In re Rolling Thunder Gas Gathering, LLC: Case No. 05-10476 (Nugent) (August 16, 2006)
Order sustaining objection of the official unsecured creditors committee to claim no. 11 of david and nancie peterson
Facts:
This case began as an involuntary Chapter 11 filed by three petitioning creditors on February 7, 2005. ON March 16, 2005, the Court entered an Order for Relief adjudicating the debtor as bankrupt. On April 7, 2005, David and Nancie Peterson (the “Petersons”) filed a claim in the amount of $728,686.50 representing a 50% ownership interest in Rolling Sky, LLC, a limited liability company owned by the debtor Rolling Thunder Gas Gathering, LLC (“debtor”). The only basis for a “debt” owing from the debtor to the Petersons was due to the Peterson’s investment in debtor.
Holding:
A proof of claim is presumed valid unless the objecting party meets that presumption with competent evidence. The Court shall allow a claim except to the extent that the claim is “unenforceable against the debtor and property of the debtor, under any … applicable law for reason other than because such claim is contingent or unmatured.” There was no consideration for the note or the grant of the mortgage by the debtor to the Petersons because the Petersons did not lend any money to the debtor, which warrants disallowance of the Petersons claim under §502(b)(1).
Craig Gabel vs. Virginia Snyder, Elizabeth Labore, Clyde Smith, and Deborah Spicer (In re Gabel); Case No. 05-11125; Adv. No. 05-5810 (Nugent) (August 16, 2006)
MEMORANDUM OPINION
Facts:
Craig Gabel (“debtor”) seeks to avoid the fraudulent conveyance of three (3) tracts of real estate to defendant Virginia Snyder (“Snyder”) and to recover said properties for the estate. Debtor claims that Snyder stole three bland warranty deeds from his office and fraudulently obtained the three properties.
Holding:
While it appears debtor caused the properties to be transferred to Snyder to place them out of the reach of Deborah Spicer (“Spicer”) in her divorce from debtor, the only person who may be a bona fide purchaser is not a party to this adversary proceeding and was a knowing and compliant participant in the attempt to defraud Spicer a creditor of debtor. Therefore, the transfers were fraudulent and are deemed avoided for the benefit of the estate.
In re Richard Herman Hayes; Case No. 05-19685 (Nugent) (August 25, 2006)
Memorandum opinion and order overruling ferguson’s objection to exemption
Facts:
Richard Herman Hayes (“debtor”) filed his Chapter 7 petition October 15, 2005. On Schedule B he listed six (6) vehicles, including a 1997 Chevrolet Camaro. Debtor claims the 1197 Camaro as his exempt means of conveyance on Schedule C. Debtor typically commutes from Kingman to Wichita for work in a 1999 Chevrolet Suburban. Debtor drives the Camaro on errands and around town. Debtor occasionally drives the Camaro to Wichita to pick up his grandson. In 2005 debtor estimates that he drove the Suburban 25,000, a Chevrolet Van 48,000 miles and the Camaro 6,000 miles. The Camaro has in excess of 100,000 is in good condition despite some flaws, but no debt exists against the Camaro. The other vehicles listed on Schedule B are significantly encumbered in relation to their value.
Holding:
K.S.A. §60-2304(c) provides that every person residing in this state shall have exempt from seizure and sale upon any attachment, execution or other process issues from any court in this state … such person’s interest, not to exceed $20,000 in value, in one means of conveyance regularly used for the transportation of the person or for transportation to and from the person’s regular place of work…. The statute does not state that the vehicle must be used exclusively or primarily. Regular is defined as “customary, usual or normal.” The debtor regularly uses the Camaro and is entitled to a liberal construction of the exemption laws. Therefore the objection is overruled.
Craig Gabel vs. Terrence L. Huelskamp (In re Gabel); Case No. 05-11125; Adv. No. 06-5287 (Nugent) (August 31, 2006)
Order granting defendant’s motion to dismiss
Facts:
Craig Gabel (“debtor”) seeks to recover funds held in a trust account by defendant Terrence L. Huelskamp (“Huelskamp”), divorce attorney for debtor’s ex-wife, pursuant to a temporary Domestic Court order. Debtor alleges that Huelskamp converted the monies which represent the proceeds from property of the debtor and his ex-wife.
Holding:
The Court deferred to the Domestic Court for division of the marital assets attendant to the pre-bankruptcy marriage dissolution proceedings between debtor and his ex-wife and therefore, the Court is without jurisdiction to address or remedy debtor’s allegations and Huelskamp’s motion to dismiss is granted.
In re Rex Oliver Fair and Angela Sue Fair; Case No. 05-43450 (Karlin) (August 24, 2006)
Memorandum opinion and order partially granting and partially denying, debtors’ objection to the claim of gmac mortgage corporation
Facts:
The debtors Rex and Angela Fair (“debtors”) purchased a home in Wamego, Kansas on May 17, 1996 that was secured by a purchase money mortgage to First Union Home Equity Bank, N.A. (“First Union”) in the amount of $57,000. Debtors also gave First Union a second mortgage in the amount of $9,000. Between May 17, 1996 and July 18, 1997, the debtors chose to borrow money to make some home improvements. They executed a promissory note, secured by a mortgage to First Plus in the amount of $65,000. As a condition to First Plus, debtors were required to payoff the $9,000 second mortgage to First Union. When First Union received the payment for its $9,000 second mortgage, it inadvertently released the first mortgage by filing a Satisfaction of Mortgage on July 18, 1997. Debtors admit that they did not pay First Union, whose note was eventually assigned to GMAC in July 2003. Debtors made payments to GMAC for 18 months after the assignment. However, debtors now request that the Court find that GMAC’s claim is unsecured based upon a Satisfaction of Mortgage that was inadvertently recorded by GMAC prior to the filing of this bankruptcy.
Holdings:
1. The debtors doe not allege that they are seeking to use the trustee’s strong arm powers contained in 11 U.S.C. §544 to avoid the mortgage in this case, nor could they, however they content that the inadvertent pre-bankruptcy release of the mortgage renders GMAC’s mortgage null and void, and makes its claim unsecured. Kansas law determines whether a valid security interest exists, and under the facts of this case, GMAC retains a valid security interest in the property pursuant to Kansas Law.
2. The Court will not disallow the charges for an inspection fee simply because notice was not given to the debtors of GMAC’s intent to conduct the drive-by inspections, however, the Court cannot understand why GMAC needed to make 12 drive-by inspections between April 6, 2005 and June 27, 2006. Since GMAC has presented no evidence to support the necessity of the frequent drive-by inspections, the charges will be reduced by half. The Court further reduced the attorney fees charged from $750 to $350 based on the expertise of the law firm filing the mortgage foreclosure action.
In re Kurt James Bolze and Jennifer Gail Blassingame; Case No. 06-40036 (Karlin) (August 31, 2006)
Memorandum opinion and order sustaining objection to confirmation
Facts:
On August 27, 2004, the debtor Kurt Bolze borrowed $14,495.36 from the Kansas Super Chief Credit Union (“KSCCU”) to purchase a 2001 Mazda MPV and KSCCU properly perfected its purchase money security interest in this vehicle. Jennifer Gail Blassingame is the common law wife of Kurt Bolze, was not a party to the transaction with KSCCU despite the fact that her name was added to the title when the vehicle was registered with the Kansas Department of Motor Vehicles. On January 31, 2006, the debtors filed for bankruptcy protection under Chapter 13. In their Chapter 13 plan, the debtors propose to cram down KSCCU’s claim that is secured by the Mazda to $7,600, the purported value as of the date of filing. KSCCU objected to its treatment under the plan alleging that BAPCPA prevents the debtors from cramming down KSCCU’s secured claim.
Holding:
KSCCU is entitled to be paid the full amount of its claim at the ongoing Till rate as the car was acquired for personal use of the debtors within 910 days of the filing of their Chapter 13 bankruptcy petition.
In re Michael Christian Diller and Gina Michelle Diller; Case No. 05-42116 (Somers) (September 11, 2006)
MEMORANDUM AND ORDER GRANTING CHAPTER 7 TRUSTEE’S MOTION for turnover as to debtor, Michael Diller
Facts:
The debtors Michael and Gina Diller (“debtors”) filed a joint voluntary Chapter 7 petition on June 30, 2005. Post-petition the debtors were divorced pursuant to a decree entered in the Riley County District Court. Prior to the entry of the decree of divorce, the debtors entered into a Settlement Agreement, which was signed on March 10, 2005. As part of the Settlement Agreement, the Pierre Street property listed on Schedule A and claimed as exempt was assigned to Gina Diller. The Trustee claims that Michael Diller’s interest in the real property, including the contract right to payment through offset against Michael Diller’s child support obligation, is property of the estate.
Holding:
The child support payments are not exempt, and even if they were, only the parent receiving child support and not the parent paying the child support would receive such an exemption. Furthermore, the fact that Michael Diller intends to reinvest his savings from the offset in a new homestead does not make the payments exempt under the homestead exemption. The Trustee is entitled to turnover of Michael Diller’s interest, whether that interest is the “stream of payments” resulting form the monthly off-set to satisfy Michael’s child support obligation or a lump sum payment of Michael Diller’s share of the equity upon the sale of the homestead, whether through foreclosure or otherwise.
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