Business Law Insolvency Law Committee

The United States Supreme Court, relying on textual interpretation, the principles of common-law fraud, precedent from the 1800s, and legislative intent, held that the debt incurred because of the fraud of a spouse or partner is imputed to the other partner and therefore is non-dischargeable in that person’s bankruptcy under the provisions of 11 U.S.C. § 523(a)(2)(A).  Read more

The plaintiff obtained two loans secured by his home. Plaintiff stopped making payments.  In March 2014, one lender foreclosed on a loan. Read more

In Rios, the Bankruptcy Court for the Eastern District of Wisconsin held that the Internal Revenue Service (“IRS”) had an “interest in property” through its federal tax liens on the Chapter 13 Debtors’ (“Debtors”) Social Security benefits. Read more

Utilizing provisions of the New York Limited Liability Company Law, a bankruptcy court in the Eastern District of New York (the Court) granted a chapter 11 liquidating trustee’s motion to appoint co-trustees to liquidate the assets of LLCs in which the deceased debtor was a managing member.  Read more

In a published opinion with a detailed description of the development abusind importance of California’s usury law, the California Court of Appeal (the Court) reversed a trial court ruling which reflected the lower court’s erroneous understanding that California’s complicated relationship with usury, with many exceptions, demonstrates that the prohibition of usury is not a fundamental public policy of the state. Read more

The allowed homestead exemption in Riverside County California, when Robert and Suzanne Reicher filed their chapter 7 petition, was roughly $456,000.  Read more

In an unpublished decision, the U.S. Bankruptcy Appellate Panel of the Ninth Circuit (the “BAP”) affirmed the bankruptcy court’s rulings denying a chapter 7 debtor’s motion to convert and motion for reconsideration, based on its determination that the bankruptcy court’s finding that the debtor had sought conversion in bad faith was not clearly erroneous.   Read more

The United States Bankruptcy Appellate Panel of the Ninth Circuit recently affirmed the bankruptcy court finding that a chapter 7 trustee may assert a fraudulent conveyance action that occurred within seven years of the bankruptcy petition provided that (1) either the fraudulent transfer occurred within four years of the bankruptcy petition or (2) a judgment (creating a creditor) is entered against a debtor within four years of the bankruptcy petition.  Weil v. Pyramid Center, Inc. (In re Momentum Dev. LLC), 649 B.R. 33 (B.A.P. 9th Cir. 2023). Read more

A bankruptcy court in the District of Idaho held that a Chapter 13 Debtor’s employer-paid medical and dental benefits shall be considered income for purposes of calculating “currently monthly income” (“CMI”) for Means Test purposes.  In re Clifford, No. 22-00129-NGH, 2022 WL 16727279, at *1 (Bankr. D. Idaho Nov. 4, 2022). Read more

In MOAC, the Supreme Court held that 11 U.S.C. § 363(m) of the Bankruptcy Code is not jurisdictional, reversing the Second Circuit Court of Appeals and resolving a Circuit split over whether section § 363(m) limits appellate jurisdiction over § 363 sale orders or instead just limits the appellant’s remedies on appeal in the event there is a sale or lease to a good-faith purchaser or lessee. Read more