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Opinions

The District of Utah offers a database of opinions for the years 1979 to Current, listed by year and judge. For a more detailed search, enter the keyword or case number in the search box above.

Opinion Archive

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Title: In re Clemens | Date: Aug-22-2006 | Status: PUBLISHED (Judge Thurman) | Case(s): 06-20124

The Court interpreted the BAPCPA amendments to section 330(a)(3) and 330(a)(7) regarding allowance of chapter 7 trustees' fees. The Court held that under these amendments, the 10th Circuit's opinion of In re Miniscribe, 309 F.3d 1234 (2002) was not overruled but that section 326 must now be a part of the Court's Lodestar analysis, instead of simply acting as a cap against Trustee's fees.In reviewing trustee fee requests, the Court will now consider: 1) the time and labor required; 2) the novelty and difficulty of the issues involved; 3) the skill requisite to perform the service properly; 4) the preclusion of other employment by the trustee due to his or her acceptance of the appointment as trustee in the case; 5) the customary charges by other professionals involved in the case and by the field in general; 6) the contingent nature of the fee; 7) time limitations imposed by acceptance of the appointment; 8) the amount generated by the trustee's efforts for creditors and the results obtained; 9) the experience, reputation, and ability of the trustee; 10) the 'undesireability' of the case; 11) awards in similar cases; 12) computation of any multiplier for extraordinary results obtained by the trustee; 13) the amount resulting from the calculations under section 326(a); 14) whether the trustee has engaged in conduct which might justify denial of compensation under section 326(d); 15) whether notice of the trustee's fee request is appropriate, and whether any party in interest objects to the fees; and 16) whether the fees are to be paid from cash collateral and whether the creditor secured by the collateral consents.In this case, the chapter 7 Trustee's request for fees was not accompanied by any documentation of the hours spent in prosecuting the case. The Court held that without such documentation, it could not undergo the required "Lodestar" analysis discussed above. Accordingly, the Court denied the Trustee's request for fees without prejudice.


Title: In re Curtis | Date: Jul-11-2006 | Status: PUBLISHED (Judge Boulden) | Case(s): 06-20001

The Debtor proposed a Chapter 13 plan in which he sought to bifurcate the secured claims of two different creditors under 11 U.S.C. § 506(a)(1). These creditors had provided financing to the Debtor within the previous year that allowed him to purchase two semi-tractors used in his business. The Debtor argued that the hanging paragraph of § 1325(a) requires that a creditor whose collateral consists of “any other thing of value” purchased within one year of filing can only avoid having its secured claim crammed down under § 506(a)(1) if it has a purchase money interest in the collateral. Furthermore, the Debtor argued that a creditor can never have a purchase money security interest in a motor vehicle in Utah. The Court found that the hanging paragraph does require a creditor whose collateral consists of “any other thing of value” to have a purchase money security interest in the collateral to avoid the cram down of its secured claim. The Court also found that the Utah Uniform Commercial Code regulates the creation of security interests in motor vehicles in Utah meaning that Creditors can have purchase money security interests in motor vehicles. The Debtor's objections were overruled and his plan was denied confirmation without prejudice.


Title: In re Fuger | Date: Jun-29-2006 | Status: PUBLISHED (Judge Thurman) | Case(s): 06-20801

The Court was called upon to determine the meaning of the phrase, “applicable commitment period” found in Section 1325(b)(1)(B) under the Bankruptcy Abuse Prevention and Consumer Protection Act (“BAPCPA”). Through an analysis of plain language of the statute and prior case law, the Court ruled that a chapter 13 Debtor may propose a plan which does not require a set length of time to be in a plan, but which pays a specific amount to unsecured creditors. This amount would normally be calculated and paid over the applicable commitment period. The 'applicable commitment period,' 3 or 5 years, serves to aid the Debtor in determining the amount he or she must return.


Title: In re Wilbur | Date: Jun-21-2006 | Status: PUBLISHED (Judge Thurman) | Case(s): 06-20104

In this case, the Court was called upon to determine the scope of the phrase "unsecured creditors" in the context of Section 1325(b)(1)(B) relating to confirmation of a chapter 13 plan. That section provides that upon objection to confirmation by a party in interest, the Court may confirm a debtor's proposed chapter 13 plan only if the debtor proposes to pay unsecured creditors in full, or proposes to pay the debtor's projected disposable income for the applicable commitment period to "unsecured creditors." The Debtors in this case urged the Court to adopt the plain language of §1325(b)(1)(B). They contended that the phrase "unsecured creditors" refers to both priority and non-priority unsecured creditors which resulted in a lower payment to the unsecured creditors. The chapter 13 Trustee disagreed and objected to the plan.The Court declined to enforce the plain language of section 1325(b)(1)(B) because that interpretation conflicts with manifest Congressional intent, and would bring an absurd result. The Court concluded that the reference in section 1325(b)(1)(B) to "unsecured creditors" refers to non-priority unsecured creditors only, requiring the Debtors' proposed chapter 13 plan to return to non-priority unsecured creditors at least the amount calculated on Form B22C, which in this case would be a much greater amount than proposed. Since the Debtors' proposed plan did not comply with this requirement, the Court held that the Debtors' proposed plan did not meet the requirements of section 1325(b)(1)(B) and was not confirmable.


Title: In re Wilkinson | Date: May-30-2006 | Status: UNPUBLISHED (Judge Boulden) | Case(s): 06-20441

Chapter 13 debtor attempted to comply with 11 U.S.C. § 521(a)(1)(B)(iv) by filing all pay advices received during the 60 days prepetition but erroneously filed one pay advice for the wrong year. The missing pay advice was filed immediately prior to the confirmation hearing but outside the 45-day time limit articulated in § 521(i). The debtor filed a Motion to Find Compliance with 11 U.S.C. § 521 or, in the Alternative, Motion to Vacate Order of Dismissal arguing either that the debtor had “substantially complied” with the requirements of § 521 or that the Court otherwise had discretion to not dismiss the case. Elaborating on the Court's decision in In re Fawson, 338 B.R. 505 (Bankr. D. Utah 2006), the Court rejected the debtor's interpretation of the statute and reiterated the holding that automatic dismissals occur on the 46th day after the petition is filed without judicial intervention unless a timely extension motion is filed. The Court also rejected an argument based on substantial compliance in light of the strict statutory scheme of § 521(a)(1) and (i). Finally, the Court held that Federal Rule of Bankruptcy Procedure 9024, incorporating Federal Rule of Civil Procedure 60(b), cannot be used to vacate a dismissal that occurred automatically by operation of statute.


Title: GE Money Bank v. Belinda Marek (In re Marek) | Date: May-10-2006 | Status: UNPUBLISHED (Judge Clark) | Case(s): 05-02766

Creditor filed adversary to have creditor's debt excepted from discharge under § 523(a)(2), but filed the adversary proceeding after debtor had been issued a discharge and after debtor's case had been closed. Creditor served a summons and complaint upon debtor after closure of Debtor's case as well. Debtor did not file an answer to the summons and complaint or otherwise defend. Creditor submitted an application for default judgment and the matter came before the court on hearing. Creditor argues that under Knotrick v. Ryan, 540 U.S. 443 (2004). Creditor is entitled to a default judgment because Debtor failed to assert Creditor's late filing of the adversary proceeding as an affirmative defense. Creditor argued that service upon Debtor was effective because the debtor is an individual and that service upon individuals is governed by F.R.B.P. 7004(b)(1). The Court held that service of process upon a debtor is governed by Rule 7004(b)(9) rather than Rule 7004(b)(1), that Creditor's service upon the Debtor was ineffective because the Debtor's case was closed at the time that Debtor was served with the summons and complaint, and that Creditor must reopen debtor's case in order to effectuate service of process upon the Debtor under Rule 7004(b)(9).


Title: In re Beckstead | Date: Apr-26-2006 | Status: UNPUBLISHED (Judge Thurman) | Case(s): 05-35213

The Court was called upon to determine whether a real estate commission was property of the estate and if so, whether it was exempt. One of the Debtors in this case was employed as a real estate agent under the supervision of her principal broker. Before filing for chapter 7 bankruptcy relief, the Debtor produced buyers to certain sellers, who were ready, willing and able to purchase the sellers' real property. The Debtor, acting as a real estate agent, performed the bulk of her services before the filing of the Debtor's case. The sale did not close until after the Debtor filed this bankruptcy case. Upon reciept of the commission from the sale, the Debtors amended their statements and schedules to include the commission and claimed an exemption for 75% of the commission under Utah R. Civ. P. 64D. The chapter 7 trustee assigned to the Debtors' case objected to their claimed exemption, arguing that a commission is not subject to an exemption under Rule 64D.The Court first held that under Utah law the commission is property of the estate because the Debtor had an agreement with her broker that she was entitled to a commission whenever the broker became entitled to its commission. Under Utah law a broker is entitled to a commission when the broker presents a seller with a buyer who is ready, willing and able to purchase the property at issue, regardless of whether the sale actual goes to completion. Because the broker was entitled to collect its commission before the Debtor filed for bankruptcy relief, so too was the Debtor entitled to collect the commission. Thus, the Court concluded that the commission was property of the estate.The Court also held that under Utah law a commission is subject to an exemption under Rule 64D. The Court reached this conclusion by considering the language and history of Rule 64D, applying Utah rules of statutory construction.


Title: Markus v. Fried (In re Geneva Steel) | Date: Apr-18-2006 | Status: PUBLISHED (Judge Clark) | Case(s): 05P-02578

The Chapter 11 trustee brought an adversary proceeding against certain members of Geneva's Board of Directors alleging breach of duty of care, breach of duty of good faith, breach of duty of loyalty and breach of fiduciary duty. Two of the defendants filed a motion with the Court to have the trustee's causes of action declared as "non-core" matters under 28 U.S.C. § 157(b)(3). Both of the moving directors had filed proofs of claim in the Geneva bankruptcy proceeding. An element of the Director's proofs of claim included an indemnity claim asserting claimant's rights to be indemnified, defended, or held harmless by Geneva for any liability that may arise from the Director's service on the Board of Directors. Upon being served with the trustee's complaint, both directors filed a counterclaim in the adversary proceeding asserting their indemnification rights. The Court ruled that the causes of action in the trustee's adversary proceeding against the directors were a compulsory counterclaims to the director's proofs of claim and the Court ruled that the director's counterclaims were compulsory counterclaims to the causes of action brought by the trustee in the adversary proceeding. The Court held that under 28 U.S.C. § 157(b)(2)(C), and 28 U.S.C. § 157(b)(2)(O), the causes of action asserted by the trustee are "core" matters.


Title: In re Montoya, 2006 WL 931562 (Bankr.D. Utah) | Date: Apr-10-2006 | Status: PUBLISHED (Judge Boulden) | Case(s): 05-80022

The Debtor proposed a Chapter 13 plan in which she sought to pay for a car that was purchased within 910 days of filing her petition (910-vehicle claim) by bifurcating the secured claim under 11 U.S.C. § 506(a)(1), paying the secured value of the car in full, and paying only a small percentage of the unsecured balance. Although the hanging paragraph found after § 1325(a)(9) now prohibits bifurcation under § 506(a)(1) in certain instances, the Debtor and the Chapter 13 Trustee argued that bifurcation is still allowed because the creditor secured by the car failed to file an objection to the Debtor's Chapter 13 plan and, therefore, should be deemed to accept the plan under § 1325(a)(5)(A). The Court found (1) that under the BAPCPA, § 1325(a)(5) can no longer be used to cram down a 910-day vehicle claim; (2) that a creditor's failure to object to a plan is not deemed implied acceptance of that plan when the plan proposes treatment that is contrary to the statute; and (3) a plan that incorrect bifurcates a 910-day vehicle claim does not comply with the provisions of Chapter 13 and, therefore, cannot be confirmed under § 1325(a)(1).


Title: In re Easthope, 2006 WL 851829 (Bankr. D. Utah) | Date: Mar-29-2006 | Status: PUBLISHED (Judge Boulden) | Case(s): 06-20366

A secured creditor moved for an order under § 362(c)(4)(A)(ii) confirming that no stay was in effect arguing that the individual debtor had two cases pending within the previous year. The debtor had one prior Chapter 13 case that was dismissed within the previous year and another prior Chapter 13 case that was closed within the previous year. This earlier Chapter 13 case had been dismissed more than a year prior to the filing of the current case. The secured creditor argued that a case is still “pending” for § 362(c) purposes until it is closed and, therefore, the debtor had two cases pending in the previous year. The Court determined that both the plain meaning of the word “pending” and policy considerations demonstrate that a case is no longer pending once it has been dismissed. Given this definition, the debtor only had one case pending withing the previous year and the 30-day automatic stay did go into effect under § 362(c)(3). The secured creditor's order seeking confirmation that no stay was in effect was, therefore, denied.

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