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THE CONSUMER BANKRUPTCY LETTER |
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In This Issue:
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June 28 2004
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BankruptcyAcademy.com - Enroll two lawyers - save $500 on tuition!
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CAN'T ATTEND ACADEMY? BUY THE BOOK!
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PRIVATE TAX COLLECTION OPPOSED
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DEBTORS FORFEIT UNDISCLOSED PI CASE
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DISCHARGING TAXES IN BANKRUPTCY
KING BANKRUPTCY ACADEMY SCHEDULES 3-DAY SEMINARS ON DISCHARGING TAXES - LAS VEGAS, SAN FRANCISCO & SAN ANTONIO
The first dates scheduled for the 5th annual Bankruptcy Academy program on discharging taxes in bankruptcy cases have been scheduled for
LAS VEGAS, Nevada, on Sept. 8, 9 and 10, 2004;
FISHERMAN'S WHARF, S. F., on October 27, 28 & 29, 2004,
SAN ANTONIO, Texas, January 27, 28 & 29, 2005.
Additional 2005 dates are pending for Atlanta, Georgia, and Boston, Mass.
Principal presenters will be; Morgan King, attorney and author of Discharging Taxes in Bankruptcy; Charles F. Rosen, former chief of the Los Angeles IRS office of Special Procedures (bankruptcy, insolvency); Eric M. Casper, formerly Senior Trial Attorney, Tax Division, U.S. Department of Justice - Washington, D.C.; and Robert N. Kolb, formerly with the IRS and recently the prevailing attorney for the debtor/taxpayer in two important appellate cases.
The 3-day seminar and workshop will be a thorough exploration of bankruptcy remedies for delinquent taxes and tax liens in consumer bankruptcy cases (chapter 7 and chapter 13), emphasizing practical handlng of tax discharge cases from A-to-Z.
Early registration before July 2 saves $50 off the regular enrollment fee of $695. And, with a double enrollment, the second tuition fee is 1/2 price!
CLE
Previous programs have qualified for CLE in all states for which CLE accreditation was requested. On request the Academy will assist in obtaining CLE accreditation for an enrollee's state.
TUITION
Single attorney registration $645 until July 2 (then $695)
Double attorney registration $895 (saves $500!)
Paralegal or other office staff $350
Enrolled agent or CPA $495
For more information about the Tax Discharge program, or to enroll, click on red below or call (925) 829-6460 west coast time.
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PRIVATE TAX COLLECTION OPPOSED
In June 1st and 8th letters to members of the House of Representatives, Republican Congressmen, the National Treasury Employees Union (NTEU), the Consumer Federation of America, National Association for the Advancement of Colored People, National Association of Retired Federal Employees, National Consumer Law Center on behalf of its low-income clients, and the National Consumers League, urged Congress to reject a proposal to allow the Internal Revenue Service to collect taxes using private collection professionals. The provision was included in the most recent version of export tax repeal legislation (H.R. 4520) released by House Ways and Means Committee Chairman Thomas (R-CA) June 4.
According to the letter signed by 17 Republican members: "In this era of electronic information, instantaneous communications, and rampant identity theft, we have grave concerns about the release of sensitive personal information to entities and individuals outside of the federal government."
The NTEU group letter alleged that private tax collection is less cost-effective than using IRS personnel. NTEU stated that with additional agency funding of $296 million, $9.47 billion in known tax debt collections would be realized--a net return of $31 for every $1 invested. By contrast, according to NTEU, the administration's privatization scheme would, in the best case, result in a net return of only $3 for every taxpayer dollar spent. The Ways and Means Committee is expected to mark up H.R. 4520 June 10.
David Goch
Washington Legislative Counsel
Commercial Law League of America
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No activity on bankruptcy reform is expected this week.
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CHARGED WITH BANKRUPTCY FRAUD - PURCHASED CAR IN SOMEONE ELSE'S NAME
A former Breckenridge police officer is accused in federal court of hiding her ownership of a $32,700 Jeep Grand Cherokee during her bankruptcy proceedings.
A grand jury indicted Corrine M. Purucker, 43, now a police officer in Washington state, in Colorado U.S. District Court on Wednesday.
Purucker allegedly had her roommate buy the new vehicle for her in November 2001, weeks before she filed for bankruptcy. After the bankruptcy proceedings finished and Purucker's debts of about $64,000 were discharged, she titled the vehicle in her own name, according to the FBI and the Colorado U.S. Attorney's Office.
Federal authorities seized the Jeep in Washington state in June.
Rocky Mountain News
June 24, 2004
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CHARGED WITH BANKRUPTCY FRAUD - FAILURE TO DISCLOSE HOUSE
A McMurray, PA man has been indicted by a federal grand jury on charges of bankruptcy fraud in connection with the sale of a home in South Carolina.
William Lincoln Adams Jr., 51, of Lintel Drive, filed for Chapter 7 bankruptcy but failed to disclose a residence he owned on Hilton Head Island as an asset of his estate, the grand jury said.
While the bankruptcy petition was pending, Adams and his wife sold the property and netted about $53,000, the indictment said.
Prosecutors said half of that money should have been included in the estate in order to pay Adams' creditors.
Pittsburgh Post-Gazette
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UTAH'S BK FILINGS TWICE NATIONAL AVERAGE
Utah continues to lead all other states in the percentage of residents in personal bankruptcy, according to a report issued Monday.
For the 12 months ended March 31, one in every 36.5 Utah households filed for Chapter 7 or Chapter 13 bankruptcy protection, according to the American Bankruptcy Institute.
The figure is a slight increase from the 2002 level of 36.7 households per filing in Utah, according to ABI, which compiles per capita bankruptcy statistics every three months based on figures from the Census Bureau and U.S. Bankruptcy Courts.
"Utahns are known for having large families, and for starting families at an early age," James Wood, director of the University of Utah's Bureau of Economic and Business Research said. "This puts a significant burden on households that may not have had the time to develop a solid financial base, and many of them feel they have no choice but to go into debt."
Standard-Examiner
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KING'S DISCHARGING TAXES IN BANKRUPTCY
5th ed. • 915 pages • 75 exhibits and checklists • over 1,000 cases cited • indexed
This book has been called "the bible" for discharging taxes in consumer bankruptcy cases. Used by thousands of lawyers, trustees, judges and other tax professionals across the country, it explains in simple yet comprehensive terms what kinds of taxes can be erased, when they can be erased, and how they can be erased in chapter 7, 13, or 11. It covers all the issues and traps for the unwary. This book is even used by revenue officers!
Says Ike Shulman, former President of the National Association of Consumer Bankruptcy Attorneys, "Every serious bankruptcy practitioner should have this book!"
At BankruptcyBooks.com
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DEBTORS CAN'T PURSUE PI CASE WHEN NOT DISCLOSED IN BK
The bankruptcy court erred in declining to apply judicial estoppel to bar personal injury claims that were not disclosed in debtors' bankruptcies. Unless judicial estoppel was applied, the debtors would have been able to "have their cake and eat it too."
The debtors'' positions in the bankruptcy court and personal injury litigation were clearly inconsistent. "It goes without saying that the Bankruptcy Code and Rules impose upon bankruptcy debtors an express, affirmative duty to disclose all assets, including contingent and unliquidated claims." Coastal Plains, 179 F.3d at 207-08. The duty to disclose is continuous. Thus, under Coastal Plains, the debtors' omission of the personal injury claim from their mandatory bankruptcy filings is tantamount to a representation that no such claim existed. Now, however, the debtors contend, before the state court and in the limitation proceeding, that the personal injury claim is viable and worth $2.5 million.
Judicial estoppel is a common law doctrine that prevents a party from assuming inconsistent positions in litigation. Brandon v. Interfirst Corp., 858 F.2d 266, 268 (5th Cir. 1988). "The purpose of the doctrine is to protect the integrity of the judicial process by preventing parties from playing fast and loose with the courts to suit the exigencies of self interest.
In re Superior Crewboats, Inc. (5th Cir. 2004)
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DISCHARGE DENIED - DEBTOR CLAIMS LOST $$$ IN POKER GAME, THEN TAKES VACATION TO CARRIBEAN
The debtor was the only witness at the trial. He testified that he had $150,000 in a briefcase as a result of numerous withdrawals from bank accounts during the summer of 1998 and that immediately after he was ordered to deposit the money in an escrow account he gambled $130,000 in a winner-take-all stud poker game at a private residence in Brooklyn, New York. He was not able to provide any further details about the poker game except that someone, who no longer lives in the country, drove him there. The debtor testified that he reserved enough money to pay for a Carribean vacation. Discharged denied.
In re McNamara (Bankr. Conn. 2004)
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OBJECTING TO PROOF OF CLAIM - BURDEN OF PROOF
The Bankruptcy Code establishes a burden-shifting framework for proving the amount and validity of a claim. The creditor's filing of a proof of claim constitutes prima facie evidence of the amount and validity of the claim. The burden then shifts to the debtor to object to the claim. The debtor must introduce evidence to rebut the claim's presumptive validity. If the debtor carries its burden, the creditor has the ultimate burden of proving the amount and validity of the claim by a preponderance of the evidence.
In re Harford Sands Inc. (4th Cir. 2004)
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NOT A FRAUDULENT CONVEYANCE
Debtor's grant of security interest to bank that made loan to debtor's shareholders was not fraudulent conveyance, where debtor received benefit from loan, resulting in no net loss to debtor's estate or to funds available to unsecured creditors.
In re Northern Merchandise, Inc. (9th Cir. 2004)
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Debtors' attorney Rooker Feldman's motion for approval of fees came on calendar. One billing entry was for $350 for a court appearance some time ago. The judge noted that Feldman had three cases on at the same hearing, and that each matter actually took only 6.5 minutes. The judge approved fees for 6.5 minutes. "After all," said the judge, "you had to be in court anyway, right? So how can you charge for all three cases? And, as you should know, you can only charge for actual time spent, which in this case is 6.5 minutes."
At first Feldman was disappointed. But then, a lightbulb lit up in his head.
The next day he went up to the ticket desk for Pineapple Airlines and asked for a free seat to Hawaii. The clerk looked at him as though he were nuts. "After all," said Feldman, "the plane's going to be up in the air anyway, right?"
Next, he tried getting in free at the local movies. "After all," he said, "You're showing the movie anyway, aren't you?"
Next, he tried to file three bankruptcy cases with only one filing fee. "After all," he said to the clerk, "you're going to be sitting here anyway, filing papers, right"?
The clerk reached through the little hole in the window and stamped "NO" in big red letters on Feldman's forehead.
"Why did you do that? That hurt!" exclaimed Feldman.
"After all," said the clerk, "my rubber stamp was going through the air to stamp somebody anyway, and you were standing there, right?"
"I think," said Feldman, "I need a martini."
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PUBLISHED BY KING BANKRUPTCY MEDIA FOR BANKRUPTCY PROFESSIONALS 7080 Donlon Way Suite 222 Dublin California 94568 (925) 829-6460
© King Bankruptcy Media 2004 CONTACT US AT editor@bankruptcymedia.com
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