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western district of kentucky

In re Rynerson

Ruling
Motion to convert or dismiss chapter 11 case denied where creditors'position would not be improved.
Procedural posture

After a debtor's amended chapter 11 plan of reorganization was confirmed, the hospital moved to reopen the case and to either convert the case to chapter 7 or dismiss the chapter 11 case on the grounds that the debtor did not comply with the plan on payments to unsecured creditors or on liquidation of estate assets and that the debtor failed to disclose assets. The debtor objected to the motion.

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opinion summary, case decided on October 05, 2006 , LexisNexis #1106-131

In re James M. Rynerson M.D. P.S.C.

Ruling
Conversion or dismissal denied as not in best interests of creditors where there was no default and plan was substantially consummated.
Procedural posture

A creditor filed a motion to convert a debtor's case to chapter 7 or, in the alternative, to dismiss the debtor's chapter 11 case, pursuant to 11 U.S.C. § 1112.

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opinion summary, case decided on October 03, 2006 , LexisNexis #1006-138

Huskey v. Allen County Farmers Servs.

Ruling
Stay violation could not be grounds for dismissal of personal injury case where debtor's prior conduct in the action was inconsistent with stay defense.
Procedural posture

Plaintiffs, a husband and wife, sued defendants, a farm supplier and a wire company, for damages from an alleged injury the husband received when wire was unloaded from his truck. Prior to the suit, the wire company filed for bankruptcy and a stay was issued pursuant to 11 U.S.C. § 362(a)(1) pending the bankruptcy's resolution. Before the federal district court were the wire company's motions for summary judgment and to file an amended answer.

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opinion summary, case decided on September 05, 2006 , LexisNexis #1006-050

Kitterman v. Sallie Mae Servicing L.P. (In re Kitterman)

Ruling
Fainting spells and depression were not grounds for undue hardship discharge of student loan debt where they would not prevent debtor from finding or maintaining employment.
Procedural posture

Plaintiff debtor filed a complaint against defendant creditors to determine the dischargeability of his student loans based on undue hardship under 11 U.S.C. § 523(a)(8).

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opinion summary, case decided on August 30, 2006 , LexisNexis #1006-094

Schilling v. Reid

Ruling
Debtor's good faith post-discharge sale of property of the estate and retention of proceeds was not cause for revocation.
Procedural posture

Plaintiff trustee sued defendant debtor, contending that the debtor's discharge should have been revoked pursuant to 11 U.S.C. § 727(d)(2) because she had sold real estate postdischarge and retained the proceeds for her own use rather than submitting them to the trustee. The bankruptcy court held a trial.

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opinion summary, case decided on August 25, 2006 , LexisNexis #0906-131

In re Thompson

Ruling
Creditors could reopen case to allow claim based on post-discharge entry of civil judgment.
Procedural posture

Creditors filed a motion to allow claim of creditors following their filing of a report of the proceedings in a civil action indicating that a judgment had been entered against the debtor and that the jury had determined that the debtor's actions were intentional.

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opinion summary, case decided on August 17, 2006 , LexisNexis #0906-015

In re Brinley

Ruling
Unencumbered equity in abandoned property should be preserved for benefit of the estate.
Procedural posture

An unsecured creditor moved for an order finding that the unencumbered equity created by the avoidance of its judgment lien against certain property be preserved for the bankruptcy estate pursuant to 11 U.S.C. § 551. The debtor objected to the motion, arguing that section 551 was inapplicable and that the property in question had been technically abandoned as a result of the closing of the bankruptcy case.

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opinion summary, case decided on August 17, 2006 , LexisNexis #0906-029

In re Sheffer

Ruling
Per se ban on settlement of proceedings for denial of discharge would be unduly restrictive.
Procedural posture

Chapter 7 debtor filed a motion to approve a global settlement of several fraudulent transfer claims.

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opinion summary, case decided on August 17, 2006 , LexisNexis #1106-033

In re Hall

Ruling
Case was dismissed since debtor did not file petition or chapter 13 plan in good faith.
Procedural posture

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).

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opinion summary, case decided on July 31, 2006 , LexisNexis #0806-114

In re Duke

Ruling
Court held that surrender of vehicle in compliance with hanging paragraph of section 1325(a) did not fully satisfy creditors'claims.
Procedural posture

Movant debtors filed motions to surrender collateral (two motor vehicles) in full satisfaction of debts owed to respondent secured creditors.

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opinion summary, case decided on July 12, 2006 , LexisNexis #0806-009