In a much-anticipated follow-up to its 2014 decision in Crawford v. LVNV Funding, LLC, 738 F.3d 1254 (11th Cir. 2014), the U.S. Court of Appeals for the Eleventh Circuit recently held that there is no irreconcilable conflict between the federal Fair Debt Collection Practices Act (FDCPA) and the Bankruptcy Code.
Summary: The Public Administration and Constitutional Affairs Committee's findings in relation to Kids Company serve as a reminder of the risks of insolvency to large charities. The inherent weaknesses in the demand-led 'self-referral' operating model resulted in little to no reserves, and ultimately led to the trustees being required to file a petition to wind up the charity. Trustees of large charities must always be mindful of reserve levels.
The U.S. Court of Appeals for the Fourth Circuit recently affirmed the dismissal of a borrower’s lawsuit against a bank, holding that the district court correctly found that sale orders entered in a prior bankruptcy case were res judicata and precluded the borrower’s new claims.
A copy of the opinion is available at: Link to Opinion.
The Consumer Financial Protection Bureau (CFPB) recently reopened the comment period for its proposed amendments to the mortgage servicing related rules under RESPA and TILA that generally would require servicers to provide modified periodic statements to consumers who have filed for bankruptcy.
BLP real estate disputes partner Roger Cohen summarises a recent court decision about whether or not a landlord had accepted a lease surrender by the way it handled “jingle mail”, a letter returning the keys, from the administrators of the insolvent tenant. Jingle mail is a tactic used by administrators. The landlord argued successfully that ,on this occasion, the tactic failed.
The Supreme Court of Ohio recently held that a mortgage defectively executed but properly recorded still provides constructive notice of its contents.
A copy of the opinion is available at: Link to Opinion.
The borrowers executed a promissory note and a mortgage. The notary acknowledgment on the mortgage was left blank. The mortgage was recorded with the notary section incomplete. The mortgage was later assigned.
The U.S. Bankruptcy Appellate Panel for the Eighth Circuit recently affirmed an order of the bankruptcy court granting a debtor’s motion to avoid a judgment creditor’s lien on the debtor’s residence held in tenancy by the entirety with his non-debtor spouse, holding because the lien “fixed” under the Bankruptcy Code and thus impaired the debtor’s claimed exemption, it was avoidable.
A copy of the opinion is available at: Link to Opinion.
Finance Bill 2016 includes provisions designed to prevent taxpayers converting profits generated in a company into a capital receipt in the hands of the shareholder(s). Taxpayers may want to consider winding-up their companies or making substantial dividend distributions ahead of 6 April 2016 as a result of these measures and the changes to the taxation of dividends.
Broadly, the intention is that a capital distribution made in the winding-up of a company will be taxed as income if:
The U.S. Court of Appeals for the Sixth Circuit recently held that a bankruptcy court clearly erred in its finding that a debtor proposed a Chapter 11 plan in good faith, when the secured mortgagee would be paid only in part and very slowly after 10 years with no obligation by the debtor to maintain the building and obtain insurance, while a second class would be paid in full in two payments of $1,200 each over 60 days.
The U.S. Bankruptcy Court for the Southern District of Florida recently denied a mortgagee’s motion to reopen a Chapter 7 case to compel the surrender of real property, due to a five-year delay in filing the motion.
In so ruling, the court agreed with an earlier ruling from the U.S. Bankruptcy Court for the Middle District of Florida (In re Plummer, 513 B.R. 135 (Bankr. M.D. Fla. 2014)), distinguishing “surrender” from “foreclosure,” and holding that a creditor cannot use the Bankruptcy Code to circumvent the obligations imposed by state law.