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Family Law and Bankruptcy—Dischargeability of Debts Assigned to Spouse in Marriage Settlement Agreement

In re Carrion, __ B.R. __  (B.A.P. 9th Cir. May 31, 2019).  During marriage, the debtor borrowed $21,894 from the U.S. Department of Education to pay tuition for his son’s college education.  His wife later filed a petition for dissolution of marriage and, around the same time, they filed a joint chapter 7 petition.  In their marriage settlement agreement, husband and wife both agreed to be liable for half of the education loan.  Husband later...

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Bankruptcy Case Involving Marijuana Related Business

Garvin v. Cook Investments NW, SPNWY, LLC, 922 F.3d 1031 (9th Cir. 2019). The U.S. Trustee argued that a chapter 11 plan was “proposed by …means forbidden by law” because one of five debtors’ income was from lease of its real property to a marijuana grower.  Debtors and property were located in Washington state in which marijuana is legal.  Leasing property to a marijuana grower is illegal under federal law.  The debtors proposed a plan...

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Some Lessons Learned from In re Pacific 9 Transportation, Inc.

In 2018, Danning, Gill, Diamond & Kollitz, LLP, concluded its representation of the Official Committee of Unsecured Creditors appointed in In re Pacific 9 Transportation, Inc., Bankr. Case No. 2:16-bk-15447-WB (Bankr. C.D. Cal.). The case presented a number of interesting issues that continue to plague trucking companies operating out of Los Angeles ports. The debtor was an intermodal trucking company engaged in the transport of shipping containers from the Ports of Los Angeles and Long...

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When Spouses Acquire Real Property and Take Title as Joint Tenants, Is It Really Community Property? The Ninth Circuit Seeks Guidance from the California Supreme Court

Family Code § 760 provides that “[e]xcept as otherwise provided by statute, all property, real or personal, wherever situated, acquired by a married person during the marriage while domiciled in [California] is community property.” This statute codifies a presumption that property acquired by a spouse during marriage is community property. Family Code §§ 850-853 allow spouses to “transmute” community property to separate property of either spouse. The requirements for a transmutation are strictly enforced. Among other...

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Non-Filing Spouses, Homestead Exemptions, and Voidable Transactions

The California Bankruptcy Journal has published an article by Michael G. D’Alba entitled “Non-Filing Spouses, Homestead Exemptions, and Voidable Transactions” (Volume 34, 2017, Number 2). A copy of the article may be obtained by emailing Mr. D’Alba at mdalba@dgdk.com. California is a community property state, and Mr. D’Alba examines issues which arise when non-debtor spouses try to claim homestead exemptions in community property. Mr. D’Alba discusses issues that arise when a spouse relocates from the...

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