The debtor allowed her husband to use the debtor's good credit to obtain a loan to continue farming. The debtor's husband signed the debtor's name to a false financial statement concerning the debtor's financial affairs. The Court held that the husband's intent to deceive could not be imputed through agency law to the debtor.
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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.
Robert F. Hershner, Jr. (Retired)
Pursuant to 11 U.S.C.A. § 366, the Chapter 11 debtor proposed its current liquidity as adequate assurance of payment for utility services. The debtor also proposed to require its utility companies to obtain court approval before terminating its services. No utility company appeared at the hearing or objected to debtor's motion. The Assistant United States Trustee did object. The Court held that the debtor's current liquidity was adequate assurance of payment, but declined to require utility companies to obtain court approval before terminating services.
The creditor held a second mortgage on the debtor's primary residence. The confirmed Chapter 13 plan provided that the second mortgage was disputed and would be satisfied of record upon completion of the plan and the debtors' discharge in bankruptcy. The Court held that the creditor was bound by the confirmed plan but that the creditor's secured claim and rights under his second mortgage survive the confirmation of the debtors' Chapter 13 plan and discharge in bankruptcy.
The debtor owned a small store that sold lottery tickets. The debtor failed to deposit certain proceeds from the sale of lottery tickets into a special bank account. The Court held that this failure was a "defalcation while acting in a fiduciary capacity" under 11 U.S.C.A. § 523(a)(4).
The chapter 11 debtor purchased real estate from the creditor. The creditor received cash and some shares of stock that the debtor owned in WorldCom, Inc. The debtor signed a written guarantee secured by a deed to secure debt that the stock would double in value within three years. The stock failed to double in value and the debtor was unable to perform under his guarantee. The debtor urged the Court to set aside as fraudulent conveyances the written guarantee and the deed to secure debt. The Court concluded that the sale was an arms length transaction and that the debtor was not insolvent at the time of the sale. The Court held that the transfer was not a fraudulent conveyance.
Judge James D. Walker Jr. (Retired)
A debtor who seeks to enjoin a criminal prosecution for bad checks can survive a Rule 12(b)(6) motion by showing (1) a threat of great and immediate injury by alleging some bad faith in the criminal case; and (2) the necessity of an injunction to protect a federal right by showing that he is unable to raise a defense in the state court based on his allegation of bad faith.
Debtor’s student loans were discharged in full because they created an undue hardship. Debtor’s refusal to participate in William D. Ford Federal Direct Loan Program’s income contingent repayment plan did not preclude a finding that Debtor had made a good faith effort to repay his loans.
Debtor sought relief for creditor’s failure to disclose that it would seek payment of attorney fees incurred between the date of filing and the date of confirmation. The Court dismissed the complaint for failure to state a claim because the creditor had not yet demanded payment of more than the amount actually disclosed on the proof of claim.
Chief Judge John T. Laney, III
The Court held a hearing on the Motion of Arthur Geeslin, Jr. ("Debtor") for Contempt against Meriwether County District Attorney Peter Skandalakis ("Respondent") for violations of the automatic stay and the discharge injunction. The Court held that it had the inherent power to determine violations of the automatic stay and the discharge injunction, despite Respondent’s sovereign immunity argument. Further, the Court ruled: 1) the exception to the automatic stay under 11 U.S.C. § 362(b)(4) did not apply to the actions taken by Respondent; 2) the debt was discharged, despite the language of 11 U.S.C. § 523(a)(7); and 3) because damages were not proven, the issue of sovereign immunity would not be reached. The Court reserved judgment on issuing an injunction because an adversary proceeding had not been filed.
The Court held a hearing on cross-motions to enforce a settlement agreement. SGE Mortgage Funding Corp. ("Plaintiff") and Accent Mortgage Services, Inc. ("Defendant") filed the motions after a dispute arose over the terms of the settlement agreement. The Court held in favor of Plaintiff, stating that Defendant’s CEO was "sophisticated in business matters" and Defendant’s counsel present when the CEO signed an amendment to the settlement agreement which confirmed Defendant’s liabilities under the settlement agreement. Therefore, Defendant was liable for the amount remaining due to Plaintiff under the settlement agreement, plus ad valorem taxes paid by Plaintiff at a real estate closing.