You are here

Opinions

The Western District of Wisconsin offers a database of opinions for the years 1986 to present, listed by year and judge. For a more detailed search, enter a keyword, statute, rule or case number in the search box above.

Opinions are also available on the Government Printing Office website for Appellate, District and Bankrupty cases. The content of this collection dates back to April 2004, though searchable electronic holdings for some courts may be incomplete for this earlier time period.

For a direct link to the Western Wisconsin Bankruptcy Court on-line opinions, visit this link.

Available Decisions:

  • Chief Judge Catherine J. Furay--2013-present
  • Judge William V. Altenberger--2016-present
  • Judge Brett H. Ludwig--2017-present
  • Judge Robert D. Martin (retired)--1990-2016
  • Judge Thomas S. Utschig (retired)--1986-2012

Judge Robert D. Martin

Case No. 12-15486-7
On remand from the district court, the bankruptcy court had to determine if the debtor committed a defalcation as defined by the Supreme Court in Bullock v. BankChampaign, N.A., 133 S. Ct. 1754 (2013). On the facts admitted and proved, it was extremely unlikely that debtor did not have actual knowledge of his construction company’s wrongdoing. His participation in the decision not to pay the creditor demonstrated his knowledge that his company had more debts than money to pay them. Thus, every time he received a commission from the sale of the house, he was alerted to the fact that all the subcontractors were not receiving full payment. Even if debtor did not have actual knowledge, he was consciously disregarding the risk that he was violating his fiduciary duty. Consequently, the court found debtor, as a fiduciary of a trust that existed by operation of Wisconsin's theft by contractors statute, committed a defalcation for purposes of 11 U.S.C. § 523(a)(4) where, even if he was not actively cognizant of wrongdoing, he consciously disregarded the substantial and unjustifiable risk that his conduct violated his fiduciary duty.

Chief Judge Catherine J. Furay

Case Nos. 11-11386-11
A chapter 11 debtor’s confirmed plan contained a provision obligating the debtor to execute a deed to specified property in the event of a default and a failure to cure. The court had jurisdiction over a creditor’s motion to compel such a transfer. The motion “arose in” a case under title 11. The court had the authority under section 1142(b) to order the transfer of the deed. It previously found the plan had not been “substantially consummated,” and in any event, section 1142(b) does not reference acts necessary for “substantial consummation” of the plan but rather for “consummation.” The court determined permissive abstention was not warranted and ordered the transfer. Currently on appeal to the district court.
11 U.S.C. § 1142(b) -- Implementation of plan

Case Number: 13-16039-7

The debtor sold property on a land contract and claimed an exemption in the proceeds under the applicable Minnesota homestead exemption statute. The statute provides, “[t]he owner may sell and convey the homestead without subjecting it, or the proceeds of such sale for the period of one year after sale” to any debt from which it was exempt. For the purposes of the statute, the “sale” occurred when the debtor and vendee executed the land contract, not when the debtor received the last payment. Accordingly, the debtor was only entitled to exempt proceeds she received in the year following the execution. She could not exempt proceeds received after that time.

Minn. Stat.§ 510.07 .-- Proceeds from sale of homestead

Case No. 11-16408-7
The court approved a fee application in part and denied it in part. Billing practices like vague descriptions of services, lumping unrelated activities into single entries, and submitting bills with entries that appeared duplicate impeded the court from determining whether certain fees were reasonable or necessary. A number of the services the attorney provided were necessary and calculated to benefit the estate at the time they were performed. However, some services were unusual, like acting as a disbursing agent, and others improper, such as pursuing collections actions in bankruptcy court, and the court denied fees for these services.
11 U.S.C. § 330 -- Compensation of professionals

Case No. 14-11862-13
Permissive abstention and remand was warranted following the debtor’s removal from state court of a dispute concerning a business relationship. The state court action centered around whether the business relationship was a partnership, and the debtor requested an injunction preventing the other party from carrying on business operations, dissolution, and an order of accounting and winding up of partnership affairs. Numerous factors weighed in favor of abstention. The action exclusively featured state law issues, so state law issues predominated over bankruptcy issues. Remand also promoted judicial efficiency, as the action was a non-core, related-to proceeding and the bankruptcy court would only have been able to enter proposed findings of fact and conclusions of law. The state court had jurisdiction to finally adjudicate claims.
28 U.S.C. § 1334(c)

Case No. 13-15325-13
Land contract vendors objected to confirmation of the debtors’ chapter 13 plan proposing to cure a default after the redemption date set in a judgment of strict foreclosure. Under Wisconsin law, equitable title remained with the debtors because the state court had not entered an order confirming the default after the expiration of the redemption period. Section 1322’s more specific cure provision governed the debtors’ ability to cure, not the general provisions of section 108(b) extending a non-bankruptcy deadline for curing a default. The debtors could cure the default within a “reasonable time” in their plan under section 1322(b)(5).
11 U.S.C. § 1322(b)(5)
 Fed. R. Bankr. P. Rule 7054
28 U.S.C. § 1821
28 U.S.C. § 1920
Wis. Stat. § 59.36
Wis. Stat.§ 59.38

Case No. 13-10813-7
After the court denied the plaintiff’s motion for summary judgment in the decision issued May 6, 2014, the court held a trial to determine whether the defendant committed defalcation under section 523(a)(4), that is, whether he acted knowing his conduct would violate his Perishable Agricultural Commodities Act (“PACA”) duties. The court found he had. Although the defendant testified he did not know what PACA required of him, this testimony was not credible given his long experience in the grocery business. Additionally, every invoice the defendant received from the plaintiff stated the listed items were subject to a statutory trust pending receipt of full payment, putting him on notice of his duties.
11 U.S.C. § 523(a)(4) -- Nondischargeability - fraud in fiduciary capacity
 
 

Case No. 13-10279-7
After reaching a settlement with the trustee on his objection to their claim of exemption in real property, the debtors sold land to fund the settlement. They then filed a proof of claim for delinquent taxes, attorney’s fees incurred in litigating the objection and selling the land, and money expended to satisfy judgment liens on the property. The court sustained the trustee’s objection to the proof of claim for a number of reasons. Debtors cannot assert claims against themselves. Additionally, the claim was filed late and the trustee objected, subjecting it to disallowance under section 502(b)(9). There were a number of problems with the debtors’ claim for real estate taxes, and it did not meet the statutory criteria for the asserted section 507(a)(8) priority treatment. Finally, as for the attorney’s fees, although chapter 7 trustees may hire an attorney to be compensated from the estate, here, the debtors incurred the fees.
11 U.S.C. § 101(5) -- Definition of claim
11 U.S.C. § 330 -- Compensation of professionals
11 U.S.C. § 502(b) -- Allowance of claims or interests
 

Case No. 13-10813-7
In prior proceedings, the district court determined the defendant’s produce LLC had violated its Perishable Agricultural Commodities Act (“PACA”) trust obligations to the plaintiff. It made no findings about whether the defendant was individually liable. The defendant then filed an individual chapter 7 petition, and the plaintiff sought to except the PACA debt from discharge under section 523(a)(4). In denying a motion to dismiss the adversary complaint, the court determined the defendant-owner was personally liable for the dissipation of the PACA trust assets. The court also ruled that a PACA trust imposed fiduciary duties within the meaning of section 523(a)(4). The plaintiff then filed a motion for summary judgment, and the only question remaining was whether the debtor’s conduct constituted fraud or defalcation within the meaning of section 523(a)(4). The court rejected the plaintiff’s arguments that the Supreme Court’s interpretation of “defalcation” in Bullock v. BankChampaign, N.A., 133 S. Ct. 1754 (2013), did not apply to statutory breaches of fiduciary duty and that a breach of fiduciary duty imposed by PACA constituted per se defalcation within the meaning of section 523(a)(4). Instead, applying Bullock, the court looked to the facts available and could not conclude whether or not the debtor had knowledge of, or acted with gross recklessness in respect to, the improper nature of the behavior that resulted in a breach of his fiduciary duties. Accordingly, the court denied summary judgment.
11 U.S.C. § 523(a)(4) -- Nondischargeability - fraud in fiduciary capacity

Case No. 13-14059-13
The plaintiff sought a determination that debt for overpaid unemployment benefits was nondischargeable. On summary judgment, the court had an obligation to verify the debts were nondischargeable, even though the defendant conceded the overpayment was nondischargeable and only disputed his liability for the filing fee. The overpayment was excepted from discharge under section 523(a)(2)(A) because the defendant falsely certified he was unemployed and not receiving wages. A penalty assessed for the overpayment was intended to punish fraud, and thus was excepted from discharge under section 523(a)(7). The plaintiff could recover the fee for filing the adversary proceeding, as its recovery was permitted under a state statute. Because the underlying debt was nondischargeable, the filing fee was too.
11 U.S.C. § 523(a)(2)(A) -- Nondischargeability - fraud
11 U.S.C. § 523(a)(7) -- Nondischargeability - fines/penalties/forfeitures

Pages