September 2011 Archives

Billing Statement's Disclaimer Prevents Stay Violation - Santa Rosa Bankruptcy

September 30, 2011, by Law Offices of James V. Sansone

past-due-bills2.jpgHow do you know if you have violated the automatic stay in bankruptcy? A debtor filed for Chapter 13 relief, and then later received a mortgage loan statement from Chase Home Finance. The debtor and his wife sued Chase alleging violations of the automatic stay, the Pennsylvania Fair Trade Extension Uniformity Act, the Pennsylvania Unfair Trade and Consumer Protection Act, and the Fair Debt Collection Practices Act.

The bankruptcy court granted Chase's motion to dismiss. Because the debtor's wife was not a debtor, she was not protected by the automatic stay. The court said the statement did not state that the account was past due nor demand immediate payment but did include a disclaimer that did not violate the stay as to the debtor.

The court characterized the Statement as being informative rather than an attempt to collect a prepetition debt. The language of the Statement was unambiguous and makes it aware that the Debtor is protected by the automatic stay and the statement is for compliance and informational purposes only which does not constitute an attempt to collect debt.

The court did not accept that the automatic stay prohibits all communication between a creditor and a bankruptcy debtor. The court granted the motion regarding consumer protection violations based on the court's lack of subject matter jurisdiction. The cause of the action was due to the debtor's property rather than the bankruptcy.

The Law Offices of James V. Sansone is located in Santa Rosa, California and serves clients, debtors and creditors, with their bankruptcy needs throughout the North Bay area of California, including Sonoma County, Mendocino County, Lake County, Santa Rosa, Napa, Petaluma, Cotati, Rohnert Park, Sebastopol, Healdsburg, Sonoma, Kenwood, Glen Ellen, Windsor, Bodega Bay, Ukiah, Willits, Clearlake, Lakeport and Kelseyville.

Former Trustee Sentenced For Fraud - Santa Rosa Bankruptcy

September 27, 2011, by Law Offices of James V. Sansone

FBI_LOGO.pngWell, maybe a bankruptcy trustee can't be sued in state court under an intentional tort theory; this does not mean a trustee can't break the law. Former bankruptcy trustee Marika Tolz was sentenced to 81 months in jail, followed by 18 months of house arrest. In May, Tolz pleaded guilty to one count of conspiracy to commit wire fraud in a $16 million conspiracy. Tolz had been a member of the panel of Chapter 7 trustees for the US Bankruptcy Court, Southern District of Florida, for more than 20 years.

According to court records, Tolz and others conspired to misappropriate money from bankruptcy estates, receiverships, and other matters in which Tolz had been appointed as trustee, receiver, or personal representative, by writing or causing the writing of unauthorized checks from various fiduciary accounts which contained funds she was appointed to safeguard, without authority or legal justification. The money was then used for her own benefit, and to conceal her previous misappropriations by using the money to restore the balance of other fiduciary accounts from which she had previously taken funds.

Debtors are not the only players in the bankruptcy system that have an obligation to be honest. A trustee, obviously, can't rob Peter to pay Paul. The Law Offices of James V. Sansone is located in Santa Rosa, California and serves clients with their criminal defense and bankruptcy needs throughout the North Bay area of California, including Sonoma County, Mendocino County, Lake County, Santa Rosa, Napa, Petaluma, Cotati, Rohnert Park, Sebastopol, Healdsburg, Sonoma, Kenwood, Glen Ellen, Windsor, Bodega Bay, Ukiah, Willits, Clearlake, Lakeport and Kelseyville.

Can The Panel Trustee Be Sued In State Court Under An Intentional Tort Theory?

September 22, 2011, by Law Offices of James V. Sansone

malice.gifThis is an interesting legal question. I know many debtors who feel a certain local panel trustee goes too far with his investigation and treatment of debtors at the Meeting of Creditors. So, if a trustee goes too far, is there a state court tort action available to the aggrieved parties? Debtors in the sixth circuit are locked into this holding as the Sixth Circuit US Court of Appeals says no!

In the case of Steve McKenzie, the bankruptcy court denied a law firm's request for permission to sue the Chapter 7 trustee in state court for malicious prosecution and abuse of process.

The court stated, "[a]lthough the presence of a tort action might weigh in favor of allowing [the movant] to proceed in state court, the court concludes that because the alleged torts are so intertwined with the trustee's duties pursuant to 11 USC § 704 and the turnover provisions of 11 USC § 542(e), these claims are better suited to be heard in bankruptcy court."

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Marriage, College, And A Job Won't Ward Off Bankruptcy - Santa Rosa Bankruptcy

September 20, 2011, by Law Offices of James V. Sansone

bad-credit-student-loans.jpgA wedding ring, college degree and a well-paying job: the American dream or a recipe for bankruptcy? Some of the factors often associated with financial success are increasingly becoming correlated with personal bankruptcy filings, a study released Tuesday by the Institute for Financial Literacy found, according to Bankruptcy Beat. The study found that from 2006 to 2010, bankruptcy filings increased among college graduates and those earning $60,000 a year or more.

What's more, last year, 64% of bankruptcy filers surveyed were married a number that also increased from five years ago.

Why is this you ask? I think the answer is simple. The more we make the more we spend.


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No Lien Stripping in Chapter 20 Cases In The Ninth Circuit - Santa Rosa Bankruptcy

September 15, 2011, by Law Offices of James V. Sansone

underwater.pngThe issue of whether or not a debtor can strip a lien in a "Chapter 20" bankruptcy is split throughout the United States. However, the issue was just settled in our circuit.

In re Ricardo and Jenny Victorio, the bankruptcy court sustained the trustee's objection to confirmation of the debtors'' plan, holding that debtors in a Chapter 20 case cannot obtain a permanent avoidance of a wholly unsecured junior lien on their principal residence unless they pay the clam amount in full, or obtain a discharge.

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Federal Court Enjoins Foreclosure - Santa Rosa Bankruptcy

September 13, 2011, by Law Offices of James V. Sansone

Stop Foreclosure.jpgI just recently successfully filed suit against Bank of America to enjoin a pending foreclosure sale based on their bad faith behavior by not negotiating a loan modification in good faith. A federal court in Massachusetts apparently agrees with me.

In an unrelated case, a federal court in Massachusetts has enjoined a foreclosure action in order to give the homeowner a chance to prove that the lender should be required to negotiate a loan modification in good faith. In denying the lender's motion to dismiss the homeowners' complaint, Judge William G. Young found that their common law claim of equitable estoppel was not preempted by the Home Owners Loan Act. (Dixon vs. Wells Fargo Bank)

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2011 Relay For Life of Santa Rosa California Is Here

September 10, 2011, by Law Offices of James V. Sansone

Logo.gif flags.jpg
9/10/2011 10:00 AM - 9/11/2011 10:00 AM at Maria Carillo High School

52 Teams & 619 Participants

JVS Law is a proud sponsor of the 2011 Santa Rosa Relay For Life.

DUI Arrests Up Over Labor Day Weekend Which May Complicate A Child Custody Dispute

September 8, 2011, by Law Offices of James V. Sansone

Child-Endangerment-OTS-145x145.jpgStatewide, there was an increase in drunken driving arrests and alcohol-related fatalities this Labor Day weekend compared to last year, the California Highway Patrol reported Tuesday.

Statewide, 1,531 drunken driving arrests were made over the three-day weekend, compared to 1,521 last year.

There were also 21 fatalities in CHP jurisdiction, compared to 10 last year, the CHP said.

Drivers who had children in their vehicles at the time of their arrests can face additional criminal charges of willful cruelty or child endangerment.

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If It Sounds Too Good To Be True, It Is: Couple Convicted of Foreclosure Rescue Fraud

September 6, 2011, by Law Offices of James V. Sansone

images.jpgA Pennsylvania couple was convicted in federal court of fraudulently trying to give new hope to homeowners facing foreclosure. Edward and Jacqueline McCusker face up to 240 years in prison for their involvement in what US Attorney Zane David Memeger described as a $14.6 million mortgage fraud scheme that resulted in at least 35 fraudulent mortgage loans.

The McCuskers operated Axxium Mortgage Inc., along with co-defendants John Bariana, Jeffrey Bennett and Stephen Doherty, owners of the law firm Bennett & Dohnerty.

The defendants targeted financially distressed homeowners facing foreclosure, falsely promising to help them save their homes. They said they would find investors, but what they did was arrange for a straw purchaser to obtain a fraudulent mortgage and then transfer title of the homeowner's residence to the straw purchaser.

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Bankruptcy Petition Preparers, Not A Good Idea - Santa Rosa Bankruptcy Lawyer

September 1, 2011, by Law Offices of James V. Sansone

5398335_177.jpgHarriette King, a bankruptcy petition preparer who was convicted of bankruptcy fraud and other charges in February 2011, was sentenced to 27 months in prison followed by three years of supervised release, according to the KNOE-TV in Monroe, LA. King was also ordered to pay $20,359 in restitution.

According to trial testimony, King committed numerous criminal violations as a bankruptcy petition preparer. The testimony revealed that King wrongfully received legal fees and court costs from three debtors after fraudulently representing herself as an attorney. King refused to obey multiple bankruptcy court orders to return the money to the debtors.

King added to her criminal violations when she later filed her own bankruptcy petition and fraudulently claimed to own property she did not own and fraudulently omitting debts she was required to disclose.

I have been retained by several clients who first went to a bankruptcy preparer to "save money". The preparer butchered their case and it took me double the time, and cost the debtors, double the money, to fix all the errors the preparer created.

It's not worth it! If you are considering filing bankruptcy you must consult with an experienced bankruptcy attorney. There is no suitable substitute.

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