Question about Collection Activity of State Board of
Posted: Fri Sep 26, 2014 10:56 am
I understand that practically speaking, it would be easier to "just pay
it", but remember, postpetition income is property of the bankruptcy estate
in a Chapter 13, so I am not sure that I can advise debtor to use estate
property to pay the SBE outside of the Plan.
Holly Roark
Certified Bankruptcy Specialist*
*and Sports Lawyer*
holly@roarklawoffices.com **primary email address**
www.roarklawoffices.com
Central District of California
Consumer Bankruptcy Attorney
1875 Century Park East, Suite 600
Los Angeles, CA 90067
T (310) 553-2600
F (310) 553-2601
*By State Bar of California Board of Legal Specialization
**For a quicker response, email me at holly@roarklawoffices.com.
I only use gmail for my listservs, and am likely to miss private emails
directed to my gmail account.**
On Thu, Sep 25, 2014 at 11:22 PM, Michael Avanesian michael@avanesianlaw.com
[cdcbaa] wrote:
>
>
> I think it could go both ways depending on exactly what happened. So I
> think both parties are correct.
>
> If the SBE said, "Either you give us the $ or we will slam the new
> business owner." Then yeah, you have a violation.
> If the SBE said, "Just FYI, if you default, we will exercise our right to
> pursue the new owner." That's just courtesy. Something the bar should
> encourage.
>
> If my client told me they had a $1,400 dispute with the SBE, I would be
> tempted to tell them to give me a $1,700 flat fee to fix the problem. I'd
> then write a check over to the SBE for $1,400 and pocket $300. I just saved
> my client $5,000 in attorney fees and a headache. I'm being a little silly
> to make a point. I'd actually tell my client to cough up the money.
>
> Now it gets dangerous since I'm going to talk about something I know very
> little about. If you're paying SBE 100% over 60 months, what prevents you
> from paying them $300 / month for 4 months and a 5th payment for $200? Is
> there nothing that can be moved around to accomplish this?
>
> Sincerely,
> Michael Avanesian
>
> On Thu, Sep 25, 2014 at 6:17 PM, Holly Roark hollyroark22@gmail.com
> [cdcbaa] wrote:
>
>>
>>
>> I think it can be taken either way. I believe was trying to get the
>> Debtor to pay and trying to get her to pay outside the plan pursuant to the
>> agreement they had prior to filing the BK.
>>
>>
>> Holly Roark
>> Certified Bankruptcy Specialist*
>> *and Sports Lawyer*
>> holly@roarklawoffices.com **primary email address**
>> www.roarklawoffices.com
>> Central District of California
>> Consumer Bankruptcy Attorney
>> 1875 Century Park East, Suite 600
>> Los Angeles, CA 90067
>> T (310) 553-2600
>> F (310) 553-2601
>>
>> *By State Bar of California Board of Legal Specialization
>>
>>
>> **For a quicker response, email me at holly@roarklawoffices.com.
>> I only use gmail for my listservs, and am likely to miss private emails
>> directed to my gmail account.**
>>
>>
>> On Thu, Sep 25, 2014 at 6:01 PM, 'Peter M. Lively'
>> petermlively2000@yahoo.com [cdcbaa] wrote:
>>
>>>
>>> [Attachment(s)
>>> from
>>> Peter M. Lively included below]
>>>
>>> The threat wasn't to further pursue the debtor, the estate property, or
>>> a co-debtor on a consumer debt. I view it more as a factual statement of
>>> policy regarding exercise of SBE's right to collect against the nondebtor.
>>>
>>> Peter 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 Thursday, September 25, 2014 5:42 PM, "Holly Roark
>>> hollyroark22@gmail.com [cdcbaa]" wrote:
>>>
>>>
>>>
>>> I understand how you are viewing this and I get that there is no
>>> codebtor stay here, but what I was looking at is his attempt to collect
>>> from the Debtor directly by using this threat.
>>>
>>> Holly Roark
>>> Certified Bankruptcy Specialist*
>>> *and Sports Lawyer*
>>> holly@roarklawoffices.com **primary email address**
>>> http://www.roarklawoffices.com/
>>> Central District of California
>>> Consumer Bankruptcy Attorney
>>> 1875 Century Park East, Suite 600
>>> Los Angeles, CA 90067
>>> T (310) 553-2600
>>> F (310) 553-2601
>>> *By State Bar of California Board of Legal Specialization
>>>
>>> **For a quicker response, email me at holly@roarklawoffices.com.
>>> I only use gmail for my listservs, and am likely to miss private emails
>>> directed to my gmail account.**
>>>
>>>
>>> On Thu, Sep 25, 2014 at 5:36 PM, 'Peter M. Lively'
>>> petermlively2000@yahoo.com [cdcbaa] wrote:
>>>
>>>
>>> [Attachment(s)
>>>
>>> from Peter M. Lively included below]
>>> Given that sales taxes are nonconsumer debts, there isn't a codebtor
>>> stay as to the buyer. I'm not persuaded that the statement by the SBE
>>> agent is a stay violation.
>>>
>>> Peter 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 Thursday, September 25, 2014 4:09 PM, "Holly Roark
>>> hollyroark22@gmail.com [cdcbaa]" wrote:
>>>
>>>
>>>
>>> The Plan is not yet confirmed.
>>>
>>> On Thursday, September 25, 2014, Nicholas Gebelt ngebelt@gebeltlaw.com
>>> [cdcbaa] wrote:
>>>
>>>
>>> Dear Holly,
>>>
>>> If the plan has been confirmed, then it is binding on SBE pursuant to >>> 1327(a). If SBE seeks repayment other than through the confirmed plan,
>>> then it is in violation of the order confirming the plan. Sovereign
>>> immunity has been abrogated with respect to 1327 pursuant to >>> 106(a)(1). Therefore, you can seek relief using an OSC re contempt motion
>>> to get costs and attorneys fees under 105. However, you cannot get
>>> punitive damages because of 106(a)(3).
>>>
>>> If the plan has not been confirmed, then if SBE has filed a proof of
>>> claim it has waived sovereign immunity pursuant to 106(b). This waiver
>>> does not appear to be restricted to the Code sections listed in 106(a)(1).
>>>
>>> Sovereign immunity has also been abrogated with respect to 362
>>> pursuant to 106(a)(1), and in particular, abrogated with respect to
>>> 362(k). Therefore, SBEs threat to the Debtor which was clearly intended
>>> to induce payment by the Debtor is a stay violation. Since >>> explicitly mandates costs and attorneys fees (. . . *shall* recover
>>> actual damages, including costs and attorneys fees . . .>>> paid for your efforts.
>>>
>>> And Stella, the U.S. Supreme Court upheld the constitutionality of >>> in *Central Va. Cmty. Coll. V. Katz*, 126 S. Ct. 990 (206), so any
>>> appeal to the Eleventh Amendment by SBE will fail. The Court addressed the
>>> Eleventh Amendment argument and held: The . . . States agreed in the
>>> plan of the Convention not to assert any sovereign immunity defense they
>>> might have had in proceedings brought pursuant to Laws on the subject of
>>> Bankruptcies. *Central Va. Cmty. Coll. V. Katz*, 126 S. Ct. at 377.
>>>
>>> Good luck,
>>>
>>> Nick
>>>
>>> *Nicholas Gebelt*
>>>
>>> Nicholas Gebelt, Ph.D., J.D.
>>> Attorney at Law
>>> Certified Bankruptcy Law Specialist
>>>
>>> [image: Description: Description: Description:
>>> cid:image003.jpg@01CC076B.B14D73C0]
>>>
>>> Law Offices of Nicholas Gebelt
>>> 15150 Hornell Street
>>> Whittier, CA 90604
>>> Phone: 562.777.9159
>>> FAX: 562.946.1365
>>> Email: ngebelt@goodbye2debt.com; ngebelt@gebeltlaw.com
>>> Web: www.goodbye2debt.com
>>> Blog: www.southerncaliforniabankruptcylawblog.com/
>>>
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>>> *From:* cdcbaa@yahoogroups.com [mailto:cdcbaa@yahoogroups.com]
>>> *Sent:* Thursday, September 25, 2014 2:24 PM
>>> *To:* cdcbaa@yahoogroups.com
>>> *Subject:* RE: [cdcbaa] Question about Collection Activity of State
>>> Board of Equalization for Sales Tax
>>>
>>>
>>> SBE is the most difficult of all state agencies to deal with. It is
>>> a kingdom onto itself. Until recently, it was taking the position that it
>>> was not subject to the jurisdiction of the bankruptcy court because of the
>>> 11th amendment. I would pay the $1,400 and not make a big to do. SBE
>>> will do what it says it will do and worse.
>>>
>>> Stella
>>>
>>> *From:* cdcbaa@yahoogroups.com [mailto:cdcbaa@yahoogroups.com]
>>> *Sent:* Thursday, September 25, 2014 2:13 PM
>>> *To:* Strictly Bankruptcy Issues; cdcbaa
>>> *Subject:* [cdcbaa] Question about Collection Activity of State Board
>>> of Equalization for Sales Tax
>>>
>>>
>>> Chapter 13 debtor filed plan which is paying 100% to State Board of
>>> Equalization for sales tax for which she is personally liable for a
>>> corporation that is no longer active. The only business that the
>>> corporation did was owning a restaurant. The restaurant was sold. No escrow
>>> was used, and apparently there was some sales tax owed for which Debtor has
>>> been paying pursuant to a payment plan with the SBE. Debtor does not meet
>>> the requirements set forth here:
>>> http://www.jdsupra.com/legalnews/discha ... ili-30155/
>>> to discharge such taxes.
>>> The tax is only $1,400, so we are not talking a huge amount here.
>>> Despite including the SBE in the Plan as a priority debt, serving the
>>> Plan on the SBE, and talking to the SBE about this treatment in the Plan,
>>> SBE *threatened* Debtor that if she did not stick to their prior payment
>>> plan of $300/month, then they would go after the buyer of the restaurant
>>> who is apparently also liable on the tax by virtue of buying the restaurant
>>> and not getting a certificate of tax clearance:
>>> http://www.boe.ca.gov/sutax/faqbus.htm
>>> Aside from the Stay violation, which is another conversation (SBE will
>>> probably say, no, they were not really talking to the "Debtor" but to the
>>> officer of the dead corporation that originally owed the tax), I'd like to
>>> know if anyone has had experience with the SBE, and what can Debtor do, if
>>> anything, to keep the SBE from seeking payment from the buyers? If SBE does
>>> get paid from buyers, does Debtor then have to pay back the buyers through
>>> the Chapter 13 Plan as a priority debt as if buyer were the SBE?
>>>
>>> I'd like to hear any other comments or observations you have on this.
>>> I want to call the SBE back with some leverage, but I want to make sure I
>>> understand what's what here.
>>>
>>> Holly Roark
>>> Certified Bankruptcy Specialist*
>>> *and Sports Lawyer*
>>> holly@roarklawoffices.com **primary email address**
>>> http://www.roarklawoffices.com/
>>> Central District of California
>>> Consumer Bankruptcy Attorney
>>> 1875 Century Park East, Suite 600
>>> Los Angeles, CA 90067
>>> T (310) 553-2600
>>> F (310) 553-2601
>>> *By State Bar of California Board of Legal Specialization
>>>
>>> **For a quicker response, email me at holly@roarklawoffices.com.
>>> I only use gmail for my listservs, and am likely to miss private
>>> emails
>>> directed to my gmail account.**
>>>
>>>
>>>
>>>
>>> --
>>> Holly Roark
>>> Certified Bankruptcy Specialist*
>>> *and Sports Lawyer*
>>> holly@roarklawoffices.com **primary email address**
>>> http://www.roarklawoffices.com/
>>> Central District of California
>>> Consumer Bankruptcy Attorney
>>> 1875 Century Park East, Suite 600
>>> Los Angeles, CA 90067
>>> T (310) 553-2600
>>> F (310) 553-2601
>>> *By State Bar of California Board of Legal Specialization
>>>
>>> **For a quicker response, email me at holly@roarklawoffices.com.
>>> I only use gmail for my listservs, and am likely to miss private emails
>>> directed to my gmail account.**
>>>
>>>
>>>
>>>
>>>
>>>
>>>
>>>
>>
>
>
I understand that practically speaking, it would be easier to "just pay it", but remember, postpetition income is property of the bankruptcy estate in a Chapter 13, so I am not sure that I can advise debtor to use estate property to pay the SBE outside of the Plan.Holly RoarkCertified Bankruptcy Specialist*and Sports Lawyer
holly@roarklawoffices.com**primary email address**
www.roarklawoffices.com
Central District of California
Consumer Bankruptcy Attorney
1875 Century Park East, Suite 600
Los Angeles, CA 90067
T (310) 553-2600
F (310) 553-2601
*By State Bar of California Board of Legal
Specialization
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