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New Cases For the Week of March 25, 2002 -
March 29, 2002
Brought to you by BKINFORMATION.COM
- The Source for Business Bankruptcy Information on the Internet
March
29, 2002
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Case
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Court
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Holding
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In
re Cumberland Farms
(DBN Subscription Required) |
1st Cir. |
The
bankruptcy court did not err when it found that a debtor was
entitled to setoff its $3 million note obligation to an
insider against a breach of fiduciary duty debt owed by the
insider. The insider, who controlled a separate
corporation that owed $5.75 million to the debtor, caused the
separate corporation to use its funds to pay a third party
creditor rather than the debtor thereby breaching the
insider's duty to the debtor. |
Village
of San Jose v. McWilliams
(DBN Subscription Required) |
7th Cir. |
An
individual debtor who tries to recover fraudulently
transferred property after the filing of his voluntary
bankruptcy may nevertheless be denied a discharge on account
of the prepetition fraudulent transfer.
"Transfer," for this purpose, means merely the
initial transfer and not "transferred and stayed
transferred." |
Goulet
v. Educational Credit Management Corp.
(DBN Subscription Required) |
7th Cir. |
The
bankruptcy court erred in finding that a 55-year old debtor
with addiction problems qualified for an undue hardship
discharge of student loan debts. |
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March
28, 2002
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Case
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Court
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Holding
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| In
re Coleman Enterprises, Inc. |
8th Cir.
BAP |
A
small business election by a debtor who does not qualify for
such election is a nullity. However, the nullification does
not vitiate the bankruptcy filing, merely the election.
The case continues as a Chapter 11 case until the bankruptcy
court makes a determination to confirm a plan of
reorganization, to convert the cases to Chapter 7, or to
dismiss. |
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March
27, 2002
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Case
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Court
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Holding
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In
re Leet
(DBN Subscription Required) |
6th Cir.
BAP |
The
bankruptcy court erred in using its equitable power to extend
by two days the 60-day dischargeability deadline in section
523(c). Analogizing to the strict construction applied
by the Supreme Court in the the exemption deadline case of
Taylor v. Freeland & Kronz, the BAP holds that the
creditor's failure to seek an extension before expiration of
the original deadline is fatal. |
In
re Jamo
(DBN Subscription Required) |
1st Cir. |
In
a Chapter 7 case, a lender who is owed both secured and
unsecured debts may insist upon reaffirmation of the latter as
a condition to reaffirmation of the former without violating
the stay. |
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March
26, 2002
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Case
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Court
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Holding
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| Cook
v. U.S. |
Crt.
Fed. Claims |
The
Court did not err in imposing a responsible person penalty
against the majority shareholder/officer of a corporate
Chapter 11 debtor which willfully failed to pay, or report the
accrual of, trust fund taxes during the pendency of its
bankruptcy. The responsible person could not avoid
liability based upon a claim that the bankruptcy court
effectively mandated that available funds be used for
environmental remediation. |
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March
25, 2002
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Case
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Court
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Holding
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In
re Crawford
(DBN Subscription Required) |
8th Cir.
BAP |
A
creditor's failure to perfect a security interest against an
annuity was fatal only to the 25% of the annuity that was
property of the estate, and not as to the 75% of the annuity
that was exempt. |
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