Source: https://www.shbllp.com/blog/bankruptcy-appellate-panel/
Timestamp: 2019-04-26 12:01:17+00:00

Document:
By Melissa Davis Lowe of Shulman Hodges & Bastian LLP posted in Bankruptcy Appellate Panel on Thursday, February 28, 2019.
In In re Hamilton, BAP Nos. SC-17-1126 and SC-17-1123, the Ninth Circuit Bankruptcy Appellate Panel ("BAP") considered the intent requirement for non-dischargeability of a debt under Section 523(a)(6). The debtor argued that the Supreme Court case of Kawaauhau v. Geiger, 523 U.S. 57 (1998) required actual intent or specific intent to cause injury to meet the "willful" injury requirement of Section 523(a)(6). The BAP clarified that while Geiger held that an intent to cause harm was required, it did not elaborate as to "the precise state of mind required," as stated by the Ninth Circuit in Petralia v. Jerchich (In re Jercich), 238 F.3d 1202 (9th Cir. 2001). The BAP commented that the holding in Jercich that the debtor must intentionally commit the act with a substantial certainty that injury will occur is controlling and not at odds with Geiger. As such, the BAP confirmed that a specific intent to cause injury is not required to meet the "willful" standard under Section 523(a)(6) but rather, only a substantial certainty that injury will occur as found in Jercich.
By Melissa Davis Lowe of Shulman Hodges & Bastian LLP posted in Bankruptcy Appellate Panel on Friday, August 18, 2017.
In re Anderson, BAP No. ID-16-13156-JuFB, filed on August 11, 2017, the Ninth Circuit Bankruptcy Appellate Panel upheld the Bankruptcy Court's finding that the debtors' contingent real estate commissions were estate property. The debtors were real estate agents. When they filed their bankruptcy petition, they had 13 transactions which were under contract and in escrow but had not yet closed. Under Idaho state law, the debtors were not entitled to payment of their commissions until the transaction closed. The closings did not occur until after the filing of the bankruptcy. The Bankruptcy Court found, and the BAP agreed, that because the interest in the commissions was sufficiently rooted in the pre-bankruptcy past and especially because the debtors were unable to show that any of the acts necessary to earn the commissions were performed post-petition, the commissions were property of the bankruptcy estate.
On behalf of Shulman Hodges & Bastian LLP posted in Bankruptcy Appellate Panel on Tuesday, August 8, 2017.
In In re Mainline Equipment, Inc., Case No. 15-60069, the Ninth Circuit Court of Appeals held that the County of Los Angeles ("County") could not enforce its tax liens on personal property against a bona fide purchaser when the County had failed to perfect its liens. The Chapter 11 debtor could set aside the County's liens under Bankruptcy Code Section 545 because the liens were only statutory and were unenforceable against a bona fide purchaser based on the enforceability of the liens pursuant to Cal. Rev. and Tax Code section 2191.4. Specifically, the County had recorded tax delinquency certificates with the County Recorder but failed to file its liens with the Secretary of State of California. While this granted the County a lien upon all of the debtor's real and personal property in the county in which it was recorded, such liens were not enforceable against a bona fide purchaser of personal property and thus, could be avoided by the debtor. The result would likely be different if real property were concerned because judgment liens recorded with the County Recorder are perfected as to real property.
By Melissa Davis Lowe of Shulman Hodges & Bastian LLP posted in Bankruptcy Appellate Panel on Thursday, June 15, 2017.
In Weil v. Elliott, decided June 14, 2017, the Ninth Circuit Court of Appeals decided the statute of limitations for the filing of an action to revoke a debtor's discharge is not jurisdictional and can be waived if not timely raised as an affirmative defense.
By Melissa Davis Lowe of Shulman Hodges & Bastian LLP posted in Bankruptcy Appellate Panel on Thursday, May 19, 2016.
In Husky International Electronics, Inc. v. Ritz published on May 16, 2016, the Supreme Court of the United States ("SCOTUS") found a debt not dischargeable because of the debtor's intercompany transfer scheme to avoid paying the debt. The debt was owed by Chrysalis Manufacturing Corp. but its director Daniel Lee Ritz, Jr. ("Ritz") drained any assets available to pay that debt by transferring money to other entities owned by Ritz. Ritz then filed for bankruptcy when Husky came after him to recover the debt. Reversing the lower courts, the SCOTUS found the debt non-dischargeable. Even though Ritz made no direct false representation to Husky, the SCOTUS found his intercompany transfer scheme constituted actual fraud such that the debt was non-dischargeable, holding that Section 523(a)(2)(A) "encompasses fraudulent conveyance schemes, even when those schemes do not involve a false representation."
On behalf of Shulman Hodges & Bastian LLP posted in Bankruptcy Appellate Panel on Thursday, August 27, 2015.
On March 4, 2014, the Supreme Court of the United States struck down the Ninth Circuit's imposition of an equitable surcharge on the basis of bad faith against a debtor's exempt property in Law v. Siegel, 134 S.Ct. 1188 (2014). The Supreme Court held that the general equitable powers of Bankruptcy Code Section 105(a) did not provide authority for judge-made exemptions to explicit mandates of the Bankruptcy Code. The Supreme Court emphasized that "federal law provides no authority for bankruptcy courts to deny an exemption on a ground not specified in the Code," and that any basis for denial of a state law exemption must arise under state law. Id. at 1197-98. As a result of Law v. Siegel, a growing number of cases have held that bankruptcy courts lack the authority to disallow a debtor's claimed homestead exemption based on Section 105(a), whether indirectly by denying leave to amend, or directly by disallowing the exemption; therefore, effectively rendering an objection to claimed exemptions on the basis of bad faith a nullity.
On behalf of Shulman Hodges & Bastian LLP posted in Bankruptcy Appellate Panel on Tuesday, June 23, 2015.
On June 15, 2015, contrary to the standing authority in the Ninth Circuit and a majority of lower courts, the United States Supreme Court in Baker Botts L.L.P. v. ASARCO LLC, 2015 U.S. LEXIS 3920 (June 15, 2015) ruled in a 6-3 decision that 11 U.S.C. §330(a) does not authorize compensation for attorney fees incurred in defending fee applications.
On behalf of Shulman Hodges & Bastian LLP posted in Bankruptcy Appellate Panel on Monday, December 15, 2014.

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