Wells Fargo Bank, N.A. v. Gordon (In re Codrington), 716 F.3d 1344 (11th Cir. 2013) –
A Chapter 7 trustee sought to use his strong arm powers as a hypothetical bona fide purchaser to avoid a security deed. He argued that a minor error in execution meant that the security deed did not provide constructive notice to a purchaser even though it had been accepted for recording. Continue reading
In re Lively, 717 F.3d 406 (5th Cir 2013) –
An individual debtor that ended up in chapter 11 bankruptcy after his debts exceeded the chapter 13 limits proposed a plan of reorganization that allowed him to keep all of his property while paying unsecured creditors only a small dividend. The bankruptcy court denied confirmation of the plan on the basis that it violated the absolute priority rule. It then certified the question of whether the absolute priority rule applies in individual debtor cases for immediate appeal to the 5th Circuit. Continue reading
Pazdzierz v. First Am. Title Ins. Co., 718 F.3d 582 (6th Cir. 2013) –
First American Title Insurance Company (First American) contended that an individual debtor should not receive a discharge for several mortgage loans based on false statements he made in connection with obtaining the loans. Its right to pursue the issue was based on an assignment of 75% of the lenders’ interests in the applicable mortgage notes, which it obtained as part of a settlement involving claims under related title insurance policies. The debtor countered that any fraud claims could not be assigned, so First American could not pursue the exception from discharge. The bankruptcy court agreed and granted summary judgment to the debtor. After the district court reversed, the debtor appealed to the 6th Circuit. Continue reading
Gentile v. DeGiacomo (In re Gentile), 492 B.R. 580 (1st Cir. BAP 2013) –
A chapter 7 trustee sought c0urt approval to sell several investment properties. The debtors objected, arguing that the sales should be suspended until a pending state court appeal was resolved. The bankruptcy court overruled the objection, and the debtors appealed to the bankruptcy appellate panel. The decision on appeal turned on whether the debtors had standing. Continue reading
In re Fowler, 493 B.R. 148 (Bankr. E.D. Cal. 2012) –
A chapter 13 debtor had two secured creditors: a bank that held a deed of trust on the debtor’s residence, and a county that had a lien on the residence for unpaid real property taxes. The debtor’s chapter 13 plan provided for payments to the two secured creditors, with nothing for the general unsecured creditors. The plan called for payment of the real property taxes over time with 4% interest. The plan was challenged on the basis that 18% per annum was the proper interest rate for the taxes based on a state statute setting a rate applicable specifically to tax claims in a bankruptcy. Continue reading
Crumpton v. Stephens (In re Northlake Foods, Inc.), 715 F.3d 1251 (11th Cir. 2013) –
The trustee of a distribution trust (created under a debtor’s confirmed chapter 11 plan of reorganization) sought to recover a dividend paid to a shareholder as a constructive fraudulent transfer. The bankruptcy court dismissed the case, and the district court affirmed. On appeal to the 11th Circuit, the issue was whether the debtor received “reasonably equivalent value” for the shareholder dividend payment obligation. Continue reading
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