Judge Timothy A. Barnes - Opinions

Judge Timothy A. Barnes

In re Larry Shelton
September 14, 2018

Upon an objection to a chapter 13 plan brought by the standing chapter 13 trustee assigned to the matter, wherein the trustee asserted that the plan’s reduction of payments to secured creditors in order to allow debtor’s counsel fees to be paid earlier in the case both violated the express requirements of the Bankruptcy Code and was not proposed in good faith, held: The plan’s treatment of secured creditors violates the express prohibition in the Bankruptcy Code against such treatment. As a result, the plan is not confirmable. Further, such improper treatment benefits counsel alone and does not treat the debtor or the debtor’s other creditors fairly. As a result, the plan has not been proposed in good faith and is not confirmable. The trustee’s objection is sustained and confirmation of the plan is denied.

15bk33812, 16ap00511
Upon a complaint under 11 U.S.C. § 727, wherein denial of the debtor’s discharge is sought for the debtor making false oaths, namely denial of prior ownership of real property, tools and employment at the meeting under 11 U.S.C. § 341, held: While the plaintiff fails to establish the required elements of 11 U.S.C. § 727 in relation to the tools and employment, the plaintiff has carried his burden regarding the prior ownership of the real property. As a result, the debtor’s discharge is denied.

16bk30240, 17ap00064
Upon the administrator of a decedent estate’s complaint for determination of nondischargeability of debt pursuant to 11 U.S.C. § 523(a)(4) and objection to the debtor’s discharge under alternative grounds in 11 U.S.C. § 727(a)(3), (a)(4)(D), (a)(5) and (a)(6)(A), held: the plaintiff has demonstrated that the debtor breached her fiduciary duty and embezzled funds from the decedent.  The debt due to the plaintiff is, therefore, nondischargeable.  The plaintiff has also proven that the debtor has failed to satisfy her duty to provide records of her financial condition and has failed to satisfactorily explain the loss of the large amount of funds that the debtor received from the decedent’s bank account.  As a result, the debtor will be denied a discharge in her bankruptcy case.  Judgment is entered in favor of the plaintiff on both counts of the complaint.

15bk31790, 16ap00004
Upon the adversary plaintiff’s complaint for determination of nondischargeability of debt pursuant to 11 U.S.C. § 523(a)(2)(A), held: the plaintiff has failed to show by a preponderance of the evidence that the debtor owed a debt to the plaintiff.  The plaintiff also failed to show by a preponderance of the evidence that the alleged debt was obtained through false pretenses, false representation, or actual fraud.  As a result, the debtor will not be denied a discharge of the alleged debt.  Judgment is entered in favor of the debtor on the complaint.

Upon a debtor’s motion for rule to show cause on alleged violations of the automatic stay, held: The debtor has established the requisite grounds for relief arising from the alleged stay violations only as it relates to creditor’s postconversion conduct. The creditor, the debtor’s preconversion bankruptcy counsel, did not violate the automatic stay by attempting to collect on unpaid postpetition fees in another forum during the pendency of the matter prior to conversion. Upon conversion to chapter 13, however, the preconversion fees were treated as prepetition ones and thus the continuation of the collection action violated the automatic stay. The motion is, therefore, GRANTED in part, DENIED in part and CONTINUED in part for a later hearing on additional actual damages.

14bk14023, 16ap00387
Upon the U.S. trustee’s complaint seeking to deny discharge for the debtor under 11 U.S.C. § 727(a)(4)(A), wherein the U.S. trustee alleged that the debtor failed to disclose certain assets on her bankruptcy petition, held: The U.S. trustee has not proven by a preponderance of the evidence that the debtor acted with fraudulent intent when failing to disclose certain assets on her bankruptcy petition. As a result, the debtor will not be denied a discharge on the grounds alleged. Judgment is entered in favor of the debtor.

Upon the adversary defendants’ motion for leave to file counterclaims against the liquidating trustee, held:  The Barton doctrine, which requires a party to seek leave to file claims against a trustee in a bankruptcy case, is inapplicable when the claims are brought in an adversary proceeding in the appointing court.  Therefore, the motion for leave to file counterclaims is DENIED as unnecessary.

In re Elton Tabor
April 11, 2018

15 B 26544
Upon the United States Trustee’s motion for sanctions brought pursuant to 11 U.S.C. § 105, held:  The United States Trustee has shown by a preponderance of the evidence the need to address the circumstances discussed herein in a proceeding under 11 U.S.C. § 105.  The motion is granted and counsel is sanctioned in the matter set forth herein.

17 B 03148
Upon the application for administrative expense brought by prepetition assignee for the benefit of creditors on behalf of its counsel, held: The assignee is entitled to compensation for its counsel under 11 U.S.C. § 503(b)(4), the provision affording administrative expenses for professional services rendered for a superseded custodian. Upon application of the standards relating thereto, the application is, therefore, GRANTED in the manner set forth herein.

16 B 36934
Upon the motion for civil contempt brought by a creditor, alleging that the debtor and debtor’s manager violated bankruptcy court orders by transferring property of the bankruptcy estate without court authority, held: The movant has established under section 105 of the Bankruptcy Code clear and convincing evidence of civil contempt by the debtor and the debtor’s manager by proving that the nonmoving parties knowingly violated court orders. The motion is, therefore, GRANTED.