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Case Summaries December 2012

Posted by John Smith | Sep 30, 2014 | 0 Comments

Case Name:

In re Margaret A. Bertran, 2012 WL 6093443 (Bkrtcy.D.Alaska)

Case Summary:

On December 6, 2012, the United States Bankruptcy Court for the District of Alaska issued its Memorandum on Motion for Stay Relief and granted the Creditor's Motion for Stay Relief.

Notable Points to Bankruptcy Practitioner:

After filing her petition for bankruptcy, the Creditors moved for stay relief for cause based on a lack of equity under 11 U.S.C. § 362(d)(1).  The Debtor opposed the motion on the basis that a substantial equity cushion existed to protect the Creditor's interests.  Unfortunately, no reliable evidence was presented as to value of the Debtor's equity and therefore the resolution of the motion was determined on the basis of which party carried the burden of proof.  Here, under 11 U.S.C. § 362(d)(2), the Creditors had the burden of proof to demonstrate a lack of equity in the properties and unfortunately the Creditors failed to carry this burden.  However, 11 U.S.C. § 362(d)(1) reversed the roles of who should carry the burden and by demonstrating the Debtor's complete failure to make any post petition payments, the Debtor had to demonstrate the Creditors were indeed adequately protected.  Here, the Debtor failed to carry her burden and the Creditor's motion was granted.

Case Name:

In re Margaret A. Bertran, 2012 WL 6093454 (Bkrtcy.D.Alaska)

Case Summary:

On December 6, 2012, the United Stated Bankruptcy Court for the District of Alaska issued its Memorandum Decision denying the Debtor's Motion to Avoid Judicial Lien.

Notable Points to Bankruptcy Practitioner:

Pursuant to 11 U.S.C. § 522(f)(1)(A), the Debtor moved to avoid a judgment lien entered in Montana's Fourteenth Judicial District, Musselshell County.  The Judgment encumbered two parcels of real property in Musselshell County.  One of the parcels is a 13-acre ranch with a residence on it and the Debtor asserts this property is her homestead and exempt.  Unfortunately, the Debtor's testimony reflected that as of the petition date she was a resident of the State of Alaska and her claim that she intended to return to her previously abandoned homestead did not establish a valid homestead exemption in the Montana Ranch property.

Case Name:

In re Timothy Ray Wright, 2012 WL 6737487 (Bkrtcy.D.Ariz.)

Case Summary:

On December 28, 2012 the United States Bankruptcy Court for the District of Arizona issued its Memorandum Decision regarding Debtor's Objection to MidFirst Bank's Proof of Claim and sustained the Debtor's objection.

Notable Points to Bankruptcy Practitioner:

In a rather lengthy opinion, wrought with factual issues, MidFirst, a secured creditor, filed an amended proof of claim attempting to assert a claim for a deficiency judgment on a residential property.  Under Arizona law, specifically, A.R.S. § 33-814(D), a creditor must bring an action to recover on a deficiency within 90 days of the sale of the property.  Here, the Creditor did not bring an action in the required time frame and therefore the foreclosure price is deemed in full satisfaction of the underlying obligation.  Furthermore, in a previous Order granting MidFirst's Motion to Lift Stay, the Order provided MidFirst broad relief to proceed with all legal rights and remedies under Arizona law and MidFirst failed to proceed timely with its deficiency action.               It is also noteworthy that the Debtor provided in its Plan of Organization and Disclosure Statement that a secured creditor could recover after vacatur of the automatic stay a deficiency claim, subject to the applicable state law.  It is assumed that counsel was fully aware that Arizona law did not provide for many avenues in this matter to recover on a deficiency claim.

Case Name:

In re Jeffrey Albert Kolb and Heidi Elaine Kolb, 2012 WL 6759007 (Bkrtcy.D.Ariz.)

Case Summary:

On December 26, 2012 the United States Bankruptcy Court for the District of Arizona issued its Memorandum Decision Denying Discharge Pursuant to 11 U.S.C. § 727(a)(3).

Notable Points to Bankruptcy Practitioner:

Plaintiff's asserted at least two viable claims under 11 U.S.C. §523(a)(2) and (a)(6); however because the Debtor's failed to keep proper financial records and intermingled personal and business funds, and destroyed records improperly, the Court denied Debtor's discharge under 11 U.S.C. §727(a)(3).

Case Name:

In re Shane Skinner, 2012 WL 0545276 (Bkrtcy.D.Ariz.)

Case Summary:

On December 14, 2012 the United States Bankruptcy Court for the District of Arizona issued its Memorandum Decision finding the Debtor's debt to be non-dischargeable under 11 U.S.C § 523(a)(2)(a) and awarding damages and attorney fees.

Notable Points to Bankruptcy Practitioner:

No notable points of interest to the Bankruptcy Practitioner.

Case Name:

In re Luke Cusack, 2012 WL 6570738 (Bkrtcy.D.Ariz.)

Case Summary:

On December 14, 2012 the United States Bankruptcy Court for the District of Arizona issued its Memorandum Decision quashing all subpoenas, vacating 2004 examination orders, requiring all subpoenaed material to be returned, and providing a roadmap for how the parties should proceed in the matter.

Notable Points to Bankruptcy Practitioner:

No notable points of interest to the Bankruptcy Practitioner.

Case Name:

In re Benjamin Jones and Jessica Treola Jones, 2012 WL 6212834 (Bkrtcy.D.Ariz.)

Case Summary:

On December 13, 2012, the United States Bankruptcy Court for the District of Arizona issued its Memorandum Decision on the Trustee's Motion to Sell Certain Property Free and Clear of Liens.  The Court granted the Trustee's Motion finding that the property devised to the Debtor was indeed property of the Estate under 11 U.S.C. § 541(a)(1) and (a)(5).

Notable Points to Bankruptcy Practitioner:

No notable points of interest to the Bankruptcy Practitioner.

Case Name:

In re Sunnyslope Housing Limited Partnership, 2012 WL 6479735 (Bkrtcy.D.Ariz.)

Case Summary:

On December 12, 2012, the United States Bankruptcy Court for the District of Arizona issued its Memorandum Decision Regarding Value of Low Income Housing Tax Credits.  The Court found the value of the Low Income Housing Tax Credits to be $1.3 million as of January 1, 2013.

Notable Points to Bankruptcy Practitioner:

In a one day trial to determine the value of remaining tax credits to be included as part of the value of First Southern's collateral under 11 U.S.C. § 506(a), the Court heard the testimony of two highly regarded experts.  However, the Court found both experts' testimony to be lacking, but based on the Debtor's expert's discounted cash flow analysis, the Court found the Debtor's expert's testimony more persuasive.  When presenting expert testimony on complex tax issues, one should know who your audience is and whether he or she has a Doctorate from Yale and a Juris Doctorate from Stanford.

Case Name:

In re Joseph Cunningham and Resa Cunningham, 2012 WL 6042863 (Bkrtcy.D.Ariz.)

Case Summary:

On December 5, 2012 the United States Bankruptcy Court for the District Court of Arizona issued its Memorandum Decision Denying Defendant's Motion to Dismiss Count II of Plaintiff's First Amended Complaint.

Notable Points to Bankruptcy Practitioner:

For a Ninth Circuit Practitioner, the Court provides a thorough analysis of the current standard for a motion to dismiss.

Case Name:

In re Daniel Leslie Schayes and Wendy Lucero Schayes, 483 B.R. 209 (Bkrtcy.D.Ariz. 2012)

Case Summary:

On December 4, 2012, the United Stated Bankruptcy Court for the District of Arizona denied Debtor's Motion for Summary Judgment and Granted Summary Judgment in Favor of the secured creditor in its Opinion Regarding Principal Residence and Application of 11 U.S.C. 1123(b)(5).  The Court held the Debtor's alleged investment purpose did not alter the fact that the house was their residence on the petition date, that the petition date was the proper date for determining residency, and any multi-use exception to the anti-modification provision of 11 U.S.C. 1123(b)(5) would require an actual use by the Debtor, not some intended future use.

Notable Points to Bankruptcy Practitioner:

No notable points of interest to the Bankruptcy Practitioner.

Case Name:

In re Assyrian Babylon, LLC, 2012 WL 6012783 (Bkrtcy.D.Ariz.)

Case Summary:

On December 3, 2012 the United States Bankruptcy Court for the District of Arizona issued its Memorandum Decision confirming Debtor's Plan of Reorganization.

Notable Points to Bankruptcy Practitioner:

In a small business reorganization, this case is well organized and a good example and form for a practitioner to review.

Case Name:

In re Jeffrey Francis Lilly, 2012 WL 6589699 (Bkrtcy.D.Idaho)

Case Summary:

On December 18, 2012, the United States Bankruptcy Court for the District of Idaho issued its Memorandum Decision dismissing all of Plaintiff's causes of action and allowing the Debtor's discharge.

Notable Points to Bankruptcy Practitioner:

No notable points of interest to the Bankruptcy Practitioner.

Case Name:

In re George P. O'Neal and Janet S. O'Neal, 2012 WL 6107492 (Bkrtcy.D.Idaho)

Case Summary:

On December 10, 2012, the United States Bankruptcy Court for the District of Idaho issued its Memorandum of Decision setting trial dates, limiting Plaintiff's cause of action to that under 11 U.S.C. 523(a)(6), and limiting exhibits to those disclosed timely and to rebuttal exhibits at the Court's discretion.

Notable Points to Bankruptcy Practitioner:

No notable points of interest to the Bankruptcy Practitioner.

Case Name:

In re Professional Satellite and Communication, LLC, 2012 WL 6012829 (S.D.Cal.)

Case Summary:

On December 3, 2012, the United States District Court for the Southern District of California issued its Order Denying Motion to Withdraw the Reference.

Notable Points to Bankruptcy Practitioner:

No notable points of interest to the Bankruptcy Practitioner.

Case Name:

In re Jose J. Hernandez, 2012 WL 6522748 (9th Cir. BAP (Cal.))

Case Summary:

On December 14, 2012 the United States Bankruptcy Appellate Panel of the Ninth Circuit affirmed the Southern District of California's Bankruptcy Court's Order and held that prepetition levied funds in the hands of the Sheriff on the petition date were property of the estate under 11 U.S.C. § 541(a) due to the Debtor's exemption rights in the funds.

Notable Points to Bankruptcy Practitioner:

No notable points of interest to the Bankruptcy Practitioner.

Case Name:

In re Pascal Jean-Francois Besset, 2012 WL 6554706 (9th Cir. BAP (Cal.))

Case Summary:

On December 14, 2012 the United States Bankruptcy Appellate Panel of the Ninth Circuit affirmed the Southern District of California's Bankruptcy Court's Orders approving final fee applications.

Notable Points to Bankruptcy Practitioner:

No notable points of interest to the Bankruptcy Practitioner.

About the Author

John Smith

Law Offices of Gerald K. Smith and John C. Smith, PLLC, Tucson, ArizonaPartner (Sept 2008 – Present)Smith & Smith focuses primarily on civil and commercial litigation, secured transactions, bankruptcy and corporate reorganization.  In addition to their bankruptcy and commercial litigation practice, John has developed considerable expertise opposing wrongful foreclosure by large banking institutions against homeowners, a persistent problem in Arizona.

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