Has anyone filed an objection to UST motion to dismiss?

[Help!]

I've been searching the forum so forgive me if there are threads I on this topic I haven't found, but I have a feeling I'm wandering into uncharted territory this time. I know a few of you have weathered 2004 examinations, but has anyone brought a means test issue before the judge in their district?

The motion to dismiss hasn't been filed yet, but the UST has stated this is their plan. This reminds me of a very long chess match and I guess I'm just looking a few moves ahead.

For those that are getting tired of my continuing saga, it's almost over... I promise! If nothing else, maybe my posts make you feel better about your own chapter 7.

[Yankeegirl]

Help...

Yes, we have been through both a 2004 exam and challenged the UST on a motion to dismiss.

The UST was challenging whether or not we could deduct the following on the means test:
1. mortgage payments for a house we were surrendering
2. take an ownership deduction for a car paid in full

While there were opinions issued in other districts, there were none issued in mine. That is the key. The UST will decide whether or not to proceed based upon local opinion. He/she does not care what a judge in another district has decided.

In our case, we did not go to court to decide on the motion to dismiss. We asked the judge to decide whether or not the two items listed above could be taken as deductions on the means test. He ruled no to #1 and yes to #2. Unfortunately, this meant we "failed" the means test. As a result, we agreed to a dismissal without prejudice.

Now that we understand the "rules" we are reducing our income, and will refile again next year when we're certain that we'll pass without question from the UST. We thought this was a better option than Chapter 13 for 5 years.

P.S. Our "failed" chapter 7 cost us almost $10,000 and took 14 months!

[laurannm]

I've seen references to 2004 exams...what are some of the common reasons why a debtor would be subjected to this exam?

[Yankeegirl]

Our 2004 exam was simply a formal meeting with the UST (and our attorney) so that we could answer questions about our documents.

We had relocated and received relocations benefits prior to the 6 month look back. However, my husband's compnay put the value of those benefits on his paystub during the 6 month look back making it appear that we received money that we didn't. We had to answer questions about that and some other things. Also presented some information the UST requested. It was official, and recorded, however, wasn't really a big deal.

[Help!]

Help...

Yes, we have been through both a 2004 exam and challenged the UST on a motion to dismiss.

The UST was challenging whether or not we could deduct the following on the means test:
1. mortgage payments for a house we were surrendering
2. take an ownership deduction for a car paid in full

While there were opinions issued in other districts, there were none issued in mine. That is the key. The UST will decide whether or not to proceed based upon local opinion. He/she does not care what a judge in another district has decided.

In our case, we did not go to court to decide on the motion to dismiss. We asked the judge to decide whether or not the two items listed above could be taken as deductions on the means test. He ruled no to #1 and yes to #2. Unfortunately, this meant we "failed" the means test. As a result, we agreed to a dismissal without prejudice.

Now that we understand the "rules" we are reducing our income, and will refile again next year when we're certain that we'll pass without question from the UST. We thought this was a better option than Chapter 13 for 5 years.

P.S. Our "failed" chapter 7 cost us almost $10,000 and took 14 months!

This is all really good to know. Lots of questions for you since you've been through this...

(1) Was the UST's motion to dismiss filed before or after your 2004 examination?

(2) You filed an objection to the UST's motion to dismiss, then your lawyer researched the legal precedent for both issues and filed a brief. How much time passed between the filing of the objection and the judge's ruling?

(3) Did the judge narrowly focus on just those issues or did this result in an even deeper look at your finances (e.g., individual items on bank and CC statements)?

You're right - have to carefully consider everything this would entail if we object to the dismissal. In our case, I think it's worth the effort. If we allowed conversion to 13 we'd be penalized for a lot of income (including one-time cash outs) we no longer have. There is no way to fund repayment anyway with our current schedules I and J.

If it is dismissed, I think we'd do exactly what you are doing. What was Congress thinking when it passed BAPCPA?!

[Help!]

I've seen references to 2004 exams...what are some of the common reasons why a debtor would be subjected to this exam?

From what I've read here, it looks like they happen when (a) something with a serious bearing on the case was not disclosed on the petition for whatever reason (b) when there's so much documentation to discuss that it can't be done in the initial and continued 341 hearings or (c) when the UST feels the debtor is being dishonest or deceptive and is on a fact-finding mission. I think (c) is pretty rare but scary, even if you haven't done anything wrong.

[AngelinaCat]

Hi Help! We had a Rule 2004(b) Examination on May 22, 2008. What triggered it was this:

We sold a Mortgage note that we had been holding for a discounted value to get some cash so that we could bring our utilities up to date, and also pay back a couple of loans. Although we were supposedly being guided by an attorney, we have had NO actual real guidance at all, even though we were trying to prepare to file CH 13. I lost my FT job, and we had to file 7.

This attorney knew of this note and that we had sold it. Her response to us was that “you no longer have it; don’t worry about it.” She did not file it in our paperwork, and we certainly did not know at the time it should have been included. Nor did she ask at any time for us to itemize exactly what we had done with the money. If she had, we would have done so. Then she would have known that part of it was to pay back a son-in-law (a relative by marriage, therefore, an “insider”), and a person whom we have befriended and call our “god-daughter”. She is in no way actually related by blood or legal means, though we love her dearly.

Some of this has been stated elsewhere, but what triggered the Examination was that for whatever reason, the purchaser of the note did not get it recorded until the month before we filed. We have an Enemy that is hounding our heels doing everything he can to harm us. While searching through Public Records, he found the recorded note and sent it on to the Trustee, tripping all over himself with glee.

We had no guidance at all from the attorney as to what to expect, prepare, or even bring to the examination. She did call the morning of the examination as we were walking out the door, wanting to know if we were coming by her office on our way to the meeting. This attorney is located about 60 miles in the opposite direction of where we had to be—also at a distance of about 60 miles. She said she would then appear at the meeting by telephone conference call.

When we met with the examiner and the conference call was made, he asked specifically about the mortgage note and how the monies were dispersed. We had an itemized sheet of what we had done with it. The attorney had copies also, via email, but it was painfully obvious that she had not even looked at our material.

Now after all this, and almost a month later, and several emails to the attorney asking what happens next? How about an appointment? We email and include read receipts so that we can have a trail.

We had gotten NO response until today with a letter from the Examiner date June 3, 2008, that essentially the trustee is willing to offer a deal for us to pay back part of that money, but a response has to come in 15 days. TODAY IS THE 15TH DAY!!!. Her accompanying email was basically a ‘kiss-off’ telling us that she could not help us, and that the fees we had paid her did not include extra work, though she had done extra, trying to help us. And that she would not be available for the rest of this week and all of next.

So we have sent her an email thanking her for her services so far, and that they were no longer needed. We have also drafted a response to this letter and emailed it to the Examiner and Trustee, along with the notations that we are now pro se officially.

So that’s where we sit right now.

[Yankeegirl]

Help...

If I remember correctly, the 2004 exam came before the motion to dismiss.

The official briefs were filed by our attorney and the UST in Sept. 2007 (each filed with their positions and supporting case law) The judge issued a ruling in April 2008 - so 7 months.

The judge only ruled on the questions before him (that's all we asked for). Based upon his ruling it was up to us to push the issue further (i.e actually go to court and have a trial) or agree to dismiss. In our case, alot changed between when we initially filed and when the judge issued his ruling so it was in our best interest to dismiss.

[Help!]

Hi Help! We had a Rule 2004(b) Examination on May 22, 2008. What triggered it was this:

We sold a Mortgage note that we had been holding for a discounted value...

From the sound of it, I honestly think you'll be more likely to get a discharge representing yourself from this point forward. It scares me to continue with this lawyer. If his handling of our case thus far is any indication of his legal knowledge I don't think he could litigate himself out of a box! I envy those with competent legal counsel...

[Help!]

Help...

...

The judge only ruled on the questions before him (that's all we asked for). Based upon his ruling it was up to us to push the issue further (i.e actually go to court and have a trial) or agree to dismiss...

One last question... If he had ruled in your favor on both issues, would that have been the end of it (i.e., would his ruling have overruled the UST's motion to dismiss and included an order discharging you?)? Seven months... that's insane!!

[Yankeegirl]

The UST told our attorney that if the judge ruled in our favor on both issues that she would drop the motion to dismiss. However, this did not happen.

In our case, the UST was prepared to push forward with the motion to dimiss; it was up to us whether or not we wanted to continue fighting (and paying) or if we wanted to just take the dismissal, regroup, and decide what we wanted to do.

We decided that taking the dismissal, waiting a bit, and then refiling would be better than a Chapter 13. Have you considered doing that? You know what the UST's objections are, now you can wait the necessary six months to make sure your income is as low as possible and then refile - maybe even pro se!

[AngelinaCat]

From the sound of it, I honestly think you'll be more likely to get a discharge representing yourself from this point forward. It scares me to continue with this lawyer. If his handling of our case thus far is any indication of his legal knowledge I don't think he could litigate himself out of a box! I envy those with competent legal counsel...

Good Morning Help!

What really IS scary is that when we called the Trustee's office to try to talk to him about the situation--neither he nor the Examiner are allowed to talk to us while we have *representation*; that's why we gave notice--the office manager said: "I don't understand the problem, you've got a good one [attorney]"........ I felt like saying--but didn't--"Would you PLEASE introduce us?"

If this is an example of a GOOD attorney, I'd hate to see a BAD one......

[Help!]

The UST told our attorney that if the judge ruled in our favor on both issues that she would drop the motion to dismiss. However, this did not happen.

In our case, the UST was prepared to push forward with the motion to dimiss; it was up to us whether or not we wanted to continue fighting (and paying) or if we wanted to just take the dismissal, regroup, and decide what we wanted to do.

We decided that taking the dismissal, waiting a bit, and then refiling would be better than a Chapter 13. Have you considered doing that? You know what the UST's objections are, now you can wait the necessary six months to make sure your income is as low as possible and then refile - maybe even pro se!

Yes, I think that's our only option if it's dismissed. If we had filed on September 1 we would have been fine on the means test. Maybe we will be able to do that instead of waiting 6 months - I think getouttadebt was able to refile within days of dismissal. It depends on the UST's next move.

[Help!]

Good Morning Help!

What really IS scary is that when we called the Trustee's office to try to talk to him about the situation--neither he nor the Examiner are allowed to talk to us while we have *representation*; that's why we gave notice--the office manager said: "I don't understand the problem, you've got a good one [attorney]"........ I felt like saying--but didn't--"Would you PLEASE introduce us?"

If this is an example of a GOOD attorney, I'd hate to see a BAD one......

No doubt! I think I saw a good one the other day outside the courtroom. He was talking with his clients *before* their hearing, telling them what to expect, explaining the parts of their petition that might draw the UST's attention, etc. Must be nice to have an attorney actually prepare you for your hearing. I wasn't eavesdropping, but it caught my attention and I was impressed.

[Yankeegirl]

Unless you're dimissed WITH prejudice, you can immediately refile.

Ours was dismissed withOUT prejudice; we were given no restrictions on when we could refile. We are choosing to wait until next year so that we can lower our income.