Justia U.S. 8th Circuit Court of Appeals Opinion Summaries

Debtor appealed the bankruptcy court's order allowing a claim filed by the DHHS as a priority debt in the nature of a domestic support obligation. The court affirmed the judgment, concluding that the debt owed to DHHS was a debt in the nature of support of a child under 11 U.S.C. 101(14A)(B). The court concluded that debtor's remaining arguments lacked merit. View "Hernandez v. Dept. of Health & Human Serv." on Justia Law

These consolidated appeals concerned a home previously owned by debtor. On appeal, the Trustee challenged the bankruptcy court's order holding that he recover nothing from defendants on his action to avoid a transfer which occurred when defendants perfected their liens on estate property postpetition. GMAC challenged the part of the order holding that the automatic stay was not violated and that GMAC lacked standing in the matter. The bankruptcy appellate panel (BAP) concluded that GMAC did not have standing to appeal any violation of the stay because, if GMAC was aggrieved, it was either by a wrongful foreclosure by U.S. Bank or by its own failure to protect its interests, not by the registration of the judgments or the order. Therefore, the court dismissed GMAC's appeal. In regards to the Trustee's claim, the BAP affirmed the bankruptcy court's awarding of nothing to the Trustee where the estate's interest had no value in and of itself, and the loss of a right to use some sort of "leverage" to get money to which the estate was not entitled was not the basis for a cause of action. View "Seaver v. New Buffalo Auto Sales, LLC, et al." on Justia Law

Trustee filed an adversary complaint against Scarlett & Gucciardo to avoid as a preferential transfer under 11 U.S.C. 547, and recover under 11 U.S.C. 550, the $65,000 payment Scarlett & Gucciardo had received from Debtor. Scarlett & Gucciardo received the payment on behalf of defendant in connection with the settlement of a lawsuit. Trustee then filed a motion to amend the complaint to join defendant and to have the amended complaint "relate back" to the date of the original complaint. The bankruptcy appellate panel (BAP) concluded that the district court did not abuse its discretion in allowing Trustee to amend his complaint and to allow Trustee's amended complaint to relate back to the date of Trustee's original complaint; the $65,000 payment was not a contemporaneous exchange within the meaning of section 547(c)(1); and the payment was not made in the ordinary course of business within the meaning of section 547(c)(2)(A). Accordingly, the BAP affirmed the judgment. View "Ries v. Calandrillo" on Justia Law

Plaintiff appealed the bankruptcy court's imposition of sanctions on her for making factually unsupported and harassing statements in documents filed with the court. The court concluded that Federal Rule of Bankruptcy Procedure 9011 did not authorize the sanctions imposed in this case; even if Rule 9011 was inapplicable, it did not mean that the bankruptcy court lacked authority to sanction plaintiff; the court had jurisdiction over the appeal where the penalty imposed was criminal in nature because the monetary penalty was punitive, payable to the court, and non-compensatory; plaintiff did not move for recusal or object to the judge's participation and she therefore forfeited any objection; the bankruptcy court did not commit an obvious error by failing to recuse sua sponte and there was no showing of prejudice or miscarriage of justice; there was no reasonable probability of a different outcome before a different judge where the evidence of plaintiff's contempt was undisputed and aggravated; and plaintiff's remaining claims about the contempt process were without merit. Accordingly, the court affirmed the judgment. View "Isaacson v. Manty" on Justia Law

Debtor appealed a bankruptcy court order holding that the funds in his health savings account (HSA) were not excluded from the bankruptcy estate pursuant to 11 U.S.C. 541(b)(7)(A)(ii) and were not exempt. The bankruptcy appellate panel (BAP) held that an HSA was not a health insurance plan regulated by state law and, therefore, the HSA was not excluded from the bankruptcy estate by section 541(b)(7)(A)(ii). The BAP also concluded that section 522(d)(10)(C) and (11)(D) exemptions did not apply in this instance where the funds in the HSA could be used for purposes other than "disability, illness, or unemployment" and also could be used for purposes other than "personal bodily injury." Further, these exemptions applied only to a debtor's "right to receive" the stated benefits but, in this instance, debtor had already received the money from his employer and there was no longer a "right to receive" the funds that are already in the account. Accordingly, the BAP affirmed the judgment of the bankruptcy court. View "Leitch v. Christians" on Justia Law

Debtors filed a Chapter 13 bankruptcy petition and later, in an amended schedule, claimed as exempt an unliquidated personal injury claim. On appeal, debtors challenged the Bankruptcy Appellate Panel's (BAP) decision affirming the bankruptcy court's ruling that the holding in In re Benn compelled the conclusion that debtors' unliquidated personal injury claim could not be exempted from their bankruptcy schedules. The court concluded, however, that unless In re Benn was overruled en banc or by the Supreme Court, it remained binding precedent, and was directly applicable to the issues in this case. Accordingly, the court affirmed the judgment. View "Abdul-Rahim, et al. v. LaBarge, Jr." on Justia Law

Debtor filed for chapter 7 bankruptcy and then converted her case to one under chapter 13. J&M objected to debtor's homestead exemption in her chapter 7 case, but did not similarly object after she converted to chapter 13. The bankruptcy court entered an order confirming debtor's chapter 13 plan and debtor filed a motion to avoid J&M's judicial lien. The court affirmed, holding that debtor was entitled to claim her homestead exempt in her bankruptcy case; that J&M's judicial lien impaired her exemption; and that the bankruptcy court properly applied Kolich v. Antioch Laurel Veterinary Hospital in computing the extent to which the lien impaired debtor's exemption. View "J&M Securities, LLC v. Moore" on Justia Law

Debtor appealed the bankruptcy court's order denying her Motion to Set Aside Compromise. The bankruptcy appellate panel affirmed the judgment of the bankruptcy court, concluding that debtor failed to meet her burden to show a pecuniary interest to establish her standing to object to the trustee's Motion to Compromise or to pursue this appeal. View "Peoples v. Radloff" on Justia Law

A bankruptcy court ordered that the Laurel Avenue house be vacated and authorized U.S. Marshals to physically remove plaintiff, the debtor's son, from the home. On appeal, plaintiff challenged the dismissal of his suit, which alleged, inter alia, that his constitutional rights were violated when the house, its contents, and his person were searched and seized. The court found no error in the dismissal of plaintiff's 42 U.S.C. 1983 claim against the federal defendants where he did not allege a Bivens v. Six Unknown Named Agents of Federal Bureau of Narcotics action in the amended complaint, nor did he seek to amend to add the claim; plaintiff's section 1983 claim failed against the city and the city's officers where plaintiff failed to set forth sufficient facts to show a direct causal link between the city's policy or custom and the alleged violation of his constitutional rights; the district court did not err in dismissing his tort claims against the trustees under the doctrine established in Barton v. Barbour, which established that an equity receiver could not be sued without leave of the court that appointed him; and because the dismissal of plaintiff's federal claims was proper, the court found no abuse of discretion in the district court's decision to decline supplemental jurisdiction over the remaining state law claims. Accordingly, the court affirmed the judgment. View "Alexander v. Hedback, et al." on Justia Law

Debtor appealed from a bankruptcy court order confirming her Chapter 13 plan over her objection. Debtor filed her model form Chapter 13 plan using the mandatory model form and inserted certain non-standard language in paragraph 10, a blank paragraph labeled "Other." The trustee objected based on the non-standard language. The court concluded that the bankruptcy court properly denied confirmation of her first amended plan because debtor conceded that one or more of her proposed additions were appropriately rejected; the model plan form did not infringe upon a debtor's substantive rights; the bankruptcy court did not issue a blanket rejection of a debtor's ability to include language in paragraph 10; instead, the bankruptcy court considered the specific proposed language and rejected it as, among other things, inconsistent, confusing, and contrary to the Bankruptcy Code; and, therefore, the court affirmed the order. View "McIntosh v. LaBarge, Jr., et al." on Justia Law