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Monthly Archives: February 2013

Bankruptcy Lawsuits

11 U.S.C. 727: Death in the Bankruptcy Court

By Anerio Altman

The strongest remedy available to a creditor or interested party in the Bankruptcy Court is to request that the court deny an individual his or her discharge pursuant to 11 U.S.C. Sec. 727(Hereinafter “727”).  A 727 cause of action occurs when a party requests that the court deny the Debtor their discharge for approaching the court dishonestly, or destroying property of the estate.

There are three types of 727 causes of action that may arise:  727(a)(2), 727(a)(3) and 727(a)(4).

These state as follows:

“Destruction of Property”:  11 U.S.C. 727(a)(2)

(2) the debtor, with intent to hinder, delay, or defraud a creditor or an officer of the estate charged with custody of property under this title, has transferred, removed, destroyed, mutilated, or concealed, or has permitted to be transferred, removed, destroyed, mutilated, or concealed—

(A) property of the debtor, within one year before the date of the filing of the petition; or

(B) property of the estate, after the date of the filing of the petition;

“Hiding your personal history” 11 U.S.C. 727(a)(3)

(3) the debtor has concealed, destroyed, mutilated, falsified, or failed to keep or preserve any recorded information, including books, documents, records, and papers, from which the debtor’s financial condition or business transactions might be ascertained, unless such act or failure to act was justified under all of the circumstances of the case;

“Lied on the Petition” 11 U.S.C. 727(a)(4)

(4) the debtor knowingly and fraudulently, in or in connection with the case—

(A) made a false oath or account;

(B) presented or used a false claim;

(C) gave, offered, received, or attempted to obtain money, property, or advantage, or a promise of money, property, or advantage, for acting or forbearing to act; or

(D) withheld from an officer of the estate entitled to possession under this title, any recorded information, including books, documents, records, and papers, relating to the debtor’s property or financial affairs;

The result of a verdict in favor of any of these three causes of action is a complete denial of the Debtor’s discharge and a determination that the debts attached to the Debtor’s case remain non-dischargeable…FOREVER.

727 causes of action may only be resolved by a formal trial in the Bankruptcy Court in an Adversary Proceeding.

Bankruptcy Events

LBRP 9013-1(o): How Most Things Get Done

By Anerio Altman

Most things happen in Bankruptcy Court under a rule called 9013-1(o) or the “scream or die” rule.

Local rule of Bankruptcy Procedure 9013-1(o) provides that for certain matters, if you file a motion, and no one opposes it, 14 days after service of the motion on the appropriate parties, the relief requested in the motion may be granted by the court.

If anyone wants to oppose the rule, they have to file a written request for a hearing within the 14 day period.

Once filed, the moving party has to then schedule a hearing in front of the judge or let the judge deny the motion.

The majority of the motions in Bankruptcy Court are dealt with under this rule. It is not particularly exciting, but it is how things work.

For most of the judges EVERYTHING in Bankruptcy Court can be handled by 9013-1(o) except for the following:

(A) Objections to claims;
(B) Motions regarding the stay of 11 U.S.C. § 362;
(C) Motions for summary judgment and partial summary adjudication;
(D) Motions for approval of cash collateral stipulations;
(E) Motions for approval of postpetition financing;
(F) Motions for continuance;
(G) Adequacy of chapter 11 disclosure statements;
(H) Confirmation of plans in chapter 9, chapter 11, chapter 12, and chapter 13
cases;
(I) Motions for orders establishing procedures for the sale of the estate’s assets
under LBR 6004-1(b);
(J) Motions for recognition of a foreign proceeding as either a main or a
nonmain proceeding;
(K) Motions for the adoption of a chapter 15 administrative order;
(L) Motions for the adoption of a cross-border protocol;
(M) Motions to value collateral and avoid liens under 11 U.S.C. § 506 in chapter
11, 12, and 13 cases; and
(N) Motions for issuance of a TRO or preliminary injunction.

Always consult an attorney concerning your case, the judge and the judge’s own preferences regarding any motion.