Showing 32 posts in Chapter 13.
Sixth Circuit Affirms Holding that Contributions to a 401(k) Plan Made More than Six Months Prior to Bankruptcy Cannot be Excluded from Disposable Income
The U.S. Court of Appeals for the Sixth Circuit recently ruled in a case involving a Chapter 13 debtors’ attempt to shield contributions to a 401(k) retirement account from “projected disposable income,” therefore making such amounts inaccessible to the debtors’ creditors.[1] For the reasons explained below, the Sixth Circuit rejected the debtors’ arguments. Read More ›
Categories: 6th Circuit Court of Appeals, Chapter 13
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Sixth Circuit Upholds Chapter 13 Debtor’s Right to Request and Receive Dismissal of Bankruptcy Case
A statute must be interpreted and enforced as written, regardless, according to the U.S. Court of Appeals for the Sixth Circuit, “of whether a court likes the results of that application in a particular case.” That legal maxim guided the Sixth Circuit’s reasoning in a recent decision[1] in a case involving a Chapter 13 debtor’s repeated filings and requests for dismissal of his bankruptcy cases in order to avoid foreclosure of his home. Read More ›
Categories: 6th Circuit Court of Appeals, Chapter 13
Supreme Court Holds that “Mere Retention” of Estate Property After Bankruptcy Filing Doesn't Violate the Automatic Stay
On January 14, 2021, the U.S. Supreme Court decided City of Chicago, Illinois v. Fulton (Case No. 19-357, Jan. 14, 2021), a case which examined whether merely retaining estate property after a bankruptcy filing violates the automatic stay provided for by §362(a) of the Bankruptcy Code. The Court overruled the bankruptcy court and U.S. Court of Appeals for the Seventh Circuit in deciding that mere retention of property does not violate the automatic stay.
Case Background
The City of Chicago (the “City”) impounded respondents’ vehicles for failure to pay fines for motor vehicle infractions. Thereafter, each respondent filed a Chapter 13 bankruptcy petition and requested the return of their vehicle. The City refused to return the vehicles, and the bankruptcy court in each case found the City’s refusal to be a violation of automatic stay. The Seventh Circuit affirmed, concluding that by retaining possession of the debtors’ vehicles after they declared bankruptcy, the City had acted “to exercise control over” the debtors’ property in violation of the automatic stay. Read More ›
Categories: Case Law Updates, Chapter 13, U.S. Supreme Court
Sixth Circuit Rules that Monthly 401(k) Contributions can be Excluded from “Projected Disposable Income” Under a Chapter 13 Plan
A Chapter 13 bankruptcy plan requires a debtor to satisfy unsecured debts by paying all “projected disposable income” to unsecured creditors over a five-year period. In a recent case before the U.S. Court of Appeals for the Sixth Circuit (the “Sixth Circuit”), the court grappled with whether a Chapter 13 debtor’s wages that are contributed to an employer-sponsored retirement plan are considered disposable income under the Bankruptcy Code.[1] Read More ›
Categories: 6th Circuit Court of Appeals, Chapter 13
Sixth Circuit Court of Appeals Holds that Penalties Associated with Michigan Unemployment Benefits Fraud are Non-dischargeable in Chapter 13 Bankruptcy Cases
In a recent opinion, the U.S. Court of Appeals for the Sixth Circuit (the “Court”) ruled that penalties assessed by the state of Michigan against two debtors, stemming from fraud associated with the wrongful receipt of Michigan unemployment benefits, are non-dischargeable in Chapter 13 bankruptcy pursuant to Bankruptcy Code § 523(a)(2).1 Read More ›
Categories: 6th Circuit Court of Appeals, Chapter 13
Bankruptcy Court Grants Relief from Stay to Credit Union to Exercise State Law Rights Related to Setoff Against Funds in which the Debtor's Children Hold an Interest
The United States Bankruptcy Court for the Western District of Michigan recently issued an opinion in a case that involved mutual claims between the debtor and a creditor, and lifted the automatic stay to allow a creditor to exercise “setoff” rights provided by state law to recover its debt.1 Read More ›
Categories: Chapter 13
The Debtor, not the Trustee, is Entitled to Funds Being Held by a Trustee Following Dismissal of a Chapter 13 Bankruptcy Case
Filing for Chapter 13 bankruptcy as a consumer is a voluntary decision. Once a Chapter 13 case has been filed, it is also up to the debtors to dismiss the case if they so choose. Read More ›
Categories: Chapter 13, Did you Know?
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
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
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
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