All posts in Chapter 13

Should ‘No Money Down’ Chapter 7s Be Allowed?

I am quoted by Danny Gill in his Bloomberg Bankruptcy Law Reporter article.  He quotes me saying that I agree that there should be some way to permit bankruptcy attorneys to be paid post-petition for filing a chapter 7 petition and representing the debtor throughout.   The article is here.

“I talk to people all the time who don’t have the money to file a Chapter 7,” M. Jonathan Hayes told Bloomberg Law Oct. 16.  Hayes is a member of Simon Resnik & Hayes in Sherman Oaks, Calif., and has practiced consumer bankruptcy law for 37 years in the Central District of California. Read more…


Nice post by San Jose certified specialist Cathy Moran on the new rules.    In her post, Cathy has attached a very nice spreadsheet prepared by Chapter 13 Trustee Beverly Burden in Kentucky.  The spreadsheet identifies the rules changes that affect the chapter 13 practice.

F. Lee Bailey Files Chapter 13 In Portland Maine – Chapter 13 Trustee Annoyed

Think your chapter 13 trustee is tough?  This is what the trustee filed last week in F. Lee Bailey’s Chapter 13 case.


In the matter of F. LEE BAILEY Chapter 13 Debtor Case # 17-20323


NOW COMES the standing Chapter 13 trustee Peter C. Fessenden and submits the following comments in connection with confirmation of the debtor’s plan. Read more…

Nice Tentative from Judge Houle on Converting Case from Chapter 7 to Chapter 13 Postdischarge

On February 28, 2013, Michael & Maricar Santos (“Debtors”) filed a Chapter 7 voluntary petition.  On June 17, 2013, Debtors received a standard discharge.  The Chapter 7 case, however, remained open.

On October 4, 2016, Debtors filed a motion to convert case from Chapter 7 to 13.  On October 12, 2016, Trustee filed his opposition.  On November 2, 2016, Debtors filed a reply.  A hearing on the matter was held on November 9, 2016.  The hearing was continued to allow for additional briefing on the issue whether, and in what circumstances, a Chapter 7 case could be converted to a Chapter 13 post-discharge.  Debtor filed their response on November 18, 2016.  Trustee filed their response on November 29, 2016. Read more…

CDCBAA Program: Fundamentals for “Finalizing” a Chapter 13 Case

Central District Consumer Bankruptcy Attorney Association (“cdcbaa”) present: FUNDAMENTALS FOR “FINALIZING” A CHAPTER 13 CASE

July 23, 2016 Read more…

National Chapter 13 Plan Form Getting Closer

I understand that the “national form,” once approved will not be required in the Central District.  An article updating the progress on the new form is here.

Judge Zurzolo Brown Bag – July 25, 2016

Bankruptcy Judge Zurzolo Brown Bag Discussion

12:00 noon – July 25th

Room 1268 – Roybal Building Read more…

Yikes!! Attorney Sentenced to 34 Months in Prison For Failing to Disclose Receipt of Filing Fees for Chapter 13 Cases

The article is here.

MONROE, La (US Atty Office) - United States Attorney Stephanie A. Finley announced today that a bankruptcy attorney was sentenced to 34 months in prison for collecting filing fees from clients without informing the bankruptcy court.

Glay H. Collier II, 53, of Benton, La., was sentenced by U.S. District Judge Robert G. James on one count of bankruptcy fraud. He was also sentenced to three years of supervised release and ordered to pay $69,063.05 restitution. According to evidence presented at the November 10, 2015 guilty plea, Collier filed records into the bankruptcy court stating that he would accept “No Look” fees as payment for his services. The “No Look” fee caps attorney’s fees in bankruptcy proceedings to $2,800. In excess of that limit, Collier charged up to $281 in filing fees to some clients, which he did not disclose to the court. Between March 2010 and November 2013, Collier filed 983 Chapter 13 bankruptcy cases in Monroe, and during the same time period, he filed 2,160 Chapter 13 bankruptcy cases in Shreveport. In approximately 479 of these cases, Collier fraudulently collected and attempted to collect filing fees.

The FBI and the U.S. Trustee’s Office, Region 5, conducted the investigation. Assistant U.S. Attorney Cytheria D. Jernigan prosecuted the case.

Penrod Giveth and Bos Taketh Away – A Response from Peter Lively

My sense is that Judge Watford should have referred to the creditor’s objection to Penrod’s 506b motion rather than its objection to her Plan’s confirmation.

By challenging the bankruptcy code’s ability to modify the vehicle loan (no use of 506 where negative equity was added to the loan originated within 910 days of the petition), the creditor was litigating enforceability of its contract as falling outside the scope of the code rather than acknowledge that it’s contact was subject to the code and fighting over how the code functions – like the more general modification of contract rights that are the focus of plan confirmation, relief from stay and such.

If you take Judge Watford’s premise that the contract rights were at play because of the creditor’s plan confirmation objection, then the only way to reconcile Bos and David’s RFS opinion is to view everything through the OJ Dream Team lense where the highest priced legal team prevail in court.

Best regards,

Penrod Giveth and Bos Taketh Away

I thought I knew where we are on attorneys fees after the 9th Circuit ruled in In re Penrod that a creditor fighting with a debtor in a bankruptcy case, is an effort by the creditor to collect its debt form the debtor, and therefore an “action on the contract” and therefore, assuming there is a right to attorneys fees in the contract, the bankruptcy court can award attorneys fees to the debtor.

My friend Peter Lively was surprised to hear me say recently that I think that Penrod allows for attorneys fees to the debtor anytime the debtor defeats any creditor efforts in a bankruptcy case including stay relief motions, oppositions to plan confirmation, battles over property values, cash collateral, plan fights.  His sense was that since Penrod was over the issue of bifurcating a car loan, it didn’t necessarily extend out to everything else.  He promised to look into it further.

In Penrod Judge Watford wrote:

“Under California law, an action is ‘on a contract’ when a party seeks to enforce, or avoid enforcement of, the provisions of the contract.  AmeriCredit sought to enforce the provisions of its contract with Penrod when it objected to confirmation of her proposed Chapter 13 plan.”

“AmeriCredit insisted that it was entitled to have its claim treated as fully secured.  The only possible source of that asserted right was the contract—in particular, the provision in which Penrod granted a security interest in her Taurus to secure ‘payment of all you owe on this contract.’” Read more…