Judge Fulton

Machanic v. Clark (In re Clark)

After defendant debtor filed for chapter 7 bankruptcy protection, plaintiff purchaser initiated an adversary proceeding, seeking a determination that the debtor was required to reimburse her for the money she had spent and would spend to correct alleged undisclosed problems with a house she purchased from him. The purchaser also alleged that the damages were nondischargeable under 11 U.S.C.S. § 523(a)(2)(A).
Ruling: 
Debt owed to purchaser of debtor's former residence was dischargeable absent proof of intent to deceive or purcasher's reliance on representations.
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Consumer case opionion summary, case decided on September 03,2008, LexisNexis #0908-079

In re Scarlet Hotels LLC

The debtor appealed from a final order of the United States Bankruptcy Court for the Middle District of Tennessee, challenging the court's award of attorney's fees to law firms for their representation of a trust, the primary creditor of debtor, which operated and was renovating a single asset, a hotel. The debtor argued that the award of $ 469,846 in fees and costs was unreasonable.
Ruling: 
Large award of attorneys' fees of oversecured creditors allowed to stand as due to debtor's poor management of its single asset.
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Commercial case opionion summary, case decided on August 22,2008, LexisNexis #0908-021

MCS Acquisition Corp. v. Gilpin (In re Gilpin)

Adversary plaintiff, a creditor and the former employer of defendant debtor, appealed from an order of the United States Bankruptcy Court for the Northern District of Ohio, Eastern Division, that denied its motion for relief from the automatic stay on its motion to enforce a covenant not to compete against the debtor. At issue was whether its equitable rights under the covenant not to compete constituted a claim under 11 U.S.C.S. § 101(5)(B).
Ruling: 
Bankruptcy court erred in denying relief from stay to allow creditor to pursue rights under judicially approved covenant not to compete.
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Consumer case opionion summary, case decided on July 17,2008, LexisNexis #0808-039

Warner v. Gallimore (In re Gallimore)

Plaintiff creditor filed a complaint objecting to discharge of defendant debtor in connection with plaintiff's claim to recover a $15,000 payment made to defendant on account of defendant's sale of a trailer to plaintiff because the trailer was later impounded for an invalid VIN. Though the debt was alleged to be nondischargeable under both 11 U.S.C.S. § 727(a)(2)(A) and 11 U.S.C.S. § 523, only the § 727 claim was considered at this time.
Ruling: 
Objection to discharge overruled in absence of evidence of debtor's intent to defraud.
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Consumer case opionion summary, case decided on July 10,2008, LexisNexis #0908-053

Commonwealth Ambulance Serv. V. Roush (In re Roush)

Plaintiff corporation filed an adversary proceeding against defendant debtor, pursuant to 11 U.S.C. § 523(a)(2)(A), seeking non-dischargeability of an obligation allegedly owed to the corporation. The court held a trial on the merits and issued findings of fact and conclusions of law.
Ruling: 
Restaurant loan extended without proper due diligence was dischargeable.
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Commercial case opionion summary, case decided on September 30,2007, LexisNexis #1107-025

Miles v. Clarke (In re Miles)

Plaintiff bankruptcy debtor brought an adversary proceeding against defendant, the debtor's former spouse, seeking a finding of contempt by the spouse for allegedly violating the discharge injunction of 11 U.S.C. § 524(a)(2) by attempting to collect prepetition debts arising from the parties'property settlement. The bankruptcy court conducted an evidentiary hearing.
Ruling: 
Former spouse's attempt to collect on prepetition debt violated discharge injunction.
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In re Hall

Debtor filed for chapter 13 bankruptcy protection. An amended chapter 13 plan was filed, to which a creditor filed an objection pursuant to 11 U.S.C. § 1325(a)(3), (a)(6) and (a)(7), and 11 U.S.C. § 1307. The chapter 13 trustee also objected to confirmation, stating that debtor did not propose to pay the minimum amount into the plan as required by 11 U.S.C. § 1325(b)(1).
Ruling: 
Case was dismissed since debtor did not file petition or chapter 13 plan in good faith.
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LWD Trucking Inc. v. LWD Inc. (In re LWD Inc.)

Plaintiff United States Trustee brought an adversary complaint against defendant individuals and company, alleging, inter alia, equitable subordination and seeking payment of the trustee's fees. Defendants moved to dismiss the complaint.
Ruling: 
Bankrtuptcy court declined to strike complaint in equitable subordination proceeding that put debtor sufficiently on notice of claims.
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Smith v. Wilson (In re Wilson)

Plaintiff, defendant debtor's former spouse, filed an adversary proceeding against the debtor claiming that a deficiency balance on a motorcycle, a debt for which the former spouse was jointly responsible, should be declared a non-dischargeable debt under 11 U.S.C. § 523(a)(5) or , alternatively, 11 U.S.C. § 523(a)(15). The former spouse also alleged that the debtor should be denied his discharge under 11 U.S.C. § 727(a)(2)(A).
Ruling: 
Deficiency balance on motorcycle jointly owned by debtor and debtor's former spouse was deemed dischargeable since deficiency was not in nature of support and debtor lacked ability to pay debt.
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Shain v. Shain (In re Shain)

Plaintiff, the former spouse of defendant debtor, filed a complaint contending that attorney fees awarded to him during a custody battle between the parties were nondischargable under 11 U.S.C. § 523(a)(5) and (a)(6).
Ruling: 
Attorney fees awarded to debtor's former spouse from custody battle case was deemed nondischargeable debt.
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