If you put your ear to the ground you may hear the rumblings regarding a change to Bankruptcy Rule 3002.1 requiring the institution of a mid-case bankruptcy audit. This mid-case audit would be like the Notice of Final Cure but would be performed by a trustee’s office in the middle of a pending Chapter 13, rather than at the end,...

By Wm. Houston Brown, United States Bankruptcy Judge (Retired) Debtor’s Attorney - Suspension of firm upheld. The District court affirmed the 90-day suspension of Law Solutions Chicago, LLC (d/b/a UpRight Law, LLC), with the record supporting the bankruptcy court’s findings that the firm failed to adequately represent the debtor in a “simple” consumer case. Disgorgement of fees was appropriate under...

(Used with expressed permission from the MI Bankruptcy Journal and the Steven W. Rhodes Consumer Bankruptcy Conference) III. Contrasting the Majority and Minority Interpretations The majority and minority approaches differ as to (1) the interpretation of the use of "collect" in § 586(e); (2) the operative effect of parallel provisions in chapters 11 and 12 on the interpretation of §...

By The Honorable William Houston Brown (Retired) Debtor could cure default beyond 60 months. Agreeing with In re Klaas, 858 F.3d 820 (3d Cir. 2017), bankruptcy court had discretion to permit debtors to cure plan default, allowing a reasonable grace period beyond the 60 months of confirmed plan. Dismissal of the case for plan default was not required under §...

By Wm. Houston Brown, United States Bankruptcy Judge (Retired) Debtor’s Attorney - Chapter 13 no-look fee subject to Hawai’i’s general excise tax. Construing the State’s excise tax, the Chapter 13 debtor’s attorney could not collect the required excise tax in addition to the agreed upon no-look fee. The district’s Rights and Responsibilities Agreement between debtor and attorney did not contain...

In determining the appropriate “present value” factor to be added to the payment of a secured claim in a Chapter 12, the Court should look at the “riskless” treasury rate rather than the “prime rate” before enhancing it with a risk factor.  (Ebinger) Farm Credit Services of America v. Topp, 2022 WL 2981590 (S.D. Iowa, July 19, 2022) Case Summary...