Court denied US Trustee's motion for partial summary judgment in action seeking denial of debtor's discharge. The court had previously ruled that creditors would be best served by converting debtor's chapter 11 case to chapter 7 due, in part, to debtor's lack of financial records. The prior ruling had focused on the effect of the proceeding on creditors; there was no "law of the case" regarding the elements of section 727.
IRS moved for relief from the automatic stay to allow setoff of the chapter 13 debtor's postpetition claim to tax overpayment against prepetition priority tax liability of the debtor due to the IRS. The court granted the motion, finding the nonbankruptcy right to setoff continued postconfirmation and the debtor only had right to a refund after the government had credited the tax overpayment against the tax liability under 26 U.S.C. sec. 6402(a).
A creditor filed a motion to dismiss the chapter 13 case filed by same-sex spouses, arguing the debtors were not "spouses" for purposes of sec. 302 because Wisconsin did not allow or recognize same-sex marriages. The Court denied the motion to dismiss and found that same-sex spouses married in a state that allows them to do so (Iowa), may file a joint bankruptcy case in a state that does not recognize their union as a marriage (Wisconsin) under the "place of celebration" rule, which requires the recognition of an out-of-state same-sex marriage as valid when interpreting the Bankruptcy Code.
Court found judicial lien on chapter 13 debtors' homestead was avoidable to extent trust monies were not traceable to homestead. Wisconsin law regarding exception to homestead exemption statute was discussed. Additionally, Court noted that exemption by default under section 522(l) did not appy in the context of lien avoidance. Note: This is a Court Minutes Decision, only.
After above-median income debtor's income decreased below the applicable median income following confirmation, he sought to reduce the plan duration to a period less than 60 months without also providing for full repayment to unsecured creditors. The trustee opposed confirmation of the modified plan. The court overruled the objection in part and sustained the objection in part. A postconfirmation modification could reduce the applicable commitment period, provided the change in circumstances inhibited the debtor's ability to fund the plan through the end of the original term, a determination which required further evidence.
Defendants' motions to dismiss or, in the alternative, motion for summary judgment, were denied. The debtor's complaint seeking damages for alleged violations of the automatic stay stated a claim upon which relief could be granted. Additionally, the bankruptcy court had personal jurisdiction over the individual debtor and facts in dispute precluded summary judgment.
Chapter 13 trustee objected to confirmation of modified plan on grounds it did not provide for payment of all projected disposable income. The Court overruled the objection, finding the cash surrender value increase of the debtors' whole life insurance policy over the life of the plan was not disposable income to be paid as an additional dividend to unsecured creditors.
Plaintiff home restoration contractor filed motion for summary judgment on grounds that prior state court judgment against chapter 13 debtors for failure to pay insurance proceeds after repairs were made to their residence should be given preclusive effect. The motion was granted because the previous trial and appellate court findings were sufficient to find the obligation nondischargeable under section 523(a)(4).
Plaintiff subcontractor's motion for summary judgment on grounds that chapter 13 debtor prime contractor breached his duties under Wisconsin's theft by contractor statute and the resulting debt was nondischargeable under section 523(a)(4) was denied. Standards established by Supreme Court required the court to make a finding regarding the debtor's state of mind while acting in a fiduciary capacity, a determination ill-suited for summary judgment.
Plaintiff subcontractors filed motions for summary judgment on the grounds that the chapter 7 debtor general contractor breached his fiduciary duties under Wisconsin's theft by contractor statute and the resulting debt was nondischargeable under section 523(a)(4). Plaintiffs also argued a previous state court default judgment should be given preclusive effect. The motions were denied because the matter had not been actually litigated in state court and the bankruptcy court was required to assess the debtor's state of mind while acting in a fiduciary capacity.