Debtor's attorney abandoned client and failed to file response to complaint objecting to discharge. Debtor moved pro se for reconsideration of order that denied Debtor's discharge. Court held that it did not have jurisdiction to hear Debtor's motion because the motion was filed more than ten days after entry of order denying discharge.
Opinions
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Robert F. Hershner, Jr. (Retired)
The debtor's counsel failed to file a timely response to an objection to discharge. The Court entered an order denying the debtor's discharge. The debtor, pro se, moved the Court to reconsider its order. The debtor's counsel thought that the debtor had obtained other counsel to represent her in the adversary proceeding. The Court noted that counsel had failed to ensure that a response to the complaint objecting to discharge had been filed. The Court held that it could not consider debtor's motion for reconsideration because the motion was filed more than ten days after entry of the order denying her discharge.
The debtor withdrew the funds in his IRA. The debtor later met with a bankruptcy attorney and learned that he could exempt funds in an IRA. The debtor rolled over his IRA distribution check into his IRA. The Court held that the debtor had, on the eve of bankruptcy, converted his IRA distribution check into an IRA with actual intent to hinder, delay, or defraud creditors. The Court allowed the trustee to avoid the transfer as a fraudulent conveyance.
Debtors' state income tax obligations were nondischargeable because they failed to file tax returns.
SunTrust Bank assigned its claims and first priority liens to the Chapter 11 debtor in exchange for the debtor foregoing any 11 U.S.C. 506(c) surcharges against SunTrust's interest in certain property. The Foothill Lenders contended that their second priority liens now had priority over the liens the debtor acquired through the assignment. The Court rejected Foothill's theories and determined that the debtor's liens had priority over Foothill's liens.
The Court entered a "form discharge order" which purported to discharge the debtor's student loan obligation. The debtor had not filed an adversary proceeding contending that payment of her student loans would be an undue hardship. The Court determined that its discharge order was rendered in a manner inconsistent with due process and thus void under Federal Rules of Civil Procedure 60(b)(4).
Judge James D. Walker Jr. (Retired)
Debtor sought to reopen his case to add a previously unlisted creditor and subsequently enforce the discharge injunction against that creditor. The Court concluded that the real issue was whether the creditor was subject to the discharge injunction. Because allowing the Debtor to reopen his case to add the creditor would not answer that question, the court denied Debtor’s motion to reopen.
A creditor-farmer filed nondischargeability complaint under 11 U.S.C. § 523(a)(4) and (a)(6) against Debtor, a seed dealer, for failing to pay the creditor for seeds he had harvested during three growing seasons. With respect to § 523(a)(4) the creditor failed to show any statute or common law rule that gave rise to a fiduciary duty, thus failing to prove fiduciary fraud or defalcation. The creditor also failed to prove embezzlement and larceny because the facts indicated that Debtor intended to pay the creditor, thus demonstrating a lack of fraudulent intent. With respect to § 523(a)(6), the creditor failed to prove willful and malicious injury because he was aware of that Debtor had sold his seeds and had not remitted payment, and despite this knowledge, the creditor failed to take steps to protect his property.
Judge John T. Laney, III
Debtors proposed to cure over six months its prepetition arrearage in an automobile lease. The court held that Debtors’ six-month cure proposal did not constitute a "prompt" cure under § 365(b)(1) of the Bankruptcy Code. Also, the court found that Debtors did not exercise the option under the lease agreement to purchase the vehicle. Even if Debtors had timely exercised their option to purchase, the court held that Debtors’ plan proposal to pay the residual value over the life of the plan is contrary to law. Therefore, the court granted relief from stay to the movant.
Debtors filed a motion to compel the mortgage company to pay a mortgage insurance premium which the Debtors alleged was an item required to be paid through escrow. Approximately one month before hearing on Debtors motion was held, the mortgage company paid the premium and reinstated the mortgage insurance policy. Although the motion was moot, Debtors requested to recover attorney fees from the mortgage company for bringing the motion. Failing to find any statutory authority authorizing the recovery of attorney fees, the court denied Debtors request.