All posts in Chapter 7

Section 727(a)(5) says you can be denied a discharge if you (debtor) cannot explain how you lost your assets.  One court in Connecticut denied a 70+ year old debtor a discharge when he said he spent $140,000 on “wine, women and song” and carried all that money in rolled up one hundred dollar bills.  The court said that is dubious.  Regardless, I would like to meet this gigolo!

Read another great piece from Colliers and I reconcile with Rule 4003(b).   Corporation files bankruptcy, trustee requests tax returns 7 days prior….do you have to send it?   Well let’s see what the statute says…

Rule 4002 Duties of Debtor

(b)Tax Preparation Green Valley:  Individual Debtor’s Duty To Provide Documentation.

(3) Tax Return. At least 7 days before the first date set for the meeting of creditors under §341, the debtor shall provide to the trustee a copy of the debtor’s federal income tax return for the most recent tax year ending immediately before the commencement of the case….

The statute is pretty clear to me in the title of that section — Individual Debtor’s Only.

UPDATE:  Yes, section 521(e)(2) says “debtor shall turnover tax returns” but 521(e)(1) has the word “individual” and under some statutory interpretation or canon I would argue that since (e)(1) comes before (e)(2) that Congress implied  “individual” in (e)(2)  but I know it’s a far stretch.  Thanks Michael Avanesian, I enjoy our stimulating conversations.

FRBP versus the Code — both are federal statutes with conflicting language– who wins?  (turning to 2L conlaw outline).

My morning ritual involves reading Colliers while enjoying my homegrown coffee beans that I roast myself  (coffee snob?  absolutely!).  I stumbled across this great piece of information from Collier’s re: scope of 341 examination with the trustee.  I particularly enjoyed reading the legislative history of what the trustee can/cannot ask.  Turns out the 341 examination is not a carte blanche, ask anything you want type of meeting.  Nay!

If you represent debtors and attend 341(a) meeting of creditors then you should read the below….

Read more…

I had no idea what a dower and curtsy are.  Where did I find these words?  In Section 363 sale/use/lease of property.   Section 363(g) says the trustee may sell property free and clear of any right in nature of a dower or curtesy.    ::::go to google.com::::

A dower or curtesy is a surviving spouse’s right to receive a set portion of the deceased spouse’s estate (1/2 in California).  Dower (not dowry) refers to the portion to which a surviving wife is entitled, while curtesy refers to what a man may claim.  However, because discrimination on the basis of sex is now illegal in most cases, most states have abolished dower and curtesy and generally provide the same benefits regardless of sex — and this amount is often known simply as the statutory share.

Learn something new everyday.

The last cdcbaa meeting was a blast — Chapter 7 Trustees Amy Goldman, David Goodrich, Jason Rund, Jeff Golden and Wes Avery shared a ton of interesting “insider” information to our membership.

Here are some highlights:

• The trustees routinely review the schedules and statements filed in prior cases
• The trustees routinely check the ownership history for the property where the debtor currently resides
• If your case has issues, do not ask for a continued Meeting of Creditors — big red flag!
• Trustees routinely ask for the underwriting file from a lender to see what was disclosed by the debtor then versus in the schedules and statements
• Do not put “unknown” for a value — better to be low/high than unknown — and $0 does not equal unknown
• If the debtor does not know the value of their pending litigation claim, request the statement of damages filed in the state court
• If you know there are issues in the case, call or email the trustee — the first taste of the case they get should not be from an angry creditor!
• Asset cases are only 2% district wide Read more…