Topeka's Only Consumer Bankruptcy Law Specialists Now Helping Borrowers with Federal Student Loans
TAX REFUND ASSIGNMENTS AND CHAPTER 7
In re: Sydmark, Case No. 06-41218
In re: Black-Watkins, Case No. 05-42439
June, 2008, Judge Karlin
Lamie v. US and Redmond v. Lentz, Hodes and Wagers redux. Assignment of a tax refund does not divest the estate of an interest in them, even though UCC1 was filed. In a Chapter 7 case, refunds, after subtraction of a flat fee, must be turned over to Trustee.
DEBTORS MAY BE CONVERTED TO 7 EVEN THOUGH NOT ELIGIBLE FOR
7 DISCHARGE
In re Rogers, Case No. 08-21487
January 2009, Judge Somers
In a case in which assets may be liquidated, a 13 may be converted to a 7 even though debtors may not be eligible for a 7 discharge.
Digest by:Â Jan Hamilton, Trustee
2016 APPLICATIONS BY CREDITORS
In re Loy, Case No. 07-41333
December 2007, Judge Karlin
This case contains a discussion of the various issues that are to be considered by court and counsel in the context of a 2016 application by a creditor. This same issues present themselves in proofs of claim issues pertaining to attorney fees.
Digest by:Â Jan Hamilton, Trustee
109(h) CREDIT COUNSELING NOT OBTAINED WITHIN 180 DAYS IS FATAL
In re Gaddis, Case No. 07-40476
June 2007, Judge Karlin
Chapter 7 case dismissed for failure to comply with 109(h), in that the credit counseling was not obtained within 180 days of the date of filing. No statutory exception was alleged. Debtor is simply not eligible to obtain title 11 relief if 109(h) is not complied with.
Digest by:Â Jan Hamilton, Trustee
Cathy Moran
Cathy Moran, my friend and blogging colleague on the Bankruptcy Law Network, has launched Bankruptcy Mastery, a website to train new consumer bankruptcy lawyers.
With 30 years of experience, Cathy is well-qualified to teach and mentor lawyers new to the consumer bankruptcy field. She is speaks on bankruptcy law topics on the national stage and is the author of Bankruptcy in Brief, the very popular website on consumer bankruptcy law information, and On the Bankruptcy Soapbox blog. She has a very busy practice in the San Francisco Bay area representing consumer and small business debtors in chapters 7, 11 and 13 bankruptcy.
Cathy collaborates with Jay Fleischman on Consumer Ledger and Family Debt Guide.
FAILURE TO OBTAIN CREDIT COUNSELING—EXIGENT
CIRCUMSTANCES
In re Thomas, Case No. 06-10242
March 2006, Judge Nugent
Pro se case dismissed for failure to obtain credit counseling. Certificate of exigent circumstances which recites pending foreclosure insufficient, case dismissed. 109(h)(1).
Should my LCC or small corporation file bankruptcy? Usually not. The general rule of thumb is that single owner corporations or limited liability companies should not file bankruptcy.
Occasionally, there is a benefit to filing bankruptcy for a small corporation, such as recovering a preference to pay priority trust fund taxes the owner owes personally. The down side to corporate bankruptcy filing is the bankruptcy trustee asking questions, making demands and suing the owner on various theories of mismanagement or insider transactions–the owner losts control of the corporation.
An LLC or corporation does not get a discharge of debts in bankruptcy. It can stop business and liquidate in bankruptcy, but that is better done under state corporation dissolution laws. Generally, a small business owner has incurred personal debt for the business or has guaranteed corporate debt and may need to file a personal bankruptcy. The contingent liability for the corporate debts can be listed in the personal case to stop collection against the owner.
An LLC or corporation is not eligible to file a chapter 13 debt adjustment bankruptcy. Corporations can reorganize in bankruptcy under chapter 11, which is very expensive and has many requirements small businesses are not equipped to comply with.
See a bankruptcy attorney with experience representing small business owners to determine if your single-owner LLC or corporation should file bankruptcy? A business dissolution coupled with a personal bankruptcy for you may be a better solution for you.
22C EXPENSE NOT PERMITTED ON SURRENDERED COLLATERAL
In re Miller, Case No. 07-22927
December 2008, Judge Somers
This decision ties to the concepts enunciated in the various Lanning decisions, i.e., to
what extent may post petition changes in circumstances be considered in determining
what is to be paid by an above the line debtor. Digest by Jan Hamilton, Trustee.
The federal bankruptcy law is published in Title 11 of the United States Code, which is one of the series of books containing federal laws. The bankruptcy law is often called the The Bankruptcy Code.
REITERATION THAT INCOME AND EXPENSE CHANGES MAY BE
CONSIDERED POST PETITION IN 13.
In re Tholl, Case No. 07-22677
December 2008, Judge Somers
Court reviewed and followed the Melvin decision regarding changes of income and expenses after the filing of the chapter 13 bankruptcy but prior to confirmation of the chapter 13 bankruptcy plan.
LANNING EXTENDED TO EXPENSE SIDE
In re Melvin, Case No. 07-22352
December 2008 Judge Somers
Court extended the Lanning analysis and found there was no binding precedent on the issue of whether actual of 22C expenses were mandated and found that 22C expenses may be deviated from also. This is consistent with dicta in Lanning, and Judge Nugent in In Re Hoss, 08-10365, and In re Arroyo, No. 07-12779. It may also be inconsistent with Judge Karlin in the bankruptcy court decision in Lanning.
Lanning has been appealed by the bankruptcy trustee and is currently pending in the U.S. Supreme Court. Oral argument is expected in March 2010.
Digest by:Â Jan Hamilton, Trustee
People seeking debt relief often feel guilty about filing for bankruptcy. We are raised to pay our debts and conditioned to feel bad when we can’t. In fact, people will go to extreme measures, such as depleting the retirement account, to avoid bankruptcy.
When you can’t pay your bills because your credit card lenders have raised interest to 30%, it is time to stop feeling guilty. Stop feeling bad about bills you can’t afford to pay.
It may not be your fault. It may be that someone in your family has gotten sick or injured and you are facing huge medical expenses. It may be that you have lost your job on main street because of greedy acts on Wall Street. It may be that your marriage ended. Most Americans are one injury, illness, job loss or divorce away from bankruptcy.
Bankruptcy is a legal way to resolve your debts.  It is for honest debtors who play by the rules. Get the fresh start you deserve and get on with your life in peace. Call today to see if bankruptcy is the right solution for your financial problems.
