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Demystifying Bankruptcy

Demystifying Bankruptcy. Tex Ritter ERICSA. Bankruptcy 201. A bankruptcy primer for the advanced situations. Demystifying Bankruptcy. Definitions Language of bankruptcy Types of bankruptcy Resources History Child Support is First Priority Debt type. Bankruptcy is fun and easy.

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Demystifying Bankruptcy

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  1. Demystifying Bankruptcy Tex Ritter ERICSA

  2. Bankruptcy 201 • A bankruptcy primer for the advanced situations

  3. Demystifying Bankruptcy • Definitions • Language of bankruptcy • Types of bankruptcy • Resources • History • Child Support is First Priority Debt type

  4. Bankruptcy is fun and easy Discharge/Dismissal Trustee’s duties and obligations Domestic Support Obligation Automatic Stay in Bankruptcy Proof of Claim Types of Claims

  5. Bankruptcy is fun and easy Objections to Claims Objections to Plans Failure to provide for current support Failure to provide for child support arrears

  6. Bankruptcy is fun and easy Situations Employer files bankruptcy Obligor files bankruptcy Custodial parent files bankruptcy Notification of Bankruptcy

  7. Bankruptcy is fun and easy Discharge in bankruptcy Domestic Support obligations are not discharged Notice to Withhold is authorized National Medical Support Notice is authorized Tax intercept, license suspension, credit reporting and passport denial are authorized

  8. Bankruptcy is fun and easy File a proof of claim? Or Not? Depends on the circumstances Let’s make a deal Include unliquidated amounts (unreimbursed medical, child care, school expenses, recreational expenses if authorized by judgment or statute)

  9. Bankruptcy is fun and easy Objection to Claim Objection to Plan Relief from stay Motion to avoid a lien Adversary Proceedings

  10. Bankruptcy 201 Advanced Bankruptcy Complex Proofs of Claim Various Child Support Categories Multiple Cases Adding Interest to arrears Bankruptcy is fun and easy

  11. Proof of Claim A claim is a right to payment. 11 U.S.C. § 101 (5). (5) 'claim' means - (A) right to payment, whether or not such right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured, or unsecured; or

  12. Proof of Claim A claim in bankruptcy could be the right to collect unliquidated, but accrued, unreimbursed medical expenses or educational expenses or reimbursement of child care costs not yet reduced to a judgment.

  13. 11 U.S.C. § 101 (12A) 'debt for child support' means a debt of a kind specified in section 523(a)(5) of this title for maintenance or support of a child of the debtor.

  14. 11 USC Section 101(14A) “Domestic Support Obligation” is a debt owed to a spouse, child, parent of a child or a governmental agency in the nature of maintenance, support (including public assistance) or alimony.

  15. 11 USC Section 362(b)(2)(C) Income Withholding, Notice to Withhold Income, Earnings Assignments Orders, National Medical Support Assignments do not violate the automatic stay. 362(b)(2)(G) Revoking a professional or driver’s license does not violate the automatic stay. Reporting to credit bureaus does not violate the automatic stay. 362(b)(2)(E)

  16. 11 USC Section 362(b)(2)(F) Intercepting a tax refund is not a violation.

  17. Employer files Bankruptcy Notice to Withhold not honored Who gets credit? What not to do Who files the Proof of Claim Wages or Support

  18. Advanced Bankruptcy Objections to Claims Prima Facia filing Objection to Claim Motion The Proceeding Evidence

  19. Objection to Chapter 13 Plan The Plan does not provide for the payment of support Object to confirmation Negotiate Child Support is non-dischargeable Not proposed in good faith Require amendment to Plan

  20. Complex Issues Motions to Avoid a lien Recordings are judicial liens Child Support Exemption

  21. Violations of the Stay Automatic Stay in Bankruptcy What to do? What not to do?

  22. Adversary Proceedings Bankruptcy based law suit or legal proceeding Core proceedings Non-core proceedings

  23. Relief from Stay Alter Ego Actions Preferential Transfers Fraudulent Conveyances Discovery

  24. Negotiations Typical scenario You receive Notice Chapter 13 filed Contact Debtor’s attorney Next step? File a Proof of Claim Do not file a Proof of Claim How to negotiate

  25. Negotiations Review case Good Pay/Bad Pay NTW or income withholding order or wage assignments are allowed for current and arrears Income Ratios/Child Support Obligation Trustee's fees (10%)

  26. Negotiations Modify Plan to allow for payment of child support and arrears outside of Plan (or part in Plan) and list debt as non-dischargeable Sent Notice to Withhold or Income Withholding Order or part NTW and part Proof of Claim for arrears (with knowledge and consent of debtor’s attorney)

  27. Bankruptcy is fun and easy Procedure Telephonic hearings are authorized Electronic filing is required, electronic docketing may be required

  28. Bankruptcy is fun and easy In re Garrett (E.D. Tex 2005) 315 B.R. 431 In re Charnock (9th Cir. BAP 2004) 318 B.R. 720 In re Cervantes (9th Cir. 2000) 219 F.3d 955 In re Lebowitz (9th Cir. 2000) 217 F.3d 799

  29. Bankruptcy is fun and easy In re Coker (C.D. CA. 1998) 232 B.R. 182 In re Pacana (9th Cir. BAP 1991) 125 B.R. 19 In re Donald Clifford Foster (9th Cir. 2003) 319 F.3d 495 In re: Wayne K. Crawford (7th Cir. 2003) 324 F.3d 539 In re Gruntz , 202 F.3d 1074 (9th Cir. 2000)

  30. Bankruptcy Exercise Yes Yes Yes Discuss case options Yes Yes Yes

  31. Bankruptcy Exercise . Yes Yes Yes Yes A A A A Yes Yes Yes Yes

  32. Bankruptcy Exercise Yes Yes Yes Yes No No No No Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes

  33. Bankruptcy is fun and easy Thank you! Thank ERICSA! Please fill out your evaluation forms Email if you have any questions Tex.Ritter@co.nevada.ca.us

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