Tag: asset of estate

Bankr. W.D.N.C.: In re Mergentime- Transferred Social Security Benefits

Summary:

Ms. Mergentime received $62,417.80 as a lump sum payment for retroactive Social Security benefits, approximately 4 months after filing her Chapter 7 bankruptcy. She had not disclosed those potential funds in her petition. Pursuant to her equitable distribution agreement, she paid half of those funds to her ex-husband. The Trustee sought to recovery those transferred funds and to deny Ms. Mergentime’s discharge, arguing that even though those funds would have been fully protected, the transfer to her ex-husband changed the nature of those funds such that they were no longer protected.

The bankruptcy court rejected this argument as the Social Security benefits were not, pursuant to 42 U.S.C.… Read More

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Bankr. W.D.N.C.: In re Bronikowski- Employment Bonus is an Expectation of Payment not Contingent Interest

Summary:

Ms. Bronikowski disclosed a potential employment bonus in her November 11, 2016, bankruptcy petition, asserting that it was not an asset of her bankruptcy estate, as the award of the bonus was at the complete discretion of the employer, and, in the alternative and out of caution, claimed it as exempt as wages of the debtor under N.C.G.S. § 1-362. The Trustee objected to the exemption and argued that the potential employment bonus was a contingent interest and asset of the estate.

After a thorough review of case from across the country, the bankruptcy court held “that the discretion of the employer is the most important consideration for determining whether an anticipated bonus is property of the estate.” See Klein-Swanson, 488 B.R.… Read More

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Bankr. W.D.N.C.: In re Green- Date of Transfer of Cashier’s Check Determines Ownership

Summary:

After the filing of her Chapter 7 bankruptcy, the Debtor found a cashier’s check payable to her ex-husband in the amount of $11,000.00. This check was not listed as an asset in the Debtor’s schedules, but her ex-husband was listed as holding a priority claim for $0.00 for alimony. The Debtor contended that this was for unpaid alimony and her ex-husband, in fact, had the sole allowed DSO priority claim for $15,000.00 in the case. The Debtor argued that the cashier’s check was not an asset of the bankruptcy estate and that it would be more efficient and maximize the amount received creditors, namely her ex-husband, if the cashier’s check was simply tendered to him.… Read More

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Bankr. E.D.N.C.: In re Napoleon- Assigned Insurance Proceeds not an Asset of the Bankruptcy Estate

Summary:

Separately, both Mr. and Ms. Napoleon signed assignments of insurance proceeds to Bio-Medical for kidney dialysis treatment Ms. Napoleon received. After litigation over the amounts owed and distribution of pre-petition insurance proceeds, the Napoleons filed Chapter 13 bankruptcy and subsequently received addition insurance checks ad amended their exemptions to claim $4,999.00 under Mr. Napoleon’s wildcard. Bio-Medical objected.

Relying largely on In re Helms, 467 B.R. 374 (Bankr. W.D.N.C. 2012), the court held that assigned insurance proceeds are not part of a Debtor’s bankruptcy estate and accordingly could not be exempted.

Commentary:

Insert your Battle of Waterloo jokes below.

Given that Bio-Medical’s counsel was located in Winston-Salem and the Napoleon’s live in High Point, it is not unreasonable to speculate why Bio-Medical did not seek a change of venue to the Middle District.… Read More

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