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CONVERSION CONFUSION
In re Fry, Case No. 04-16887
October 2008 Judge Nugent
Debtor converted from 13 to 7 and then learned she was not eligible for a 7 and attempted to converted back to 13. Case dismissed as an “end run†around 7 discharge.
Digest by:Â Jan Hamilton, Trustee
INVOLUNTARY DEBTOR NOT REQUIRED TO OBTAIN PRE PETITION
COUNSELING
In re Sims, Case No. 08-41668
January 2009, Judge Karlin
109(h) pre petition counseling requirements do not apply to an involuntary debtor.
Digest by:Â Jan Hamilton, 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
Conversion: Cases under the Code may be converted from one chapter to another chapter; for example, a Chapter 7 case may be converted to a case under Chapter 13 if the debtor is eligible for Chapter 13. Even though the chapter of the Code which governs it changes, it remains the same case as originally filed.
Court watchers will have to wait for another case to find out how the U.S. Court of Appeals for the Tenth Circuit will rule on the so-called negative equity issue. Â The Court dismissed the appeal in In re: Hunt, No. 07-3297, as moot after the debtor converted his case from chapter 13 to chapter 7 bankruptcy.
The ruling disappointed the creditor, Wells Fargo Bank, N.A, which urged the Court to proceed with the appeal despite the conversion. The Court ruled against the creditor saying the existence of other cases on the same legal issue and the desire for binding appellate authority was not sufficient reason to make an exception to the mootness doctrine. Courts are required dismiss a case when a controversy no longer exists. [Read more…]
