Ch.7 dismissed due to "abuse" AND "totality of circumstances"

[Liore1477]

One man's advice is another man's lecture. It's all perception. If you can take the emotions out of it and mentally filter the information, you may find some great wisdom here. In combined experience, people here have about seen it all.

In the end, as you know, the only opinion that matters is the trustee's.

And for the record, I know everyone on this forum secretly envies my sweet bicycle and my bus pass...LOL

Bkmaggster, I agree it's all about perception. I would add that we all have different communication styles, and while one person puts it politely, another one may be very blatant and downright rude. So I take no offense whatsoever because only I and my close circle know my life circumstances, and no one else does.

[bkmaggster]

I am on this board to share experiences and get advice, not to get lectured.

One man's advice is another man's lecture. It's all perception. If you can take the emotions out of it and mentally filter the information, you may find some great wisdom here. In combined experience, people here have about seen it all.

In the end, as you know, the only opinion that matters is the trustee's.

And for the record, I know everyone on this forum secretly envies my sweet bicycle and my bus pass...LOL

[Liore1477]

As the owner of two Kia's I am a little offended by those remarks. I can't be too offended though since I bought them because they are cheaper. I needed a specific vehicle type in both cases and they were the only cars I could afford in that class. The first was an suv that I needed for work and the second was minivan that I needed for the kids. I drive my Kia's proudly knowing that my family is provided for. If you want to snicker at me that's fine, while you are at it I have a Dynex tv and I buy some generic food items too.

Kpower, that's exactly what I am saying... how can anyone say "Hope you get financed at Kia dealership", as Hereforinfo said? That really implies that Kia is the last resort type of car.... And it is not the case. I got some solicitations from Ford dealership, too.

[backtoschool]

Well, I traded in my saab 9-3 (ie, a $40,000 car) for a hyundai elantra as part of my pre-bankruptcy planning, and LOVE the elantra.

[Kpower]

As the owner of two Kia's I am a little offended by those remarks. I can't be too offended though since I bought them because they are cheaper. I needed a specific vehicle type in both cases and they were the only cars I could afford in that class. The first was an suv that I needed for work and the second was minivan that I needed for the kids. I drive my Kia's proudly knowing that my family is provided for. If you want to snicker at me that's fine, while you are at it I have a Dynex tv and I buy some generic food items too.

[Liore1477]

Hereforinfo - it sounds like you are the Trustee sympathizer or a Trustee himself lurking in this board.

I am not getting your penchant to lecture some people on how imprudent or bad they are... and all of this from Trustee's standpoint. I have my atty to relay this info. I am on this board to share experiences and get advice, not to get lectured.

Oh, and one other thing. I am reporting your post to Kia HQ in USA for offending their brand name and reputation.

[hereforinfo]

Why not try to help the OP, rather than get bogged down in trying to find fault in where he is in life?

Yes, but you also have to consider the DEBT level as well. I think someone with that income could reasonably afford 2 $40k cars, but not if they can't afford to pay other debts. Apparently that's the trustee's opinion as well - with more reasonable car payments there would be money left to fund a 13.

[hereforinfo]

No, not that....there was someone who said "you consider $80K worth of vehicles reasonable and necessary??" For my family, the answer is YES. It is clear that only someone who has an envious streak could say something like that.

You really think too highly of yourself. We actually have 2 luxury cars in the driveway, one of which is paid off. We're not bankrupt, genius. Actually, no debt other than a primary mortgage and one small car payment. See? Some people can actually question you without being jealous. Apparently I'm not out of line, considering the trustee wants to dismiss your case. I guess he must be jealous of you too? If it makes you feel better about yourself to think that I would rather be broke with a dismissed bankruptcy, then by all means go right on telling yourself that. Hope you can get financed at the Kia dealership.

[2manybills]

JB: I agree with you about the McMansion case. Also, there was another case that the Ninth Circuit came down with that allowed the boats, etc. I'll see if I can find.

There again, it depends on what Circuit you are in and for that matter what District you are in.

In some areas, it is average to have a $3K or $4K house payment, where in others $600 is the norm. As with salaries, if you are making $100K a year but your in a house that costs $3 or $4K a month, you will wind up just as much in the hole as the family that is making $50K in that $600 a month house. I hope my example makes sense, but its all relative.

[Kingxray]

Liore1477:

The UST filed a motion to dismiss or convert our case due to "abuse" and "totality". We also made over 100K and my dad's (a creditor) lawyer was also given our case grief. Our lawyer decided we should dismissed it, change the numbers so they looked better and then refile. My dad's lawyer is still giving us grief but so far no involvment with the UST. I'm keeping my fingers crossed. Maybe you can do the same thing too.? Just dismiss and fix the things they are specifically mentioning and then refile, but your lawyer knows best. Good luck!

[pcn]

I think some of us get stuck in trying to relate other's experiences in the context of our own experiences. Ohiofiler said it well:

It may well be difficult for many people to comprehend the need for 2 $40,000 vehicles.

[justbroke]

Can the argument be made that at least one of the cars the spouse uses it for business? Lets say 50% under a separate business like an LLC. We were set up like that and the UST has stopped pestering us about it. (now she may blindside us when we court to court on it, too)

But now you've just said you have a business, which could open up things. Also, the car company -- and this happened to me -- could say that the spouses car is not necessary for your reorganization. (Of course, this is in a non-community property state.)

also (I am wondering if justbroke can chime in on this) in my research for our case it seems there have been some recent rulings that the congress didn't put a limit on secured debt in the means test for a reason

Absolutely true and if you look above, is what I stated. This is now precedence.

therefore it can't be canceled out under totality of circumstances or abuse. The San Diego McMansion case comes to mind.

This is where everyone gets it confused! The McMansion case is special in two ways.

First, I already concede and agree that Congress allows all secured debt payments in the Means Test. That's just an objective bar for filing. Having payments on a Leer Jet is okay, under Congressional intent of the Statute.

Second, there's the "totality of circumstances" and "abuse". Congress never intended for this part of the Code to just somehow vanish, simply because they added that all secured debt can be included in the Means Test. However, abuse goes beyond that. This appears to be why Congress left, virtually untouched, 11 USC 707(b)(3) which goes to abuse and "totality of circumstances". Could you imagine a person owning a Leerjet or Boeing business jet filing Chapter 7? When they could liquidate the jet and pay off their unsecured creditors?

Now, the McMansion case is special because you were dealing with a residence (the primary residence) of the debtor. I haven't read one case in which the residence of the debtor is not necessary for the reorganization of that debtor. In other words, your homestead is protected insofar as it being necessary. Also, the Court looks, under totality of circumstances, whether it is common for your income and locale for that type of residence. Perfect example is that a home in Pasco County Florida is a totally different price from a home in Broward County Florida. So much so that the IRS understands this and the UST allowances understand this.

So looking at the McMansion in the "totality" of Southern California, the income level of the debtor, and that it was the homestead of the debtor, the McMansion case is easy to see why the decision was reached.

Has anyone found any recent rulings that support the opposite?

The opposite of what?

[bkmaggster]

IT IS ABUSE! WTF WERE YOU THINKING? I hope they will never let you file. Putting on flame suit.

YOU'RE JUST JEALOUS!





(sorry, I couldn't resist)

[nc73]

IT IS ABUSE! WTF WERE YOU THINKING? I hope they will never let you file. Putting on flame suit.

[goingcrzy]

also (I am wondering if justbroke can chime in on this) in my research for our case it seems there have been some recent rulings that the congress didn't put a limit on secured debt in the means test for a reason, therefore it can't be canceled out under totality of circumstances or abuse. The San Diego McMansion case comes to mind.

Has anyone found any recent rulings that support the opposite?