East Texas Cases

 

To the Bar:

I have decided to send out an e-mail to the attorneys that I deal with on a regular basis concerning interesting cases/rulings/comments from the Court after each confirmation/modification/dismissal docket.  I will then be posting these e-mails here on my website under this tab entitled “East Texas Cases”

My ultimate goal is to let you know about these cases/rulings/comments so that you can make a determination on how such may affect your cases and your practice.  Of course, these e-mails represent my recollection of the events in Court and do not constitute any representation that the Court will make similar rulings/comments in future cases.

 

Chapter 13 Trustee

Confirmation Denied Upon Failure to Provide Certification of Post-Petition Mortgage Payments

Final denial Order entered where debtors failed to pay dividend to unsecured creditors per Means Test, best interest of creditors, and budget

Final Denial Order entered with untimely budget disclosing new job acquired 4 months earlier

Private school for below median income debtors allowed under this fact pattern

Post Petition Gambling by Debtors

 TRCC does not serve as a modification of the terms of the debtor’s confirmed plan

 Trustee will not waive the prejudice period of MTD in pre-confirmed case except in limited circumstances as previously approved by Court

 Form B22C must be accurately completed

Debtor not allowed to amend plan to add post-petition mortgage arrears to the plan

 Case dismissed by Court without prejudice after errors were made by Debtor’s counsel

 Pro Se Debtors given additional time to file new Plan after Debtors were able to bring plan payments current under previously stricken plan

Comments by Judge Parker re Mortgage Certifications

 Attorney sanctioned for filing second case within the 120 day prejudice period after dismissal of first case

 Motion to Modify reducing plan term withdrawn after Court declined to confirm

Petition Preparer in a Chapter 7 Case sanctioned by Court and enjoined from ever acting in such capacity in future cases 

Attorney waived attorney’s fees due to his poor handling of the case

 Mobile home determined to be personal property subject to cram down, thereby rejecting creditor’s argument that such became part of real property; Till interest rate applied

Two cases relating to creditor agreements at confirmation

Trustee: Memo relating to 5th Circuit Opinion in Reaulieu relating to inclusion of Social Security benefits on budget

Plan must meet the Best Interests of Creditors Test in order to be confirmed

Denial of Debtor’s Motion to Vacate Dismissal Order after dismissal of Case Pursuant to CDO

Trustee’s Interpretation of new Mortgage Certification Form, and possibly

putting on-going mortgage payments through Plan

Objection to Claim is proper mechanism to convert an unsecured claim to a secured claim

“Court Announcement: Motions to Modify should not be filed the morning of Court in order to obtain a continuance of Motion to Dismiss”

Ex-wife dismissed from jointly filed case when she failed to turn over tax return in order to allow Husband to complete case

Final Denial Order entered when Debtor failed to file an accurate amended budget to support feasibility of the Plan

Plan proposed in bad faith that provided for the cram down of corporate debt assumed by Debtor

Attorney cannot change election of “no-look” fee to greater fee supported by Fee Application after confirmation

 Proposed Plan must at least have a likelihood of feasibility and success at confirmation in order to be confirmed

 Court: No interest allowed on mortgage arrears paid through plan unless underlying loan documents so provide

Court denied Debtor’s Motion to Modify seeking a partial refund of lawsuit settlement previously paid over to and disbursed by Trustee due to a later resulting tax liability to the Debtors arising from this lawsuit settlement

Court: More care needs to be taken in the preparation of proposed Orders submitted with motions and objections under negative notice language

Continuance Reluctantly Given to Allow Attorney to Fix Error in Plan up for Final Denial

Modification to bring plan payments current denied where there was a pending motion to lift stay due to debtor’s failure to make post-petition mortgage payments

New Attorney filing a motion to modify to fix feasibility issues during no-look fee period of time allowed to charge a fee for the motion to modify

Motion to Allow Late Filed Claim by debtor and Creditor after the approval of TRCC was denied by the Court by res judicata and laches

Third vehicle for Debtor’s 18 year old daughter to attend college not necessary for reorganization of Debtor

New Attorney taking over a case was entitled to a larger fee than normal for preparing a motion to modify in the case

Objection to Claim to set cram down value of collateral denied in part to the extent that Debtor sought to value the collateral in an amount more than its true value

Fee Application for additional services rendered during the “no-look” period of time denied by the Court.

Motion to Allow Late filed Plan granted but not until after the Court Reduced the Debtor’s attorney’s fees by $500

Eastern District Chapter 7 Debtor sentenced to prison time after her conviction of making false declarations on schedules

Automatic stay Cannot be used in lieu of a Supersedeas Bond to Stop the efforts to collect a Judgment where the Judgment is under Appeal

Condition Requiring Debtor to Stay Current on Plan Payments to Trustee as contained in Order Extending Automatic Stay as Against all Creditors is absolute with no grace period

Death of a Debtor where Surviving Co-Debtor or Family desire to Proceed with Bankruptcy

Court denied confirmation of New Form Plan that failed to provide AP payments to over-secured car creditor and failed to give any “Justification” for the Debtors’ direct payment to a second car creditor

Court denied the Debtors’ Motion to Modify wherein they were seeking to retain all of their tax refund (instead of turning it over to Trustee) where they had previously spent such (case dismissed per Trustee’s Motion to Dismiss)

Treatment of Property Tax Claims under the new form Plan

Confirmation of Plan Denied based upon Debtors substantially increased retirement contributions on eve of filing bankruptcy

Appropriateness of No-Look attorney’s fee where Plan only provides for payment of attorney’s fees and unsecured creditors

Court dismissed case with prejudice upon learning the Direct Payment Certification filed was false

Fundamental Fairness required Dismissal Order to be vacated where Debtors lacked actual knowledge of requirement to make timely plan payments per Order Extending the Stay