Bankr. No.:
05-42197
Chapter:
7
Date of Decision:
March 3, 2008
Issue:
(1) Whether medical expense benefits from Debtors' vehicle insurance policy and personal injury settlement funds received due to Debtors' injuries from a pre-petition auto accident are property of the estate? (2) Whether a post-petition creditor who provided medical services to one of the debtors related to a pre-petition accident had a priority interest in the medical expense benefits from Debtors' vehicle insurance policy or the personal injury settlement funds that were property of the estate?
Ruling:
(1) Both the insurance benefits and the personal injury settlement funds were property of the bankruptcy estate. No party in interest demonstrated how any exclusion under 11 U.S.C. § 541 applied or how state law excluded the property from the estate upon application of § 541(a). (2) No party in interest demonstrated, under applicable bankruptcy or nonbankruptcy law, how the medical provider's post-petition claim could be paid from the insurance proceeds and settlement funds that were property of the bankruptcy estate.
Full Bankruptcy Court Decision:
