Judge Klinette H. Kindred

May 11, 2023

Trustee ordered to disgorge fees

Where a Chapter 7 panel trustee received a share of commissions from a realtor to whom he referred business, and that arrangement was not disclosed to the court, the trustee must disgorge his fees in this case. Background This matter was before the court for a hearing on the court’s order to show cause why […]

Dec 8, 2022

Claims narrowed in dispute between homeowner and contractor

Where a homeowner alleged a contractor violated the Virginia Consumer Protection Act and that resulting damages are nondischargeable, but she failed to plead facts supporting her claims, they were dismissed. And where the contractor counterclaimed against the homeowner for breach of contract, but the alleged breaches did not correspond with a contractual duty in either […]

Oct 16, 2022

Debtor fails to show signature was forged

Where a bank filed claims against the debtor based on personal guarantees signed by the debtor and his late wife, and the debtor claimed his signature was forged on the documents, his objections were overruled. He failed to rebut the presumption that the notarized documents are valid and that the notaries performed their duties properly. […]

Aug 22, 2022

No discharge for ‘willful and malicious injury’

Where a jury previously found that debtors discriminated against a former employee on the basis of sex, gender and pregnancy, and retaliated against her and wrongfully terminated her employment in violation of public policy, the resulting judgment was for conduct that was inherently willful and thus non-dischargeable. Background Trina Bengtsson brings this action asserting that […]

Aug 9, 2022

Fraud debt exempt from discharge

Where the debtor obtained $120,000 from the plaintiff by telling her that he was a licensed home improvement contractor, when he was not, he must disgorge those funds. Because those funds were obtained through fraud, that debt is not dischargeable. Background Prior to this bankruptcy proceeding, a dispute arose between the Hanan Khalil and Mohamed […]

Nov 23, 2021

Petition was filed in bad faith

Where the debtor inflated his expenses to hide disposable income, and the record showed a pattern of making unsubstantiated expense claims, the court concluded that he filed his three Chapter 13 plans in an effort to unreasonably delay and thwart his creditors. As a result, his latest plan was dismissed. Background Patrick Roch filed this […]

Jun 2, 2021

Automatic stay extended to nondebtor lawyer

Where the nondebtor’s finances were intertwined with the those of the debtors, but she could not file for bankruptcy protection because it could put her law license, and the only source of income for the debtor, at risk, there was good cause to extend the automatic stay to her. Background Cornus Montessori LLC owned and […]

May 25, 2021

Bad faith conduct results in two-year refiling bar

Where the court previously dismissed with prejudice the bankruptcy filing of the debtor’s alter-ego, this case was the ninth filed by the alter-ego since 2010 and was filed during a prior bar to refiling, and neither the debtor nor the alter ego defended their conduct, both the debtor and the alter ego were barred from […]

Apr 30, 2021

IRS scuttles proposed settlement

Where a proposed settlement would pay an unsecured creditor ahead of the Internal Revenue Service, which was a senior creditor, it violated the Bankruptcy Code’s priority schemes and was denied. Background In August of 2017, River House Enterprises LC obtained an arbitration award against the debtor, Tovan Construction Inc., and had that award confirmed in […]

Feb 17, 2020

Husband not liable for forged personal guarantees

Where the evidence demonstrated the debtor’s wife likely forged his signatures on personal guarantees to obtain loans, the bank failed to carry its burden to prove the guarantees were genuine copies of original documents signed by the debtor. With respect to one guarantee, however, the debtor could not claim it was a forgery because he […]

Feb 14, 2020

Bankruptcy judge disallows $2.3M in bank claims

Based on evidence that four loan guarantees were the product of forgery by the debtor’s wife, a bankruptcy judge has disallowed more than $2.3 million in claims by a bank that lent money to a now-defunct real estate investment firm. The decision by U.S. Bankruptcy Judge Klinette H. Kindred describes an embezzlement scheme that came […]

Dec 4, 2019

Debtor induced to buy business based on inaccurate data

Where the debtor was induced to buy a bagel business based upon inaccurate information provided by the seller, his objection to the seller’s claim for damages was sustained. But because the debtor received more value from the business than his investment he was awarded no damages. Background On April 4, 2014, debtors Khader and Nanette […]

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