In a case of first impression on the issue of “whether a lease assumption can survive discharge even though it is not reaffirmed[,]” the U.S. Court of Appeals for the Ninth Circuit recently held that a creditor’s post-discharge attempt to collect the balance owed under an automobile lease assumed by the debtor post-petition but prior to discharge in a Chapter 7 case did not violate the discharge injunction.
The U.S. Court of Appeals for the Sixth Circuit recently held that wages withheld as a voluntary 401(k) contribution prior to filing bankruptcy were not considered “disposable income” under a Chapter 13 bankruptcy plan.
A copy of the opinion in In re Camille Davis is available at: Link to Opinion.
An individual debtor (“consumer”) filed a Chapter 13 bankruptcy with more than $200,000 in debt ($189,000 unsecured debt) and fewer than $39,000 in assets.
The U.S. Court of Appeals for the Ninth Circuit recently held that bankruptcy courts could confirm Chapter 13 plans proposing estimated time periods to complete the plan if unsecured creditors and the trustee did not object, reversing a contrary ruling from its Bankruptcy Appellate Panel.
A copy of the opinion in In re Nanette Sisk is available at: Link to Opinion.
The U.S. Bankruptcy Appellate Panel for the Eighth Circuit recently held managing members of a limited liability company that filed a Chapter 11 bankruptcy were equitably estopped from asserting ownership of equipment where the members previously verified documents in the bankruptcy showing ownership of the equipment by the company.
A copy of the opinion in Richards v. Rabo ArgiFinance, LLC is available at: Link to Opinion.
The U.S. Court of Appeals for the Seventh Circuit recently held that absent unforeseen extraordinary circumstances, debtors in Chapter 13 cases cannot proceed on appeal in forma pauperis.
A copy of the opinion in Bastanipour v. Wells Fargo Bank, N.A. is available at: Link to Opinion.
On 20 May 2020, the UK Government presented the Corporate Insolvency and Governance Bill (the “Bill”) to the House of Commons. The Bill is being fast-tracked through Parliament, with the aim of completing all stages and becoming law during July 2020. On 3 June 2020, the Bill was passed by the House of Commons and the Bill is now to be considered by the House of Lords, and if approved, it will require Royal Assent before becoming law.
The U.S. Bankruptcy Appellate Panel for the Eighth Circuit recently reversed a bankruptcy court’s disallowance of postpetition interest at the default contract rate, holding that “the bankruptcy court erred in applying a liquidated damages analysis and ruling the default interest rate was an unenforceable penalty,” and also erred in weighing “equitable considerations” to avoid enforcing the contractual default interest rate.
*Fried Frank published a memorandum titled COVID-19 Pandemic: Key UK Government and Bank of England Initiatives to Support Businesses on March 30, 2020 ("March 30 Memorandum") and published an update to the March 30 Memorandum on April 15, 2020 (the "April 15 Update"). In light of the rapidly developing situation and government response, the April 15 Update has been further updated to include the latest guidance provided by the UK Government, in particular as to employment retention initiatives and loan schemes, and is current as of May 12, 2020.
The U.S. Court of Appeals for the Eighth Circuit recently affirmed the denial of bankruptcy discharge for a Chapter 7 debtor due to the debtor’s failure to keep adequate records.
In particular, the Eighth Circuit focused on a sudden and financially significant return of hundreds of thousands of dollars’ worth of high-end watches and jewelry that left significant unanswered questions as to the whereabouts of the assets and the legitimacy of the creditor jeweler’s claim.
The U.S. Bankruptcy Appellate Panel for the Eighth Circuit recently affirmed a bankruptcy court’s holding that the contemporaneous exchange for new value defense to a preference action under § 547(c) applied to a creditor bank that released its liens for less than full payment.
In so ruling, the Eighth Circuit BAP held that the bankruptcy trustee could not recover two of the three payments that the debtor made to the bank during the 90-day pre-petition preference period.