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Showing 51 posts by Patricia J. Scott.

Significant Changes to Bankruptcy Rules Effective December 1, 2017

Numerous changes to the Federal Rules of Bankruptcy Procedure (the “Rules”) take effect on December 1, 2017. The changes significantly impact the administration of consumer bankruptcy cases, and Chapter 13 cases in particular. Read More ›

Categories: Chapter 13, Chapter 7

Trustee’s Avoidance of Transfer by Chapter 7 Debtors Does Not Necessarily Preclude Debtors from Claiming an Amended Exemption

The United States Bankruptcy Court for the Western District of Michigan recently issued an opinion in a bankruptcy case involving a husband and wife who filed for Chapter 7 bankruptcy protection. Read More ›

Categories: Chapter 7, Collections

Michigan House Considers Bills Proposing Adoption of the Uniform Commercial Real Estate Receivership Act

Two proposed bills are working their way through the Michigan Legislature that would significantly impact state law pertaining to commercial real estate receiverships. Read More ›

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

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