Opinions

The Southern District of Illinois offers a database of opinions. These opinions were entered between the period of 2/1987 and the present. To conduct a detailed search, enter a keyword or case number in the search box to the right.

 

Opinions can also be viewed via the U.S. GPO's Federal Digital System

Date Filedsort ascending Summary Case Number PDF
04/15/2019

In re: Richard Jones

Summary: Prior to filing, debtor withdrew $50,000 from his IRA and deposited $49,000.00 of the funds into his personal checking account.  Less than 60 days later, debtor purchased a $20,000 cashier’s check from his bank and deposited those funds into the same IRA.  Approximately four months later, debtor filed a chapter 7 bankruptcy petition.  Debtor claimed a $40,000.00 exemption in the IRA under 735 ILCS § 5/12-1006.  The trustee objected on the basis that $20,000 of the funds lost their exempt status once they were withdrawn from the IRA.  Debtor countered that the funds were reinvested into the same IRA within the 60-day rollover time frame allowed by the Internal Revenue Service regulations, and that the funds were in a protected retirement account on the date of filing bankruptcy.   The trustee did not raise any allegations of fraud nor did he argue that debtor improperly converted nonexempt property into exempt property. The Court overruled the trustee’s objection, finding that he failed to meet his burden of proving that the exemption was improperly claimed.

18-31532 View
03/08/2019

In re: Dene Shaeffer

Summary: In this Chapter 7 case, the Creditor moved for attorney’s fees after a hearing regarding the Debtor’s Motion for Contempt and Sanctions. The Debtor was unable to prove the factual allegations in her Motion and was found to be not credible after evidence of a pattern of deceit and dishonesty was presented. Because the Debtorwas unable to provide any evidence of her allegations and was completely uncooperative throughout the discovery process, the Creditor sought sanctions pursuant to Rule 9011. The Court concluded that the Debtor’s conduct was a violation of Rule 9011(b)(3) and awarded the Creditor reasonable attorney’s fees.

17-30052 View
10/24/2018

In re: Barbara A Mosley

Summary: This case presented the issue of whether the Court must dismiss or convert a Chapter 13 case for cause where, due to substantial educational loans, a debtor exceeded the debt limits imposed by 11 U.S.C. § 109(e). The debtor in this case listed unsecured, non-contingent, liquidated debts totaling $513,550.73 on her Schedule E/F. This figure included $384,165.00 in student loans. The Chapter 13 Trustee moved to dismiss or convert the case for cause pursuant to 11 U.S.C. § 1307(c). He asserted that because the amount of the debtor’s unsecured debts exceeded the limits set forth in 11 U.S.C. § 109(e), she was ineligible for Chapter 13 relief. Although the debtor acknowledged that she exceeded the debt limit, she argued that because most of her unsecured debt was student loans, she should still be permitted to proceed under Chapter 13 for policy reasons.

In rejecting the debtor’s argument, the Court determined that the language of § 109(e) was unambiguous and that a debtor who exceeded the prescribed debt limits was not eligible to be a Chapter 13 debtor. The Court noted that there are numerous of situations where student loans, by statute, are afforded special treatment (i.e. nondischargeability in bankruptcy, deferments, etc.). Had Congress intended to exclude student loan debt from the §109(e) debt limits it could easily have done so. Because Congress provided for no such exception, the Court concluded that it could not create one and, accordingly, the debtor’s case was dismissed.

18-30771 View
10/02/2018

In re: Alex A Manuel

Summary: In this chapter 7 case, the debtor asserted that a Child Tax Credit was exempt from the bankruptcy estate as a public assistance benefit under 735 ILCS 5/12-1001(g)(1).  The trustee objected to the exemption and also filed a motion for turnover of certain amounts from debtor’s tax refunds.  The Court sustained the trustee’s objection to exemptions and granted the motion for turnover, declining to adopt a broad interpretation of “public assistance.”

17-60450 View
09/14/2018

In re: Gargula v. Delagrange

Summary: The Court denied the debtor’s discharge pursuant to 11 U.S.C. §§ 727(a)(4)(D), 727(a)(6)(A) and 727(a)(4)(A). The debtor disclosed virtually no assets or income on his schedules and Statement of Financial Affairs, failed to disclose property transfers, repeatedly failed to cooperate with the Trustee and blatantly ignored Court orders. The Court concluded that such conduct represented an abuse of the bankruptcy process and, accordingly, the debtor was not entitled to a discharge.

17-04017 View
08/28/2018

In re: Simon v. Finley, III et al

Summary: The debtors’ chapter 13 confirmed plan provided that debtors would make direct payments to their mortgage creditor. In their motion for a chapter 13 discharge under § 1328(a), the debtors represented that they had made all payments required by the plan. After the motion was filed, but before entry of the discharge order, the mortgage creditor filed a response to the chapter 13 trustee’s Notice of Final Cure Payment. The creditor’s response indicated that the debtors were delinquent in post-petition mortgage payments in the amount of $70,869.24. No objections to the motion for discharge were filed and an order of discharge was entered. Approximately three weeks after entry of the discharge order, the trustee filed a complaint to revoke the debtors’ discharge under §1328(e) of the Bankruptcy Code. The complaint alleged that the debtors obtained their discharge by falsely and fraudulently stating (in their motion for discharge) that they had made all payments required by the plan. The debtors moved to dismiss the complaint for failure to state a claim on two grounds: (1) payments made directly to the mortgage creditor are not “payments under the plan,” and (2) the trustee had notice of their failure to make post-petition mortgage payments in plenty of time to file an objection to their motion for discharge. The court found that direct payments to the mortgage creditor were payments under the plan as contemplated by § 1328(a). The court further found that § 1328(e)(2) barred the trustee’s action to revoke debtors’ discharge because he had notice of their failure to make post-petition mortgage payments in ample time to object to their motion for discharge. The debtors’ motion to dismiss the complaint was granted.

18-04011 View
08/20/2018

In re: Villa Marie Winery 18-30163

Summary: In this chapter 11 proceeding, the primary secured creditor, First Mid-Illinois Bank and Trust, moved to enforce a settlement agreement with the Debtors.  According to the Bank, the settlement terms were fully set forth in a Forbearance Agreement that was attached to an email sent by Bank’s counsel to Debtors’ counsel.  The Bank contended that the Agreement was confirmed and accepted by Debtors’ counsel in a later email.  Debtors disputed the existence of a valid settlement agreement, arguing in particular that the Debtors never agreed to certain release language contained in the Forbearance Agreement.  The Court found that the Bank failed to prove that the Debtors expressly authorized their attorney to agree to the release language.  The motion to enforce settlement was denied.

18-30163 View
08/07/2018

In re: Connie L Melching 15-31947

Summary: The issue in this case was whether a chapter 7 debtor may claim two separate exemptions, each in the amount of $15,000.00, for payment received on account of personal bodily injury.  Debtor sought to exempt $15,000.00 for personal bodily injury arising from a pre-petition automobile accident, as well as $15,000.00 for injuries related to a pre-petition products liability claim.  The Court held that under the Illinois exemption statute governing payment for personal bodily injury, Debtor was limited to a maximum exemption of $15,000.00.

15-31947 View
04/26/2018

In re: Gary E Jones 17-40497

Summary: This matter was before the Court upon the Trustee’s Objection to Confirmation of the Debtor’s Second Amended Chapter 13 Plan. The Debtor’s plan proposed to pay $3,000.00 in attorney fees, the Trustee’s fees, and $550.00 to the Debtor’s general unsecured creditors over a forty month duration. The Debtor was ineligible to file this case under Chapter 7 due to a Chapter 7 case filed seven years prior. The Trustee asserted that the plan was not filed in good faith as a result of the proposal to pay $3,000.00 in attorney fees and only $550.00 to general unsecured creditors. The Debtor was judgment proof, but chose to file this Chapter 13 case in an effort to avoid the time and expense of defending multiple collections actions in state court. Whether a Chapter 13 Plan is proposed in good faith is a determination made on a case by case basis. The Trustee’s Objection was overruled. Given the facts of this case, the Court held that if the Debtor and his attorney were complying with the provisions of the Bankruptcy Code and Rules and holdings of the Bankruptcy Court for the Southern District of Illinois, the Court could not find bad faith.

17-40497 View
03/06/2018

In re: First Financial Bank, N.A. et al v. Blake et al

Summary: In this chapter 12 case, First Financial Bank asserted a secured interest in debtors’ crops, farm equipment and general intangibles, including payments under the Agricultural Risk Coverage Program (ARC). The Bank filed a complaint to determine the validity, priority and extent of its lien in the ARC payments. Debtors filed a counterclaim seeking to avoid any lien asserted by the Bank as a preference under 11 U.S.C. §547. The sole issue before the court was this: When did the debtors acquire rights in the ARC payments to trigger a transfer as required by §547(e)(3)? The Court found that debtors acquired contractual rights to the 2015 and 2016 crop year payments on the date that they enrolled in the ARC program for those years, which was well outside of the 90-day preference period. Judgment was entered in favor of the Bank and the debtors’ counterclaim was denied.

17-06006 View

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