Central District Consumer Bankruptcy Attorney's Association

I have a PC in the middle of a divorce, the judgment is entered but now the subject of a post-judgment set aside.
PC and ex have house with $250,000 in equity. Down payment was partially by a gift from exs father who provided a gift letter at the time of purchase. Now that the marriage has failed, father wants his gift back.
Ex now wants all kinds of remedies including support (waived in judgment, but may be back in play).
PC also has about about $80k in credit card debt on top of a first and second mortgage.
PCs income is over median, but If i put him into an asset Chapter 7, all debts, except the father gift, gets paid by liquidating the house, maybe with some left over for the battling spouses.
But will the Chapter 7 trustee do it? Or will being over median income mean we do this in a Chapter 13? And what about the father gift down payment? Does he just fight it out with the trustee?
I would appreciate your thoughts.
Desiree Causey
Law Office of Desiree Causey
7755 Center Avenue, Suite 1100
Huntington Beach, CA 92647
714-372-2225
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From attorneychristine@gmail.com Mon Mar 19 18:31:31 2018
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If he fails the means test, do you have any other way to keep him in a
chapter 7? Failed means test is a UST flag.
A gift is a gift.....if dad wants to take it back...he'll have to sue.
He's a potential creditor based on what he has asserted.
I hope this helps.
Christine
Christine A. Kingston
*Surf City Lawyers*
*5882 Bolsa Avenue, Suite 130

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Dear Desiree,
The only way that the Chapter 7 Trustee can move to convert a Chapter 13 case to one under Chapter 7 is using 1307(c). That sort of conversion must be "for cause," and 1307(c) lists the sort of cause. Although that subsection contains the word "including," which is not limiting pursuant to 102(3), the flavor of 1307(c) is that there has been some sort of bad action by the Chapter 13 debtor. I don't see how the simple fact that the debtor has an ownership interest in the business and the house is ground for a forced conversion.
Peter is, of course, correct that 363(h)'s balancing test restricts the Chapter 7 Trustee's liquidation power. Therefore, you should see if you can use that subsection to thwart the sale. However, the community property status of the assets may make it difficult to win.
Good luck,
Nicholas Gebelt
Nicholas Gebelt, Ph.D., J.D.
Attorney at Law
Certified Bankruptcy Law Specialist - State Bar of California Board of Legal Specialization
Commissioner, California State Bar's Bankruptcy Law Advisory Committee
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Desiree,
The ability of the potentialchapter 7 trustee to sellreal property is limited by 363(h)'sbenefitsversus detriments test.
PeterPeter M. Lively, J.D., M.B.A.
Law Office of Peter M. Lively * Personal Financial Law Center I
11268 Washington Boulevard, Suite 203, Culver City, California 90230-4647
Telephone: (310) 391-2400* Toll Free: (800) 307-3328 * Fax: (310) 391-2462
On Monday, May 18, 2015 2:00 PM, "'Desiree Causey 714-372-2225' causeylaw@gmail.com [cdcbaa]" wrote:
I have a family law matter that crosses over to BK. Parties have been separated more than 2 years. Parties own a house with lots of equity and a business that does not make money has a huge debt burden, some of which is business debt, much of which is personal and also secured by the house. Wife has filed for Chapter 13, including all of husband interests in the community. Husband contemplates Chapter 7. He fits easily into the income limitations of a Chapter 7. With the assets (still in the community) being the subject of competing BKs, will the trustee convert the wifes Chapter 13 to a Chapter 7 and liquidate it all? I would appreciate your thoughts.Desiree Causey, Esq.Law Office of Desiree Causey7755 Center Avenue, Suite 1100 (NEW ADDRESS AS OF DECEMBER 2014)Huntington Beach, CA 92647 714-372-2225 (phone)714-908-7646 (same fax number) Privileged And Confidential Communication.
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Please consider the environment before printing this e-mail. #yiv48
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I have a family law matter that crosses over to BK.
Parties have been separated more than 2 years. Parties own a house with
lots of equity and a business that does not make money has a huge debt
burden, some of which is business debt, much of which is personal and also
secured by the house.
Wife has filed for Chapter 13, including all of husband interests in the
community. Husband contemplates Chapter 7. He fits easily into the
income limitations of a Chapter 7.
With the assets (still in the community) being the subject of competing BKs,
will the trustee convert the wifes Chapter 13 to a Chapter 7 and liquidate
it all?
I would appreciate your thoughts.
Desiree Causey, Esq.
Law Office of Desiree Causey
7755 Center Avenue, Suite 1100 (NEW ADDRESS AS OF DECEMBER 2014)
Huntington Beach, CA 92647
714-372-2225 (phone)
714-908-7646 (same fax number)
Privileged And Confidential Communication.
This electronic transmission, and any documents attached hereto, (a) are
protected by the Electronic Communications Privacy Act (18 USC
2510-2521), (b) may contain confidential and/or legally privileged
information, and (c) are for the sole use of the intended recipient named
above. If you have received this electronic message in error, please notify
the sender and delete the electronic message. Any disclosure, copying,
distribution, or use of the contents of the information received in error is
strictly prohibited.
Please consider the environment before printing this e-mail.

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