Can you get back fees and costs against someone who sues you in bankruptcy and loses?
202107.05
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Can you get back fees and costs against someone who sues you in bankruptcy and loses?

In rare cases a creditor may file suit against a debtor in bankruptcy asserting either that the debtor not be entitled to eliminate the debts in bankruptcy (a denial of discharge), or that the debt owed to the particular creditor not be eliminated (objection to dischargeability).  Either proceeding will likely significantly increase the cost of…

What happens if a creditor continues to report a debt after bankruptcy?
202106.25
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What happens if a creditor continues to report a debt after bankruptcy?

Occasionally a credit report may inaccurately continue to show liability on a debt that was discharged in bankruptcy. The Fair Credit Reporting Act is one possible remedy for this problem. While credit reporting agencies are initially required to ensure that information on the reports is accurate; they are under a more specific duty to investigate…

202106.18
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Creditor who was not represented by counsel ordered to pay over $41,000 for violating bankruptcy law in filing criminal embezzlement charges in attempt to collect debt

Creditor who was not represented by counsel ordered to pay over $41,000 for violating bankruptcy law in filing criminal embezzlement charges in attempt to collect debt: While criminal proceedings are not stayed by the bankruptcy laws, when a creditor files criminal charges simply in an attempt to collect a debt, they may face the wrath…

202106.18
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Massachusetts Federal appellate court determines that funds debtor held from an uncashed 401k loan check is property bankruptcy trustee can take and use to pay creditors

Massachusetts Federal appellate court determines that funds debtor held from an uncashed 401k loan check is property bankruptcy trustee can take and use to pay creditors: In reversing a bankruptcy court decision, the federal appellate court in Boston found that a $18,000 uncashed check for a loan from the Debtor’s 401k was property the trustee…

202106.18
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Chapter 13 can change interest rate and reduce debt on home to value of home when final payment on mortgage is due before final payment under plan

Chapter 13 can change interest rate and reduce debt on home to value of home when final payment on mortgage is due before final payment under plan: While the general rule in chapter 13 is that the debtor cannot modify the mortgage on a debt secured by the debtor’s principal residence (the debtor can cure…

202105.06
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Virginia District Court finds private right to action under §525(b) employment discrimination case

It is fairly rare to see a case brought alleging employment discrimination due to the filing of a bankruptcy.  This allegation gave rise to a complaint under 11 U.S.C. §525(b) in Johnson v. Speedway, LLC, 2021 U.S. Dist. LEXIS 80891, Case no 7:21cv00100 (W.D. Va. 28 April 2021). 

202104.30
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11th Circuit reverses summary judgment for credit reporting agency under FCRA finding mere verification with provider insufficient where consumer advised that reaffirmation had been rescinded

 The 11th Circuit just recently entered a decision on the liability of credit reporting agencies for continuing to report an obligation owed on a debt discharged in bankruptcy.  In Losch v. Nationwide Mortg. LLC, 2021 U.S. App. LEXIS 12578, Case no. 20-10695 (28 April 2021) the debtor, Losch, initially reaffirmed the mortgage, but rescinded such reaffirmation (with court approval) after the trustee sold the home.  Upon discovering that Esperian was continuing to report a $140,000 balance and that he was delinquent on the mortgage in the amount of $10,000, he contacted the agency to have them correct the issue, but the agency’s inquiry with its data furnisher – Nationstar, inaccurately confirmed the prior report.  

202104.14
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Florida court determines Ohio law precludes successful defendant/debtor from an award of prevailing party fees on §727 complaint, but awards costs under Federal law

 In Feldy Boys, LLC v. Polasky (In re Polasky), 221 Bankr. LEXIS 927, Adv No. 2:18-ap-594-FMD (7 April 2021) Judge Delano denied the Debtor-Defendant’s request for attorneys fees, but allowed costs of $4,261.03 against the plaintiff.  The adversary proceeding involved a personal guaranty of a lease, and  included counts under §727(c)(d) and (e) as well as §523(a)(5).  Upon prevailing in the adversary itself, the Debtor sought taxation of fees in the amount of $95,970 under §57.105(7) of the Florida Statutes, as the guaranty provided for reimbursement to plaintiff of fees and expenses.

202005.13
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Prepetition Credit Counseling continues to trip up debtors

Prepetition Credit Counseling continues to trip up debtors: Prior to filing bankruptcy, debtors are required to take a credit counselling course.  A survey of cases in which waiver of the credit counseling requirement was sought was listed in In re Grantham, 2020 Bankr. LEXIS 1228, Case No. 6:20-bk-11740-WJ (Bankr. C.D. Cal., 7 May 2020). In this…