(Bankr. W.D. Ky. Feb. 1, 2017)
The bankruptcy court denies the creditor’s request for default rate interest on the secured claim. The value of the real property securing the claim was in excess of the claim amount. Case law establishes that there is a presumption in favor of the contractual rate of interest, but it is subject to rebuttal when evidence establishes the default rate is significantly higher without justification. Here, the default rate doubled the non-default rate and the court finds there was no justification under the evidence presented. Opinion below.
The Sixth Circuit affirms the 2015 consent order specifying the manner in which certain provisions of the confirmed Chapter 11 plan would apply to a class of claim holders. The Korean Claimants objected, arguing that the district court lacked authority to enter the consent order and that the consent order was an impermissible modification of the distribution agreement. The court holds that the court had the requisite authority to enter the consent order and it merely clarified the distribution agreement rather than modified it. Opinion below.
Judge: Kethledge
(7th Cir. Mar. 4, 2016)
(Bankr. W.D. Ky. July 17, 2017)
The bankruptcy court enters judgment in favor of the lender, holding the debt owed by one of the debtors would not be discharged, pursuant to 11 U.S.C. § 523(a)(6). The debtor disregarded the lender’s security interest in his business’s inventory, using the proceeds of the inventory for personal expenses in violation of the security agreement. The court holds that the lender failed to present sufficient evidence to except the other debtor’s (the first debtor’s spouse) debt from discharge. Opinion below.
Judge: Stout
(Bankr. E.D. Ky. Feb. 2, 2017)
The bankruptcy court enters summary judgment in favor of the plaintiff trustee. The trustee sought to obtain title to a truck sold to the debtor prepetition by the defendant dealer. The dealer had not provided a certificate of title, but the debtor did receive physical possession of the truck pursuant to a bona fide sale. The court finds in favor of the trustee after applying Kentucky’s comprehensive automated motor vehicle registration and titling system contained in KRS §§ 186A.010-186A.990. Opinion below.
Judge: Schaaf
(Bankr. W.D. Ky. Nov. 16, 2016)
(Bankr. E.D. Ky. Nov. 22, 2017)
(Bankr. E.D. Ky. July 17, 2017)
The bankruptcy court dismisses the debtor’s complaint seeking to avoid a transfer to the bank defendant. The transfer consisted of the Bank exercising its contractual setoff right and applying funds in the debtor’s bank account to the Bank’s claim. The transfer occurred while the bankruptcy case was dismissed. The debtor fails to state a claim that is plausible on its face. Opinion below.
Judge: Schaaf
(7th Cir. Jan. 30, 2017)
(S.D. Ind. Nov. 18, 2016)
The district court affirms the bankruptcy court’s holding that a tax penalty is dischargeable if the penalty is described by either 11 U.S.C. § 523(a)(7)(A) or (B). Opinion below.
Judge: McKinney
Attorney for Appellant: Peter Sklarew
Attorneys for Debtors: Camden & Meridew, PC, Julie A. Camden