So, my chapter 7 was discharged Feb 2006. Still not closed. I'm checking pacer once a month and today I find that the trustee has motioned the court to petition and employ an attorney for my case due to belief of Fraudulent transfers. He states that the amount believed to be recovered for the estate does not exceed $15,000. The law firm that the trustee also is affiliated with is the firm he is proposing to contract the legal work with. He has also sent the affidavit of disinterestedness for approval from the judge. Does anyone here that knows the real legalities of this situation (ie attorneys) have any suggestions of how the debtor can make a motion to dismiss his requests, or just sit back and make them show the burden of proof, which will lead them down a dead end road? Thanks in advance.
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Just sit back and make them show the burden of proof, which will lead them down a dead end road ...
I'm sorry to hear this, I guess you have assets? I was discharged end of January, and sopposedly have assets when I filed no assets, because I don't even own a house or a business, I guess he considers my new car an asset?
Best of Luck riding through this! CatchmeifyoucanJuly 2006: Filed Ch13 :blink:
Oct 2006: Converted to Ch7 :clapping:
Jan 2007: DISCHARGED :clapping:
Nov 2007: CLOSED :yahoo::yahoo::yahoo: -
Well, there is nothing you can do to prevent the trustee from getting permission to hire an attorney. That aspect of what is going on is a formality.
If were talking about fraudulent transfers, that usually means the law firm the trustee hired is going to sue the alleged recipient of those alleged transfers.Comment
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I was afraid you were going to say this. I filed pro se, but my personal attorney came to an examination I had to attend this summer after my discharge. My case was a no asset case. 14 months before I filed, my wife and I were having marital problems, and I quit claimed my interest in the house to her. The most I can see, the house maybe had $30,000 equity at the time, so 50% of that would be mine, right? But I have exemptions that would protect this, right? Also, after the examination, my attorney called the law firm/trustee to find out what they were going to do. They were more interested in a business I once owned with a partner, which I had not owned when I filed. The law firm said they would be pursuing the option of suing my old partner in the business!!!! So, this must be what they are doing. Will they sue my wife also for the quit claim deed/house equity,etc???Originally posted by HHM View PostComment
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Did the marital problems end in a Divorce, or are you still married. If there has been a divorce, then it probably won't be an issue, if not, it is "possible"...and will depend on your state's law regarding fraudulent transfer, i.e the look-back period. The reason the trustee is probably going into this is that both the scenario's you laid out (wife and the business partner) are transfers to "insiders", thus the look back period is longer. Moreover, as you already said with the house, all you did was quit claim the house, meaning you probably didn't receive fair value for the house. Thus, you have an insider transfer in which you didn't receive fair value for your interest, in BK terms, that is gold to a trustee.
What I have laid out for you is "worst case" scenario, it may never come to all that, and I obviously don't have all the facts. But at the very least, that should give you some insight about what the trustee is looking into and why.Comment
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I'm glad you're so fast to respond. No we aren't divorced and improved our marriage. But, like I said, will the trustee look at the value before I filed or after,now, etc? If the value has gone up, will they go for 50% of that? What if the house was LTV 100% after the filing, meaning a refinance? Can they do anything about that now if it's worth less than the mortgages? As to the business transfer, it was a default where the franchise company terminated our business agreement, so face value was N/A. What do you think as to the house? Should I be concerned with value then or now, loans then or now?Originally posted by HHM View PostComment
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The value of the house is usually the value on the date you filed for BK. As for the other questions it is hard to say, you may not have to worry about the house directly since it is encumbered to full value, but the trustee can still pursue the case in BK court and get a judgment, also, if there is a finding of abuse, the trustee could revoke your discharge. (that would be bad). If it really is the house the trustee is after, you may have to negotiate with the trustee and pay him some money to make this go away. But, once this law firm investigates, they may just drop the whole thing.Comment
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