Central District Consumer Bankruptcy Attorney's Association

The statute you are thinking of is 11 USC Section 558. Under the Code,
while the Trustee can attempt to sell a legal defense that is property
of the estate, this does not prevent the debtor from using the same
defense if later sued on the same claim. See 10 5-558 Collier on
Bankruptcy P 558.01 citing Nasr v. Texas Trust Sav. Bank (In re Nasr),
120 B.R. 855 (Bankr. S.D. Tex. 1990) (debtor entitled to assert setoff
and recoupment defenses to fraud claim in non-dischargeability
proceeding). In the fact pattern you have presented, while the trustee
does have something to sell, the creditor in question de facto has
nothing of value to buy.
Wesley H. Avery, Esq.
Roquemore, Pringle & Moore, Inc.
6055 E. Washington Blvd., Ste. 500
Los Angeles, CA 90040-2466
wavery@rpmlaw.com
http://www.rpmlaw.com
(323) 724-3117 (office)
(323) 724-5410 (fax)
(323) 919-9336 (blackberry)
The Bankruptcy Law Center
28005 Smyth Drive, Ste. 125
Valencia, CA 91355-4023
wavery@thebankruptcylawcenter.com
http://www.thebankruptcylawcenter.com
(661) 295-4673 (office)
(661) 430-5467 (fax)
(661) 618-7376 (cell)
Certified Specialist
Bankruptcy Law
State Bar of California
Board Certified
Business Bankruptcy Law
American Board of Certification
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The post was migrated from Yahoo.

charsetndows-1252
#3 "Rooker-Feldman Doctrine"...
Jason
On Mar 14, 2011, at 8:22 AM, David A. Tilem wrote:
>
> Not sure what there is to buy. What is it that the Trustee is proposing to sell? One question is what issues are on appeal? Are they substantive issues, procedural issues, due process issues or something else.
>
> Okay, a bit more logic here. The creditor holds a claim against the estate. The Trustee, or any other interested party for that matter (including the Debtor), can object to the claim. The "dispute" can then be settled by the Trustee on notice to interested parties, including the Debtor. Debtor can object to the proposed settlement. If the settlement is approved, however, why would not the issue be resolved on collateral estoppel grounds.
>
> 1. Consider a procedural defense, i.e. that the Trustee is taking too many procedural shortcuts and is depriving the Debtor of an opportunity to be heard.
>
> 2. Consider a defense based on that doctrine, I can never remember the name, preventing Fed Cts from interfering with State Court process.
>
> 3. Consider counter motion for abstention.
>
>
>
>
> David A. Tilem
> Certified Bankruptcy Specialist*
> Law Offices of David A. Tilem (a debt relief agency)
> 206 N. Jackson Street, #201, Glendale, CA 91206
> Tel: 818-507-6000 Fax: 818-507-6800
>
> * Bankruptcy specialist cert. by State Bar of CA Bd of Legal Specialization.
> Business bankruptcy specialist cert. by Amer. Bd. of Certification
>
>
> -----Original Message-----
jbsesq1965
> Sent: Sunday, March 13, 2011 5:59 PM
> To: cdcbaa@yahoogroups.com
> Subject: [cdcbaa] Urgent Need Answer ASAP
>
>
> PC called with an interesting fact pattern. Brief is due Monday. Among PC's listed creditor's is a person who was suing Debtor when debtor filed BK. In that pre-petition state court case the debtor had lost a $50K judgment and had that loss on appeal when he filed BK. Debtor has lost his discharge 727, but the appeal was stayed. So now the debtor wants to proceed with that appeal.
>
> The same creditor has now made an offer to the chapter 7 trustee to "buy all of the debtor's interest in the appeal". The debtor wants to hire me to fight that motion to approve the sale.
>
> I don't think there is anything to sell. What's on appeal are DEFENSES that the debtor had lost when he filed BK. Now that he lost his discharge, its really important that he preserve these defenses. How can the trustee sell the debtor's right to mount a legal defense on the merits?
>
> I can't find any authority that helps me, at all. And I'm worried about the argument that creditors benefit because there is cash on the table. Why should creditors not get the money?
>
> There has to be something out there and I have a really vague recollection that there IS a case out there that says that says that a purely defensive action is NOT property of the estate. HELP, FAST!
>
> Jeff Smith
>
>
>
>
charsetndows-1252
#3 "Rooker-Feldman Doctrine"...JasonOn Mar 14, 2011, at 8:22 AM, David A. Tilem wrote:

Not sure what there is to
buy. What is it that the Trustee is proposing to sell?
One question is
what issues are on appeal? Are they substantive issues, procedural issues,
due process issues or something else.

Okay, a bit more logic here.
The creditor holds a claim against the estate. The Trustee,
or any other interested party for that matter (including the Debtor), can object
to the claim. The "dispute" can then be settled by the Trustee on notice
to interested parties, including the Debtor. Debtor can object to theproposed settlement. If the settlement is approved, however, why would not
the issue be resolved on collateral estoppel grounds.

1. Consider a
procedural defense, i.e. that the Trustee is taking too many procedural
shortcuts and is depriving the Debtor of an opportunity to be heard.

2. Consider a defense
based on that doctrine, I can never remember the name, preventing Fed Cts from
interfering with State Court process.

3. Consider counter
motion for abstention.




David A.
Tilem
The post was migrated from Yahoo.

Not sure what there is to buy. What is it that the Trustee is proposing to
sell? One question is what issues are on appeal? Are they substantive
issues, procedural issues, due process issues or something else.
Okay, a bit more logic here. The creditor holds a claim against the estate.
The Trustee, or any other interested party for that matter (including the
Debtor), can object to the claim. The "dispute" can then be settled by the
Trustee on notice to interested parties, including the Debtor. Debtor can
object to the proposed settlement. If the settlement is approved, however,
why would not the issue be resolved on collateral estoppel grounds.
1. Consider a procedural defense, i.e. that the Trustee is taking too many
procedural shortcuts and is depriving the Debtor of an opportunity to be
heard.
2. Consider a defense based on that doctrine, I can never remember the
name, preventing Fed Cts from interfering with State Court process.
3. Consider counter motion for abstention.
David A. Tilem
Certified Bankruptcy Specialist*
Law Offices of David A. Tilem (a debt relief agency)
206 N. Jackson Street, #201, Glendale, CA 91206
Tel: 818-507-6000 Fax: 818-507-6800
* Bankruptcy specialist cert. by State Bar of CA Bd of Legal
Specialization.
jbsesq1965
Sent: Sunday, March 13, 2011 5:59 PM
To: cdcbaa@yahoogroups.com
Subject: [cdcbaa] Urgent Need Answer ASAP
PC called with an interesting fact pattern. Brief is due Monday. Among PC's
listed creditor's is a person who was suing Debtor when debtor filed BK. In
that pre-petition state court case the debtor had lost a $50K judgment and
had that loss on appeal when he filed BK. Debtor has lost his discharge 727,
but the appeal was stayed. So now the debtor wants to proceed with that
appeal.
The same creditor has now made an offer to the chapter 7 trustee to "buy all
of the debtor's interest in the appeal". The debtor wants to hire me to
fight that motion to approve the sale.
I don't think there is anything to sell. What's on appeal are DEFENSES that
the debtor had lost when he filed BK. Now that he lost his discharge, its
really important that he preserve these defenses. How can the trustee sell
the debtor's right to mount a legal defense on the merits?
I can't find any authority that helps me, at all. And I'm worried about the
argument that creditors benefit because there is cash on the table. Why
should creditors not get the money?
There has to be something out there and I have a really vague recollection
that there IS a case out there that says that says that a purely defensive
action is NOT property of the estate. HELP, FAST!
Jeff Smith
Message
Not sure what there is to
buy. What is it that the Trustee is proposing to sell?
One question is
what issues are on appeal? Are they substantive issues, procedural issues,
due process issues or something else.

Okay, a bit more logic here.
The creditor holds a claim against the estate. The Trustee,
or any other interested party for that matter (including the Debtor), can object
to the claim. The "dispute" can then be settled by the Trustee on notice
to interested parties, including the Debtor. Debtor can object to theproposed settlement. If the settlement is approved, however, why would not
the issue be resolved on collateral estoppel grounds.

1. Consider a
procedural defense, i.e. that the Trustee is taking too many procedural
shortcuts and is depriving the Debtor of an opportunity to be heard.

2. Consider a defense
based on that doctrine, I can never remember the name, preventing Fed Cts from
interfering with State Court process.

3. Consider counter
motion for abstention.




David A.
Tilem
Certified Bankruptcy
Specialist*
The post was migrated from Yahoo.

Jeff:
11 U.S.C. 541:
(a) The commencement of a case under section 301 , 302 , or 303
The post was migrated from Yahoo.

PC called with an interesting fact pattern. Brief is due Monday. Among PC's listed creditor's is a person who was suing Debtor when debtor filed BK. In that pre-petition state court case the debtor had lost a $50K judgment and had that loss on appeal when he filed BK. Debtor has lost his discharge 727, but the appeal was stayed. So now the debtor wants to proceed with that appeal.
The same creditor has now made an offer to the chapter 7 trustee to "buy all of the debtor's interest in the appeal". The debtor wants to hire me to fight that motion to approve the sale.
I don't think there is anything to sell. What's on appeal are DEFENSES that the debtor had lost when he filed BK. Now that he lost his discharge, its really important that he preserve these defenses. How can the trustee sell the debtor's right to mount a legal defense on the merits?
I can't find any authority that helps me, at all. And I'm worried about the argument that creditors benefit because there is cash on the table. Why should creditors not get the money?
There has to be something out there and I have a really vague recollection that there IS a case out there that says that says that a purely defensive action is NOT property of the estate. HELP, FAST!
Jeff Smith

The post was migrated from Yahoo.