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Expunge or Not?

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    Expunge or Not?

    Okay, so it's my turn to ask a question. Okay, this is a pro se question on strategy.

    I'm right up against the 109(e) debt limit for unsecured credit (and claims). I mean, within a couple of hundred dollars and I may have other things pending (based on lien stripping and cramdowns).

    I have two claims filed by a Creditor which date back to 1987 and 1987. (Yes, not a typo). They filed the claims and they were disallowed because I asserted relief on the grounds that they are time-barred by Statute (unerlying Statute of Limitations).

    Should I have them expunged, or should I keep them there.. so that they are discharged?

    If I expunge them, can they still attempt to collect them after? (And by collect, I mean, pester, not actually threaten law suits or anything.)

    Just trying to think of different strategies. I may withdraw my pleading (to Expunge), if it's better to let them get discharged. Or, are they discharged anyhow?
    Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
    Status: (Auto) Discharged and Closed! 5/10
    Visit My BKForum Blog: justbroke's Blog

    Any advice provided is not legal advice, but simply the musings of a fellow bankrupt.

    #2
    If the claims have been disallowed by the trustee then he will "reserve" them and they will not receive a penny. So expunging them won't change anything and I don't think you can do that anyway. I have a claim that was disallowed and it still shows up in the totals but if you click on the creditor, it states that the check to them is "held" and not to be issued. The trustee's bookkeeper will know not to issue them any money.

    Comment


      #3
      As far as I know, for the purposes of 109(e), the debt limits are calculated based on what was deemed to be liquidated (readily ascertained) debt at the time of filing. The lien stripping and cram downs should not disqualify you from a chapter 13, as they occurred after the petition was filed. Look up liquidated vs. unliquidated debt, it makes a big difference. Unliquidated debt is excluded from the 109(e) computation.

      See In re Nicholes, 184 B.R. 82, 99-91 (9th Cir. B.A.P. 1995)
      FranksMom
      Chapter 13 (pro se)
      341 Meeting - Concluded
      Payments made 0/60

      Comment


        #4
        Originally posted by FranksMom View Post
        As far as I know, for the purposes of 109(e), the debt limits are calculated based on what was deemed to be liquidated (readily ascertained) debt at the time of filing. The lien stripping and cram downs should not disqualify you from a chapter 13, as they occurred after the petition was filed. Look up liquidated vs. unliquidated debt, it makes a big difference. Unliquidated debt is excluded from the 109(e) computation.

        See In re Nicholes, 184 B.R. 82, 99-91 (9th Cir. B.A.P. 1995)
        Thanks Mom!

        I did some reading, and it's being interpreted differently in different jurisdictions.

        For example, I think in the 8th Circuit, they go by the Scheudles, and that's it.

        However, in my District, a recent ruling by MY JUDGE was that they can look "beyond" the schedules where it is warranted. She also went on to state that, basically, anything that needs to be litigated to determine its value shouldn't count against the 11 USC 109(e) limits because the whole purpose of the process, and citing Rule 9001 on expediency, is that this is done quickly and not dragged out.

        I liked her reasoning, that the Code was not meant to get 4, 5 even 6 months into the process and confirmation, only to find you don't qualify.

        I think I'm okay, but my final (evidentiary) hearing on a few things and final confirmation hearing are in two weeks. Don't want to mess up now!

        Don't remember where I got this, but I'm hoping to be confirmed before the 109(e) limit is passed... I also rest on this

        On the other hand, the court in In re Morton, 43 Bankr. 215 (Bankr.E.D.N.Y.1984), held that the whole portion of the debt should be considered secured for the section 109(e) computation. “The focus of section 109(e) is of debts existing at the time of filing while the focus of section 506(a) is of claims existing and allowed well beyond the filing date.” 43 Bankr. at 220. Congress did not intend that a determination of Chapter 13 eligibility be delayed until the case has substantially progressed
        Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
        Status: (Auto) Discharged and Closed! 5/10
        Visit My BKForum Blog: justbroke's Blog

        Any advice provided is not legal advice, but simply the musings of a fellow bankrupt.

        Comment

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