Here, debtor purchased more than $1,100 of collector Barbie dolls and accessories within 40 days of filing for bankruptcy. Debtor sought to discharge these debts to the creditor who issued the credit card upon which the charges were placed. Creditor filed an adversary complaint with the Bankruptcy Court claiming that these Barbie doll purchases were “luxury […]
Archive for National
Bank Ordered to Pay Credit Union
In this case, a member of First Railroad Community Credit Union, Clark Crapps, held accounts at Columbia County Bank [Columbia] and Florida’s First Community Federal Credit Union [Credit Union]. Crapps was engaged in an elaborate check-kiting scheme for which neither Columbia nor the Credit Union was aware. Columbia allowed immediate credit on deposits made to […]
False Pretenses & Disappearing Collateral
Here, the debtor owed more than $3,900 to ITT Financial Services on a loan secured by various items of personal property, including a Pentax Camera and lens, snowblower, color television set, VCR, stereo system, a gun, power saw and an electric guitar. The initial debt was refinanced several times by the debtor and on each […]
Guarantor Liability Survives Debtor’s Bankruptcy
In this case, the Federal Court held that a guarantor on a loan is not excused from liability even when the principal debtor files bankruptcy. In this case, an obligation to the creditor was guaranteed by a third-party. The principal debtor filed bankruptcy and proposed to “cram down” the obligation to the creditor. Creditor filed an action […]
State Court Judgment – Fraud
Here, a state court judgment found the debtor liable for fraud. Although the federal court has exclusive jurisdiction as to determining dischargeability in bankruptcy, the federal court nevertheless found the debtor was precluded from refuting the state court judgment. Hence, the debtor could not collaterally attack the state court judgment in federal court, and the […]
Fatally Defective Foreclosure Acceleration Notice
Bank-Fund Staff Federal Credit Union held a mortgage on debtors’ real estate. The loan was in default and the credit union sought to foreclose and obtain possession of the property. The credit union initiated foreclosure proceedings and sent a Notice of Foreclosure Sale to debtors. The foreclosure notice, however, erroneously stated that the members did […]
“Note” Created Personal Liabilty On Business Debt
PERSONAL LIABILITY VERSUS CORPORATE LIABILITY. In this case, the debtors, McClellan and Hoyt, were, respectively, the president and secretary of Calistoga Court Club, Inc. Calistoga Court Club, Inc. applied for and received a loan for $30,420 from a predecessor in interest to Mountain America Credit Union. The loan went into default and the debtors’ corporation […]
Preferential Transfer: Checks
Debtor issued three checks to his creditors prior to his filing a Chapter 7 bankruptcy, however, those checks had not cleared debtor’s bank at the time he filed bankruptcy. The Trustee in Bankruptcy sought an order compelling debtor to turn over the funds in his account at the time he filed for bankruptcy in the […]
Credit Union Violates Automatic Stay by Transferring Automatic Payments
Here, in the case of In re Krivohlavek, (8th Cir. BAP), Debtor, Terri Krivohlavek, filed a Chapter 7 bankruptcy petition with a Statement of Intentions to surrender one 2002 Ford Windstar that was pledged as collateral to Boys Town Federal Credit Union. Prior to the bankruptcy filing date, Debtor paid her secured loan at the Credit […]
Mortgaged Property Kept Without Reaffirmation or Redemption
Here, the Court considered whether a debtor may keep property secured by a mortgage to the credit union even if the debtor does not either reaffirm, surrender or redeem the obligation. In this case, GNC Credit Union held a mortgage issued by the debtors and secured by their home. The balance on the loan was […]