An element of Ch. 11 is that through the Plan the sorting of creditor claims into a particular class, with other substantially similar claims is allowed. A legitimate business purpose must be shown to warrant creation of a separate class of claims though. If the Plan changes a claim holder’s legal or contract rights this…
Archives for December 2011
IRS Penalties Still Apply When Business Is In Chapter 11
A Bankruptcy Appellate Panel of the 6th Circuit affirmed a Bankruptcy Court Order made regarding Southeast Waffles LLC. This Debtor had sought to avoid and recover penalty payments made to the IRS. After the Ch. 11 Plan was confirmed, an appointed Liquidating Agent sold assets accordingly, as Debtor S.E. Waffles operated business as a debtor-in-possession. …
Business debtor can’t hire lawyer once Ch. 11 Trustee appointed
Moohaven Dairy LLC filed bankruptcy in the Eastern District of MI, Northern Division, requesting legal representation from Attorney Dale Cubitt. The primary secured creditor Bank of America was granted relief from automatic stay, which permitted them to get an Order against non-debtors in the County Circuit Court. Under 11 U.S.C. Sec. 327 the Bankruptcy Court…
6th Circuit forces entireties property sale to satisfy tax debt of singular spouse
On an Appeal made by Defendant Deborah Barczyk, the 6th Circuit Opinion is that the District Court for the Eastern District (MI) has authority, to order a foreclosure and sale of entireties property having attached Federal tax liens. The delinquent tax debt in the instant matter belonged solely to Defendant Barczyk’s spouse. Noting it was…
Appeals Court says SSI isn’t disposable income in Chapter 13.
Baud is an opinion from the 6th Circuit Court of Appeals. DMI is a projected figure, and in this case, when debtors were above median income filers, whether or not it was available primarily depended upon if SSI benefits may be included in the determining calculation. Through analyzing relevant statutes 6th Circuit concluded in Baud any…
Court cites Baud as a precedent in Tobias decision. Agrees SSI is not disposable income.
Tobias was a Court decision made in the Eastern District of MI, Southern Division. In making the Tobias opinion, the Court specifically requested briefs from parties on Baud and the impact of it on the present case’s Confirmation. Leading up to this decision the 13 Trustee hadn’t filed any formal objection, but refused to approve…