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In re Jacobson
It sure sounds like it.
*
*
*
*
*ROBERT KEVIN LEE, A.P.C.*
*Bankruptcy Lawyers*
*A Strategic Part of Any Corporate Reorganization.*
_________________________
Robert K. Lee, Esq
State Bar Certified Specialist
[Bankruptcy Law]
3435 Wilshire Blvd, Suite 1035
Los Angeles, CA 90010
Ph [888] 777-0839 Ext 505
Fax [888] 777-0849
WEBSITE
On Tue, Apr 24, 2012 at 1:29 PM, Jim Selth wrote:
> **
>
>
> Could a Chapter 7 trustee use this case to argue that following a sale of
> a property by the trustee and payment of the homestead exemption to the
> debtor, the debtor must reinvest that payment in a new homestead within
> six months or the trustee can take it back?
>
> Jim Selth
>
> *Sent from my Verizon Wireless 4G LTE DROID*
>
>
> -----Original message-----
>
> To: *"cdcbaa@yahoogroups.com" *
> Sent: *Mon, Apr 23, 2012 23:35:24 PDT
> *
> Subject: *Re: [cdcbaa] In re Jacobson
>
>
>
> Thanks Daniela:
>
> From the Jacobson case: I thought the previous case from the 9th Cir
> was 15 years ago, it was 26 years ago. I am getting old.....This is not a
> new theory. We had the same worry 26 years ago and it did not pan out.
>
> I have, on occasion, advised people to move to Big Bear and buy a small
> cabin within 6 months, to save the exemption.
>
> Note, Judge Ferris cannot spell postpetition.
>
> d
>
> In In re Golden, 789 F.2d 698 (9th
> Cir. 1986), the debtor had filed for bankruptcy after selling his
> California homestead and had then let the reinvestment period
> lapse without investing his exempt share of the proceeds. Id.
> at 699. The debtor argued the proceeds were nonetheless
> exempt because they had been exempt when he filed for bankruptcy. Id. at
> 700. We rejected that argument and held the debtor had received the
> proceeds subject to the reinvestment
> There is no material difference between Golden and
> this case. The homestead exemption gave the Jacobsons
> clearly defined rights with respect to the Kensington property.
> The Jacobsons had a right to $150,000 in proceeds. Cal. Civ.
> Proc. Code 704.730(a)(3) (2007). That right was contingent
> on their reinvesting the proceeds in a new homestead within
> six months of receipt. Cal. Civ. Proc. Code 704.720(b). The
> Jacobsons did not abide by that condition and thus forfeited
> the exemption.
>
> ------------------------------
> *From:* Daniela Romero
> *To:* cdcbaa@yahoogroups.com
> *Sent:* Monday, April 23, 2012 11:12 PM
> *Subject:* Re: [cdcbaa] In re Jacobson [1 Attachment]
>
>
>
> NINTH U.S. CIRCUIT COURT OF APPEALS
>
> *-Bankruptcy-*
> Where debtors home was sold at a sheriffs sale to satisfy judgment, and
> debtor failed to reinvest the exempt portion of the proceeds within six
> months, the proceeds lost their exempt character under California law as it
> existed at the time of the bankruptcy filing. Trustee failed to establish
> by preponderance of the evidence that the estate was entitled to turnover
> of certain property owned by debtors spouse, where spouse was the sole
> owner of record, the property was acquired with proceeds of his
> inheritance, and was subsequently sold by him in his own name with his
> spouses confirmation that it was his separate property. Trustee lacked
> standing to claim that the inheritance belonged to a prior bankruptcy
> estate. Determination in prior bankruptcy that debtor ran her husbands
> affairs--as a result of which he was not implicated in wifes fraud and was
> discharged--did not estop him from claiming that his property was not part
> of her bankruptcy estate, since that issue was not litigated in the prior
> proceeding.
> *In re Jacobson* - filed April 23, 2012
> Cite as 10-60040
> Full text http://www.metnews.com/sos.cgi?0412%2F10-60040
> Sincerely,
> *
>
> Daniela P. Romero*
> *Law Office of Daniela P. Romero, APLC*
> *1015 North Lake Ave., Ste. 212*
> *Pasadena, CA 91104*
> *Tel: (626) 817-2611*
> *Fax: (626) 296-6991*
> *email: dromerolaw@gmail.com *
> *web: www.pasadenabankruptcylaw.com*
> ______________________________________________________________
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> On Mon, Apr 23, 2012 at 10:13 PM, Dennis McGoldrick wrote:
>
> **
>
> ok, I'll be more specific. What is the cite?
> This has been the law for a long time.
>
> d
>
> ------------------------------
> *From:* Robert Lee
> *To:* cdcbaa@yahoogroups.com
> *Sent:* Monday, April 23, 2012 9:57 PM
> *Subject:* Re: [cdcbaa] In re Jacobson
>
>
> No just got a email update from findlaw today
> On Apr 23, 2012 9:41 PM, "Dennis McGoldrick" wrote:
>
> **
>
> Is this case you are asking about, 15 years, or so, years old?
> ------------------------------
> *From:* Robert Lee
> *To:* cdcbaa@yahoogroups.com
> *Sent:* Monday, April 23, 2012 9:31 PM
> *Subject:* [cdcbaa] In re Jacobson
>
> **
>
> *Has anyone seen this ruling ? Homestead exemption ruled as belonging to
> the bankruptcy estate because it was not reinvested in a homestead within 6
> months. *
>
> *The reinvestment period under the California homestead exemption lasts*
> *six months regardless of when a debtor sells his homestead.*
> *Lane theorized that if the proceeds from post-petition homestead*
> *sales could lose their exempt status, trustees might*
> *claim an interest in the homestead and postpone closing a*
> *case so long as there is any possibility the debtors circumstances*
> *might change. Id. at 765. We find this concern too*
> *speculative. We doubt a trustee would delay liquidating an*
> *estate because (1) the debtors homestead might be sold at*
> *some point in the future and (2) the debtor might fail to reinvest*
> *his share of the proceeds six months after the sale.*
> *
> *
> *The reasoning is flawed for at least two reasons:*
> *1] Trustees will most likely delay closing of cases because they've
> done it before capture the growth in equity unless a motion to abandon is
> filed and granted;*
> *2] Since when can a debtor in Los Angeles County buy another home for
> $75,000 / $100,000 / $175,000 ? No bank is going to give them a loan
> during bankruptcy or shortly thereafter thereby requiring them to buy one
> for cash.*
> * *
> * *
>
>
> _________________________
> Robert K. Lee, Esq
> State Bar Certified Specialist
> [Bankruptcy Law]
> 3435 Wilshire Blvd, Suite 1035
> Los Angeles, CA 90010
> Ph [888] 777-0839 Ext 505
> Fax [888] 777-0849
> WEBSITE
>
>
>
>
>
>
>
>
>
>
It sure sounds like it.
The post was migrated from Yahoo.
Note that 704.720 does not require the proceeds to be spent on another homestead, only that they are exempt for six months. The case misstates the law. They may be spent down or they could be spent on some other asset that is exempt. Whether buying other exempt assets is restricted by the exemptions scheme selected at the filing (703 or 704) or whether they can be changed at all, i.e. I now exempt my proceeds by buying some life insurance and a car and I do not know, but the statute clearly does require reinvestment and the case says we take the good with bad on the state exemptions, i.e. we follow all of state law.
If you have any questions or concerns, please contact me.
Pat
Patrick T. Green
Attorney at Law
Fitzgerald & Green
1010 E. Union St. Ste. 206
Pasadena, CA 91106
Tel: 626-449-8433
Fax: 626-449-0565
pat@fitzgreenlaw.com
The post was migrated from Yahoo.
It's crazy, but that's the way I read it.
Law Office of Eric Alan Mitnick
21515 Hawthorne Boulevard, Ste. 1080
Torrance, California 90503
(310) 792-5864; 792-5866 (fax)
MitnickLaw@aol.com
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To: cdcbaa
Sent: Tue, Apr 24, 2012 1:29 pm
Subject: Re: [cdcbaa] In re Jacobson
Could a Chapter 7 trustee use this case to argue that following a sale of a property by the trustee and payment of the homestead exemption to the debtor, the debtor must reinvest that payment in a new homestead within six months or the trustee can take it back?
Jim Selth
Sent from my Verizon Wireless 4G LTE DROID
The post was migrated from Yahoo.
Jacobson is a little different because it concerns a postpetition sale of the residence. In the past I've had cases where the debtor sold before filing and needed to reinvest w/in 6 months to preserve the protection for proceeds of sale. The 9th Cir. just brushes aside the longstanding case law that exemptions are fixed at the filing date. As of the filing date, this debtor owned the property, she did not own proceeds to reinvest, which makes the decision a little scary.
Makes me wonder how a chapter 13 debtor who sells his residence to pay off his 5% plan would do using the 9th Circuit's exemption analysis.
Eric
Law Office of Eric Alan Mitnick
21515 Hawthorne Boulevard, Ste. 1080
Torrance, California 90503
(310) 792-5864; 792-5866 (fax)
MitnickLaw@aol.com
Although this email and any attachments are believed to be free of any virus or other defect that might affect any computer system into which it is received and opened, it is the responsibility of the recipient to ensure that it is virus free and no responsibility is accepted by the sender for any loss or damage arising in any way from its use.
The information contained in this email message and any attached files may be privileged, confidential and protected from disclosure. If you are not the intended recipient, any dissemination, distribution or copying is strictly prohibited. If you think that you have received this email message in error, please notify the sender by reply email, and delete the email message you received and all of the attached files.
To: cdcbaa
Sent: Mon, Apr 23, 2012 11:35 pm
Subject: Re: [cdcbaa] In re Jacobson
Thanks Daniela:
The post was migrated from Yahoo.
charsetF-8;
format="flowed"
It may not be a new theory, but with the 9th circuit holding there is
no longer any prepetition vs. postpetition distinction relating to the
6 month reinvestment rule under CCP704.730 for homestead proceeds
after sale of a personal residence, isn't the worry of 26 years ago
from Golden now a binding reality?
Based on the Jacobson holding, anytime a personal residence is sold
by a Chapter 7 Trustee, the debtor must reinvest the homestead proceeds
within 6 months or it reverts to the estate if the estate is still
open. Since these are asset cases, they will almost always be open 6
months later. I certainly do not see why any trustee would abandon the
estate's interest in those exempt proceeds before the case being
closed. The 9th circuit appears to completely misunderstand the
consequences of its holding by myopically analyzing the consequences
based upon the rare factual circumstances of that case where a judgment
creditor obtained relief from stay and sold the homestead while the
bankruptcy case was open! Sadly, even if the 9th circuit understood
the consequences, it would likely still have ruled the same way based
upon its reasoning that all of CCP704.730's terms apply.
Chapter 7 Trustee's would be remiss in their duties if they did not
pursue chapter 7 debtors who failed to reinvest the postpetition
personal residence sale homestead proceeds within the 6 months
following the sale.
This holding will have the effect of forcing every debtor whose home
is sold postpetition while the case is still open to buy a dwelling
they may not really want in order to protect their homestead exemption.
In the middle of a bankruptcy it will be very difficult if not
impossible to obtain financing! What can somebody buy outright with
$75,000? A Dilapidated mobile home? A Small condo or cabin in a
remote area far away from employment? Move back in with the folks and
buy part of their house if the folks are lucky enough not to be upside
down?
Obviously most of our client's are not blessed with significant
equity in their property these days, but it does come up! I just had
one case close a few weeks ago where my client's house was sold in the
Chapter 7 and he did not reinvest the homestead exemption proceeds.
Good timing!
Mark T. Jessee
Law Offices of Mark T. Jessee
"A Debt Relief Agency"
50 W. Hillcrest Drive, Suite 200
Thousand Oaks, CA 91360
(805) 497-5868 (805) 497-5864 (Facsimile)
On Mon, 23 Apr 2012 23:34:17 -0700 (PDT), Dennis McGoldrick wrote:
Thanks Daniela:
From the Jacobson case: I thought the previous case from the 9th Cir
was 15 years ago, it was 26 years ago. I am getting old.....This is
not a new theory. We had the same worry 26 years ago and it did not
pan out.
I have, on occasion, advised people to move to Big Bear and buy a
small cabin within 6 months, to save the exemption.
Note, Judge Ferris cannot spell postpetition.
d
In In re Golden, 789 F.2d 698 (9th
Cir. 1986), the debtor had filed for bankruptcy after selling his
California homestead and had then let the reinvestment period
lapse without investing his exempt share of the proceeds. Id.
at 699. The debtor argued the proceeds were nonetheless
exempt because they had been exempt when he filed for bankruptcy.
Id. at 700. We rejected that argument and held the debtor had received
the proceeds subject to the reinvestment
There is no material difference between Golden and
this case. The homestead exemption gave the Jacobsons
clearly defined rights with respect to the Kensington property.
The Jacobsons had a right to $150,000 in proceeds. Cal. Civ.
Proc. Code 704.730(a)(3) (2007). That right was contingent
on their reinvesting the proceeds in a new homestead within
six months of receipt. Cal. Civ. Proc. Code 704.720(b). The
Jacobsons did not abide by that condition and thus forfeited
the exemption.
From:Daniela Romero
To:cdcbaa@yahoogroups.com
Sent: Monday, April 23, 2012 11:12 PM
Subject:Re: [cdcbaa] In re Jacobson [1 Attachment]
NINTH U.S. CIRCUIT COURT OF APPEALS
-Bankruptcy-
Where debtors home was sold at a sheriffs sale to satisfyjudgment, and debtor failed to reinvest the exempt portion of the
proceeds within six months, the proceeds lost their exempt character
under California law as it existed at the time of the bankruptcy
filing. Trustee failed to establish by preponderance of the evidence
that the estate was entitled to turnover of certain property owned by
debtors spouse, where spouse was the sole owner of record, the
property was acquired with proceeds of his inheritance, and was
subsequently sold by him in his own name with his spouses
confirmation that it was his separate property. Trustee lacked standing
to claim that the inheritance belonged to a prior bankruptcy estate.
Determination in prior bankruptcy that debtor ran her husbands
affairs--as a result of which he was not implicated in wifes fraudand was discharged--did not estop him from claiming that his property
was not part of her bankruptcy estate, since that issue was not
litigated in the prior proceeding.
In re Jacobson - filed April 23, 2012
Cite as 10-60040
Full text http://www.metnews.com/sos.cgi?0412%2F10-60040
Sincerely,
Daniela P. Romero
Law Office of Daniela P. Romero, APLC
1015 North Lake Ave., Ste. 212
Pasadena, CA 91104
Tel: (626) 817-2611
Fax: (626) 296-6991
email: dromerolaw@gmail.com
web: www.pasadenabankruptcylaw.com
The post was migrated from Yahoo.
NINTH U.S. CIRCUIT COURT OF APPEALS
*-Bankruptcy-*
Where debtors home was sold at a sheriffs sale to satisfy judgment, and
debtor failed to reinvest the exempt portion of the proceeds within six
months, the proceeds lost their exempt character under California law as it
existed at the time of the bankruptcy filing. Trustee failed to establish
by preponderance of the evidence that the estate was entitled to turnover
of certain property owned by debtors spouse, where spouse was the sole
owner of record, the property was acquired with proceeds of his
inheritance, and was subsequently sold by him in his own name with his
spouses confirmation that it was his separate property. Trustee lacked
standing to claim that the inheritance belonged to a prior bankruptcy
estate. Determination in prior bankruptcy that debtor ran her husbands
affairs--as a result of which he was not implicated in wifes fraud and was
discharged--did not estop him from claiming that his property was not part
of her bankruptcy estate, since that issue was not litigated in the prior
proceeding.
*In re Jacobson* - filed April 23, 2012
Cite as 10-60040
Full text http://www.metnews.com/sos.cgi?0412%2F10-60040
Sincerely,
*
Daniela P. Romero*
*Law Office of Daniela P. Romero, APLC*
*1015 North Lake Ave., Ste. 212*
*Pasadena, CA 91104*
*Tel: (626) 817-2611*
*Fax: (626) 296-6991*
*email: dromerolaw@gmail.com *
*web: www.pasadenabankruptcylaw.com*
The post was migrated from Yahoo.
ok, I'll be more specific. What is the cite?
This has been the law for a long time.
d
________________________________
To: cdcbaa@yahoogroups.com
Sent: Monday, April 23, 2012 9:57 PM
Subject: Re: [cdcbaa] In re Jacobson
No just got a email update from findlaw today
On Apr 23, 2012 9:41 PM, "Dennis McGoldrick" wrote:
>
>Is this case you are asking about, 15 years, or so, years old?
>
>
>________________________________
>To: cdcbaa@yahoogroups.com
>Sent: Monday, April 23, 2012 9:31 PM
>Subject: [cdcbaa] In re Jacobson
>
>
>
>
>Has anyone seen this ruling ? Homestead exemption ruled as belonging to the bankruptcy estate because it was not reinvested in a homestead within 6 months.
>
>
>The reinvestmentperiod under the California homestead exemption lasts
>six months regardless of when a debtor sells his homestead.
>Lane theorized that if the proceeds from post-petition homestead
>sales could lose their exempt status, trustees might
>claim an interest in the homestead and postpone closing a
>case so long as there is any possibility the debtors circumstances
>might change. Id. at 765. We find this concern too
>speculative. We doubt a trustee would delay liquidating an
>estate because (1) the debtors homestead might be sold at
>some point in the future and (2) the debtor might fail to reinvest
>his share of the proceeds six months after the sale.
>
>
>The reasoning is flawed for at least two reasons:
>1] Trustees will most likely delay closing of cases because they've done it before capture the growth in equity unless a motion to abandon is filed and granted;
>2] Since when can a debtor in Los Angeles County buy another home for $75,000 / $100,000 / $175,000 ? No bank is going to give them a loan during bankruptcy or shortly thereafter thereby requiring them to buy one for cash.
>
>
>
>
>
>
>_________________________
>Robert K. Lee, Esq
>State Bar Certified Specialist
>[Bankruptcy Law]
>3435 Wilshire Blvd, Suite 1035
>Los Angeles, CA 90010
>Ph [888] 777-0839 Ext 505
>Fax [888] 777-0849
>WEBSITE
>
>
>
The post was migrated from Yahoo.
No just got a email update from findlaw today
On Apr 23, 2012 9:41 PM, "Dennis McGoldrick" wrote:
> **
>
>
> Is this case you are asking about, 15 years, or so, years old?
> ------------------------------
> *From:* Robert Lee
> *To:* cdcbaa@yahoogroups.com
> *Sent:* Monday, April 23, 2012 9:31 PM
> *Subject:* [cdcbaa] In re Jacobson
>
> **
>
>
> *Has anyone seen this ruling ? Homestead exemption ruled as belonging to
> the bankruptcy estate because it was not reinvested in a homestead within 6
> months. *
>
> *The reinvestment period under the California homestead exemption lasts*
> *six months regardless of when a debtor sells his homestead.*
> *Lane theorized that if the proceeds from post-petition homestead*
> *sales could lose their exempt status, trustees might*
> *claim an interest in the homestead and postpone closing a*
> *case so long as there is any possibility the debtors circumstances*
> *might change. Id. at 765. We find this concern too*
> *speculative. We doubt a trustee would delay liquidating an*
> *estate because (1) the debtors homestead might be sold at*
> *some point in the future and (2) the debtor might fail to reinvest*
> *his share of the proceeds six months after the sale.*
> *
> *
> *The reasoning is flawed for at least two reasons:*
> *1] Trustees will most likely delay closing of cases because they've
> done it before capture the growth in equity unless a motion to abandon is
> filed and granted;*
> *2] Since when can a debtor in Los Angeles County buy another home for
> $75,000 / $100,000 / $175,000 ? No bank is going to give them a loan
> during bankruptcy or shortly thereafter thereby requiring them to buy one
> for cash.*
> * *
> * *
>
>
> _________________________
> Robert K. Lee, Esq
> State Bar Certified Specialist
> [Bankruptcy Law]
> 3435 Wilshire Blvd, Suite 1035
> Los Angeles, CA 90010
> Ph [888] 777-0839 Ext 505
> Fax [888] 777-0849
> WEBSITE
>
>
>
>
>
No just got a email update from findlaw today
On Apr 23, 2012 9:41 PM, "Dennis McGoldrick" <easky1@yahoo.com> wrote:
Is this case you are asking about, 15 years, or so, years old?t-size:14pt">
From: Robert Lee <boblee.rkl@gmail.com> To: cdcbaa@yahoogroups.com
Sent: Monday, April 23, 2012 9:31 PM Subject: [cdcbaa] In re Jacobson
Has anyone seen this ruling ? Homestead exemption ruled as belonging to the bankruptcy estate because it was not reinvested in a homestead within 6 months.
The post was migrated from Yahoo.
Is this case you are asking about, 15 years, or so, years old?
________________________________
To: cdcbaa@yahoogroups.com
Sent: Monday, April 23, 2012 9:31 PM
Subject: [cdcbaa] In re Jacobson
Has anyone seen this ruling ? Homestead exemption ruled as belonging to the bankruptcy estate because it was not reinvested in a homestead within 6 months.
The reinvestmentperiod under the California homestead exemption lasts
six months regardless of when a debtor sells his homestead.
Lane theorized that if the proceeds from post-petition homestead
sales could lose their exempt status, trustees might
case so long as there is any possibility the debtors circumstances
might change. Id. at 765. We find this concern too
speculative. We doubt a trustee would delay liquidating an
estate because (1) the debtors homestead might be sold at
some point in the future and (2) the debtor might fail to reinvest
his share of the proceeds six months after the sale.
The reasoning is flawed for at least two reasons:
1] Trustees will most likely delay closing of cases because they've done it before capture the growth in equity unless a motion to abandon is filed and granted;
2] Since when can a debtor in Los Angeles County buy another home for $75,000 / $100,000 / $175,000 ? No bank is going to give them a loan during bankruptcy or shortly thereafter thereby requiring them to buy one for cash.
_________________________
Robert K. Lee, Esq
State Bar Certified Specialist
[Bankruptcy Law]
3435 Wilshire Blvd, Suite 1035
Los Angeles, CA 90010
Ph [888] 777-0839 Ext 505
Fax [888] 777-0849
WEBSITE
Is this case you are asking about, 15 years, or so, years old? From: Robert Lee <boblee.rkl@gmail.com> To: cdcbaa@yahoogroups.com Sent: Monday, April 23, 2012 9:31 PM Subject: [cdcbaa] In re Jacobson
Has anyone seen this ruling ? Homestead exemption ruled as belonging to the bankruptcy estate because it was not reinvested in a homestead within 6 months.
The reinvestmentperiod under the California homestead exemption lastssix months regardless of when a debtor sells his homestead.
Lane theorized that if the proceeds from post-petition homesteadsales could lose their exempt status, trustees mightclaim an interest in the homestead and postpone closing a
case so long as there is any possibility the debtors circumstancesmight change. Id. at 765. We find this concern toospeculative. We doubt a trustee would delay liquidating an
estate because (1) the debtors homestead might be sold atsome point in the future and (2) the debtor might fail to reinvest
his share of the proceeds six months after the s
The post was migrated from Yahoo.