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Can Same-Sex Couples Own Real Property as Tenants by the Entirety in Michigan?

Two years have passed since the United States Supreme Court passed down a 5-4 decision in Obergefell v. Hodges which held that same-sex couples have a fundamental right to marry under both the Due Process and Equal Protection Clauses of the Fourteenth Amendment. Read More ›

Categories: U.S. Supreme Court, Zoning & Land Use

Supreme Court to Address Circuit Split Regarding Debt Re-Characterization Claims

On June 26, 2017, the Supreme Court granted certiorari in PEM Entities v. Levin to decide whether bankruptcy courts should apply a federal multi-factor test or an underlying state law when deciding whether to re-characterize a debt claim as equity. The Court’s decision to grant cert in this case should resolve a circuit split and clarify the law as it relates to re-characterizing corporate debt as equity. Read More ›

Categories: 6th Circuit Court of Appeals, Chapter 11, U.S. Supreme Court

Bankruptcy Court Denies Creditors Request for Relief from Automatic Stay to Arbitrate its Claims and Progress Setoff and Recoupment Rights

One of the primary reasons that most debtors seek bankruptcy relief is the automatic stay, which prevents creditors from pursuing collection efforts outside of the bankruptcy proceedings. Creditors can, however, seek relief from the automatic stay from the bankruptcy court under certain circumstances. Read More ›

Categories: Chapter 11, Western District of Michigan

Supreme Court Rules that Debt Collector’s Attempt to Collect Time Barred Claim in Chapter 13 Bankruptcy Case Does not Violate Fair Debt Collection Practices Act

What happens in a Chapter 13 bankruptcy case when a creditor files a proof of claim involving a debt for which the statute of limitations to collect the debt has run? More specifically, does the filing of such a claim violate the Fair Debt Collection Practices Act (the “Act”)? That’s the issue considered by the U.S. Supreme Court in its recent decision in the case of Midland Funding, LLC v. Johnson. 1 Read More ›

Categories: Chapter 13, U.S. Supreme Court

Reserve it or Lose it: Sixth Circuit BAP Reverses Bankruptcy Court on Issue of Whether Trustee Abandoned Asset in Chapter 7 Case

In a recent decision, the Bankruptcy Appellate Panel of the Sixth Circuit (the “Court”) considered the issue of asset “abandonment” in a Chapter 7 case[1]. The Court reversed the bankruptcy court’s decision to allow the Chapter 7 trustee to compromise a claim that the debtor argued the trustee had abandoned.

[1] In re: Wayne L. Wright, Docket No. 16-8019 (6th Cir. BAP, April 17, 2017). Read More ›

Categories: 6th Circuit Court of Appeals, Chapter 7

Sixth Circuit Affirms Decision to Deny Chapter 7 Debtor’s Proposed Exemption Because She Lacked Equity in Property After a Sale

In the case of Susan G. Brown v. Douglas Ellmann [1], the U.S. Court of Appeals for the Sixth Circuit (the “Sixth Circuit”) recently affirmed a bankruptcy court’s decision to deny a Chapter 7 debtor’s proposed exemptions for the value of redemption rights she enjoyed under Michigan law related to the sale of a property she surrendered to the bankruptcy estate.

[1] Case No. 16-1967 (6th Cir., March 20, 2017). Read More ›

Categories: 6th Circuit Court of Appeals, Chapter 7

District Court Affirms that Civil Fraud Penalties are Nondischargeable in Chapter 13 Bankruptcy Cases

Many bankruptcy cases involve adversary proceedings in which creditors seek to have certain debts deemed nondischargeable. The United States District Court for the Eastern District of Michigan (the “District Court”) recently considered, on appeal, whether the Bankruptcy Court properly held that a debt owed by a debtor (the “Debtor”) to the State of Michigan Unemployment Insurance Agency (the “Agency”) is dischargeable in a Chapter 13 case.1 Read More ›

Categories: Chapter 13, Eastern District of Michigan

Bankruptcy Court Upholds Contemporaneous Exchange for New Value Defense in Preference Action

The Bankruptcy Code grants a trustee (or a debtor in possession) certain “avoidance” powers to recover payments to creditors made shortly before a bankruptcy filing where the payment gave the creditor more than other, similarly situated, creditors would receive through the bankruptcy process. 

In a recent case in the United States Bankruptcy Court for the Western District of Michigan (the “Court”), the Court considered whether a payment made by a Chapter 7 debtor to her son in advance of the debtor’s bankruptcy filing was “preferential” and thus subject to recovery by the Chapter 7 trustee. Read More ›

Categories: Chapter 7, Western District of Michigan

Chapter 7 Debtor’s Case Dismissed After Court Finds that She is Judicially Estopped from Arguing that Student Loan Debts are Non-Consumer in Nature

While bankruptcy relief is available as a tool for individuals to discharge debts, it is not available to everyone, under all circumstances. Before a debtor can, for example, discharge debts in a Chapter 7 bankruptcy, he or she must prove that debts and income are within certain statutory thresholds. When determining whether an individual is eligible for relief, the nature of the debts at issue is also relevant. Read More ›

Categories: Chapter 13, Chapter 7, Eastern District of Michigan

Fraudulently Obtained Unemployment Benefits are not Dischargeable in Bankruptcy

State unemployment benefits are paid pursuant to a system that relies on trust. Benefits are paid based on representations made by claimants that they are out of work and that they continue to seek out full-time work. If a claimant finds part-time work, then benefits are reduced accordingly.

A recent opinion from the United States Bankruptcy Court for the Western District of Michigan (the “Court”) addresses a Chapter 7 debtor’s attempt to discharge a debt owed to the State of Michigan for overpaid unemployment benefits, and penalties and interest stemming from the overpayment.  Read More ›

Categories: Chapter 7, Western District of Michigan