Ms. Calloway divorced Mr. Bowles and shortly before a final judgment was entered in their equitable distribution proceeding, she filed Chapter 13. Just prior to Ms. Calloway’s bankruptcy filing, the state court judge circulated a preliminary ruling to the parties via email, stating that he believed an unequal distribution of the marital assets in favor of Mr. Bowles would be equitable and that Ms. Calloway would be required was to pay a total of $50,514 by means of monthly payments of $300, due to the her liquidation of two retirement accounts, which had a total value of roughly $31,000. Additionally, since their separation, Ms.… Read More
The Debtor contested large portions of the Domestic Support Obligation (DSO) claim filed by his ex-wife, who was also seeking dismissal of his Chapter 13 plan. The bankruptcy court held that the Indiana Superior Court where this claim originated was best suited for deciding the issues, See Caswell v. Lang, 757 F.25 608, 610 (4th Cir. 1985), and continued the matter for three months to allow for such decision.
No matter how unpleasant bankruptcy cases can be, the clear preference of bankruptcy judges to punt these issues back to state court shows that domestic cases are far worse.
For a copy of the opinion, please see:
Blohm- Forum for Determination of Domestic Support Obligation.pdf… Read More
Property Agreement provided that the Debtor would be primarily liable for the mortgage debt and “[t]o the extent of any obligation contained herein is discharged in bankruptcy and the non-bankrupt party is held liable for said debt, the non-bankrupt party shall have the right to petition a court of competent jurisdiction for spousal support in an amount sufficient to cover any amounts so discharged.” The Debtor, of course, filed Chapter 13 and disputed whether this created a domestic support obligation under 11 U.S.C. § 1328(a)(2).
Citing to In re Deberry, 429 B.R. 532, 537 (Bankr. M.D.N.C. 2010), the court held that a debt is a domestic support obligation if it:
(1) owed to or recoverable by a former spouse;
(2) in the nature of alimony, maintenance, or support;
(3) established before the bankruptcy relief is filed by a separation agreement or divorce decree; and
(4) not assigned other than for purpose of collection.… Read More