on her and her dependents.  See 11 U.S.C. § 523(a)(8).  Under the undue hardship test, the Plaintiff must establish the three prongs outlined in Brunner v. New York State Higher Educ. Servs. Corp., 831 F.2d 395, 396 (2nd Cir. 1987).  In this case, the Plaintiff failed to meet her burden of proving the first two prongs of the Brunner test for undue hardship.  Plaintiff would have disposable income after making the payment of her student loans and her total household income is expected to increase during the repayment period of the loan.  Accordingly, the debt is nondischargeable.

Euler Hermes ACI v. Coal River Res., Inc., et al. (In re Coal River Res., Inc., et al.) (Case No. 04-00988; A.P. No. 04-07146) 07/25/2005

The Court found that an assignee Creditor did not have a workman's or materialman's lien under West Virginia law because the liens were not filed in accordance with the statute, despite an exception from the automatic stay.  A general unsecured creditor does not have standing to assert an equitable subordination motion against another general unsecured creditor without authorization of the Court after notice and hearing to all creditors and parties in interest.

American General Fin. Serv. of Am. v. Booher (In re Booher) (Case No. 04-74179; A.P. No. 04-07145) 07/15/2005

The Court found that the debtor purchased an engagement ring approximately one month prior to filing bankruptcy with the intent to not pay for it and to discharge the liability.  The Court denied the debtor’s discharge of the debt pursuant to 11 U.S.C. § 523(a)(2)(A).

In re Mullen (Case No. 05-70763) 07/15/2005

The Trustee objected to confirmation of the Debtor's Chapter 13 plan on the ground that it does not meet the requirement of 11 U.S.C. § 1325(a)(4) (the "liquidation test").  The Debtor co-owns her personal residence with her sister.  The issue before the Court is whether the Debtor would have to absorb the full cost of the sale of her residence, rather than prorating the costs of sale among the co-owners, thereby reducing the Debtor's equity, if any, in the property.  For purposes of the liquidation test, 11 U.S.C. § 363(j) is clear that if the case were liquidated under Chapter 7, the trustee would distribute any proceeds according to the interests of any co-owners after deducting costs and expenses.  There is no dispute in the courts in the interpretation of this provision and the costs of sale are to be pro-rated rather than charged first against any individual co-owner's interest.

In re Fenster (Case No. 03-05002) 7/14/2005

United States Trustee's motion to dismiss case under section 707(b) for substantial abuse denied. The Court found that the petition was filed as a result of a reasonably foreseeable business failure, consumer purchases were made beyond the debtor's means to pay for them, personal living expenses ($400,000 condominium) were excesssive and unreasonable in light of then existing circumstances and the debtor had ability to pay a reasonable portion of his earnings to creditors in a Chapter 11 case (as debtor was ineligible for Chapter 13).  However, after analyzing the In re Green and In re Harrelson factors, the Court found a fairly even split among the totality of the circumstances factors, which weighed in favor of the debtor.