BAPCPA

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The following seven BAPCPA-related working papers can be downloaded from the Social Science Research Network:
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University of Arizona Law School’s Jean Braucher, Rash and Ride-Through Redux: The Terms for Holding on to Cars, Homes and Other Collateral under the 2005 Bankruptcy Act
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University of Arizona Law School’s Jean Braucher, Theories of Over-Indebtedness: Interaction of Structure and Culture
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New England School of Law’s Russell Engler, And Justice for All-Including the Unrepresented Poor: Revisiting the Roles of the Judges, Mediators and Clerks
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FDIC’s Michael Krimminger, Adjusting the Rules: What Bankruptcy Reform Will Mean for Financial Market Contracts
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Univ. of Illinois Law School’s Charles Jordan Tabb, The Brave New World of Bankruptcy Preferences
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Univ. of Illinois Law School’s Charles Jordan Tabb, Consumer Bankruptcy After the Fall: United States Law Under S.256
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Georgia State Law School’s Jack F. Williams and St. John’s Univ. Law School’s Jacob L. Todres, Tax Consequences of Postpetition Income as Property of the Estate in an Individual Debtor Chapter 11 Case and Tax Disclosure in Chapter 11
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Abstracts for each of these working papers follow:Continue Reading Seven BAPCPA-Related Working Papers Available for Downloading from SSRN

Houston’s Bankruptcy Judge Marvin Isgur, the leading author of opinions of first impression interpreting BAPCPA’s provisions as they relate to consumer debtors (see here, here (Charles case), here, and here), tackles another thorny issue of first impression in In re Toro-Arcila, 2005 WL 3370045 (Bankr. S.D. Tex., 12/12/2005). By way of background, BAPCPA’s provisions distinguish between “multiple serial filers” (2 or more cases were dismissed in year before the present case filed) and “single serial filers” (only 1 case dismissed in year before the present case filed). Single serial filers get the benefit of the automatic stay for the first 30 days of the case, but the filing is presumed in bad faith and can be rebutted only by clear and convincing evidence that the filing was not in bad faith. Judge Isgur recently developed two handy charts to guide judges and lawyers through the thicket of rules addressing the issues that must be examined in determining whether the stay should be extended as to a single serial filer (see here).
In this case, Judge Isgur addresses a separate issue: if the single serial filer fails to get the stay extended under Code section 362(c)(3), can the debtor move under Code section 362(c)(4)(B) for reimposition of the stay despite the fact that this Code section appears “at first blush” to be for the benefit only of multiple serial filers?
In concluding that what appears to be true “at first blush” is actually incorrect, Judge Isgur rejects the statute’s apparent “plain meaning.” To do otherwise, he concludes, would effectively render exactly 278 words in BAPCPA superfluous, a result Congress could not have intended. Judge Isgur then somehow remarkably divines that, “coincidentally,” the Gettysburg Address (which he quotes in its entirety, and is always worth rereading) of President Abraham Lincoln was also 278 words. From this coincidental fact, Judge Isgur concludes, tongue-in-cheek:

Although the meaning of this subsection [of BAPCPA] cannot be compared to the importance of the Gettysburg Address, the Court presumes that Congress did not codify words of comparable length with no meaning whatsoever.

As to the statutory provisions of BAPCPA in question, in concluding that “the ‘first blush’ intepretation is incorrect,” Judge Isgur draws not only upon the Gettysburg Address, but upon well developed countervailing principles of statutory construction to avoid rendering whole sections of the statute superfluous. Given that, per Bankruptcy Judge Robert Mark, BAPCPA “is not a model of clarity,” and per Judge Isgur, BAPCPA can be “particularly difficult to parse and, at worst, virtually incoherent” (see here), Judge Isgur’s dance around the “plain” or “first blush” meaning provides the bankruptcy judge and practitioner with some important tools for preventing BAPCPA from becoming the statutory nightmare it has the potential to be. He writes:Continue Reading Judge Isgur Cites to the Gettysburg Address as Basis for Rejecting “First Blush” Interpretation of BAPCPA’s Multiple Serial Filer Stay Provisions

Houston’s Bankruptcy Judge Marvin Isgur, who’s rapidly establishing himself as the “go to” judge on BAPCPA’s hot issues, delivered another strong opinion (see references here and here for his other BAPCPA-related decisions), this time on the right of a serial filer to obtain an extension of the automatic stay beyond the 30 day statutory limitation imposed on serial filers under BAPCPA’s new section 362(c)(3)(A). In re Charles, 2005 WL 3288182 (Bankr. S.D. Tex., 11/30/05).
As reported here, Judge Isgur in early November 2005 granted this serial filer’s motion to extend the automatic stay’s protections to the primary secured lender, but he was unwilling to even consider extending the stay to “all creditors” without a good explanation in the debtor’s motion of why it should be. The debtor subsequently filed an amended emergency motion for continuation of the stay as to all creditors and the Court held a hearing on the matter 16 days later.
In ruling on this amended motion, Judge Isgur said that “the Court has the discretion to extend the stay if Ms. Charles proves that the filing of this case is in good faith as to the creditors to be stayed.” However, the Court added,

[b]efore the Court analyzes the applicable factors for determining whether the case was filed in good faith as to the creditors to be stayed, the Court must determine the nature of the burden of proof on the debtor.

The Court then provided a tidy three column, four row chart analyzing who has the burden of proof on each of the following four issues:Continue Reading Judge Isgur Provides Benchmark Analysis of a Serial Filer’s Rights under BAPCPA to Obtain an Extension of the Automatic Stay Beyond 30 Days

Below you’ll find more case summaries on the following BAPCPA-related decisions from bankruptcy courts around the nation:
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BAPCPA – Automatic Stay – Serial Filers: In re Collins, 2005 WL 3163962 (Bankr. D. Minn., 11/29/05).
BAPCPA – Automatic Stay – Stay Termination – Failure to File Statement of Intention: In re Schlitzer, 2005 WL 3072791 (Bankr. W.D.N.Y., 11/17/05).
BAPCPA – Chapter 15 – Commencement of an Ancillary Case: US v. J.A. Jones Constr. Group, LLC, 2005 WL 3199053 (E.D.N.Y., 11/29/05).
BAPCPA – Credit Counseling – Exigencies: In re Cleaver, 2005 WL 3099686 (Bankr. S.D. Ohio, 11/17/05).
BAPCPA – Credit Counseling – Exigencies: In re Sukmungsa, 2005 WL 3160607 (Bankr. D. Utah, 11/23/05).
BAPCPA – Homestead Exemption – Statutory Cap: In re Blair, 2005 WL 3108495 (Bankr. N.D. Tex., 11/21/05).
***Continue Reading More BAPCPA Decisions from November 2005

Below is a roundup of recent cases interpreting BAPCPA’s new additions to the Bankruptcy Code. Judge Mark recently noted (referenced here) that BAPCPA “is not a model of clarity.” Similarly, Judge Isgur recently said (see below) that BAPCPA can be “particularly difficult to parse and, at worst, virtually incoherent.” We hope that these periodic BAPCPA decisional updates don’t suffer from the same malady and help you sort through BAPCPA’s legal thicket.
Below you’ll find case summaries on the following BAPCPA-related decisions from bankruptcy courts around the nation:
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BAPCPA – Automatic Stay – Serial Filers: In re Montoya, 2005 WL 3160532 (Bankr. D. Utah, 11/23/05).
BAPCPA – Automatic Stay – Serial Filers: In re Charles, 332 B.R. 538 (Bankr. S.D. Tex., 11/4/05).
BAPCPA – Bankruptcy Petition Preparers: Martini v. We the People Forms and Service Centers, USA, Inc. (In re Barcelo), 2005 WL 3007104 (Bankr. E.D.N.Y., 10/24/05).
BAPCPA – Credit Counseling – Exigencies: In re LaPorta, 2005 WL 3078507 (Bankr. D. Minn., 10/27/05).
BAPCPA – Homestead Exemption – “As a Result of Electing” Debate: In re Virissimo, 332 B.R. 208 (Bankr. D. Nev., 10/31/05).
BAPCPA – Homestead Exemption – Fraudulent Intent: In re Maronde, 332 B.R. 593 (Bankr. D. Minn., 11/8/05).
BAPCPA – Utilities – Adequate Assurance: In re Lucre, Inc., 2005 WL 3111078 (Bankr. W.D. Mich., 11/9/05).
***Continue Reading Some BAPCPA Decisions from October/November 2005

Professor Elizabeth Warren provides a cup of bitter coffee at the TPM Cafe Blog in her post entitled “The Bankruptcy Wars Continue.” Here, she summarizes current attacks on BAPCPA’s harsher anti-consumer provisions, including a citation to an article from the Yale Law Journal in support of the proposition that “despite the claims of the bill’s supporters that the bankruptcy laws would help those trying to collect child support, no one has been fooled by the rhetoric; the new law undermines the relative position of support claimants.”
Professor Warren’s conclusion surely will not sit well with Volokh’s Professor Todd Zywicki’s, whose recent post strongly disagreed with the conclusions drawn in that same student note (and made elsewhere, including recent updates to bankruptcy casebooks).
In Professor Zywicki’s post, he first describes the argument that BAPCPA’s provisions will disadvantage those seeking to collect domestic support obligations from their divorced spouses or parents as “going something like this”:Continue Reading Professors Warren and Zywicki Clash on BAPCPA’s Effects on the Rights of “Support Claimants”

In a prior post, I wrote:

The old phrase “Don’t Mess with Texas” rings true in today’s ruling from the Bankruptcy Court of the Southern District of Texas, In re Hubbard, 2005 WL 2847420 (Bankr. S.D. Tex., 11/2/05), where the Court denied a chapter 13 debtor’s request to extend the time to provide verification of credit counseling…. This case makes clear that lawyers and debtors should expect bankruptcy judges to hold a debtor’s feet to the fire and require it to follow BAPCPA’s rigid credit counseling guidelines. In sum, a tighter squeeze.

Six days later, the Hubbard court changed its mind, sua sponte, advising that it was reconsidering its prior order. In re Hubbard, 2005 WL 3061939 (Bankr. S.D. Tex., 11/08/05). Notably, however, Judge Isgur did not change his mind about the “plain meaning” of the statute, saying he “sees no ambiguity in the statute.” He also didn’t change his view that
“[t]he applications filed by the debtors do not constitute certifications under the law, stating that “[u]ntil certifications are filed, the Court will not consider whether the factual allegations made in the applications satisfy the requirements of § 109(h)(3).”
Instead, the court focused on the availability of credit counseling in the Houston area, and the debtor’s allegation that credit counseling was not available. Seizing this hook, the Court found grounds for dispensing justice to the poor debtor caught in BAPCPA’s imperfect transitional world. The Court stated:Continue Reading On Second Thought… Texas Bankruptcy Court Reverses Its “Don’t Mess With Texas” Stance Based on Lack of Proof of Availability of Credit Counseling