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In re McMahan

Ruling
Chapter 13 case dismissed for bad faith as filed on eve of foreclosure sale after default under chapter 11 plan instead of seeking modification of chapter 11 plan.
Procedural posture

Debtor filed a petition under chapter 13 of the Bankruptcy Code, and a bank that held a debt that was secured by real property the debtor owned filed a motion to dismiss the debtor's case for serial filing, arguing that the debtor's case was not filed in good faith under 11 U.S.C.S. §§ 1307 and 1325(a)(3).

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Consumer opinion summary, case decided on October 25, 2012 , LexisNexis #1112-134

Tow v. Henley (In re Henley)

Ruling
Discharge denied due to false statements in schedules and concealment of sale of assets.
Procedural posture

A chapter 7 trustee and two judgment creditors, filed an adversary proceeding against defendant chapter 7 debtors, a husband and wife, seeking a determination that the debtors were not eligible under 11 U.S.C.S. § 727(a) to have their debts discharged. The debtors filed counterclaims alleging, inter alia, that the creditors violated 11 U.S.C.S. § 362. The case was tried to the court.

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Consumer opinion summary, case decided on September 28, 2012 , LexisNexis #1212-058

In re Watts

Ruling
Case dismissed with prejudice due to failure to disclose malpractice action and listing trustee as plaintiff without authority to do so.
Procedural posture

Chapter 13 trustee alleged bad faith conduct by the debtors and filed a motion to dismiss the debtors' case under 11 U.S.C.S. § 1307.

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Consumer opinion summary, case decided on August 09, 2012 , LexisNexis #0912-065

In re Stout

Ruling
Proof of claim allowed where debtor signed note as corporate representative but creditor demonstrated the loan was for debtor's personal use.
Procedural posture

A creditor filed a proof of claim in a bankruptcy case based on a promissory note signed by the bankruptcy debtor as president of a corporation of which the debtor was the sole principal. The bankruptcy trustee objected to allowance of the creditor's claim.

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Consumer opinion summary, case decided on June 29, 2012 , LexisNexis #0912-114

Ciprian Ltd. v. Oxford Dev. Co. Grant St. LP (In re Ciprian Ltd.)

Ruling
Perfected security interest in liquor license and subsequent execution were not avoidable.
Procedural posture

Plaintiff chapter 7 trustee filed an adversary proceeding against defendant creditor, seeking a determination under 11 U.S.C.S. § 506 that the creditor did not hold a secured interest in a liquor license a business ("debtor") obtained before it declared bankruptcy, and a determination that a lien the creditor obtained less than ninety days before the debtor declared bankruptcy was a preferential transfer. The case was tried to the court.

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Commercial opinion summary, case decided on June 21, 2012 , LexisNexis #0712-045

In re SBMC Healthcare LLC

Ruling
Debtor could employ law firm that waived claim against the estate.
Procedural posture

Debtor LLC filed a petition under chapter 11 of the Bankruptcy Code and asked the court for permission to employ a law firm that represented the debtor before it declared bankruptcy. The United States Trustee ("UST") filed an objection.

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Commercial opinion summary, case decided on June 18, 2012 , LexisNexis #0712-036

Passavant Meml Homes v. Laurel Highlands Found. Inc. (In re Laurel Highlands Found. Inc.)

Ruling
Chapter 11 case dismissed as filed in bad faith as a litigation tactic.
Procedural posture

Plaintiff, chapter 11 debtor, filed a notice of removal of a state court action pursuant to 28 U.S.C.S. § 1452(a). Defendants, members of the debtor seeking to take over its management and an outsider, moved to remand the adversary proceeding, and alternatively to dismiss the petition, for the bankruptcy court to abstain, or for relief from the automatic stay.

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Commercial opinion summary, case decided on June 12, 2012 , LexisNexis #0712-063

In re Airhart

Ruling
Court could determine redemption value of vehicle in converted chapter 7 case without relying on value established while case was in chapter 13.
Procedural posture

Debtor filed a petition under chapter 13 of the Bankruptcy Code and proposed a plan that valued a vehicle she owned at $17,000 and paid a credit union the full amount of the debt. Just over two years later, the debtor converted her case to one under chapter 7 of the Bankruptcy Code and filed a motion to redeem the vehicle pursuant to 11 U.S.C.S. § 722. The court held a hearing on the debtor's motion.

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Consumer opinion summary, case decided on May 31, 2012 , LexisNexis #0712-028

Zedbley v. First Horizon Home Loans (In re Ong)

Ruling
Proof of claim filed within 30 days after order avoiding lien was considered timely.
Procedural posture

Before the court in debtors' chapter 7 case was objector trustee's objection to proof of claim 6. Respondent was a mortgage creditor (claimant).

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Consumer opinion summary, case decided on April 23, 2012 , LexisNexis #0512-060

PHH Mortg. Corp. v. Cardiello (In re Vitale)

Ruling
Relief from stay granted nunc pro tunc to allow mortgagee to continue foreclosure mistakenly commenced while no asset case was still being administered.
Procedural posture

A mortgagee filed a motion for relief from the automatic stay nunc pro tunc pursuant to 11 U.S.C.S. § 362(d), seeking retroactive relief from the automatic stay and abandonment of property by the bankruptcy estate. The chapter 7 trustee did not object.

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Consumer opinion summary, case decided on April 02, 2012 , LexisNexis #0412-109