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In re Westhampton Coachworks Ltd.

With reference to two Chapter 11 cases involving related persons and entities, movant, the U.S. Trustee, asked the court to either dismiss the cases or, in the alternative, convert them to Chapter 7 as permitted by 11 U.S.C.S. § 1112 on claims that dismissal or conversion were justified given, inter alia, post-petition losses and inability to reorganize. Debtors objected to the motions.
Ruling: 
Cases converted to chapter 7 due to diminution of estates and absence of reasonable likelihood of rehabilitation.
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Commercial case opionion summary, case decided on December 21,2010, LexisNexis #0211-127

In re Clark

Before the court was a motion by debtors to reopen their Chapter 7 bankruptcy case, vacate the discharge as to a creditor, and allow them to reaffirm a debt owed to the creditor under the provisions of 11 U.S.C.S. § 524. The motion was not opposed; however the court questioned, sua sponte, its authority to grant the requested relief.
Ruling: 
Debtor could not reopen case to reaffirm vehicle loan debt to avoid repossession.
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Consumer case opionion summary, case decided on December 21,2010, LexisNexis #0211-121

In re Gonsalves

The Chapter 7 debtor filed a motion for determination that his severance pay was exempt under 11 U.S.C.S. § 522(d)(10)(C) or (E). The trustee objected to the motion, arguing that the debtor was not entitled to exempt the severance pay because the benefits were not based on length of service and because the company that acquired the debtor's employer offered the debtor a job. The court held an evidentiary hearing.
Ruling: 
Severance benefits were exempt despite successor company's offer of employment.
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Consumer case opionion summary, case decided on December 21,2010, LexisNexis #0111-079

In re Cryptek Inc.

After a case was converted from Chapter 11 to Chapter 7, the Chapter 7 trustee and administrative expense claimants filed a motion to require the law firm that represented the debtor-in-possession to disgorge about $35,000 of the nearly $163,000 in approved fees and expenses that were paid to it. The trustee claimed that disgorgement was necessary to achieve equality of distribution among the Chapter 11 administrative claimants.
Ruling: 
Debtor's law firm ordered to disgorge prepetition fees paid by debtor in possession postpetition without bankruptcy court authorization.
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Commercial case opionion summary, case decided on December 21,2010, LexisNexis #0111-131

In re Ramp Chevrolet

Chapter 11 debtor filed a motion to hold a franchisor in contempt for willfully violating the automatic stay, 11 U.S.C.S. § 362(a)(7), by asserting improper setoffs under 11 U.S.C.S. § 553 without court approval, and for filing a secured proof of claim in the debtor's case in violation of the automatic stay.
Ruling: 
Franchisor's reduction of debtor franchisee's wind-down payments was not a setoff and did not violate stay.
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Commercial case opionion summary, case decided on December 21,2010, LexisNexis #0211-108

Booth v. Booth (In re Booth)

Plaintiff creditors filed a complaint against defendant Chapter 13 debtors asserting, inter alia, the dischargeability of a debt relating to the creditors' purchase of a house and lot from the debtors. The complaint was tried on the limited issue of whether the debtors, in their dealings with the creditors, committed false pretenses, a false representation, or actual fraud within the meaning of 11 U.S.C.S. § 523(a)(2)(A).
Ruling: 
State implied warranty of fitness and habitability was insufficient to establish nondischargeability of debt relating to house sale.
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Consumer case opionion summary, case decided on December 21,2010, LexisNexis #0111-082

Kimpel v. Meyrowitz (In re Meyrowitz)

Defendants, a company allegedly owned by debtor's brother and a non- debtor individual, moved to dismiss plaintiffs' complaint, alleging that plaintiffs went into business with the debtor and the individual and that defendants failed to perform in accordance with their alleged agreements, converted cash and other items, and engaged in various conspiracies and other fraudulent conduct. The individual also sought abstention in the alternative.
Ruling: 
Bankruptcy court abstained from hearing contract and fraud based action against debtor despite having "related to" jurisdiction.
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Consumer case opionion summary, case decided on December 20,2010, LexisNexis #0111-137

In re Midwest Props. of Shawano LLC

Debtors, a holding company that owed real property in Wisconsin and an oil company that owed real property in Minnesota, filed separate pro se petitions under Chapter 11 of the Bankruptcy Code, and after both cases were assigned to the District of Delaware, the United States Trustee (UST) filed motions in both cases, seeking an order converting or dismissing both cases or appointing a Chapter 11 trustee. The debtors opposed the UST's motions.
Ruling: 
Cases dismissed where businesses were operating with losses and did not submit viable chapter 11 plans.
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Commercial case opionion summary, case decided on December 20,2010, LexisNexis #0111-094

KABB Pship v. Faye Foods Inc. (In re Faye Foods Inc.)

Lessor brought an adversary proceeding against debtor which leased property from the lessor seeking a declaration that the lessor was entitled to the proceeds of a sale of the property by the debtor under a disputed option to purchase granted to the debtor in the lease. The debtor appealed the order of the U.S. Bankruptcy Court for the Western District of Tennessee which granted summary judgment to the lessor.
Ruling: 
Bankruptcy court properly refused to pay administrative expense claim for debtor's real estate broker fees from proceeds of sale.
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Commercial case opionion summary, case decided on December 20,2010, LexisNexis #0111-070

Kapolis v. Heidenrich (In re Heidenrich)

Plaintiff judgment creditors, a brother and sister, sought a determination under 11 U.S.C.S. § 523(a)(2)(A) of the dischargeability of their prepetition judgment against defendant debtor.
Ruling: 
Debtor general contractor's allegedly misleading references were insufficient grounds for nondischargeability.
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Consumer case opionion summary, case decided on December 20,2010, LexisNexis #0111-083

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