BK 7 Dismissed due to creditor on a vendetta

[LadyInTheRed]

The real problem here is that we are only getting bits and pieces of what was going on. I cannot expect you to even attempt to explain the entire case but without reviewing the judgment denying the discharge JB and LITR are only speculating.

Absolutely!

Again, if your mother doesn't understand what is going on, she needs to sit down with her attorney and have him explain it to her.

[SecretOC]

Nothing is ever a lost cause. If her attny really told her not to discloses and she can prove it. . . malpractice. The question then becomes whether or not the claim against the attny is an asset of the bk because the bad advice was given before the case was filed. Tough one on that but. . .

If there was malpractice an attny has a duty to do what he/she can to correct it. Taking the matter up on appeal could be an attempt to correct it.

As it relates to the denial of discharge, unfortunately "I did as my attny instructed" is rarely, if ever, a defense. I have seem some pretty crappy cases clearly screwed up by the attny however, the judges typically say "well you, Mr. Debtor, signed on the dotted line - didn't you? - You must have known the information was wrong or incomplete."

Des.

aw great... If my mother is somehow able to amend her schedules during the appeal (Edit: is this possible?) would they go after the inheritance even it has already been spent on their own legal fee's from a separate civil suit?

[despritfreya]

Even if her attorney advised her to NOT disclose it!? Thank you so much Des. But looks like this is a lost cause then...

Nothing is ever a lost cause. If her attny really told her not to discloses and she can prove it. . . malpractice. The question then becomes whether or not the claim against the attny is an asset of the bk because the bad advice was given before the case was filed. Tough one on that but. . .

If there was malpractice an attny has a duty to do what he/she can to correct it. Taking the matter up on appeal could be an attempt to correct it.

As it relates to the denial of discharge, unfortunately "I did as my attny instructed" is rarely, if ever, a defense. I have seem some pretty crappy cases clearly screwed up by the attny however, the judges typically say "well you, Mr. Debtor, signed on the dotted line - didn't you? - You must have known the information was wrong or incomplete."

Des.

[SecretOC]

Edt to add: Whatever was going on, the judge believed that mom knew she did not disclose, disclose, disclose. 727(a)(4)(A) requires a finding of "intent".


Des.

Even if her attorney advised her to NOT disclose it!? Thank you so much Des. But looks like this is a lost cause then...

[justbroke]

You're right Des... too complex and it's beyond speculation.

[SecretOC]

If there was no will or trust, then entitlement to the estate depends on laws of intestate succession in the state where the decedent resided.

Well in that case it was a completely different country. My mothers father is the decedent. So my mothers, mother acknowledged what my mothers brother said and understood that it was only correct to not assign a share to my mother.

[despritfreya]

The real problem here is that we are only getting bits and pieces of what was going on. I cannot expect you to even attempt to explain the entire case but without reviewing the judgment denying the discharge JB and LITR are only speculating. The fact is. . .

1. If your mom had any interest in any asset as of the filing date and failed to disclose, disclose, disclose, she would be in trouble.

2. If your mom transferred, gave away, sold for less than true value, any asset of any kind within the two years prior to filing it need to be disclosed, disclosed, disclosed. If not disclosed she would be in trouble.

3. Any transfer, give away or sale for less than true value that happened between two years and four years prior to filing, while a debtor does not need to disclose it, a Trustee has the right to recover it.

4. If your mom failed to keep financial records that one would expect a person to have, she would be in trouble.

5. If your mom paid back a loan from a family member within the one year prior to filing and failed to disclose, disclose, disclose, she would be in trouble.

And there are so many other reasons to be denied a discharge so without knowing all of the details it is really hard to comment.

Edt to add: Whatever was going on, the judge believed that mom knew she did not disclose, disclose, disclose. 727(a)(4)(A) requires a finding of "intent".


Des.

[LadyInTheRed]

If there was no will or trust, then entitlement to the estate depends on laws of intestate succession in the state where the decedent resided. What was your mother's relationship to the decedent? If your mother was entitled to a portion of the estate and somebody else took it, then your mother had a claim against the person who took what she was entitled to. That claim would be an asset of the BK estate. It sounds like the widow claims that your mother consented to the transfer of her share of the estate to somebody else and that the judge was convinced that was the case and that she did it to avoid creditors. Since a summary judgement was granted, it sounds like your mother did not present any evidence to contradict the creditor's complaint, the evidence she presented was insufficient, or the judgement was not a good one which is why her attorney wants to file an appeal.

[SecretOC]

I don't actually know what the specific problem, or the cause, that was listed by the creditor stated and proved. If it was material mis-statements in the bankruptcy filing, that would be cause. If she had an ownership interest in some property, even if it occurred 35 years ago but still had such interest in the property but failed to disclose that interest, that could be a problem.

Ah ok i see, well the creditor believe that the funds were transferred for hiding to a family member but what really happened was that the debtor's inheritance was taken by the brother for a loan that he gave that was not paid back. There was no will so would she still be entitled? This occurred 3 years prior to filing.

SecretOC, based on the details you have provided, we can only guess. But, let's say somebody died 35 years ago and left a trust. If your mother received assets from that trust and still has those assets, they are an asset of the bankruptcy estate. If the trust still exist and your mother receives income from that trust, then that should have been disclosed. If the trustee of the trust has discretion to distribute principal, then your mother has an interest in the trust that should have been disclosed. But, if the distributions are discretionary, then whether there is any value to the BK estate depends on the terms of the trust and state law. If your mother gets no current distributions from the trust and the trustee has no discretaion to distribute to her, but the trust is irrevocable and she will inherit after the death of a current beneficiary or somebody else, then she has a future interest in the trust that has some current value and is an asset of the BK estate. Or maybe your mother should have received assets from the trust, but the trustee has been holding onto them contrary to the terms of the trust in which case she has a claim against the trustee of the trust that should have been disclosed on the BK petition.

There are many ways in which your mother can have a current interest in an estate as a result of a death 35 years ago that should be disclosed in a BK. These are some examples.

Thank you, as i mentioned above though, there was no trust or will. Just based on the deceased widow's wrod on distribution which she knew about the loan. I know it is complicated but would she still be entitled after that?

[LadyInTheRed]

SecretOC, based on the details you have provided, we can only guess. But, let's say somebody died 35 years ago and left a trust. If your mother received assets from that trust and still has those assets, they are an asset of the bankruptcy estate. If the trust still exist and your mother receives income from that trust, then that should have been disclosed. If the trustee of the trust has discretion to distribute principal, then your mother has an interest in the trust that should have been disclosed. But, if the distributions are discretionary, then whether there is any value to the BK estate depends on the terms of the trust and state law. If your mother gets no current distributions from the trust and the trustee has no discretaion to distribute to her, but the trust is irrevocable and she will inherit after the death of a current beneficiary or somebody else, then she has a future interest in the trust that has some current value and is an asset of the BK estate. Or maybe your mother should have received assets from the trust, but the trustee has been holding onto them contrary to the terms of the trust in which case she has a claim against the trustee of the trust that should have been disclosed on the BK petition.

There are many ways in which your mother can have a current interest in an estate as a result of a death 35 years ago that should be disclosed in a BK. These are some examples.

[justbroke]

Ok so I read that code, But since the inheritance occured 35 years ago then why would it still be a problem? And since the date of receiving money from the inheritance does not matter then whats the problem?! It just keeps getting worse and worse

I don't actually know what the specific problem, or the cause, that was listed by the creditor stated and proved. If it was material mis-statements in the bankruptcy filing, that would be cause. If she had an ownership interest in some property, even if it occurred 35 years ago but still had such interest in the property but failed to disclose that interest, that could be a problem.

[SecretOC]

Huh? It's within 180 days of filing. It is always "yours". The only difference is whether it becomes property of the bankruptcy estate. If you inherited something before filing, it is certainly yours but still subject to liquidation (in a Chapter 7) if there are no exemptions. If it occurs within 180 days "after" filling, then it is still property of the bankruptcy estate, as if you gained ownership the day before filing. 11 USC 541(a)(5) talks about 180 days as relative to the "date" of filing the bankruptcy petition. Some people misread it to think that it's "within" 180 days of the filing date in either direction. That is not how it was meant to be read.

Anything you acquire or are entitled to acquire before filing is always property of the Estate (and may be exempted if there are exemptions available). Everything you acquire after filing, with some exceptions, is your property and NOT property of the Estate. The exceptions are that if you somehow are bequeathed or otherwise inherit property, or obtain property through a divorce proceeding, within that 180 days after filing, that also is property of the Estate as if you inherited or obtained the property the day before filing.

Ok so I read that code, But since the inheritance occured 35 years ago then why would it still be a problem? And since the date of receiving money from the inheritance does not matter then whats the problem?! It just keeps getting worse and worse

[justbroke]

Ok after searching some more i found this AVVO article. http://www.avvo.com/legal-guides/ugc...ur-inheritance which states "If the decedent died more than 180 days prior to the date of filing, the inheritance is yours." Whats your take on this article LadyInTheRed? Thank you so much for taking your time!

Huh? It's within 180 days of filing. It is always "yours". The only difference is whether it becomes property of the bankruptcy estate. If you inherited something before filing, it is certainly yours but still subject to liquidation (in a Chapter 7) if there are no exemptions. If it occurs within 180 days "after" filling, then it is still property of the bankruptcy estate, as if you gained ownership the day before filing. 11 USC 541(a)(5) talks about 180 days as relative to the "date" of filing the bankruptcy petition. Some people misread it to think that it's "within" 180 days of the filing date in either direction. That is not how it was meant to be read.

Anything you acquire or are entitled to acquire before filing is always property of the Estate (and may be exempted if there are exemptions available). Everything you acquire after filing, with some exceptions, is your property and NOT property of the Estate. The exceptions are that if you somehow are bequeathed or otherwise inherit property, or obtain property through a divorce proceeding, within that 180 days after filing, that also is property of the Estate as if you inherited or obtained the property the day before filing.

[SecretOC]

If on the date of filing, your mother had a vested interest in an estate, regardless of when she is supposed to receive her interest, it must be disclosed on her petition. If she became entitled to an inheritance within 180 days after filing BK, then she would have to report it to the trustee If she had no interest in an estate/inheritance, then I don't know why it would be an issue in the estate. Somebody must think she has an interest in it.

Ok after searching some more i found this AVVO article. http://www.avvo.com/legal-guides/ugc...ur-inheritance which states "If the decedent died more than 180 days prior to the date of filing, the inheritance is yours." Whats your take on this article LadyInTheRed? Thank you so much for taking your time!

[LadyInTheRed]

Thank you. Oh also i have been reading about receiving inheritances lately and it says that the time of death of that person is when you receive an inheritance. If the look back period is 180 days (http://www.bkforum.com/showthread.ph...ay-inheritance) then why would my mother be in deep crap for not reporting it? her attorney advised her to not report the inheritance because it occurred so long ago. Even if the other party is alleging fraud the look back period for fraud is 4 years. This inheritance still is nowhere near that scope of 4 years. On top of that she never received the money nor was entitled...

If on the date of filing, your mother had a vested interest in an estate, regardless of when she is supposed to receive her interest, it must be disclosed on her petition. If she became entitled to an inheritance within 180 days after filing BK, then she would have to report it to the trustee If she had no interest in an estate/inheritance, then I don't know why it would be an issue in the estate. Somebody must think she has an interest in it.