January 17, 2020

Technicalities Insulated a Lawyer from Liability for Misusing an IOLA

A creditor lost a dischargeability suit by failing to call the right witnesses to prove that a lawyer’s trust account was used to hide assets.

2nd Circuit, New York, New York Eastern District

January 13, 2020

Debt of $46,000 Discharged Despite a Flagrantly False Loan Application

Even though the debtor defaulted, Judge Christopher Klein held a trial and ruled that the lender had not relied on a false loan application.

9th Circuit, California, California Eastern District

January 09, 2020

Courts Interpret Brunner Too Harshly, Bankruptcy Judge Cecelia Morris Says

A debtor with a law degree but only $37,500 in gross annual income was permitted to discharge more than $220,000 in student loans.

2nd Circuit, New York, New York Southern District

January 03, 2020

Holding a Contempt Hearing May Be Ok, but the Remedy Might Violate Automatic Stay

A contempt hearing fell under the ‘criminal’ exception to the automatic stay, but jailing a debtor to coerce payment of a prepetition debt violated the stay, Judge Grossman ruled.

2nd Circuit, New York, New York Eastern District

January 02, 2020

PACA Doesn’t Give Rise to Denial of Discharge for Defalcation, Chicago Judge Says

A PACA trust lacks the hallmarks of a trust, so a failure to pay a produce supplier doesn’t give rise to a nondischargeable debt for defalcation while acting in a fiduciary capacity, Judge Goldgar says.

7th Circuit, Illinois, Illinois Northern District

November 19, 2019

Student Loans Discharged in Part, Even Though Debtor Wasn’t Destitute

A bankruptcy judge can afford little relief from student loans, even for sympathetic debtors who try hard to repay their debts.

9th Circuit, Oregon

November 06, 2019

Courts Ignore Farrey to Achieve an Equitable Result in a Matrimonial Bankruptcy

In matrimonial cases, courts find creative reasons for not avoiding a lien that impairs an exemption.

11th Circuit, Florida, Florida Southern District

November 05, 2019

Case Shows How Taggart Tilted the Scale Toward Lenders Accused of Contempt

An ambiguous demand letter violated the discharge injunction, but the lender was not held in contempt in light of Taggart.

6th Circuit, Michigan, Michigan Western District

November 04, 2019

If It’s Consensual, a Plan Can Discharge a Nondischargeable Debt

A debt that’s been paid in full under state law is discharged even if the debtor never receives a discharge, Judge Klein says.

9th Circuit, California, California Eastern District

November 01, 2019

BAP Opinion Shows How Taggart Changes the Outcome of Contempt Motions

Ninth Circuit BAP says that payment of a secured claim in full automatically terminates the underlying lien, even if the plan doesn’t say so explicitly.

9th Circuit