This matter came before the Court on one issue of the Defendants’ motions to dismiss. The Defendants argued that these cases should be dismissed under Bankruptcy Rules of Procedure Rule 7012 incorporating Federal Rule Civil Procedure Rule 12(b)(3). The Defendants argue that venue is improper under 28 U.S.C. § 1409(b). The Court found that 28 U.S.C. § 1409(b) does not restrict the venue for cases “arising under” title 11 and venue is proper.
Opinions
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Please note: These opinions are not a complete inventory of all judges' decisions and are not documents of record. Official court records are available at the clerk's office.
Judge John T. Laney, III
This matter came before the Court on objections filed by Creditor Mr. David Field and the Sub V Trustee Ms. Jenny Walker to the confirmation of the small-business reorganization plan of Trimax Medical Management, Inc. The Creditor objected to the plan under 11 U.S.C. §§ 1129(a)(3), (7), and 1191(b). The Court found that the Debtor met its burden under those sections and overruled the Creditor’s objection. The Trustee announced a resolution to one of her objections during the hearing, which the Court approved, and otherwise overruled her outstanding objection. The Court, therefore, approved confirmation of the Debtor’s plan.
This matter was tried before the Court beginning on January 31, 2024. The Plaintiffs requested their debts be excepted from the Defendant’s discharge under § 523(a)(2)(A). The Court found that the Plaintiffs did not meet their burden of proof and found in favor of the Defendant.
This matter came before the Court on the Debtor’s motion to sell real property. The Debtor moved the Court for permission to sell 15 of the 43 acres on which the Debtor currently lives. The 15 acres included in the proposed sale does not include the Debtor’s home. U.S. Bank National Association, not in its individual capacity but solely as trustee for the RMAC Trust, Series 2016-CTT, the sole lien holder on the property, objected to the sale claiming the sale was not authorized under § 363(f) and claimed its right to credit bid under § 363(k). The Court orally granted the Debtor’s motion from the bench but reserved the right to publish its finding of facts and conclusions of law. Thus, this opinion memorializes the Court’s decision.
This matter came before the Court on the Defendant’s motion to dismiss the Plaintiff’s adversary proceeding. The Defendant argued that the Plaintiff did not meet the heightened pleading requirements for fraud as required by Federal Rules of Bankruptcy Procedure Rule 7009 and that the statute of frauds prohibited the enforcement of the Defendant’s supplemental oral promise. The parties also disagreed as to whether the prohibition against parol evidence barred the Plaintiff’s introduction of the oral promise to prove fraudulent inducement. The Court found that the Plaintiff did not meet the requirements of Rule 7009, granting the Defendant’s motion in part. The Court allowed the Plaintiff fourteen days to amend his complaint or the adversary proceeding will otherwise be dismissed. The Court also found that both the statute of frauds and parol evidence did not apply in this case because the Plaintiff has elected to pursue a fraud claim, not a breach of contract claim, and, therefore, denied the Defendant’s motion on her other grounds.
This matter was tried before the Court on November 8, 2023. The Trustee objected to the Debtors’ discharge under Bankruptcy Code §§ 727(a)(2) through (5). The Court found that that the Trustee did not meet her burden as to §§ 727(a)(2) and (4) but did through §§ 727(a)(3) and (5). Therefore, the Court denied the Debtors’ discharge.
The Movants, Rodney and Greda Tyson, asked the Court to reopen the Debtor's bankruptcy case and annul the stay as to their personal injury case. The Movants were not listed as creditors in the Debtor's bankruptcy case and the statute of limitations has expired barring them from refiling their personal injury suit against the Debtor now that the Debtor's case has been dismissed. The Court found cause to reopen the case and annul the stay and granted the Movants' motion.
The Movant, Roger Munn, moved the Court to reconsider its April 4, 2023 order and opinion denying his objection to discharge and to the confirmation of the Debtor’s, Esther Collins, plan. The Court found that the Movant did not meet his burden under Rule 9023 to demonstrate “newly discovered evidence or manifest errors of law or fact.” In re Kellogg, 197 F.3d 1116, 1119 (11th Cir. 1999).
Chief Judge Austin E. Carter
The question presented in this case is whether a debtor has an absolute right to dismiss a chapter 13 case under § 1307(b), provided the case has not been converted previously, or whether the court may deny a debtor’s request to dismiss a chapter 13 case for cause.
On the Debtor’s request, the Court dismissed the chapter 13 case while a motion to convert, filed by a group of creditors, was pending. The creditors requested the Court set aside its order dismissing the case, arguing that the Debtor did not have the right to dismiss his case without creditors being afforded the opportunity to oppose the dismissal by arguing what they contended is the Debtor’s bad faith, misconduct, and ineligibility for chapter 13 relief.
The Court ruled in favor of the Debtor, finding the language of 11 U.S.C. § 1307(b) unambiguous, and holding that a debtor has an absolute right to voluntarily dismiss a chapter 13 case provided the case was not previously converted under §§ 706, 1112, or 1208. Accordingly, the Court sided with the majority position after evaluating both majority and minority approaches connected to § 1307(b).
Judge James P. Smith (Retired)
Petitioners filed an involuntary Chapter 7 petition against Debtor which, in turn, filed an answer controverting the petition. 11 U.S.C. §303(a), (b). Petitioners hold judgment liens against Debtor’s real property, some 334 acres of land (the “property”). For the past twenty years, a motorbike racing facility known as Durham Town has been operated on the property by Mike McCommons. About ten years ago, Mike’s son, Steven, suffered a serious and permanent injury. Mike formed Debtor, an irrevocable trust, to make long-term plans for Steven, who is the sole beneficiary of the trust. Mike, and one of his corporations then conveyed the 334 acre property to Debtor. Mike continued to operate the motorbike racing and other related business on the property. Those businesses paid rent not to Debtor which owns the property, but to other entities owned by Mike.
Petitioner Coleman Rogers suffered a catastrophic injury while racing at Durham Town and he, along with his parents, the other petitioners, now hold judgment liens against Debtor’s property. Petitioners filed this involuntary Chapter 7 case against Debtor in order to collect on their judgments. Debtor asserted three defenses.
First, the Court held that Debtor is not a “business trust” and therefore cannot be a debtor under 11 U.S.C. §§101(9), 101(41) and 109(b). Debtor, an irrevocable trust, was created to preserve property for the benefit of Mike’s son and includes a spendthrift clause. Until 2020, Debtor received no rent, had no bank account, had no business expenses, and filed no tax returns. Debtor simply existed. A business trust, on the other hand, is created and maintained for business purposes and its interests are transferable.
Second, the Court held that Debtor was not generally paying its debits as they become due. Debtor has few debts. The 2021 and 2022 property taxes have not been paid, two secured loans against the property are in default, and Petitioners’ and another creditor’s judgments are not being paid. Debtor’s legal fees in this case are being paid by Mike’s brother.
Finally, the Court held that the involuntary petition was filed in bad faith and was an abuse of the bankruptcy process because a bankruptcy case would serve no purpose that creditors of Debtor could not achieve under state law. The unpaid property taxes are first priority liens under state law. The secured mortgage debts can be foreclosed upon. Petitioners’ judgment liens can be collected under state law. If a bankruptcy trustee were appointed in this case, the trustee would immediately abandon the property under §554(a) as burdensome to the estate or of inconsequential value.
The Court dismissed the involuntary petition.