The Illinois Bankruptcy Lawyer Blog

Entries categorized as ‘cir 10’

Case Roundup Cir. 10

November 18, 2008 · 1 Comment

bankruptcy-court-seal.jpg

10th cir

Mosier v. Callister, Nebeker & McCullough, No. 07-4238 [Nov 13, 2008]

Suit was brought by trustee on behalf of estate against law firm and its attorneys alleging professional negligence, breach of fiduciary duty, vicarious liability, breach of the covenant of good faith and fair dealing, fraud, and civil conspiracy. The U.S. District court entered summary judgment for defendants. The Appellate court affirmed saying District Court did not err by imputing the conduct of selected officers to the defendant (a not-for-profit corp); correctly applied the doctrine of in pari delicto to hold that fault of the corporation was greater than that of its attorneys; and there was no error in applying the doctrine against a trustee in bankruptcy.

In re: Lanning, No. 08-3009 [Nov 13, 2008]

For purposes of calculating projected disposable income of an above-median Chapter 13 debtor under the BAPCPA, the circuit court adopts the forward-looking approach wherein a Chapter 13 debtor’s six-month, pre-petition “disposable income” (as defined by statute) is presumed to be the debtor’s “projected disposable income” for purposes of establishing the monthly sum that the debtor must commit to repayment of unsecured creditors in order to advance a confirmable payment plan and overcome objections to it. Amount of projected disposable income is rebuttable upon showing of “special circumstances” at the time of plan confirmation.

Categories: 1322(b)(11) · BAPCPA · bankruptcy · ch 13 · ch 7 · cir 10 · current-events · data · disposable

New Case Cavalcade

September 25, 2008 · Leave a Comment

seal of the bankruptcy court

seal of the bankruptcy court

cir 3

In Re: Schaefer Salt Recovery, Inc., 06-4574 [Sept. 9, 2008]
Petitioner accused of deliberately filing frivolous petition to forestall foreclosure; bankruptcy court’s denial of sanctions and reconsideration is vacated and remanded. Reasoning: The bankruptcy court is a unit of the district court and therefore comes within the scope of sec. 451 – hence it had plenary authority to impose sanctions under 28 U.S.C. 1927.

cir 5

In the Matter of Soza, 06-21004 [Sept. 12, 2008]
Bankruptcy court’s decision to exempt an annuity, purchased a day prior to filing, from the debtor’s estate is reversed and remanded because 1) its purchase was not an intentional fraud but to decide whether the state-law based exemption should apply a lower standard should have been applied by the court; and 2) several “badges of fraud” were evident in the purchase so under a “totality of circumstances” test the transaction represented a payment made in fraud of a creditor.

cir 7

In Re: Willett, 07-1850 [Sept, 12, 2008]
Grant of debtor’s sec. 522 motion to avoid a lien on their residence is reversed and remanded because, for purposes of ruling on such a motion, the bankruptcy court should have valued the ch. 13 debtor’s interest in the real property as of the date that their interest became part of the bankruptcy estate.


cir 8

In re: M & S Grading, Inc., 07-3909 [September 09, 2008]
In a case arising out of the bankruptcy of an excavation company that participated in employee-benefit plans wherein the plans and their trustees claimed that debtor’s bankruptcy trustee improperly made payments to a bank instead of the plans, various rulings are affirmed where: 1) unpaid contributions owed to the plans were not employee contributions because the contributions were not withheld from employees’ paychecks; 2) thus, the unpaid contributions remained corporate assets and did not become assets of the plan; 3) trustee’s failure to assert a claim against the bank was justified and the district court did not abuse its discretion in denying plans’ motion to commence litigation against the bank; 4) there was no abuse of discretion in not granting an equitable subordination claim; and 5) plans’ motion for removal of the bankruptcy trustee was properly denied without a hearing.

cir 10

In re: Sandoval, 07-5165 [Sept. 11, 2008]
In the context of bankruptcy law, sec. 523(a)(7) does not render non-dischargeable a debt incurred by a debtor who has guaranteed a bail bondsman to make the bondsman whole in the event a criminal defendant jumps bail.

Share this post :

Categories: 28 U.S.C. 1927 · 451 · 522 · 523 · ED · IL · ND · case update · ch 13 · ch 7 · cir 10 · cir 3 · cir 5 · cir 7 · cir 8 · consumer · current-events · individual

filings head back up! up! up!

September 1, 2008 · Leave a Comment

Bankruptcy Filings Nearing Million

From the Bankruptcy Law Network

Posted Aug 28 by Jill Michaux

Almost a million bankruptcy cases were filed since last June according to UST statistics.

The Highlights

Consumer +28.4%

Business +41.6%

Ch. 7 +36.7%

Ch. 13 +16.9%

Ch. 11 +30.6%

Categories: Administrative Office of the Courts · BAPCPA · Census Bureau · Executive Office of the UST · IL · IND · Middle class · UST · administrative · aoc · article · bankruptcy · blogging · blogs · business filings · ch 11 · ch 13 · ch 7 · cir 1 · cir 10 · cir 11 · cir 2 · cir 3 · cir 4 · cir 5 · cir 6 · cir 7 · cir 8 · cir 9 · consumer · current affairs · current-events · data · debt · economy · filings · government unit · individual · pay.gov · subprime · trustee

Case Roundup

August 5, 2008 · Leave a Comment

cir 3

In re: Carco Elec., 07-1009 [July 29, 2008]

In a dispute between competing bidders in the acquisition of debtor’s production facilities during bankruptcy proceedings, an appeal from a protective order limiting the disclosure of the bidders’ respective trade secrets during discovery is dismissed for lack of appellate jurisdiction where the order was neither final nor appealable under the limited scope of the collateral order doctrine.

In re: Mullarkey, 05-4081, 05-4651 [July 31, 2008]

In a suit alleging fraud in a bankruptcy proceeding by co-owners of debtor’s property, dismissal of claims is reversed where the bankruptcy court had subject-matter jurisdiction over the complaint, but erred in dismissing plaintiff-debtor’s claims on various theories of preclusion.

cir 4

Sartin v. Macik, 071464 [July 28, 2008]

A state default judgment, entered as a penalty for a party’s failure to comply with a North Carolina court’s discovery order, does not have collateral estoppel effect in subsequent litigation in bankruptcy court.

cir 9

In the Matter of: Coleman, 06-16477 [August 01, 2008]

“[U]ndue hardship” determinations, whereby bankruptcy courts decide whether student loans qualify for discharge, can be ripe in a Chapter 13 case substantially in advance of plan completion.

cir 10

In re: Paul, 07-1395 [July 28, 2008]

In an adversary proceeding brought by former debtors after a bankruptcy discharge claiming that defendant violated a discharge injunction via a state court action, an order sanctioning defendant and enjoining her from pursuing the state court litigation is reversed where neither the bankruptcy court’s findings, nor the facts of record on which they are based, demonstrated that defendant’s facially permissible actions violated the discharge injunction.

Share this post :

Categories: blogs · case update · cir 10 · cir 3 · cir 4 · cir 9

case update: cir 5, 6, 10

July 24, 2008 · Leave a Comment

5th cir

Kane v. Nat’l Union Fire Ins. Co., 07-30611 (Jul 14)
A finding of summary judgment in a PI suit, as well as judicial estoppal of the plaintiffs/debtors due to their failure to list the suit in their Chapter 7 schedules, and denial of trustee’s motion to be substituted in the case as the real party in interest, are reversed and the case is remanded because

+the PI claim became an asset of the estate upon filing of the petition
+the trustee is the real party in interest and never abandoned his right
+the debtors only benefit if a PI judgment yields a surplus to the estate

The Appellate Court also found that a prior circuit court determination in the case did not control in bankruptcy court, and the district court (which ruled that the circuit court decision controlled as a matter of law) abused its discretion.

6th cir

Phar-Mor, Inc. v. McKesson Corp., 05-4525, 05-4526 (Jul 17)
Vendor’s administrative-expense priority on a reclamation claim is not extinguished when the goods to which that claim applies are sold and the proceeds used to satisfy a secured creditor’s claim. The vendor retains it’s priority in those proceeds of the estate that remain after secured creditors are satisfied.

10th cir

In re Tri-Valley Distrib., Inc., 06-4279, 06-4280 (Jul 15)
In suit alleging state claims for fraudulent transfer and negligent lending, the parties’ motions to dismiss each other’s appeals for lack of jurisdiction are granted where:

+ bankruptcy appellate panel’s order was not final and appealable
+ denial of defendant’s motion to dismiss was not a final collateral order entitled to review
+ bankruptcy appellate panel acted within its authority
+ there was no jurisdiction to review the merits of a section 1334(c)(1) abstention issue

In re: US Med., Inc., 07-1259 (Jul 15)
Creditor is not a non-statutory insider of the debtor for purposes of 547(b)(4)(B) and a transaction between that creditor and the debtor will not be avoided where

+ the transactions at issue were at arm’s length
+ there is no undue influence or control by creditor

In sum, while creditor is only a “non-statutory insider” when its transaction of business with the debtor is not at arm’s length or there is undue influence; no such requirements are needed if the creditor qualifies as an insider per statute (“statutory insider”).

Categories: adversary · appellate court · bad faith · case update · ch 13 · ch 7 · cir 10 · cir 5 · cir 6 · consumer · individual