Tag: separation agreement

E.D.N.C.: Baum v.  Baum- Date of Separation and New Debts for Nondischargeability under §523(a)(15)

Summary:
On appeal from the bankruptcy court decision in Baum v.  Baum, the district court reviewed whether debts between separated spouse are discharged under 11 U.S.C. §523(a)(15), which  provides, that a debtor shall not be discharged from a debt:

(15) not of the kind described in paragraph (5) [dealing with alimony, maintenance and child support] that is incurred by the debtor in the course of a divorce or separation or in connection with a separation agreement, divorce decree or other order of a court of record, or a determination made in accordance with State or territorial law by a governmental unit;

First, the district court agreed with the bankruptcy court that while the parties were “informally” separated, sleeping in different rooms, at the time the debts were incurred, under North Carolina law separation requires a “cessation of cohabitation.”  Secondly, the district court also held that §523(a)(15) requires the creation of new debts. … Read More

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Bankr. E.D.N.C.: Mitchell v. Keesee- Permissive Abstention

Summary:

Prior to her bankruptcy, Ms. Mitchell and the defendant, Mr. Keesee, were involved in divorce litigation in the District Court for New Hanover County, North Carolina, wherein they agreed to an equitable distribution of their property which provided that Ms. Mitchell transfered her interest in specific property to Mr. Keesee, who agreed to pay Ms. Mitchell $750,000 from any future sale of that property. Following filing her Chapter 11 bankruptcy, Ms. Mitchell brought an adversary proceeding against Mr. Keesee alleging he failed to make payment to her following the sale of a portion of the property and also purchased the mortgage note securing the property, in an attempt to preclude her from obtaining any proceeds and unjustly enriching himself.… Read More

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