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§ 542

In re Jokiel

Ruling
Debtor ordered to turn over employment severance payment less portion attributable to postpetition service.
Procedural posture

In a chapter 7 case, the trustee moved under 11 U.S.C.S. § 542 to compel turnover by the debtor of an employment severance payment. The debtor claimed an exemption for the payment pursuant to 11 U.S.C.S. § 541(a)(6), the trustee objected.

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Consumer opinion summary, case decided on April 21, 2011 , LexisNexis #0511-087

In re Ellis

Ruling
Debtor allowed state law exemptions in annuity and homestead, despite conversion of assets to exempt property within six months of petition date.
Procedural posture

The chapter 7 trustee filed objections to the debtors' claimed exemptions for a retirement annuity and for their homestead, and a motion for turnover of the assets under 11 U.S.C.S. § 542, requested an award of costs. Debtors had admittedly failed to disclose the annuity and the homestead property, but asserted that their counsel had advised them they were not required to make the disclosures.

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Consumer opinion summary, case decided on April 15, 2011 , LexisNexis #0511-088

In re Henry

Ruling
Auto dealer ordered to turn over vehicle it ordered debtor to return two days after petition date.
Procedural posture

Debtor filed a petition under chapter 13 of the Bankruptcy Code, and he asked the court to issue an order under 11 U.S.C.S. § 542(a) that required an automobile dealer to turn over a vehicle he returned to the dealer two days after he declared bankruptcy, and that enjoined the dealer from selling or otherwise disposing of the vehicle. The dealer opposed the debtor's motion.

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Consumer opinion summary, case decided on April 13, 2011 , LexisNexis #0511-089

Las Vegas Casino Lines LLC v. Abbott (In re Las Vegas Casino Lines LLC)

Ruling
Debtor gambling cruise operator not entitled to turnover of funds allegedly stolen by passenger.
Procedural posture

Chapter 7 debtor filed an adversary proceeding against defendant, a passenger who booked passage on several cruises the debtor operated, claiming that the passenger stole money from the debtor, and it asked the court to issue an order requiring the passenger to turn over $55,000 and to pay attorney's fees, interest, and court costs. The case was tried to the court.

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Commercial opinion summary, case decided on April 06, 2011 , LexisNexis #0611-021

Slone v. Vallo (In re Starr)

Ruling
Mortgage did not trigger debtor's former spouse's obligation under separation agreement to turn over payment "upon sale or conveyance."
Procedural posture

Trustee and defendant, the ex-husband of debtor, cross-moved for summary judgment on plaintiff's claim that defendant was currently obligated to pay debtor $50,000 in connection with the couple's separation agreement and that said $50,000 thus was payable to debtor's estate under 11 U.S.C.S. § 541. The issue was whether defendant's grant of an open-ended mortgage was a "sale or conveyance" within the meaning of the separation agreement.

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Consumer opinion summary, case decided on March 24, 2011 , LexisNexis #0411-087

DH Northwest LLC v. Carey (In re National Jockey Club)

Ruling
Arbitration award breaking tie vote of board of directors resolution was not a judgment that could serve as a basis for turnover of property.
Procedural posture

Plaintiff, in the name of a Chapter 11 debtor, filed a complaint against defendant, who was the president, manager, and a board member of a limited liability company (LLC) formed by the debtor, asserting a claim for turnover of estate property under 11 U.S.C.S. § 542(a) and a claim for breach of fiduciary duty under state law. Defendant filed a motion to dismiss pursuant to Fed. R. Civ. P. 12(b)(6), as incorporated by Fed. R. Bankr. P. 7012.

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Commercial opinion summary, case decided on March 03, 2011 , LexisNexis #0311-125

Picard v. Estate of Chais (In re Bernard L. Madoff Inv. Sec. LLC)

Ruling
Proceeding for immediate turnover of funds transferred pursuant to debtor's Ponzi scheme dismissed.
Procedural posture

Defendants moved to partially dismiss the complaint of the trustee for the substantively consolidated liquidation of a securities firm and its principal under the Securities Investor Protection Act (SIPA), 15 U.S.C.S. 78aaa et seq. The complaint was filed pursuant to, inter alia, 15 U.S.C.S. § 78fff(b) and § 78fff-2(c)(3), 11 U.S.C.S. §§ 105(a), 502(d), 542, 544, 547, 548(a), 550(a), and 551, and N.Y. Debt. & Cred. Law § 270 et seq. (2010).

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Commercial opinion summary, case decided on February 24, 2011 , LexisNexis #0311-086

Springel v. Prosser (In re Prosser)

Ruling
Constructive trust imposed on debtor's property deemed subject to turnover.
Procedural posture

The chapter 11 trustee (Trustee 11) for Company and the chapter 7 trustee (Trustee 7) for debtor husband, citing 11 U.S.C.S. § 542, sought orders for turnover against various family members, including the wife, of various items of property claimed by either one or both of the trustees to be the property of their respective estates per 11 U.S.C.S. § 541. A motion to stay proceedings was also before the court.

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Consumer opinion summary, case decided on February 09, 2011 , LexisNexis #0311-018

In re Turner

Ruling
Trustee entitled to turnover of tax refunds to the extent exceeding claimed exemption.
Procedural posture

In several cases, the chapter 7 trustee objected to the debtors' claimed exemptions of their 2009 tax refunds and sought turnover pursuant to 11 U.S.C.S. § 542. The trustee requested additional compensation pursuant to 11 U.S.C.S. § 326.

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Consumer opinion summary, case decided on February 03, 2011 , LexisNexis #0311-019

In re Hooper

Ruling
Net operating losses and refunds granted under the Worker, Homeownership and Business Assistance Act were property of the estate.
Procedural posture

Chapter 7 trustee filed a motion, pursuant to 11 U.S.C.S. § 542, to compel the debtors to turn over any tax refunds generated as a result of the passage of the Worker, Homeownership and Business Assistance Act (WHBAA).

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Consumer opinion summary, case decided on December 14, 2010 , LexisNexis #0111-089