FORMULA FOR INTEREST RATE FOR SECURED CLAIMS IN CHAPTER 13 The Supreme Court, in a complicated split, has ruled on the appropriate interest rate for a Chapter 13 plan for a secured claim (whose collateral is an automobile). The Court”s opinion, written by Justice Stevens and joined by Justices Souter, Ginsberg and Breyer, states that...Read More
DEBTOR’S TAX RETURN FILED AFTER IRS SFR AND ASSESSMENT WAS NOT A “RETURN” FOR PURPOSES OF BANKRUPTCY DISCHARGE The Court concludes that the document Ehrig submitted to the IRS in 2000 for year 1990, the accuracy of which was ultimately rejected by the IRS, although it may have been as accurate as was possible after...Read More
Bankruptcy Court May Hear Dispute Between 3rd Parties In re Mulder (Bankr. N.D. Ill.) A dispute between 3rd parties is related to a Bankruptcy case only if it affects the amount of property available for distribution or the allocation of property among creditors. Mere overlap between the dispute and the affairs of the Debtor is...Read More
OMISSIONS ON SCHEDULES RESULT IN DENIAL OF DISCHARGE UST v. Wilson (Bankr. C.D. Il. 2004) The bankruptcy court concluded that the Debtor demonstrated a “continued pattern . . . of making omissions and false statements in his bankruptcy schedules” and exhibited reckless indifference for the truth, notwithstanding any memory loss. The bankruptcy court based its...Read More
Here are some cases from around the country — note the 7th Circuit and ND IL decisions among them: DEBTOR’S DISSIPATION OF FUNDS NOT GROUNDS FOR DENIAL OF DISCHARGE Although the debtor received and quickly dissipated a substantial insurance settlement within one year of her bankruptcy filing, there was no evidence of fraudulent intent to...Read More
March 2004 Synopsis of Bankruptcy Cases Prepared for the DBCA Bankruptcy Subcommittee Open-Ended Order Permitting Payment to Any Vendor Without Analysis is Invalid In re Kmart Corporation, 2004 WL 343520 (7th Cir. 2004): The Seventh Circuit examined the issue of whether Bankruptcy Courts have the discretionary authority to authorize full payment to certain unsecured creditors...Read More
ORAL ARGUMENT IN S. CT. REGARDING STATE SOVEREIGN IMMUNITY Sovereign Immunity (Whether Congress has the Authority Under the Bankruptcy Clause to Abrogate State Sovereign Immunity) The issue in this case is whether the United States Constitution gives Congress, under the Bankruptcy Clause, the power to abrogate state sovereign immunity. Pamela Hood received a Chapter 7...Read More
