Court granted the Trustee's motion to convert this case from Chapter 13 to Chapter 7 pursuant to 11 U.S.C. § 1307(c), in part because the Debtor had been sentenced to 27 months of incarceration. This case had been pending for 10 months and the debtor failed to obtain a confirmable plan during that time and unlikely that the debtor would be able to do so if he remained in Chapter 13. Therefore, cause existed to convert this case to Chapter 7 because the debtor’s inability to file a confirmable plan constituted “an unreasonable delay . . . that is prejudicial to creditors.” Further, conversion was in the best interests of the creditors and the estate because there may be equity of an undetermined amount in the debtor’s real property and, given the fact that the debtor was proceeding pro se, the “appointment of a disinterested Chapter 7 trustee would facilitate final resolution of the case.”
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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.
Two Movants filed motions for relief from the automatic stay, alleging "cause" under 11 U.S.C. § 362(d) to lift the stay to continue to prosecute their sexual harassment claims against certain debtor defendants in West Virginia state court. The Court analyzed the factors set forth in Robbins v. Robbins (In re Robbins), 964 F.2d 342 (4th Cir. 1992), and determined that all three factors supported lifting the stay for cause. Accordingly, the Court granted both motions in part. The Court lifted the automatic stay to allow the West Virginia state court actions to proceed so that the Movants can liquidate their claims against the debtor defendants, and allowed the Movants to seek recovery of their judgment up to the limits of insurance coverage and to file a proof of claim by the Bar Date and later amend the proof of claim for any amounts determined to be in excess of the available insurance coverage.
United States Trustee sought dismissal or conversion of the debtor's case under the totality of the circumstances test of section 707(b)(3)(B) based on her substantial monthly Social Security benefits. Court held on motion for partial summary judgment that because it could not consider such income in chapter 13, based on the definition in the Bankruptcy Code of "current monthly income" and the Fourth Circuit's opinion in Mort Ranta v. Gorman, it follows that the Court was unable to consider such income for purposes of the totality of the circumstances test as well.
District Court remanded for clarification of the Bankruptcy Court's prior decision holding the creditor had not established the debtor's willfulness and intent to cause her injuries. On remand, the Bankruptcy Court explained it disagreed with other courts finding an implied intent to injury in sexual assault and statutory rape (carnal knowledge) cases based on the nature of the crime and held that it would be improper to imply an intent to willfully and maliciously cause such an injury when mere negligence would suffice for the state court judgment.
Debtor filed a motion to dismiss pursuant to section 1307(b). Immediately after the debtor filed his motion, a creditor filed a motion to convert the case to Chapter 7 pursuant to section 1307(c). After review of Law v. Siegel, the Court granted the debtor's motion to dismiss. The Court denied the creditor's competing motion to convert, but barred the debtor from filing a new petition for 180 days under section 109(g)(2) as sufficient nexus existed between a prior order granting relief from stay and the motion to dismiss.
Debtor brought a Motion for Sanctions for Violation of the Automatic Stay after she received a mortgage billing statement from a creditor that did not contain any disclaimer language acknowledging that she had received a discharge in bankruptcy and was no longer personally obligated on the debt. The Court construed her request as a request for damages for violation of the discharge injunction of 11 U.S.C. § 524(a). The creditor asserted that the mortgage billing statement was sent as a result of an innocent clerical error and was a mistake. The Court concluded that the creditor willfully violated the discharge injunction by sending the mortgage billing statement without any disclaimer language, but held that the debtor failed to prove any damages since she only alleged emotional distress, which the Fourth Circuit has disallowed as an item of damages of civil contempt.
On debtors' objection to claim of DuPont Community Credit Union, the Court ruled that DuPont had carried its burden of proving that both husband and wife intended to obtain a MasterCard with DuPont and both were jointly liable on the debts accrued thereunder. Furthermore, the Court ruled that the fact DuPont had already obtained a warrant in debt against only Mr. Guertler and not also Mrs. Guertler did not bar the credit union from asserting both debtors were jointly liable on the debt.
Adversary Proceeding complaint dismissed for lack of subject matter jurisdiction pursuant to Bankruptcy Rule 7012(b) and Federal Rule of Civil Procedure 12(h)(3). Federal court does not have subject matter jurisdiction over a claim "so attenuated and unsubstantial as to be absolutely devoid of merit," "wholly insubstantial," "obviously frivolous," "plainly unsubstantial," or "no longer open to discussion."
On renewed motion for summary judgment to declare a debt nondischargeable as defalcation under Bankruptcy Code section 523(a)(4), the Court ruled in favor of the movant. The Court, relying on the Supreme Court's opinion in Bullock v. BankChampaign, N.A, 133 S. Ct. 1754 (2013), found that the debtor's failure to make any effort to file a final accounting of his stepfather's estate, for whom he was appointed conservator, constituted at least recklessness with regard to his fiduciary duties.
Creditor not entitled to recover its post petition attorney's fees as creditor failed to prove that fees were reasonable. Creditor was receiving the balance owed on the indebtedness as alleged in its proof of claim and in the amount requested in its proposed order -- terms that were identical to what creditor would have received under the debtor's proposed plan.