Recently in Bankruptcy Law Category

Murphy's Law was working overtime when David Sharfarz started talking to contractors about building an addition to his new home. Sharfarz ended up hiring Peter Goguen. The contract for the job required Goguen to pour the foundation by October 15, 2006, to obtain the necessary town permits, and to complete the project by March 15, 2007.

Goguen lied to Sharfarz on multiple occasions throughout the project, (e.g. saying he applied for permits when he hadn't, demanding — and receiving — money for a worker he never hired). Sharfarz's primary concern through the process was pouring the foundation before the weather turned cold to avoid cracks. The project was delayed (due to the missing permits), the foundation was poured after the weather turned cold, and the foundation — you guessed it — cracked.

This just in -- The First Circuit Court of Appeals has appointed a new Bankruptcy Judge.

We've been bringing you news about several vacancies over the past few months, not just in the First Circuit, but across the Circuits. Here's the first one of these vacancies to be filled: On June 8th, Chief Judge Sandra Lynch announced that the Diane Finkle has been chosen to sit as United States Bankruptcy Judge for the District of Rhode Island.

Are you a First Circuit bankruptcy attorney looking to move up the ranks? This may be the news you were waiting hear: The First Circuit Court of Appeals has announced a vacancy for Bankruptcy Judge.

The position is for the United States Bankruptcy Court for the District of New Hampshire, and it will be based out of Manchester, New Hampshire.

In a Chapter 13 bankruptcy, court schedules can lay out the amount of money that an attorney may be awarded. But there are limits to a bankruptcy attorney’s fees in a Chapter 13 bankruptcy, as we see in a recent First Circuit Court of Appeals decision.

In this case, a bankruptcy attorney challenged the fees he was awarded in a Chapter 13 bankruptcy proceeding, claiming that the fees were too meager.

If you’re a distinguished Rhode Island Bankruptcy lawyer, you may be interested in knowing that there is a judgeship vacancy, and that applications are now being accepted. In a press release, Chief Judge Sandra Lynch of the First Circuit Court of Appeals announced the creation of a Bankruptcy Merit Selection Panel. The Panel will screen and review the qualifications of applicants for the Bankruptcy Judge vacancy left by the Honorable Arthur N. Votolato.

Judge Votolato has served on the Bankruptcy Court in the District of Rhode Island since 1968. Judge Votolato, a 1956 graduate of Boston University School of Law, served as Bankruptcy Court Judge after a distinguished career in Bankruptcy, where he became Chief Judge of the First Circuit Bankruptcy Appellate Panel in 1996.

Bankruptcy judges will soon feel America’s proverbial belt-tightening in the courthouse.

This week, the Judicial Conference of the United States adopted a courtroom sharing policy for bankruptcy judges in new courthouse and courtroom construction. In court facilities with three or more bankruptcy judges, one courtroom will be provided for every two bankruptcy judges. In those facilities with an odd number of bankruptcy judges, the number of courtrooms allotted will remain at the next lower whole number.

While the courtroom sharing policy will reduce the number of courtrooms constructed, government reports indicate that reduced construction will not impair access to bankruptcy courts.

District court's holding that a creditor's garnishment of funds was avoidable under 11 U.S.C. section 547(b) affirmed

In re Net-Valazquez, 09-1816, concerned a challenge to the district court's affirmance of a bankruptcy court's judgment in favor of a bankruptcy trustee, holding that a creditor's garnishment of funds was a preferential transfer of estate property avoidable under 11 U.S.C. section 547(b).

Bankruptcy Appellate Panel's affirmance of bankruptcy court order denying plaintiff's motion for relief from stay in a suit against a debtor affirmed

In re Handy, 09-9021, concerned a challenge to a Bankruptcy Appellate Panel's (BAP) decision affirming a bankruptcy court order denying plaintiff's motion for relief from stay of his suit against a debtor under the Uniform Fraudulent Transfer Act (UFTA).

Perry v. Blum, 09-1977, involved a plaintiff's suit for an accounting of foreclosure proceeds and all rents collected between 1996 and 2002, claiming that as an equal partner in the company, he was entitled to one-half of the property's equity of redemption, arising from an underlying litigation, bankruptcy proceedings, and defendants' settlement with the FDIC.

In Re: Sherman, No. 09-1572, involved a challenge to the bankruptcy court's denial of discharge of the $983,000 debt based on its finding that the debtor appropriated the victims' property for his own benefit with fraudulent intent, thus finding the elements necessary to hold the debtor responsible as an embezzler. 

As stated in the decision: "Young is helpful again, in its example of embezzlement by using entrusted money for the recipient's own purposes in a way he knows the entrustor did not intent or authorize.  It is knowledge that the use is devoid of authorization, scienter for short, that makes the conversion fraudulent and thus embezzlement, and it is just this knowledge that the bankruptcy court found that Sherman had as a participant in the conversion."

Thus, while conceding that the bankruptcy judge did not make an express finding that debtor knew the action being taken was unauthorized, the court held that the bankruptcy judge's conclusion leaves no doubt that the judge did so find. 

Related Resource:

• Full text of In Re: Sherman, No. 09-1572