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Thomas

Hey,
Thanks! Great post you have written on "Bankruptcy, Spousal Support, and Property Settlements". Really I can say that your post is very informative, I'll come across your blog again when you will update it with new.
Thomas
http://www.jrlaw.org/

Heather

I have a question. My soon to be husband is in a Chapter 13 with his now ex wife. They entered the bankruptcy during the marriage. They have been separated for two years and now are recently divorced. It has been over 2 years that he has been paying into the the Chapter 13 and the ex-spouse refused and still refuses to pay for any part of it. She also refuses to split the 13. She continues to keep one of the vehicles listed in the bankruptcy. He is afraid to drop auto insurance on the car because if she were to get in an accident he is on the title too. Is there a way to force her to split the Chapter 13? He does not want to convert to a Chapter 7 and lose his truck and ruin his credit but it seems very unfair that she can just say no to paying and he has to continue paying her debt to. Any assistance you could provide would be greatly appreciated.

Jeanne M. Hannah

Joanne, I write in order to educate and empower people. I hope your clients will use my Blog for help whenever possible--especially if they are not able to reach you directly when they have an urgent question. Jeanne

Joe Jurecki

Spousal support | Penalties for late payment dischargeable in bankruptcy


Support payments are not dischargeable in bankruptcy. But what about penalties imposed for failure to pay support? The 1st Circuit Court of Appeals held in a ruling released on November 12, 2009 that $50 per day penalties owed by the husband because his spousal support payments were late are not "in the nature of support." [Note the penalties had accumulated to some $75,000+ over a period of years.] Thus the former husband could discharge them in bankruptcy.


According to the court:

"The term "domestic support obligation" ("DSO") is a newly defined term in the Bankruptcy Code, as updated by the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 ("BAPCPA"). See Pub. L. 109-8, 119 Stat. 23 (2005). As relevant here, a DSO is defined as ' . . . a debt that accrues before, on, or after the date of the order for relief in a case under this title, including interest that accrues on that debt as provided under applicable nonbankruptcy law [owed to] a former spouse [and that is] in the nature of alimony, maintenance, or support . . . without regard to whether such debt is expressly so designated. 11 U.S.C. § 101(14A).' "

Pursuant to the statute, for an obligation to a former spouse to be considered a DSO, it must actually be in the nature of support. This issue is one of federal bankruptcy law, and not state law.

The 1st Circuit Court disagreed with the lower bankruptcy court, which had said that the $50/day penalty "looks, smells, and feels too much like attorneys' fees collecting alimony and support payments, which have historically . . . been treated as in the same nature" as alimony. Rather, the 1st Circuit concluded that [the ex-wife's] claim is a general unsecured claim not entitled to priority status and can be discharged in [the ex-husband's] bankruptcy. See 11 U.S.C. §§ 523(a)(15), 1328(a)(2).



http://www.scribd. com/doc/22941950 /In-re-Smith

Joanne Adam

You continue to amaze me Jeanne -this is such a good site you have
I don't know how you find the time. Do you ever sleep?
Joanne
Can I let my clients access your site?

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