The Impact of Michigan’s Uniform Assignment of Rents Act on Tenants’ Rights
Foster Swift Collins & Smith » Michigan Bankruptcy Blog
by Scott H. Hogan
5M ago
Taking effect on September 22, 2022, the Michigan Uniform Assignment of Rents Act (MUARA) will impact tenants’ rights in situations where landlords default on their loans. This Act also strengthens lenders’ rights, under certain circumstances, to appoint receivers to collect rent payments if one of their borrowers defaults on a loan secured by an income-producing property. Read More › Tags: Alerts and Updates, Did you Know?, Landlord-Tenant ..read more
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Sixth Circuit Affirms Holding that Contributions to a 401(k) Plan Made More than Six Months Prior to Bankruptcy Cannot be Excluded from Disposable Income
Foster Swift Collins & Smith » Michigan Bankruptcy Blog
by Patricia J. Scott
1y ago
The U.S. Court of Appeals for the Sixth Circuit recently ruled in a case involving a Chapter 13 debtors’ attempt to shield contributions to a 401(k) retirement account from “projected disposable income,” therefore making such amounts inaccessible to the debtors’ creditors.[1] For the reasons explained below, the Sixth Circuit rejected the debtors’ arguments. Read More › Tags: 6th Circuit Court of Appeals, Chapter 13 ..read more
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Sixth Circuit Upholds Chapter 13 Debtor’s Right to Request and Receive Dismissal of Bankruptcy Case
Foster Swift Collins & Smith » Michigan Bankruptcy Blog
by Patricia J. Scott
1y ago
A statute must be interpreted and enforced as written, regardless, according to the U.S. Court of Appeals for the Sixth Circuit, “of whether a court likes the results of that application in a particular case.” That legal maxim guided the Sixth Circuit’s reasoning in a recent decision[1] in a case involving a Chapter 13 debtor’s repeated filings and requests for dismissal of his bankruptcy cases in order to avoid foreclosure of his home. Read More › Tags: 6th Circuit Court of Appeals, Chapter 13 ..read more
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Supreme Court Holds that “Mere Retention” of Estate Property After Bankruptcy Filing Doesn't Violate the Automatic Stay
Foster Swift Collins & Smith » Michigan Bankruptcy Blog
by Patricia J. Scott
2y ago
On January 14, 2021, the U.S. Supreme Court decided City of Chicago, Illinois v. Fulton (Case No. 19-357, Jan. 14, 2021), a case which examined whether merely retaining estate property after a bankruptcy filing violates the automatic stay provided for by §362(a) of the Bankruptcy Code. The Court overruled the bankruptcy court and U.S. Court of Appeals for the Seventh Circuit in deciding that mere retention of property does not violate the automatic stay. Case Background The City of Chicago (the “City”) impounded respondents’ vehicles for failure to pay fines for motor vehicle infractions. Ther ..read more
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Are Funds Received as the Beneficiary of an IRA Property of the Estate in Bankruptcy?
Foster Swift Collins & Smith » Michigan Bankruptcy Blog
by Patricia J. Scott
2y ago
When an individual files a Chapter 7 bankruptcy case, the debtor’s non-exempt assets become property of the estate that is used to pay creditors. “Property of the estate” is a defined term under the Bankruptcy Code, so a disputed question in many cases is: What assets are, in fact, available to creditors? Read More › Tags: Chapter 7, Eastern District of Michigan, Estate Planning ..read more
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Michigan Updates and Expands its Receivership Act
Foster Swift Collins & Smith » Michigan Bankruptcy Blog
by Scott H. Hogan, Patricia J. Scott
2y ago
A new amendment was recently enacted in Michigan which expands the scope of receivership proceedings, which are a liquidation alternative to bankruptcy. Previously, the receivership statute in Michigan applied only to receiverships over commercial real estate. Now it is applicable to all operating businesses in Michigan, and commercial and industrial loans irrespective of whether real estate collateral is involved. Read More › Tags: Alerts and Updates ..read more
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Sixth Circuit: Creditor did not Violate Chapter 7 Discharge Injunction While Negotiating Release of Lien
Foster Swift Collins & Smith » Michigan Bankruptcy Blog
by Patricia J. Scott
2y ago
Once a Chapter 7 debtor receives a discharge of personal debts, creditors are enjoined from taking action to collect, recover, or offset such debts. However, unlike personal debts, liens held by secured creditors “ride through” bankruptcy. The underlying debt secured by the lien may be extinguished, but as long as the lien is valid it survives the bankruptcy. Read More › Tags: 6th Circuit Court of Appeals, Chapter 7 ..read more
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Sixth Circuit Rules that Monthly 401(k) Contributions can be Excluded from “Projected Disposable Income” Under a Chapter 13 Plan
Foster Swift Collins & Smith » Michigan Bankruptcy Blog
by Patricia J. Scott
2y ago
A Chapter 13 bankruptcy plan requires a debtor to satisfy unsecured debts by paying all “projected disposable income” to unsecured creditors over a five-year period. In a recent case before the U.S. Court of Appeals for the Sixth Circuit (the “Sixth Circuit”), the court grappled with whether a Chapter 13 debtor’s wages that are contributed to an employer-sponsored retirement plan are considered disposable income under the Bankruptcy Code.[1] Read More › Tags: 6th Circuit Court of Appeals, Chapter 13 ..read more
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Who is a “Non-Statutory Insider” for Purposes of Determining Whether a Payment Was Preferential in Bankruptcy?
Foster Swift Collins & Smith » Michigan Bankruptcy Blog
by Patricia J. Scott
2y ago
One of the objectives of the Bankruptcy Code is to ensure that each class of creditors is treated equally. And one of the ways that is accomplished is to allow the debtor’s estate to claw back certain pre-petition payments made to creditors. Accordingly, creditors of a debtor who files for bankruptcy are often unpleasantly surprised to learn that they may be forced to relinquish “preferential” payments they received before the bankruptcy filing. Read More › Tags: Chapter 7, Eastern District of Michigan ..read more
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U.S. Supreme Court Rules that Order Granting or Denying Request for Relief from Automatic Stay is Final Order that is Immediately Appealable
Foster Swift Collins & Smith » Michigan Bankruptcy Blog
by Patricia J. Scott
3y ago
A party who believes that a bankruptcy court erred in either granting or denying relief from the automatic stay needs to act fast to appeal such a decision. In the recently decided case of Ritzen Group, Inc. v. Jackson Masonry, LLC, the U.S. Supreme Court held that: “[A]djudication of a motion for relief from the automatic stay forms a discrete procedural unit within the embracive bankruptcy case” which “yields a final, appealable order when the bankruptcy court unreservedly grants or denies relief.” Read More › Tags: Chapter 11, Collections, U.S. Supreme Court ..read more
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