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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.

In re Owens (Case No. 10-72509) 08/09/2013

The debtor moved again to reopen her case in order to enter into a reaffirmation agreement with her mortgage company, two years after the closing of her bankruptcy case.  The court noted from its previous order denying a motion to reopen for this purpose that no purpose would be served in reopening the case to allow the debtor to enter into a reaffirmation agreement because under 11 U.S.C. § 524 a reaffirmation agreement to be legally effective must be entered into before a discharge is granted.  The court again denied her request to reopen.

In re Shephard (Case No. 13-71197) 08/01/2013

The debtor filed an application for waiver of the chapter 7 filing fee.  The court found that the debtor, at the time the petition was filed, had income less than 150% of the official Federal guideline poverty level income and did not have the financial means to pay the filing fee.  It further found that the debtor did not have the ability to pay in a lump sum or in installments.  However, the court determined that this was not a routine case given that the debtor was not eligible for a discharge and there were no assets for a chapter 7 trustee to administer.  The court thus denied the application concluding that to waive the filing fee for such a case would appear to condone the use of delay tactics by debtors, rather than to sanction them.

Dudley v. Southern VA Univ. (In re Dudley) (Case No. 10-50840; A.P. No. 11-05040) 7/23/2013

Debtor filed motion for contempt against Southern Virginia University (“SVU”) for continuing collection action after the issuance of the bankruptcy discharge order.  SVU asserted that the debt was a qualified educational loan that was non-dischargeable under section 523(a)(8).  Debtor then filed complaint alleging that a default judgment on a debt allegedly owed by debtor to SVU was void as debtor did not receive actual notice of the judgment proceedings and that even if judgment was not void, the debt had been discharged.  Based on Massachusetts law, defendant failed to show that it was entitled to enforce the note.  The Court held that without such a showing, it could not conclude that the debt underlying the state court default judgment was the same debt as evidenced by the note.  Therefore, as creditor failed to meet its burden, the Court found that the debt was a dischargeable debt that was discharged by the discharge order.

In re Wright (Case No. 12-71032) 07/19/2013

The debtors had filed jointly by counsel, and subsequently they had a falling out with counsel who was allowed to withdraw.  The debtors were unable to find alternate counsel and were appearing pro se.  The debtors advised they were not seeking confirmation but wanted their attorney’s handling of their case to be reviewed.  The trustee filed a motion to dismiss.  In order to keep the case moving, the court concluded that, under the circumstances, the best resolution of this situation was to grant the debtors an opportunity to proceed with their chapter 13 case, if they so chose, by filing new Schedules I and J and a modified plan, or convert their case to one under Chapter 7.  If they failed to do either, the chapter 13 trustee’s motion to dismiss would be granted.

In re Riggs (Case No. 12-71761) 07/09/2013

The United States Trustee filed a motion to dismiss pursuant to 11 U.S.C. § 707(b)(3).  The court addressed whether Social Security income should be taken into account in the § 707(b)(3) “totality of the circumstances” test.  The court concluded that the debtors’ “financial situation” provided them the ability to make a meaningful settlement with their unsecured creditors without sacrificing their standard of living or exhausting the male debtor’s Social Security benefit to do so.  It further concluded that not to require that of them in order to obtain a discharge of their remaining legal liability to their creditors, when their financial predicament is the predictable result of their continued excessive consumer spending and borrowing rather than one precipitated by some unforeseen external event or calamity, would constitute an abuse of the provisions of chapter 7.

In re Bays (Case No. 11-72355) 06/20/2013

The chapter 11 trustee objected to the debtor’s exemption of two IRA accounts owned by the debtor when the case was filed.  The court concluded that the debtor lost the right to claim as exempt the proceeds of the smaller of the two IRA accounts by reason of his failure to disclose the existence of such account or to claim any exemption in it until after the funds in that account had lost their eligibility to be deposited into a new qualified IRA account, but that § 522(b)(4)(D) applied and secured his effort to maintain his claim of exemption in the larger account.

Erbschloe v. U.S. Department of Education (In re Erbschloe) (Case No. 11-72562; A.P. No. 12-07013) 06/13/2013

The debtor filed a motion to seek a discharge of her student loan debt under 11 U.S.C. § 523(a)(8).  The parties agreed that in order for the debtor’s loans to be discharged under section 523(a)(8), the debtor must establish by a preponderance of the evidence that the repayment of her student loans would be an undue hardship.  The court analyzed the evidence under the Brunner Test.  The court concluded that the debtor had failed to establish the second prong of the Brunner Test and was not entitled to an immediate discharge of her student loans.  However, under the circumstances, the court concluded that if the debtor enrolled in the income based repayment plan, fulfilled her obligations under that plan, and still had an amount due and owing at the end of the repayment period, the amount due and owing at the end of the repayment period would be an undue hardship under section 523(a)(8) and would be discharged prior to any forgiveness granted by the Government pursuant to 20 U.S.C. § 1098e(b)(7).

Catron v. First National Bank of Altavista (Case No. 13-70145; A.P. No. 13-07016) 5/29/2013

The debtor moved for entry of a default judgment avoiding a second deed of trust lien upon the debtors’ residence on the basis that the amount of the indebtedness secured by the first deed of trust against such property exceeded such property’s value.  The court denied the motion on the basis that such relief is not consistent with controlling precedent as set forth in the Fourth Circuit’s Ryan v. Homecomings Fin. Network (In re Ryan), 253 F.3d 778 (4th Cir. 2001).

In re Patterson (Case No. 13-70227) 05/23/2013

The debtor filed a motion to extend the stay pursuant to 11 U.S.C. § 362(c)(3), and two creditors objected.  The debtor entered into an agreement with one creditor to extend the stay based on certain conditions.  The debtor did not meet those conditions.  The court concluded, “with considerable disquiet,” that it had to deny the debtor’s oral motion to reimpose the automatic stay and leave him with the consequences of the agreement which he made in order to avoid a contested hearing before the court on his motion to extend the automatic stay.

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