Source: https://www.calt.iastate.edu/annotation/all?tid=7&combine=&page=3
Timestamp: 2019-04-25 22:04:21+00:00

Document:
(in case of first impression under Idaho law, court held that a Chapter 7 debtor must make election concerning how to receive annuity payments by before petition filed for annuity benefits to be exempt (up to a maximum amount); court determined that not making such election before petition date would frustrate legislative intent of capping amount of exempt monthly benefits).
(inherited IRA is exempt asset in bankruptcy; court reasons that inherited IRA holds "retirement funds" in accordance with meaning of 11 U.S.C. Sec. 522(d)(12), and that inherited IRA is tax exempt by virtue of I.R.C. Sec. 408(e); funds set aside for retirement and that character of funds determined by purpose for which they were set apart, not by what subsequently happens).
(debtor transferred real estate to sham trust in attempt to defeat creditors; transfer not deemed void as to judgment creditor under state (CO) law; judgment creditor not yet begun prosecuting case against debtor to judgment as required to establish status as judgment creditor; for judgment creditor to attach lien to real estate transferred to trust, creditor had to file action to establish fraudulent conveyance).
(consolidated opinion regarding four identical objections by trustee to debtors claimed exemptions for firearms; debtors listed one or more firearms as exempted “household goods” under California’s statutory exemptions; evidence presented that firearms used for personal protection and hunting and recreation; trustee requested court to find firearms per se are not exempt household goods; in its holding, court distinguished earlier cases, In re Thornton and In re Eveland, and held firearms can be exempt under broad California statute when evidence shows personal use and purpose of firearms, potential recreational value, reasonable necessity, and community standards establishing firearms “ordinarily found in household”; trustee in these cases failed to rebut debtors’ presumptions regarding firearms, so all debtors entitled to exemption).
(Chapter 12 case where creditor seeks relief from automatic stay and abandonment; relief granted because court determined that debtor did not file bankruptcy in good faith and legitimate questions existed as to whether reorganization plan feasible).
(plaintiff constructed earthen levee on property without permit; county issued cease and desist order and required levee to be removed; plaintiff argued “common enemy” doctrine enables him to build levee to protect his property from further flooding and exempts him from local regulations; court holds common enemy doctrine serves only as defense to liability for damaging adjacent properties; doctrine does not exempt landowner from local regulations).
(Chapter 12 case; debtors (married couple) farmed hay and raised horses since 1999; debtors purchased land securing bank’s claim in 2007 and decided to build home on tract in 2008; home construction loan executed in 2008 and bank approved debtors for 30-year adjustable rate permanent loan; home completed in 2009 and parties engaged in dispute over bank’s commitment to permanent financing ultimately resulting in foreclosure of construction mortgage and pending sale of home which precipitated debtors’ Chapter 12 filing; debtors’ office and farm headquarters located in newly constructed home; issue was whether debtors qualified for Chapter 12; if bank’s principal and interest claim included in debtors’ farm debts, 50 percent test satisfied; court determined that construction portion of bank loan included in debtor’s “farm” debt because house was integral part of farm operation due to farm’s books and records maintained in office in home and home’s proximity to farming operation which allowed debtors to care for livestock and maintain irrigation system; debtors’ treatment of bank’s claim also satisfies 11 U.S.C. §1225(a)(5) – U.S. Supreme Court decision in Till v. SCS Credit Corp., 541 U.S. 465 (2004), overrules In re Hardzog, 901 F.2d 858 (10th Cir. 1990) and formula approach to determining cramdown interest rate applicable to Chapter 12 reorganization plan to be utilized rather than market rate for similar loan approach of Hardzog; interest rate is prime rate plus 2 percent; amended Chapter 12 plan feasible and confirmable).
(plaintiff, creditor, sought determination that state court judgment against Chapter 12 debtors for fraud in sale of longhorn cattle be excepted from discharge; plaintiff filed summary judgment for issue preclusion determination that state court opinion of findings and conclusions of fraud satisfied 11 U.S.C. § 523(a)(2)(A) - exception from discharge for fraud because state factors were virtually identical; bankruptcy judge granted plaintiff’s summary judgment motion as to fraud portion of judgment as exempt from discharge, but state court judgment awarding attorney fees reversed).
(case involved issue of what the appropriate test is for determining whether a river is navigable such that the state owns the riverbed; case involves wholesale generator of electricity that challenged trial court determination that defendant owned the riverbed and was, therefore, entitled to damages for generator's use of riverbeds from 2000-2007 at hydroelectric power stations; state Supreme Court affirmed on basis that rivers were navigable at time of statehood in 1889 and by providing a channel for commerce at that time; U.S. Supreme Court reversed (unanimously) on basis that Equal Footing Doctrine specified that states did not hold title to riverbeds on portions of rivers that were non-navigable at time of statehood; Court determined that Missouri River non-navigable over 17-mile Great Falls reach - from head of first waterfall to foot of last; present-day recreational use of Madison River had no bearing on navigability issue; in addition, state's lack of assertion to title over riverbed over long period of time provided additional evidence that river segments at issue non-navigable).
(Chapter 13 case; post-petition income that becomes available to debtor after debtor's I.R.C. Sec. 401(k) loans are repaid in full constitutes "projected disposable income" that must be turned over to trustee and committed to reorganization plan; such amounts cannot be used to fund voluntary I.R.C. Sec. 401(k) plans).
(Chapter 7 debtor (real estate agent) moved to hold former employer in contempt for violating automatic stay provision by withholding sales commissions earned pre-petition but due post-petition; debt incurred as result of agency pre-paying bills for which debtor was responsible; agency applied commissions owed to debt; bankruptcy court held commission earned pre-petition was part of bankruptcy estate and failing to disclose interest in schedules meant debtor was judicially estopped from claiming interest at later date and debtor lacked standing because entitlement to commissions became property of estate; debtor appealed these two issues; appellate court affirmed on both issues; court held commission was property of estate because right to commission vested post-petition, payment was made for services rendered pre-petition, so interest in commission required to be disclosed; court also agreed agency was entitled to commission pursuant to doctrine of recoupment, which permits the offset of debts when obligations are based on same transaction or occurrence; court found historical practice of applying commissions to outstanding expenses prepaid to enable commissions to be earned, so doctrine applied).
(debtors moved to Massachusetts from Arizona less than 730 days prior to filing bankruptcy so met requirements for domicile in Arizona under code; trustee argued exemptions claimed by debtors must be based on Arizona law, which is an “opt-out” state, meaning Arizona debtors can only use state exemptions; debtors argued this applied only to current residents; court held Arizona’s opt-out requirements applies only to residents, state’s statute does not have extraterritorial powers, and federal preemption does not apply to opt-out statutes; debtors can rely on federal exemptions).
(Chapter 11 case involving petition of group of commodities customers seeking application of Subchapter IV of Chapter 7 and Part 190 of CFTC regulations that would give priority to commodities customers of debtor-parent’s subsidiary, a futures commission merchant; conversion to Chapter 7 a necessary requirement and debtors must have acted as a “commodity broker”; statute inapplicable to Chapter 11 debtors even under court’s equitable powers; debtor did not meet definition of commodity broker).
(bankruptcy case; debtors granted permission under 11 U.S.C. Sec. 365(a) to reject contracts for growers supplying chickens to an unprofitable plant under Chapter 11 bankruptcy; growers brought claim for damages from the rejected contracts; summary judgment granted in favor of growers allowing claims for damages caused by debtor’s breach of contract; damages to be ascertained).
(plaintiff claimed that, under 11 U.S.C. § 523(a)(2)(A), debtor’s obligation should not be discharged because loans were obtained under false pretenses; requirement for proof of claim is that debtor made a representation, but representations regarding the financial condition of the debtor are expressly excluded under the statute; plaintiff unable to prove representations that debtor’s business was profitable meet the remaining requirements; court held that, without more, a broken promise to repay does not satisfy the statutory requirements).
(Ener1, Inc. filed Chapter 11 bankruptcy in eastern district of New York listing assets of $73.9 million and debts of $90.5 million; company had received $118 million in taxpayer dollars from U.S. Energy Department to make electric-car batteries).
(bankruptcy trustee objected to Chapter 13 debtors’ exemption of debtor wife’s settlement proceeds received for pre-petition loss of consortium claim arising out of automobile accident involving debtor husband; court holds that generally an 11 U.S.C § 522(d)(11)(D) exemption is applicable to a loss of consortium claim; in this case, there was no evidence that the settlement proceeds were paid in settlement of the wife’s claim, so the interest in her claim remains unliquidated and a decision regarding the exemption would be premature).
(Chapter 12 case involves appeal from bankruptcy court order which granted trustee's motion to disburse unsecured funds denying any funds to appellant bank who did not file proof of claim; court did not view bank's pleadings to be informal proofs of claim allowing creditor to file formal proof of claim that would relate back to date informal proof filed; court held that pleadings did not meet all requirements as specified by Tenth Circuit to qualify as informal proof of claim; bankruptcy court order affirmed).
(purchasing party of Agriprocessors’ real property during bankruptcy proceedings received court order approving sale free and clear of all liens; county held tax lien on property but was not listed as creditor and did not receive notice of bankruptcy; county brought proceedings against purchaser to set aside the order approving the sale; ruling on summary judgment, court held county did not have actual notice of bankruptcy proceedings to defeat lack of procedural due process required to protect rights; purchaser not bona fide purchaser because had knowledge of tax lien; remedy must be determined at trial because questions of fact remained regarding purchaser’s expectations at sale and whether bankruptcy trustee agreed to pay tax liens).
(trustee objected to exemption claimed by debtors for savings account self-described as a trust for their son; account opened and transfers to account made within four years of bankruptcy petition; account listed on Schedule C to the bankruptcy petition and classified as exempt; in year before bankruptcy filing, $14,540 deposit made from other bank account and withdrawals from the savings account were made by debtors; count found account was “Totten” account; no transfer for trustee to avoid, account properly scheduled and exempted account).
(defendant pumps water from plaintiff's irrigation canal to irrigate defendant's farmland; irrigation occurred on hillside which caused erosion and landslides that damaged canal and neighboring property; defendant settled with adjoining property owner; trial court entered order barring defendant from using canal water in a manner that would not result in any groundwater recharge and that all surface irrigation be diverted from slide mass and no excess irrigation be applied to crops being cultivated on defendant's farmland; trial court determination upheld and matter did not constitute condemnation proceeding).
(inherited IRA exempt from debtor’s bankruptcy estate under 11 U.S.C. Sec. 522(b)(3)(C) because they are “retirement funds” that are tax-exempt under I.R.C. §408; decedent died about a year after establishing account which named daughter as beneficiary; daughter had own IRA and had balance of decedent’s IRA rolled into hers and then took monthly distributions from it before retiring; over nine years later daughter and husband filed Chapter 7; bankruptcy court ruled IRA not exempt; on review, court determined that IRA account funds need not be “retirement” funds of the debtor to qualify for exemption; court followed majority view that direct transfers of retirement funds from tax-exempt account qualify for exemption, and immaterial that there are differences between traditional IRAs and inherited IRAs due to I.R.C. §408(e)(1); question of whether inherited IRA should be exempt up to the Congress to change the statute).
(student loan debt not dischargeable because debtor failed to satisfy undue hardship test; unemployment not likely to continue for various reasons; medical condition did not impair ability to work; debtor did not have total incapacity to pay debts in the future).
(involuntary Chapter 7 petition filed against debtor and debtor claimed that petition failed to contain at least three entities holding separate claims as required by 11 U.S.C. Sec. 303(b)(1); petitioning creditors were married couple and couple's daughter - debtor's ex-wife; liability arose out of $12,000 loan from ex-wife's parents to debtor and ex-wife evidenced by promissory note payable to "husband and wife"; creditors held single claim; only two petitioning creditors existed and involuntary petition fails).
(court upholds bankruptcy court's denial of debtor's discharge due to debtor's making of false statements on financial disclosure and omitting existence of livestock business, gross income from livestock business, other income, transfers of certain assets and co-ownership of vehicle with wife; debtor claimed that he misread questions on Statement of Financial Affairs document and was not trying to mislead and claimed that he didn't list his farming business because it was "like hobby farming" for him; as to asset transfers, debtor claimed that assets were not collateral but didn't provide copy of security agreement and did not rebut finding that bank had security interest; do not be dischargeable under 11 U.S.C. Sec. 727(a)(4)(A), false statement must be both material and made with intent; requirements satisfied; discharge denied).
(Chapter 13 debtor appealed from denial of plan confirmation for debtor’s failure to include social security benefits in projected disposable income; on appeal, district court held that social security benefits are expressly excluded from the calculation of disposable income; failure to include entire amount of social security benefits from debtor and non-filing spouse does not constitute bad faith; bankruptcy court Order of Dismissal reversed).
(debtor filed Chapter 12 petition; case converted to Chapter 11 and then Chapter 7; debtor asserts wrongful termination of Sow Contract Grower Agreement, and breach and anticipatory repudiation of Nursery Contract Grower Agreement as well as breach and anticipatory repudiation of unwritten lease of pig finishing floor space at debtor’s farming operation; defendants moved to compel arbitration which court dismissed; court initially held that debtor’s claims for post-petition breach of pre-petition Nursery Agreement and Finishing Agreement were “core” proceedings under 28 U.S.C. Sec. 157(b)(2) and, as a result, arbitration clause in Nursery agreement was unenforceable; court also determined that enforcing arbitration provision in Sow Agreement was inappropriate because it would be counter to Chapter 11’s goal of rehabilitating debtor; in this opinion, court holds that debtor’s claims are non-core, but are related to underlying bankruptcy case and that court can hear claims and submit proposed findings of fact and conclusions of law to district court on unwritten finishing agreement; Nursery Agreement and Sow Agreement contain arbitration provisions and must be submitted to arbitration; further proceedings stayed pending conclusion of arbitration).
(Chapter 12 case involving issue of distribution of proceeds of equipment sale on which bank, as senior creditor, had lien and supplier had junior lien; bank held debtor's land as security for loan and was oversecured; reorganization plan proposed retention of real estate that secured senior creditor's debt; bank motioned to receive all proceeds of equipment sale, and supplier proposed marshaling with proceeds from equipment sale going to junior creditor; court rejected junior creditor's proposal because senior creditor had right to cash out it's position first and not have to rely on real estate for payment under long term-loan as proposed in reorganization plan; supplier's alternative proposal to take second lien on real estate rejected).
(Beacon Power, located in Massachusetts and recipient of federal government loan guarantees in excess of $43 million has filed for bankruptcy; company had proposed to build storage devices for intermittent power produced by wind and solar power facilities, but failed to attract investors).

References: §1225
 v. 
 § 523
 § 523
 § 522
 §408
 §408