AMENDED MEMORANDUM OPINION DECLARING SOUTHERN VIRGINIA UNIVERSITY'S DEBT DISCHARGEABLE REBECCA B. CONNELLY, Bankruptcy Judge. PROCEDURAL HISTORY On May 18, 2010, Cynthia Riley Dudley (the "Debtor") filed a bankruptcy petition under Chapter 13 of the Bankruptcy Code. Her case was converted on May 25, 2010 to a case under Chapter 7 of the Bankruptcy Code. Southern Virginia University ("SVU" or the "University") did not file a claim in her case, but the University and its counsel appeared on...
MEMORANDUM DECISION WILLIAM F. STONE, JR., Bankruptcy Judge. This decision recounts a cautionary tale about the inherent risks associated with a Chapter 11 case and the recriminations which fly when rosy expectations of a successful resolution of a multitude of serious interrelated financial issues are shattered and the businessman who started the process is left astounded by how quickly he has learned that one's attempt to control events can come to grief in a reorganization case without...
MEMORANDUM DECISION WILLIAM F. STONE, JR., Bankruptcy Judge. The United States Trustee has filed a Motion to Dismiss this case pursuant to 11 U.S.C. 707(b)(3) ("the Motion") asserting that "the totality of the circumstances ... of [their] financial situation demonstrates abuse" of the provisions of Chapter 7 of the Bankruptcy Code. The Motion presents a challenging issue of interpretation under the facts of this case because a part of that "totality of the circumstances" is the receipt by...
MEMORANDUM OPINION GRANTING PLAINTIFFS' MOTION FOR SUMMARY JUDGMENT AND DENYING DEFENDANTS' MOTION AND SUPPLEMENTAL MOTION FOR SUMMARY JUDGMENT REBECCA B. CONNELLY, Bankruptcy Judge. Before the Court are cross motions for summary judgment. The question the Court must answer is whether a Chapter 13 Trustee's strong arm powers under section 544(a)(3) may defeat an unrecorded deed of trust or whether equitable remedies may block the trustee's powers. THE PARTIES Herbert L. Beskin, Chapter 13...
MEMORANDUM DECISION WILLIAM F. STONE, JR., Bankruptcy Judge. Although a number of motions and other pleadings are before the Court, 1 the issue which has been presented by the parties by agreement for decision at this time is limited in scope. Counsel for the Debtors 2 poses the question as follows: Does the [2005] amendment to section 1325(b) [of the Bankruptcy Code] prohibit debtors operating under a confirmed 36-month plan from receiving a prompt discharge upon early payment of the...
MEMORANDUM OPINION REBECCA B. CONNELLY, Bankruptcy Judge. The question before this Court is whether the United States Trustee (UST) may proceed on her Motion to Dismiss pursuant to 11 U.S.C. 707(b) and (a) when the case was not originally filed under chapter 7. The debtors seek dismissal of the UST's motion because, according to the debtors: (1) section 707(b) does not apply to cases converted to chapter 7; and (2) section 707(a) is inapplicable to dismiss a case for "bad faith." The Court...
MEMORANDUM OPINION REBECCA B. CONNELLY, Bankruptcy Judge. On May 3, 2013, the Court held a hearing on Amber Erbschloe's (the "Debtor") complaint seeking discharge of her student loan debt under 11 U.S.C. 523(a)(8). The parties agreed that in order for the Debtor's loans to be discharged under section 523(a)(8), the Debtor must establish by a preponderance of the evidence that the repayment of her student loans would be an undue hardship. The Debtor testified and presented several pieces of...
