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Help! “No asset” converted to “asset”, but no details

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    Help! “No asset” converted to “asset”, but no details

    My case is a little complicated. I sold my house to my ex in January with a quitclaim deed since we are still married (I didn’t even consider filing for bankruptcy until June, weeks before I actually filed). So my attorney reviewed everything and said the Trustee would likely question it, but it shouldn’t be a problem. I had my 341 in July and that’s what happened. She questioned me like I was committing fraud, but wouldn’t let me get a word in to defend myself. So within a couple of weeks after the meeting, she hired an attorney (her own firm) and converted the case to an “asset” case.
    She wanted backup to see what I spent the sale proceeds on and she requested an extension to object exemptions. So I sent that to her in a very detailed excel spreadsheet of each transaction showing I used 90% of the proceeds to pay debt. So according to Pacer, she had until October 7 to object to discharge and object to exemptions. The problem is that the last filing was on October 2nd (when they switched judges because mine retired). On October 4, I asked the attorney if the trustee had everything and if she asked for anything else and they said “no, she isn’t shy and will ask for whatever she needs”. All of my court filings were reported in Pacer either the same day or the next day, so if she was going to file an objection, then I think I would’ve seen it by today. The problem is that my case still shows as an “asset” case and she hasn’t filed for discharge or the “no distribution of assets”..... I was going to call my attorney tomorrow, but I wanted to see if anyone here had an idea of what I have in store for me. Am I in the clear since the deadline passed? Should I expect more issues?
    Last edited by NeverEasy19; 10-08-2019, 01:48 PM.

    #2
    My schedule:
    Deadlines/Hearings
    341 Meeting 07/05/2019 08/08/2019
    at 09:00 AM
    08/09/2019
    Objection to Discharge Due 07/05/2019 10/07/2019
    Proof of Claim Deadline 08/16/2019 11/16/2019
    Last edited by NeverEasy19; 10-08-2019, 02:43 PM.

    Comment


      #3
      Originally posted by NeverEasy19 View Post
      The problem is that my case still shows as an “asset” case and she hasn’t filed for discharge or the “no distribution of assets”..... I was going to call my attorney tomorrow, but I wanted to see if anyone here had an idea of what I have in store for me. Am I in the clear since the deadline passed? Should I expect more issues?
      I know, firsthand, that it's difficult to worry about what the Trustee is doing. Since you don't mention the United States Trustee (UST) this has nothing to do with you receiving the discharge (which you should have today, or tomorrow). This is not a discharge objection. It's all about the money.

      The Trustee doesn't file for a discharge.

      It is entirely the Trustee's job to look at that quitclaim/sale with doubt and uncertainty as to whether it was a transaction in which the Trustee cannot undue. Remember, that insider payments and even transfers receive the ultimate scrutiny because they are not arm's length transactions. This is especially true if the insider payment or transfer was done within a year of filing. I think your attorney could have been a little more forthcoming with potential issues, but I will give the attorney a lot of slack, because they also don't want you to worry about "technical" details.

      When there is nothing in PACER and your last day to file a complaint to object to discharge has passed, you are entitled to a discharge. This doesn't change the Asset status of the case as discharge is separate from administration. My (100%) guess is that the Trustee is attempting to review the transaction and see if there is any wiggle-room to claw back at some of the proceeds. If your attorney thinks the Trustee doesn't have any legal standing, then that's that.

      The question may come down to whether or not you used your "unused homestead exemption" (the $4,000 "wildcard") since you didn't own property. The Trustee is probably just questioning whether transferring property to a spouse is an "arm's length" transaction for value.

      My speculation -- and I don't like speculating -- is that the Trustee is first trying to make sure you didn't transfer the property just to keep it out of the hands of creditors. I think that's foolish because you otherwise held an unlimited homestead exemption (Florida Constitution X) which kept the property away from creditors anyhow. This Trustee is just trying to see if there is something there.

      I would lean on my attorney for any additional clues. I would say that the Trustee's actions are normal for this type of insider transaction within a year of filing.
      Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
      Status: (Auto) Discharged and Closed! 5/10
      Visit My BKForum Blog: justbroke's Blog

      I am not an attorney. Any advice provided is not legal advice.

      Comment


        #4
        Thanks for your response. The attorney has been pushing to get a response from the Trustee's office, but they haven't gotten back to them yet. They've tried reaching out frequently, but haven't heard anything yet. The discharge hasn't been issued, the report of no distribution hasn't been issued, so it seems like they are considering trying to get compensation from some asset (although the date to object has passed). I'm hoping that it is just a case of them being very busy or trying to finalize everything and aren't going to try for some big reimbursement or something bad. It is like you said though, if I had the property, it would still be within the exemption, so I'm not sure why she is making a big deal of it.

        Comment


          #5
          I finally got my discharge! But my case still shows as an asset case :\

          Comment


            #6
            It will remain an asset case until the Trustee files a report of no distribution or starts to "administer" some assets. The discharge was the prize! Hopefully your attorney will keep at the Trustee. Eventually, your attorney may file a motion to compel turnover to force the Trustee's hand. It's way too early for that. You may need to wait another 6 months to learn the outcome; it may come sooner, but it may take that long.
            Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
            Status: (Auto) Discharged and Closed! 5/10
            Visit My BKForum Blog: justbroke's Blog

            I am not an attorney. Any advice provided is not legal advice.

            Comment

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