2004

Irvin N. Hoyt,  Bankruptcy Judge

Numerical Listing

2004 DECISION SUMMARIES

Irvin N. Hoyt, Chief Bankruptcy Judge

1.    January 15, 2004.  HOPE, WILLIAM BRUCE & LORI LYNN (d/b/a The South Dakota Store), Case No. 03-10194, Chapter 7.  ISSUE: Whether certain goods placed in inventory under "consignment" at Debtors’ store were property of the estate that the case trustee could sell? RULING: None of the consigned goods were property of the bankruptcy estate that the trustee could sell. Debtor did not meet the definition of a merchant as required for the consignments to fall under the U.C.C. Thus, consignors did not have to perfect their consignment interest in the goods by filing and giving notice that their goods had been placed in Debtor’s store’s inventory. Also, many of the consignment did not meet the U.C.C. definition of a consignment because the goods had a value of less than $1,000 when delivered to the store. Since the U.C.C. did not govern the consignments, general bailment law in South Dakota did. Under that law, Debtor did not have an interest in the consigned goods to which the secured claims of Debtors’ creditors or the case trustee could attach. The consigned goods remained outside the bankruptcy estate and had to be returned to the consignors.

2.    January 21, 2004.  HOLWAY, ROBERT (VanLeuven v. Holway), Case No. 03-50144, Adv. No. 03-5009, Chapter 7.  ISSUE: Whether Plaintiff was entitled to summary judgment on her complaint objecting to Debtor’s discharge pursuant to 11 U.S.C. § 727(a)(4)? RULING:Plaintiff was entitled to summary judgment, where Debtor failed to advance specific facts to create a genuine issue of material fact for trial and Plaintiff was entitled to judgment as a matter of law. Debtor’s misstatements and omissions in his schedules and statement of financial affairs constituted a pattern of reckless disregard for the accuracy of his schedules sufficient to warrant the Court’s denying Debtor’s discharge under 11 U.S.C. § 727(a)(4).

3.    January 21, 2004.  MURRAY, TAMARA L.,  Case No. 03-50393, Chapter 7.   ISSUE: Whether Debtor’s case should be dismissed for substantial abuse? RULING: Court ruled that case would be dismissed for substantial abuse unless Debtor voluntarily converted her case to Chapter 13. After pro ration of the family’s expenses based on the income each family member contributed, Debtor personally had just over $200 per month remaining with which she could fund a meaningful Chapter 13 plan. Social Security benefits that Debtor’s child and her non-filing husband’s child received were included in the family’s income analysis.

4.    January 28, 2004.  DURANTE, MARILYN A. Case No. 01-50181, Chapter 7.  ISSUE: (1) Whether case should be reopened at Debtor’s request so that the Bankruptcy Court could review a foreclosure and a forcible entry and detainer action pending in state court? (2) Whether case should be reopened at Debtor’s request so that she could seek a hardship discharge of her student loans? RULING: (1) Debtor’s motion to reopen her bankruptcy case was denied because the Bankruptcy Court did not have jurisdiction over the state foreclosure action on her mobile home or on the forcible entry and detainer action so long as the foreclosing creditor was not trying to enforce a deficiency claim. (2) Debtor’s motion was also denied because the main bankruptcy case did not need to be reopened in order for her to file a hardship dischargeability complaint regarding her student loans.

5.    February 9, 2004.  ROSENOW, LINDA L., Case No. 99-50365, Chapter 7.  ISSUE: Whether Debtor’s attorney was entitled to fees from the Chapter 7 bankruptcy estate for services rendered after the case converted from Chapter 13? RULING: Under the Supreme Court’s recent ruling in Lamie v. United State Trustee, ___ U.S. ___, 2004 WL 110846 (Jan. 26, 2004), a Chapter 7 debtor’s attorney may not be paid from bankruptcy estate funds. The Court held that this ruling will be applied to all services rendered by a Chapter 7 debtor’s attorney from the date of the decision forward. Since this debtor’s attorney Chapter 7 services were rendered before the Lamie decision, the Court, following its earlier decisions, allowed Debtor’s attorney to be compensated from the bankruptcy estate for basic Chapter 7 services, which include analyzing a debtor’s financial condition, rendering advice and assistance to a debtor in determining whether to file a petition in bankruptcy; preparing the petition, the schedule of assets and liabilities, and the statement of financial affairs; and representing the debtor at the § 341 meeting of creditors.

6.  February 25, 2004.  COATS, JAMES LESLIE & JANE IRENE.  Case No. 97-10001, Chapter 12.  ISSUE: 1. Whether Debtors may modify their confirmed plan to alter the payments on a Shared Appreciation Agreement with FSA for which the original first date to repay the debt under the Agreement fell outside the plan term? 2. Whether Debtors’ case should be dismissed for their failure to complete plan payments where they had not repaid their debt to FSA under the Shared Appreciation Agreement? RULING: 1. Debtors’ motion to modify was denied because § 1229(c) prohibits a Chapter 12 debtor from modifying a confirmed plan to change the repayment terms for a long-term debt, which included the Shared Appreciation Agreement with FSA. 2. The motion to dismiss was denied. The debt under the Shared Appreciation Agreement was to be paid outside the plan term so Debtors did not have to pay it before receiving their general discharge. The Shared Appreciation Agreement debt, however, would be excluded from the discharge.

7.    March 16, 2004.  WOOD, GLENN E. & JANET L. (Guliuzza v. Wood).  Case No. 03-50375, Adv. No. 03-5015, Chapter 7.    ISSUES:Whether Debtors’ oral representations that the sale of their other real property would allow a quick payoff of the amount they owed Plaintiffs and that Debtor would be receiving a managerial position were actionable under 11 U.S.C. § 523(a)(2)(A)? Whether Debtors’ oral representations that the sale of their other real property would allow a quick payoff of the amount they owed Plaintiffs and that Debtor would be receiving a managerial position were actionable under 11 U.S.C. § 727(a)(4)(C)? RULINGS: Debtors’ oral representations that the sale of their other real property would allow a quick payoff of the amount they owed Plaintiffs and that Debtor would be receiving a managerial position were statements respecting their financial condition and were thus not actionable under 11 U.S.C. § 523(a)(2)(A). Debtors’ oral representations that the sale of their other real property would allow a quick payoff of the amount they owed Plaintiffs and that Debtor would be receiving a managerial position were not made in or in connection with Debtors’ case and were thus not actionable under 11 U.S.C. § 727(a)(4)(C).

8.  April 2, 2004.  BRIDGEPORT TRACTOR PARTS, INC., a/k/a Gary's Tractor Parts, Inc..  Case No. 03-40965, Chapter 11.  ISSUE: Whether Chapter 11 case should be dismissed as a bad faith filing? RULING: Case was dismissed as a bad faith filing. On the eve of bankruptcy, Debtor purchased real property from an insider to protect the land from foreclosure, Debtor essentially had only one creditor who had recently obtained a large judgment and Debtor was unable to post the appeal bond, and Debtor’s plan was not confirmable.

9.  May 10, 2004.  TRI STATE ETHANAL COMPANY LLC (North Central Const. v. Tri State Ethanol Company, et al.).  Case No. 03-10194, Adv. No. 03-1032, Chapter 11.  ISSUES: Whether mechanics’ liens waivers signed by three contractors or subcontractors resulted in a re-prioritization of their liens behind a bank’s mortgage, which was filed after the contractors or subcontractors started their work on the construction sight? Whether a provision in the general contractor’s construction contract with Debtor precluded the general contractor and one subcontractor from filing any mechanics’ lien? RULING: The lien waivers did not affect the date that the mechanics’ liens originally attached. The contract did not preclude the filing of mechanics’ liens.

10.  May 17, 2004.  WOLFF, DANNY C. & MARLA J.  Case No. 03-40853, Chapter 7.  ISSUE: Whether fees paid by Debtors post-petition should be applied to fees owed by bankruptcy estate or by Debtors? RULING: Fees paid by Debtors from non estate assets had to be applied to the post-petition attorneys’ fees they incurred for services rendered for their personal benefit. Only estate assets could be used to pay that portion of the attorneys’ fees that were considered an administrative expense of the bankruptcy estate. However, as a consequence of Lamie v. United States Trustee, 124 S.Ct. 1023 (2004), a debtor’s attorney can no longer be paid at all from the Chapter 7 estate for any services rendered after January 25, 2004, unless the attorney is employed by the case trustee for a specific purpose. Lamie, 124 S.Ct. at 1031-32; In re Linda L. Rosenow, Bankr. No. 99-50365, slip op. (Bankr. D.S.D. Feb. 9, 2004).

11.  June 1, 2004.  CLOVERLEAF FARMERS' COOPERATIVE, INC., Case No. 89-40531, Chapter 12.  ISSUE: Whether a creditor’s mortgages should be deemed discharged after completion of Chapter 12 plan payments where the creditor’s claim was treated as fully unsecured in the plan, without objection, but where the creditor had filed a proof that it held a secured claim? RULING: The record indicated that all parties agreed by the time of confirmation that the creditor’s claim was wholly unsecured. Thus, at the completion of debtor’s plan payments, the creditor’s mortgages were discharged. In future Chapter 12 cases, however, as guided by present case law, the debtor should formally object to a creditor’s proof of claim. The confirmation process alone cannot overcome the presumed validity of the proof of claim as filed.

12.   June 4, 2004.  NICHOLE M. MORRISON, Case No. 04-40185.  ISSUE: Whether the debtor may make her regular monthly mortgage payments directly to the creditor while she is curing the arrearage through her plan where the creditor wanted the payments to be made through the trustee? RULING: Pursuant to § 1326(c) and relevant case law, the Court allowed Debtor to make her regular monthly mortgage payment directly to the creditor. Since the feasibility of her plan was marginal, however, the Court further ordered that should Debtor default on the direct payments, the creditor could file an affidavit of default and all subsequent payments would have to be made through the case trustee?

13.  June 4, 2004.  MILLER, LOREN D. & JEAN A. (CorTrust Bank v. Miller), Case No. 04-40136, Adv. No. 04-4016, Chapter 7.  ISSUE: Whether default judgment should be vacated under Fed.R.Civ.P. 60(b)(1) for excusable neglect where Defendants misinterpreted Fed.R.Bankr.P. 9006(f) and thus miscalculated the answer deadline? RULING: Though a mistake of law generally does not constitute excusable neglect, the default judgment was vacated where no bad faith or prejudice to Plaintiff was indicated and where the delay in the proceeding was very short.

14.  June 10, 2004.  HAUSLE, DONALD A., Case No. 04-50015, Chapter 7.  ISSUE: Whether the United States Trustee was entitled to summary judgment on his motion to dismiss Debtor’s chapter 7 case for substantial abuse? RULING: The United States Trustee was entitled to summary judgment. Using Debtor’s figures, the Court found that Debtor had the ability to pay his unsecured creditors $18,798.36 over a three-year period or $35,903.40 over a five-year period and that either figure represented a substantial portion of Debtor’s total unsecured debt of $105,709.73. Thus, the Court concluded Debtor had the substantial ability to pay his creditors.

15.    June 15, 2004.  WARKENTHIEN, BRETT E. (Patricia Warkenthien v. Brett Warkenthien).  Case No. 03-30055, Adv. NO. 03-3004, Chapter 7.  ISSUE: Whether Plaintiff-creditor, who prevailed under a § 523(a)(15) nondischargeability, was entitled under 28 U.S.C. § 1920 and Fed.R.Bankr.P. 7054 to substantial costs and attorney’s fees? RULING: The Court followed the American Rule and did not award attorney’s fees as a cost since they were not provided for by separate statute, contract, or prior order. The Court awarded only those limited, specific costs that are allowed by § 1920 and case law regarding that statute.

16.    June 23, 2004.  CREDIT STORE, INC., (Lovald v. Thornton Capital Advisors, Inc, and REcovery Partners II, L.L.C.).  Case No. 02-40922, Adv. No. 03-4017, Chapter 7.  ISSUE: Whether summary judgment should be granted regarding alleged fraudulent transfer of second lien on the debtor’s assets?  RULING: Court denied Defendants’ motion regarding both actual and constructive fraud under § 548(a) and granted Plaintiff-Trustee’s motion only as to application of § 548(a)(1)(B)(ii). A trial will be held to receive evidence of actual fraud under § 548(a)(1)(A) and to receive evidence, as to constructive fraud, on only the issue of the value of the respective transfers under § 548(a)(1)(B)(i).

17.    July 1, 2004.  GAIKOWSKI, DUANE J. & CAROL J. Case No. 03-10193, Chapter 13.  ISSUE: Whether Chapter 13 debtor’s attorney was entitled to have his fees paid in full over an unsecured creditor’s objection? RULING: The objection was overruled. Debtors’ attorney was entitled to have his allowed fees paid in full during the plan term as an administrative expense. Sections 507(a)(1) and 1322(a)(2) give this administrative expense claim a higher payment priority than general unsecured claims.

18.    July 1, 2004.  PETERSON, SCOTT A. (Peterson v. Dullerud).  Case No. 02-10036, Adv. No. 04-1011, Chapter 7. ISSUE: Whether Debtor was entitled to have discharged under § 523(a)(3) certain judgments that he failed to timely schedule in his bankruptcy case? RULING: Debtor was entitled to have discharged the unscheduled debts because the requirements of § 523(a)(3) were met. However, only Debtor's personal liability to the unscheduled creditors was discharged. If the unscheduled creditors held a valid lien on non exempt property, the creditors retained their liens since a discharge under § 523(a)(3) does not affect in rem rights.

19.    July 13, 2004.  HENLEY, MARKUS B. & CYNTHIA (Henley v. Express Collections, et al.).  Case No. 03-50441, Adv. No. 04-5007, Chapter 7.  ISSUE: Whether the clerk’s entry of default should be vacated and whether Defendant County should be allowed to file a late answer to Debtors’ § 523(a)(3) complaint? RULING: The Clerk’s entry of default was allowed to stand. Defendant County, however, was allowed to file a late answer but only to the extent that it raised justiciable issues under § 523(a)(3). The Complaint did not address the County’s lien and so the answer also should not address that issue.

20.    July 21, 2004.  PRAVECEK, DENNIE L. & MINDEE R..  Case No. 04-40643, Chapter 7.  ISSUE: Whether hearing on creditor’s relief from stay and abandonment motion should be delayed so that it could be resolved with Chapter 7 debtor’s complaint to determine whether creditor was cross-collateralized on certain vehicles? RULING: Debtor’s motion to delay the hearing on the creditor’s relief from stay and abandonment motion was denied. Debtor had not declared either subject vehicle exempt and the trustee had not resisted the creditor’s motion. Accordingly, Debtor’s standing to challenge the creditor’s relief from stay and abandonment motion was lacking.

21.    August 3, 2004.  KOOLSTRA, STACY J.  Case No. 04-4005, Chapter 13.  ISSUE: Whether Debtor’s objection to the proof of claim filed by a credit union should be sustained where the debt to the credit union was split between Debtor and her former husband in their pre-petition divorce? RULING: The objection was overruled. While Debtor’s ex-husband may have been ordered in the divorce to pay a share of the debt to the Credit Union, the divorce judgment did not alter Debtor’s original obligation to the credit union to pay the full debt.

22.    August 16, 2004.  GRABOWSKA, TROY E. & RENEE J. (Wells Fargo Bank SD v. Grasbowska), Case No. 03-10318, Adv. No. 03-1063, Chapter 7.   ISSUE: Whether Defendant-Debtor was entitled to a jury trial on a fraud-based nondischargeability complaint? RULING: Defendant-Debtor was not entitled to a jury trial. Nondischargeability is an equitable action in bankruptcy to which a right to a jury trial has not typically attached. Also, since this was an asset case, the Court directed that the amount of Plaintiff-creditor’s claim be determined through an objection to the Creditor’s proof of claim since both Debtor and the estate had an interest in the amount of the claim. No right to a jury trial also attached to the claims objection process.

23.    August 16, 2004.  RUFF, CLAIRE S.  Case No. 04-40353, Chapter 7.  ISSUE: Whether the United States Trustee was entitled to summary judgment on his motion to dismiss Debtor’s chapter 7 case for substantial abuse? RULING: The United States Trustee was entitled to summary judgment. According to Debtor’s calculations, Debtor had monthly disposable income of $189.48. Debtor, however, failed to take into account the Court’s previous rulings that a debtor may not divert funds into a 401K account that would otherwise be available to pay creditors. Adding Debtor’s $185.00 401K loan repayment to Debtor’s admitted monthly disposable income gave Debtor monthly disposable income of $374.48. This would permit Debtor to pay his unsecured creditors $11,383.15 over a three-year period or $19,471.92 over a five-year period (after allowance was made for estimated attorney fees and the chapter 13 trustee’s fee). Either figure represented a significant portion of Debtor’s unsecured debt of $40,363.10. Thus, the Court concluded Debtor had the substantial ability to pay his creditors.

24.    August 25, 2004.  DOERR, BRADLEY M. & DEBRA J.  Case No. 01-40036, Chapter 7.  ISSUE: Whether an attorney for a chapter 7 debtor may be compensated by the bankruptcy estate for services rendered prior to the Supreme Court’s decision in Lamie v. United States Trustee, 124 S.Ct. 1023 (2004)? RULING: An attorney for a chapter 7 debtor may be compensated by the bankruptcy estate for "basic" chapter 7 services, including analyzing the debtor’s financial condition, rendering advice and assistance to the debtor in determining whether to file a petition in bankruptcy, preparing the petition, the schedules of assets and liabilities, and the statement of financial affairs, and representing the debtor at the § 341 meeting of creditors, rendered prior to the Supreme Court’s decision in Lamie v. United States Trustee, 124 S.Ct. 1023 (2004).

25.    August 26, 2004.  WILLIAMS, BUD HALEY & KATHY CLAIRE (Pfeifle v. Williams), Case No. 03-40580, Adv. No. 04-4031, Chapter 7.  ISSUE: Whether because Debtor was operating his vehicle without insurance, Plaintiff’s claim for damages caused by Debtor’s accidently running a red light was excepted from discharge under 11 U.S.C. § 523(a)(6)? RULING: Because Plaintiff pled no facts that would permit the Court to conclude that Debtor intended to cause Plaintiff harm, Plaintiff’s claim was not excepted from discharge under 11 U.S.C. § 523(a)(6).

26.    August 27, 2004.  LARSON CONCRETE CO., Case No. 00-10083, Chapter 7.  ISSUE: Whether Debtor’s objection to Trustee’s proposed distribution should be sustained where Debtor wanted Trustee to marshal assets in a manner that would have increased payments to unsecured creditors but not have paid judgment lien creditors as well? RULING: The objection was overruled. Debtor should have raised the issue sooner when the various real and personal property sale and proceed distribution motions were considered. The objection was also overruled because the marshaling of assets should never prejudice a secured creditor.

27.    August 30, 2004.  ROGERS, DUANE D., Case No. 99-10071, Chapter 12.  ISSUE: Whether Debtor’s motion to incur debt should be granted where creditor objected because it had not been paid? RULING: Debtor’s motion to incur debt was approved because the purpose of obtaining the credit was to finish making plan payments to unsecured creditors. The objecting creditor, however, was not going to receive any of the borrowed funds because it had not timely filed a proof of claim. The objecting creditor’s claim also would not be discharged because the claim "was not provided for by the plan" as required for discharge under 11 U.S.C. § 1228(a).

28.  September 1, 2004.  SCHULTZ, TONY DANIEL & SHERI MARIE  (Credit Collection Services v. Schultz).  Case No. 03-40141, Adv. No. 04-4023, Chapter 7.  ISSUE: Whether defendant-creditor had to return garnished wages (under Nebraska law) as a preferential transfer where a garnishment lien was created before the preference period and where the wages were earned outside the preference period but where the creditor did not receive the funds until in the preference period? RULING: According to the Bankruptcy Court case law for the District of Nebraska, garnished wages are transferred when the debtor acquires rights to them. Since that happened in this case when the debtor earned the wages outside the preference period, no preferential transfer occurred.

29.    March 5, 2004.  SHAULL, NATHAN.  Case No. 02-30051, Chapter 7.  ISSUE: Whether certain government farm program payments are property of the estate? RULING: Under Drewes v. Vote (In re Vote), 276 F.3d 1024 (8th Cir. 2002), government farm program payments related to a pre-petition crop year are not property of the bankruptcy estate if the legislation creating the payments was enacted post-petition. That decision controlled here, where the same facts existed. Accordingly, the funds were not property of the estate.

30.    September 22, 2004.  KLEIN, MICHAEL ALLEN & MARYANN (Pine Lawn Memorial Park v. Klein).  Case No. 02-50372, Adv. No. 02-5016, Chapter 7.  ISSUE: Whether Plaintiff’s pre-petition claim against Defendants-Debtors was nondischargeable under § 523(a)(4) where Defendants-Debtors were corporate officers and directors for Plaintiff, where Plaintiff’s financial status plummeted during their tenure, and where funds held in trust were used contrary to Plaintiff’s by-laws and regulations? RULING: Plaintiff’s pre-petition claim was declared nondischargeable. Defendants-Debtors were fiduciaries of Plaintiff and their defalcation during this fiduciary relationship resulted Plaintiff’s pre-petition claim against them.

31.    October 7, 2004.  CREDIT STORE, INC., (Lovald v. Thornton Capital & Recovery Partners). Case No. 02-40922, Adv. Nos. 03-4017 and 04-4050, Chapter 7.  ISSUE: Whether these two adversary proceedings should be consolidated for trial? RULING: The adversary proceedings were consolidated for trial. The two agreements at issue (one per adversary) were related. Moreover, to look at one agreement in isolation would likely have resulted in an incomplete or inaccurate record.

32.  October 27, 2004.  WIPF, THOMAS JOHN (Marlin Hutterian Brethren v. Thomas John Wipf v. Cen-Dak Leasing of North Dakota, Inc.) (nondischargeability). Case No. 03-10306, Adv. No. 03-1060, Chapter 7. ISSUE: Whether creditor’s claim was nondischargeable where creditor purchased two trailers from Debtor and where Debtor falsely represented that he owned the trailers and where Debtor failed to give the creditor titles to the trailers? RULING: The creditor’s claim was declared nondischargeable under 11 U.S.C. § 523(a)(2)(A). Debt was calculated to be sums that creditor had paid Debtor plus value of trailer creditor had given Debtor in trade.

33.  October 27, 2004.  WIPF, THOMAS JOHN (Marlin Hutterian Brethren v. Thomas John Wipf v. Cen-Dak Leasing of North Dakota, Inc.) (replevin  third-party complaints). Case No. 03-10306, Adv. No. 03-1060, Chapter 7.  ISSUE: Whether Court should hear third-party complaint for replevin? RULING: The Court declined to rule on a non-debtor defendant’s third-party complaint against another non-debtor. While the parties had originally consented to jurisdiction under 28 U.S.C. § 157(c)(1), procedural and evidentiary problems, as well as the need to add other non-debtor parties, dictated that the Court dismiss the third-party complaint without prejudice.

34.  2.  October 27, 2004.  WIPF, THOMAS JOHN (Marlin Hutterian Brethren v. Thomas John Wipf v. Cen-Dak Leasing of North Dakota, Inc.) (revocation of discharge).  Case No. 03-10306, Adv. No. 04-1008, Chapter 7.  ISSUE: Whether Debtor was entitled to summary judgment on Plaintiff-creditor’s claim that Debtor’s discharge should be revoked under 11 U.S.C. § 727(d)(1) where Plaintiff had suspicions of possible fraud by Debtor before Debtor’s discharge was entered?  RULING: Three pre-petition circumstances put Plaintiff on notice, before Debtor’s discharge was entered, that it needed to investigate Debtor’s pre-petition actions for a possible dischargeability or denial of discharge complaint. Accordingly, Plaintiff could not now seek a revocation of Debtor’s discharge under § 727(d)(1).

35.    December 1, 2004.  ABERDEEN FINANCE COMPANY (Aberdeen Finance Company v. South Dakota Network, L.L.C.,) .  Case No. 04-10175, Adv. No. 04-1015, Chapter 11.  ISSUE: Whether Plaintiff-Debtor was entitled to summary judgment on its preference action regarding a judgment lien that was taken on a dishonored letter of credit? RULING: Summary judgment was not granted as Defendant raised material question of fact regarding whether Debtor was insolvent when the judgment lien was taken. Court also ruled that Debtor’s assets, for the insolvency test under § 547, would be valued at a going concern value and that the date of the debt was when Debtor dishonored the letter of credit, not when that debt was later reduced to judgment.

36.    December 1, 2004.  BRITT, SAMSON VERNON & SHELLY JO, Case No. 04-40692, Chapter 7.  ISSUE: Cases trustee objected to Debtors’ claimed exemption regarding a contingent remainder interest in a spendthrift trust. Per the Court’s direction, the first issue presented was whether the debtor’s interest in the trust was a bankruptcy estate asset. RULING: The Court concluded that the debtor’s interest in the spendthrift trust did not constitute property of the bankruptcy estate under § 541(c)(2), thus Debtors did not need to exempt it from the estate. The trustee’s objection was overruled.

37.    December 17, 2004.  UECKER, JOHN E. & ERDENE M., Case No. 02-41062, Chapter 12.  ISSUE: Whether a creditor may recover as an administrative expense under 11 U.S.C. § 503(b) the cost of an appraisal prepared in support of the creditor’s objection to a debtor’s chapter 12 plan? RULING: None of the provisions of 11 U.S.C. § 503(b) authorizes a creditor’s recovery of the cost of an appraisal prepared in support of the creditor’s objection to a debtor’s chapter 12 plan. To recover under § 503(b)(1)(A), the creditor must show that the expense arose from a transaction with the debtor or the debtor’s estate. To recover under § 503(b)(3)(D), the creditor must incur the expense in making a substantial contribution in a chapter 9 or chapter 11 case. Therefore, a creditor may not recover as an administrative expense under 11 U.S.C. § 503(b) the cost of an appraisal prepared in support of the creditor’s objection to a debtor’s chapter 12 plan, even if the appraisal led the debtor to increase the debtor’s proposed payments to certain creditors.

38.    December 20, 2004.  JUHNKE, RICKY D. & GWEN M., Case No. 04-41154, Chapter 7.  ISSUE: Whether a debtor may avoid a contractor’s excise tax lien pursuant to 11 U.S.C. § 522(f)(1)? RULING: A contractor’s tax lien is a statutory lien, not a judicial lien. Therefore, a debtor may not avoid such a lien pursuant to 11 U.S.C. § 522(f)(1), even if it impairs the debtor’s homestead exemption.

39.    October 14, 2004.  FLEURY, DARCI, Case No. 04-50203, Chapter 7.  ISSUE: Whether a judgment held by a creditor who was not listed on the debtor’s schedules of creditors and mailing list of creditors, but whose attorney was listed on both, was voided by the debtor’s discharge? RULING: A debtor must list each creditor on the debtor’s schedules of creditors and mailing list of creditors. Listing an attorney who represented a creditor in the past is insufficient. The claim of a creditor who was not properly listed may not have been discharged. Thus, the debtor’s motion to discharge the creditor’s judgment was premature.

40.    December 21, 2004.  FARLEY, FORREST JASON, Case No. 04-40543, Chapter 7.  ISSUE: Whether a judgment held by a creditor who was listed on the debtor’s schedules of creditors and mailing list of creditors "in care of" an attorney who represented the creditor in the past was voided by the debtor’s discharge? RULING: A debtor must list each creditor on the debtor’s schedules of creditors and mailing list of creditors at the creditor’s own address, not that of an attorney who represented the creditor in the past. The claim of a creditor who was not properly listed may not have been discharged. Thus, the debtor’s motion to discharge the creditor’s judgment was premature.

41.    March 5, 2004.  LARSON CONCRETE COMPANY, Case No. 00-10053, Chapter 7.  ISSUE: Whether Debtor’s principal was entitled to an administrative expense claim for a loan he made to Debtor pre-petition to pay a retainer to Debtor’s bankruptcy attorney just as the case was being commenced under Chapter 11? RULING: The principal was not entitled to an administrative expense claim. The principal claimed the loan was made pre-petition; therefore, he had an unsecured, pre-petition claim, not an administrative expense claim for repayment of a loan made, with court approval, during the Chapter 11 administration.