§ 542

In re Schoonover

Chapter 7 trustee filed a motion pursuant to 11 U.S.C. § 542(a) for turnover of funds in the amount of the balances in debtors'bank accounts on the date they filed their bankruptcy petition.
Ruling: 
Court ordered debtors to turnover full amount in bank accounts on petition date, including amounts drawn on outstanding checks postpetition.
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In re Boyer

An unsecured creditor sought a denial of a discharge under 11 U.S.C. § 727(a), alleging that the debtor transferred and concealed his interest in certain real property, personal property, and redirected compensation. The chapter 7 trustee filed a motion to compromise constructive trust/11 U.S.C. § 542 claims, and the creditor objected.
Ruling: 
Compromise of constructive trust claims granted.
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Clark v. Flippin

Appellant bankruptcy trustee challenged the decision of the bankruptcy court, which denied his motion for turnover of the non-exempt equity in the debtor's dower interest in certain real property.
Ruling: 
Bankruptcy court properly held that nontransferrable dower interest was not subject to turnover.
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Schnittjer v. Allied Props. & Cas. Ins. Co. (In re Huebbe)

Plaintiff chapter 7 trustee filed an adversary proceeding against defendant insurance company to recover an amount paid directly to the debtor in a settlement agreement reached after the debtor had filed for bankruptcy. The trustee alleged that the insurance company's violation of the automatic stay was willful and sought to recover damages and attorneys' fees. The insurance company claimed that it never received notice of the bankruptcy.
Ruling: 
Payment of insurance proceeds directly to debtor violated stay where agent's knowledge of filing was imputed to company.
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Pyatt v. Brown

Appellee chapter 7 trustee filed a motion seeking to require appellant chapter 7 debtor to turn over assets in a bank account pursuant to 11 U.S.C. § 542(a), which assets covered checks that the debtor wrote prepetition, but which checks were cashed postpetition. The debtor appealed after the Bankruptcy Court for the Eastern District of Missouri granted the trustee's motion.
Ruling: 
Funds drawn on by prepetition checks cashed postpetition would properly recovered from payees not by turnover by debtor.
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Swartz v. Billingsley (In re Billingsley)

Plaintiff chapter 7 trustee filed an adversary complaint for accounting and turnover of funds naming the debtor, the debtor's ex-spouse, and a corporation as defendants. The debtor and his ex-spouse were the sole shareholders of the corporation. The complaint sought a turnover of assets from the corporation. The debtor and the corporation moved for summary judgment.
Ruling: 
Trustee was not allowed to seek turnover of assets from a non-debtor corporation of which the debtor was the sole shareholder.
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Richardson v. Terry Bullock Garages Inc. (In re Bullock Garages)

Plaintiff bankruptcy trustee brought an adversary proceeding against defendant dealer of prefabricated garages, seeking to recover from the dealer unpaid invoices due to the debtor for garage kits which the debtor manufactured. The bankruptcy court conducted a trial.
Ruling: 
Trustee sufficiently showed that the accounts receivable in question were property of the debtor's bankruptcy estate subject to the dealer obtaining credits for garage kits that the dealer ordered from the debtor but never picked up from the debtor.
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Sec. Investor Prot. Corp. v. Rossi (In re Cambridge Capital LLC)

Moving defendant, the fiancee of the primary defendant, moved for partial summary judgment to dismiss adversary claims brought against her by plaintiff trustee for liquidation, under 11 U.S.C. § 542 and N.Y. Debt. & Cred. Law §§ 273–78, asserting allegations of fraud and constructive fraud concerning the transfer of $ 1.5 million in assets by the primary defendant, including the sale of his personal residence to the fiancee.
Ruling: 
Trustee had standing to assert claims of fraud regarding transfer by chief executive officer of the debtor of personal residence to wholly owned investment company and then to the officer's fiancee.
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