Opinions

The Middle District of Georgia offers opinions in PDF format, listed by year and judge. For a more detailed search, enter the keyword or case number in the search box above.

Please note: These opinions are not a complete inventory of all judges' decisions and are not documents of record. Official court records are available at the clerk's office.

Judge John T. Laney, III

This opinion arises from an adversary proceeding seeking to revoke the confirmation order in a Chapter 13 case pursuant to 11 U.S.C. § 1330. The defendant moved for summary judgment on the grounds that the plaintiff could not overcome his defenses as a matter of law. First, the defendant asserted res judicata and collateral estoppel defenses, as the plaintiff did not raise his allegations of fraud prior to confirmation.  The court held that § 1330 did not require that a party seeking revocation discover the fraud after the court’s entry of the confirmation order.

Secondly, the defendant argued that, because the claimant did not hold an allowed claim, he was not a party in interest and accordingly, lacked standing to assert the action. The court, however, determined that a party does not need to hold an allowed claim to seek revocation of a confirmation order and dismissal of Chapter 13 case.

The defendant also claimed that the plaintiff should be judicially estopped from making certain allegations because he had made prior inconsistent statements in a prior proceeding.  The court noted that the plaintiff had offered sufficient evidence for a reasonable fact finder to determine that the statements were not made to make a mockery of the judicial system.

Lastly, the defendant claimed that the complaint failed to state a claim for relief because it was based on the plaintiff’s belief that the defendant made fraudulent statements. Although the court determined that the plaintiff must meet the heightened pleading standard under Rule 9, the court found sufficient allegations in the complaint to support that burden.

Therefore, the court denied the defendant’s motion for summary judgment.

This case was before the court on a Rule 12 motion to dismiss. The defendant argued that the complaint failed to state a claim for relief because a prior state-court judgment resolved the claim and thus, res judicata prevented recovery. The court, however, determined that the complaint neither incorporated the state-court judgment nor sufficiently described the state court’s findings to create grounds for dismissal under Rule 12. Because the court would have to consider documents outside the pleadings to determine the merits of a res judicata defense, the court denied the motion.

In this case, the Chapter 7 trustee sought summary judgment on an action to determine the secured status of a claim on the Debtor’s real estate.  The claim was secured by a recorded security deed.  Subsequently, two instruments were recorded canceling the security deed; the instruments, however, were signed and recorded by a party without a recorded interest in the property.  The record indicated the instruments were recorded in error.  The holder of the claim argued that, because the party signing the instruments was a stranger in title, a hypothetical purchaser would have had inquiry notice of the error.  The Court disagreed.  It held that, because the instruments stated the claim was assigned  to the signors of the instruments and otherwise complied with Georgia law, the instruments were neither inconsistent nor facially deficient.  Thus, a bona fide purchaser—such as the trustee—could rely on the statements within the instruments.

This opinion concerns a preference action seeking to avoid the attachment of a judicial lien on the Debtors’ real estate.  The issue before the Court was whether the judicial lien was created within 11 U.S.C. § 547(b)(4)(A)’s look-back period.  The Trustee, the plaintiff in the case, argued that the lien was created when the judgment was recorded in the applicable county’s general execution docket.  The Defendant argued the entry of the judgment, which occurred outside the look-back period, created the judicial lien and that recording merely perfected that lien.  The Court determined that, by operation of O.C.G.A. § 9-12-86(b), only recording a judgment creates a judicial lien on real estate.  Therefore, for purposes of the preference action, the transfer occurred within the applicable look-back period.

Chief Judge James P. Smith

The debtor was covered by a group long term disability (LTD) insurance policy through his employer.  The debtor became disabled, and qualified for a LTD monthly benefit which was to be reduced by any Social Security disability or retirement benefit he received.  The debtor elected to receive a full, unreduced LTD monthly benefit while he awaited a determination on his claim for Social Security benefits.  Three years later, he was awarded Social Security disability benefits and received a lump sum payment.  The LTD insurer then requested reimbursement of $92,772 that it had overpaid the debtor.  The debtor sent the insurer a check and filed Chapter 7 relief two months later.  The trustee sought to recover the $92,772 as a preferential transfer.  11 U.S.C. § 547(b). 

The court held that the “ordinary course of business” defense, section 547(c)(2), protected the transfer.  Both the debt the debtor incurred in favor of the insurer and the $92,772 payment of that debt were made under circumstances similar to those which exist between a similarly situated disabled employee and his insurance company and were consistent with industry standards.  Further, the debt and repayment were incurred and made pursuant to the terms of a contract.  The court also held that there was no unusual collection practice because the insurer was merely stating the obvious when it told the debtor it would sue if he failed to pay.
 

A divorce decree awarded the debtor’s former spouse 35% of his county retirement pension.  The debtor’s Chapter 13 plan proposed to treat the award as a property settlement subject to discharge upon completion of the plan.  The former spouse objected, claiming her 35% interest was her sole and separate property.

The court held that the award was a property settlement and not alimony.  Further, state law prohibits a divorce court from assigning county retirement pension rights to a former spouse.  The court held that the debtor did not hold payments from the pension in constructive trust for his former spouse.  Finally, the court held the debtor had filed his petition in good faith despite errors and omissions on his Schedules and Statement of Financial Affairs.

A creditor filed a motion for relief from stay to foreclose on the Chapter 13 Debtor’s residence.  At the hearing on the motion, the creditor asked for a continuance.  Debtor’s counsel argued that the motion was frivolous and asked the court to hold a hearing to consider sanctions under Bankruptcy Rule 9011.  Counsel, however, had not complied with the 21 day notice requirements of Rule 9011(c)(1)(A).  Counsel then argued the 21 day rule did not apply if the court held a hearing on its own motion pursuant to Rule 9011(c)(1)(B).  After Debtor’s counsel briefed the issue, the court held that it would be improper to allow Debtor’s counsel to avoid the requirement of Rule 9011(c)(1)(A) by seeking relief under Rule 9011(c)(1)(B).

The husband debtor’s former spouse alleged, inter alia, that the Chapter 13 petition had not been filed in good faith.  11 U.S.C. § 1325(a)(7).  The former spouse argued the debtor had failed to pay certain marital settlement obligations, that the debtor’s and his new spouse’s income and expenses had fluctuated, that they had failed to list in their schedules certain income and expenses, and that they had sent derogatory emails and Facebook postings about the former spouse.    After applying the Kitchens factors and considering the totality of circumstances, the court held that the petition had been filed in good faith and overruled the former spouse’s objection.

The evidence showed that the husband debtor was in the Georgia Air National Guard and had been deployed to Kuwait and Africa, which, upon return, affected his employment status and income.  His current spouse had suffered health problems which affected her income.  There was no showing that any of their expenses were improper or excessive.  Nor did the debtors receive any advantage from any errors or omissions on the schedules.

Judge Austin E. Carter

Debtor sought damages for willful violation of the automatic stay under § 362(k) after her vehicle was repossessed post-petition.  The creditor argued it lacked knowledge of the bankruptcy due to a discrepancy between its zip code as listed on the vehicle lease agreement and as listed on the creditor matrix used by the BNC to mail the Notice of Chapter 7 Bankruptcy Case.  Because the creditor challenged the zip code used by the BNC, the court considered evidence regarding the proper zip code.  In doing so, the Court noted that the BNC had corrected the zip code for the creditor’s address and took judicial notice of two government websites indicating the creditor’s zip code.  The Court applied the presumption of receipt to the Notice of Chapter 7 Bankruptcy Case mailed to the creditor and held that the creditor failed to rebut the presumption. The Court also found that the creditor was charged with knowledge of the bankruptcy case through the Debtor’s meeting with the creditor’s employee just after the repossession.  The Court held that the creditor willfully violated the automatic stay and awarded damages for lost wages and transportation expenses.

Lessor moved for allowance of administrative expense based on post-confirmation default by debtor on lease debtor assumed through Chapter 13 plan.  Court held that creditor does not have automatic right to administrative expense due to lease default, but rather must show actual and concrete benefit to the estate in accordance with 11 U.S.C. § 503(b)(1)(A).

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