Tag: discharge

E.D.N.C.: Myrick v.  Equifax- Duty to Investigate Credit Report Dispute and Bankruptcy Discharge

Mr.  Myrick brought suit against Equifax under the FCRA for willfully failing to verify the discharge of a debt in his Chapter 7 bankruptcy.   In light of Daughterty v.  Ocwen Loan Servicing, the district court reconsidered its previous grant of summary judgment and instead found that Equifax had in its possession “records that would have enabled it to confirm the status of the … account through an identified source, i.e., PACER.”   Instead, there was a factual issue of “whether Equifax conducted a reasonable investigation by limiting its efforts to confirming the disputed information” with the creditor and not checking PACER or elsewhere.… Read More

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E.D.N.C.: Myrick v.  Equifax- FCRA Dispute Resolution and Bankruptcy Discharge


Following the entry of a discharge in 2011 of his Chapter 13 case, First Federal Bank (“FFB”) continued to report on Mr.  Myrick’s credit report with Equifax that he owed an outstanding balance of $41,603 that was past due by $2,000.  In November 2014, Mr.  Myrick submitted a dispute with Equifax regarding this balance, raising his bankruptcy discharge.  Equifax sent a Automated Consumer Dispute Verification (“ACDV”) to FFB, which responded that the balance information was correct.  Later in February 2015, Mr.  Myrick again disputed the FFB trade line, this time attaching a copy of his discharge order.  As the discharge order does not specifically list discharged claims, Equifax requested additional details regarding the account names, numbers and nature of the dispute.  … Read More

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Bankr. E.D.N.C.: Baum v. Baum- Discharge under § 523(a)(15) for Debts In Connection with Divorce Decree


During a period of financial distress and shortly before their divorce, Doreen Baum made repeated unauthorized withdrawals from the Martin Baum’s IRAs, and did not pay the mortgage on the couple’s beach house, using the funds for the support and maintenance of the family. When the Baums divorced, the parties entered into an consent orders for Alimony and Equitable Distribution. While aware of the unauthorized withdrawals, Martin Baum believed any claims he had for fraud were preserved, whereas Doreen Baum believe these consent orders resolved all issues, including for the unauthorized withdrawals.

Doreen Baum filed Chapter 7 and Martin Baum brought an Adversary Proceeding seeking to both have the bankruptcy court determine that Doreen Baum was indebted to him for compensatory and punitive damages resulting from fraud and to have such declared nondischargable.… Read More

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E.D.N.C.: Engell v. Sheetz – Appeal of Discharge or Dischargeability


Mr. Sheetz filed a Chapter 7 bankruptcy on June 1, 2015, listing, among other creditors, Mr. Engell. The last day to oppose a discharge was August 31, 2015. On August 26, 2015, Mr. Engell filed an pleading titled as “Creditor’s Objection to Debtor’s Exemption” (“the objection”), but which, in fact, asserted that judgment held against Mr. Sheetz was nondischargeable due to fraud and unfair and deceptive trade practices. Subsequently, on October 27, 2015, Mr. Engell filed a motion to amend. On December 31, 2015, the bankruptcy court overruled the objection and denied the motion to amend, holding that Mr. Engell had been required to bring an Adversary Proceeding to oppose discharge and the objection was insufficient.… Read More

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Law Review: Rendleman, Doug & Weingart, Scott- Collection of Student Loans: A Critical Examination


Although the collection of college student loans centers this article, some background precedes its main topic. It begins by defining and distinguishing federal and private student loans. Next is repayment of loans, postponing repayment through deferment, forbearance, extensions, and public-interest assistance and cancellation. Perkins loan deferment, forbearance, and cancellation follow. Delinquency and default are next, including collection fees and penalties, administrative wage garnishment, state and federal income-tax-refund offsets, federal benefits offsets, and professional-license suspension. The lender’s judicial collection is followed by the borrower’s limited affirmative defenses and post-judgment tools. A borrower may exit default through consolidation and rehabilitation. There are two types of statutory discharges: school-related discharges and discharges for death and disability.… Read More

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Bankr. W.D.N.C.: In re Stewart- Chapter 7 Discharge allowed for Dead Debtor


After filing Chapter 7 and attendance at the §341 Meeting of Creditors, the Female Debtor passed away.  The bankruptcy court held that pursuant to Bankruptcy Rule 1016, death of the Debtor was not an impediment to either the administration of a Chapter 7 estate or basis for denial of discharge.

For a copy of the opinion, please see:

Stewart- Chapter 7 Discharge allowed for Dead Debtor.PDF Read More

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Bankr. EDNC: Lowther- Dischargeability Determination not bound by Res Judicata

The Debtor was in an automobile accident and had not maintained liability insurance. Judgment was entered in state court for negligence, but after filing Chapter 13 the Plaintiff brought a non-dischargeability action alleging that the failure to maintain liability insurance cause a willful or malicious injury.

The Debtor argued that the failure to raise either willfulness or malice in the state court action precluded later raising them in the bankruptcy.

Relying on Brown v. Felsen, 442 U.S. 127, 135, 99 S.Ct. 2205, 2211 (1979), the Bankruptcy Court rejected this, holding that “a plaintiff seeking non-dischargeability “[is] not assert[ing] a new ground for recovery, nor does he attack the validity of the prior judgement.… Read More

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