Westlaw Topical Highlights: Bankruptcy, March 3, 2014

March 3, 2014

BankruptcyWestlaw Topical Highlights for Bankruptcy provides summaries of significant federal and state judicial decisions and legislative and administrative activities affecting Bankruptcy law.  A Westlaw subscription is required to access the documents linked from this page.

Plans: BAPCPA did not abrogate the absolute priority rule in individual Chapter 11 cases.  In re Brown 2014 WL 695090 (E.D.Pa.)  The Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) did not abrogate the absolute priority rule in individual Chapter 11 cases, a federal district court in Pennsylvania has held, recognizing a split of authority and noting that the issue had not yet been decided by the Third Circuit. In so ruling, the district court agreed with courts subscribing to the “narrow view,” that is, that only property and earnings acquired postpetition are excluded from the “fair and equitable” calculus, with the result that individual Chapter 11 debtors may retain property and earnings acquired postpetition. Because, in the present case, the debtors acknowledged that they could not present a plan that satisfied the absolute priority rule, the district court affirmed the bankruptcy court’s order dismissing the case. 2014 WL 695090  (The full-text of the rest of the Topical Highlights is available within Westlaw Next, subscription required). 

Claims: Benefit of stay was sufficient unfair advantage to invoke judicial estoppel to bar debtor from asserting undisclosed claims.  Cagle v. C & S Wholesale Grocers Inc. 2014 WL 703192 (E.D.Cal.)

Plans: Chapter 13 debtor could pay redemption amount over time by payments under plan.  In re Terry 2014 WL 704015 (Bkrtcy.E.D.Pa.)

Claims: Victim of childhood sexual abuse by priest failed to establish fraudulent inducement to enter into settlement agreement.  Archdiocese of Milwaukee v. Doe 2014 WL 710027 (C.A.7 (Wis.))

Plans: Chapter 13 debtor could not cure default on residential mortgage loan when auctioneer’s hammer had fallen prepetition.  In re LaPointe 2014 WL 702035 (1st Cir.BAP (N.H.))

Claims: Debtor’s purported assignment of nonassignable contract did not create valid security interest under Georgia law.  In re Albracht 2013 WL 7393248 (Bkrtcy.N.D.Ga.)

Appeals: Ruling on debtors’ entitlement to discharge upon prepayment of plan base was appropriate for direct appeal to Fifth Circuit.  In re Ruth 2014 WL 585925 (Bkrtcy.S.D.Tex.)

Avoidance: Debtors failed to state claim to avoid equitable lien under § 547(b).  In re D’Angelo 2014 WL 688116 (Bkrtcy.E.D.Pa.)

Avoidance: Debtors could not avoid statutory lien that had already fixed on their property and been extinguished to recover sums previously paid.  In re Godley 2014 WL 464213 (Bkrtcy.E.D.N.C.)

Bankruptcy Estate: Cash proceeds of stockholder’s life insurance policy did not belong to debtor.  In re Racing Services, Inc. 2014 WL 747553 (C.A.8)

Attorney Fees: Counsel seeking $3,500 in second fee application would be allowed reduced fees of $750.  In re Gagnon 2014 WL 527227 (Bkrtcy.D.Mass.)

Plans: Zero-payment plan proposed to retain “underwater” rental property was lacking in requisite “good faith.”  In re Brinkley 2013 WL 5935157 (Bkrtcy.E.D.Mich.)

Discharge: Educated debtor not suffering from medical condition impacting on ability to work was not entitled to discharge of student loan debt.  In re Gesualdi 2013 WL 7231085 (Bkrtcy.S.D.Fla.)

. Appeals: Debtor had standing to appeal the bankruptcy court’s denial of the motion to vacate approval of creditor’s claim.  In re Hope 7 Monroe Street Ltd. Partnership 2014 WL 775454 (C.A.D.C.)

Bankruptcy Estate: Debtor-husband had no interest, of kind sufficient to support separate exemption claim, in his wife’s inheritance.  In re Hampshire 2014 WL 764519 (Bkrtcy.E.D.Pa.)

Discharge: Denial of Chapter 7 discharge for failure to obey lawful court order was not warranted.  In re Swan 2014 WL 752200 (Bkrtcy.W.D.N.Y.)

Discharge: Creditor’s justifiably relied on debtor-contractor’s false statements.  In re Ragonese 2014 WL 764354 (1st Cir.BAP (Mass.))

Discharge: Secured creditor did not violate discharge injunction in Chapter 7 case.  In re Manning 2014 WL 774977 (Bkrtcy.D.N.H.)