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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.

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.

In re Harvey (Case No. 08-71684) 07/20/09

Debtor filed a motion for summary judgment in response to the United States Trustee’s motion to dismiss his Chapter 7 case pursuant to 11 U.S.C. § 707(b)(1). The U.S. Trustee sought dismissal of the Debtor’s Chapter 7 case for abuse and alleged that the presumption of abuse arose under 11 U.S.C. § 707(b)(2). The Debtor argued that the presumption of abuse did not arise because he deducted payments secured by property he intended to surrender.

In re Cooper Coal (Case No. 09-70520) 7/7/2009

Chapter 11 debtor has the burden of establishing that section 1129(a)(7)(A)(ii) is satsfied before plan can be confirmed. Even though Chapter 11 plan had been accepted by over 80% of unsecured creditors, the debtor must still show that the distributions to general unsecured creditors are at least as much as such creditors would receive in a chapter 7 liquidation. Plan also did not unambiguously state that the debtor did not qualify for a discharge if the provisions of section 1141(d)(3) were applicable.  United States Trustee's objection to confirmation sustained.

In re Whitlow (Case No. 09-71228) 07/06/09

The City of Roanoke, Virginia filed a motion for annulment of automatic stay against the Debtor and Trustee. The motion requested that he automatic stay provisions of 11 U.S.C. § 362(e) be annulled, or alternatively, that stay be terminated or modified with regard to certain real property owned by the Debtor. The Court concluded that the proper relief was modify, rather than nullify, the automatic stay to permit the City to seek confirmation of the sale by the state circuit court.

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