Northern District

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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Hanrahan v. Walterman - The Rental Co. (In re Walterman Implement Inc.)

Plaintiff chapter 7 trustee and defendant rental company filed motions for summary judgment on the trustee's claim that the transfer by the debtor's owner of his stock in the debtor to the rental company was void in violation of the automatic stay under 11 U.S.C. § 362 and was a voidable postpetition transfer under 11 U.S.C. § 549.
Ruling: 
Postpetition stock transfer by corporate debtor's owner was avoidable.
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In re CRI Inc.

The chapter 7 trustee filed a motion to sell assets free and clear of liens, encumbrances and other interests. The trustee proposed to sell the debtor's interest in a wholly-owned subsidiary, including its title to real estate.
Ruling: 
Trustee's motion to sell assets free and clear of liens granted over objection of debtor's attorneys.
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Ridgeway v. Ridgeway

Plaintiff, the debtor's former spouse, filed an adversary proceeding against defendant debtor seeking a determination that his debt was nondischargeable pursuant to 11 U.S.C. § 523(a)(15).
Ruling: 
Non-support property settlement obligations were excepted from discharge where benefit of discharge did not outweigh detriment to former spouse.
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Steil v. Steil

Plaintiff filed a complaint seeking to except debt from discharge under 11 U.S.C. § 523(a)(6) based on defendant debtors'conversion of his collateral, inventory in a convenience store leased by the debtors. The debtors denied the disposition of the collateral was willful or malicious.
Ruling: 
Willful breach of lease did not result in nondischargeable debt absent proof of maliciousness.
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In re Batzkiel

After the debtors filed a chapter 7 bankruptcy petition, the trustee moved to dismiss pursuant to 11 U.S.C. § 707(b)(1).
Ruling: 
Debtor's petition did not create presumption of abuse where monthly income was below threshold.
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Morse v. Iowa Student Loan Liquidity Corp. (In re Morse)

Plaintiff debtor filed an adversary proceeding against defendant creditor to determine the dischargeability of certain student loan obligations pursuant to 11 U.S.C.S. § 523(a)(8).
Ruling: 
Student loan obligations were discharged due to undue hardship related to debtor's history of mental illness.
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In re James

The trustee moved to dismiss the debtor's chapter 7 case pursuant to 11 U.S.C. § 707(b)(1) on the grounds that the filing constituted a substantial abuse of the provisions of chapter 7.
Ruling: 
Filing constituted abuse of chapter 7 since under totality of circumstances debtor did not file in good faith.
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In re Miglia

An attorney who represented the debtors in a prepetition lawsuit filed a secured claim against the estate. The chapter 7 trustee objected to the claim asserting that the estate could not pay attorney's fees and that the attorney failed to perfect his lien.
Ruling: 
Court allowed attorney's claim as unsecured since section 362(a)(4) barred attorney from perfecting by possession postpetition.
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In re Sherrets

Debtors'counsel applied pursuant to 11 U.S.C. § 330 for an additional $1,663 in compensation for additional legal services provided in a chapter 13 case. The trustee objected that the amount requested was excessive.
Ruling: 
Court denied counsel's application for additional compensation.
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