On Bankruptcy and Mediation
Philadelphia, Pennsylvania (photo by Marilyn Swanson) By: Donald L Swanson Today, the sole function a bankruptcy discharge is to rid the debtor of debts and, thereby, provide a fresh financial start. But in the 1700s, the focus was on getting a debtor’s body discharged from debtor’s prison, to provide a fresh start through personal liberty. And... Continue Reading →
“commercial or business activities”? (Photo by Marilyn Swanson) By: Donald L Swanson “We now hold that a not-for-profit company can be ‘engaged in commercial or business activities’ as that phrase is used" in Subchapter V of the Bankruptcy Code. Guan v. Ellingsworth Residential Community Association, Inc., 125 F.4th 1365 (11th Cir. 2025). Guan is a homeowner... Continue Reading →
Deceptive? (Photo by Marilyn Swanson) By Donald L. Swanson Here’s a refresher on legal standards, and the application of those standards, for denying a debtor’s discharge for “actual fraud” under § 523(a)(2)(A): the opinion is Capital, Inc. v. Novak (In re Novak), Adv. Pro. No. 23-01005 in the Eastern Louisiana Bankruptcy Court (decided October 21, 2024;... Continue Reading →
An unholy alliance? (Photo by Marilyn Swanson) By: Donald L Swanson I’m reading the U.S. Supreme Court’s latest opinion on a bankruptcy subject: U.S. v. Miller (decided March 26, 2025). And I’m looking for something in the opinion that’s interesting . . . anything! The opinion is about whether sovereign immunity has been waived for transfer... Continue Reading →
Bicycles are used everywhere (photo by Marilyn Swanson) By: Donald L Swanson I’ve always maintained that the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (“BAPCPA”) is heavy on “preventing abuses” (mostly phantom abuses) and skinny on “protecting consumers.” IRA Exemption in BAPCPA But there is a consumer protection in the Bankruptcy Code, added by... Continue Reading →
Opposition! (Photo by Marilyn Swanson) By: Donald L Swanson Bankruptcy laws in these United States need to be reformed. For example: About a year ago, Congress allowed the $7,500,000 Subchapter V debt limit to expire, reducing that limit to an inflation-adjusted $3,024,725 and leaving many entrepreneurs without viable bankruptcy relief—this needs to be fixed! Also about... Continue Reading →
Empowered (photo by Marilyn Swanson) By: Donald L Swanson “chapter 15 authorizes this Court to enforce nonconsensual third-party releases ordered by foreign courts.” That’s the conclusion of the Delaware Bankruptcy Court in In re Real, Case No. 25-10208, Doc. 65 at 19 (decided April 1, 2025). The Facts Here is a quick summary of the In... Continue Reading →
Authorized to act (photo by Marilyn Swanson) By: Donald L Swanson Some time ago, I’m discussing the role and powers of a Chapter 12 trustee. In response to a question, I say that a Chapter 12 trustee has no authority to sell estate assets unless and until the debtor is removed from possession. Someone promptly counters... Continue Reading →
A character for truthfulness (photo by Marilyn Swanson) By: Donald L Swanson Here are two questions under Federal Rule of Evidence 608(b): Is a bankruptcy discharge admissible to prove a person’s character for truthfulness or untruthfulness? How about a prior repossession of a person’s automobile? Is that probative of a person’s character for truthfulness or untruthfulness?... Continue Reading →
Flow-through (Photo by Marilyn Swanson) By Donald L. Swanson Question: Can a law firm member avoid flow-through tax liability by giving up ownership in the law firm shortly before it files bankruptcy? The answer is, “Yes.” That’s according to LeClair v. Tavenner, Case No. 23-1133 (4th Cir., decided 2/7/2025). Facts Law Firm operates successfully for several... Continue Reading →
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