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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 Bankruptcy 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.

Chief Judge Catherine J. Furay

Suzannah Meta Schmid v. Bank of America, N.A., and Associated Bank, N.A. (In re Schmid), Adv. No. 12-0160, Case No. 10-12142-13 (04/24/2013) (494 B.R. 737) -- Judge Catherine J. Furay 04/24/2013

Case Summary:
The Debtor filed an adversary proceeding against Bank of America, the holder of her mortgage and note, seeking a determination that the bank lacked standing to foreclose. The bank filed a motion to dismiss under Fed. R. Civ. P. 12(b)(6). Noting a final judgment of the Portage County Circuit Court on the issue of the ownership of the mortgage and note, the Court concluded that it lacked jurisdiction to hear the Debtor's claims under the Rooker-Feldman doctrine. In the alternative, the Court ruled that the Debtor's claims were barred by the doctrine of claim preclusion. It also found that the Debtor's complaint should be dismissed under Rule 12(b)(6). The Debtor's motion to amend her complaint was therefore denied, and Bank of America's motion to dismiss was granted. Affirmed by the District Court.

Statute/Rule References:
Fed. R. Civ. P. 12(b)(6) -- Failure to State a Claim

Key Terms:
Claims - Allowance
Rooker-Feldman

In re Isaacs, Case No. 12-12406-7 (04/11/2013) (491 B.R. 893) -- Judge Catherine J. Furay 04/11/2013

Case Summary:
The Chapter 7 Trustee objected to the Debtors' claim of exemptions in an unimproved 21-acre parcel of land under Wis. Stat. § 815.20, the Wisconsin homestead exemption. The Trustee contended that the vacant land was not "reasonably necessary for the use of the dwelling as a home" as required by the statute. The parcel is adjacent to the parcel on which the Debtors' home sits. In response to the Trustee's objection, the Debtors argued that the vacant parcel was reasonably necessary to the homestead because it generates rental income and income from the sale of timber. In addition, the Debtors collect firewood, hunt, and hold family reunions on the parcel. They also receive tax benefits by participating in a Managed Forest Lands stewardship forestry plan. Acknowledging the strong Wisconsin policy favoring a debtor's right to claim a homestead exemption, the Court noted a line of cases that recognized a limit to that right. Interpreting the phrase "reasonably necessary for the use of the dwelling as a home," the Court distinguished between uses of the land that simply create some benefit, and uses that are truly necessary to the home. Applied here, the Court found that the Debtors' use of the vacant parcel was periodic and primarily recreational, and that the income generated from it was insufficient to be considered necessary. As a result, the Court concluded that the land was not reasonably necessary for the use of the dwelling as a home. The Trustee's objection was sustained.

Statute/Rule References:
11 U.S.C. § 522(b) -- Exemptions - State-Law
Wis. Stat. § 815.20 -- Homestead Exemption

Key Terms:
Exemptions
Homestead Exemption

In re Saxe, Case No. 12-13807-7 (03/22/2013) (491 B.R. 244) -- Judge Catherine J. Furay 03/22/2013

Case Summary:
Chapter 7 debtors sought to avoid a lien on various items of farm equipment. The creditor asserted that it had a purchase-money security interest in one item, a skidsteer. The Debtors disputed the existence of a PMSI, argued that there had been a novation, and that their payments on the debt should be applied first to the skidsteer (such that the PMSI was paid, and the remaining obligation was a general security interest). The Bankruptcy Court found that the security agreement created a PMSI. The subsequent renewal of the loan did not constitute a novation, as the differences between the two notes were minimal, no additional funds were borrowed, and there was no indication that the original obligation was extinguished. Finally, under Wisconsin law regarding the application of payments, payments are applied first to obligations secured by purchase-money security interests only if “more than one obligation is secured.” Here, there was only one obligation, and payments would be applied to the whole debt (and the PMSI would be removed only after the entire debt has been satisfied). The motion to avoid the lien was denied as to the skidsteer.

Statute/Rule References:
11 U.S.C. § 522(f) -- Lien Avoidance
Wis. Stat. § 409.103 -- Purchase - Money Security Interest

Key Terms:
Lien Avoidance
Purchase - Money Security Interest

In re Spencer, Case No. 10-15242-7 (02/12/2013) -- Judge Catherine J. Furay 02/12/2013

Case Summary:
After receiving a discharge, the Debtor sought to reopen her bankruptcy case in order to administer assets, amend her schedules, and have her case administered “on the basis of true facts.” She had been contesting the foreclosure of the mortgage on her home in Wood County Circuit Court for nearly four years, and had recently filed a Notice of Removal of that action to the United States District Court for the Western District of Wisconsin. The Debtor’s motion to reopen her bankruptcy case alleged that she expected a recovery against PNC Bank for fraud and violations of several state and federal laws related to the foreclosure proceeding. She believed that these assets should be made available to her creditors. Citing Redmond v. Fifth Third Bank, 624 F.3d 793 (7th Cir. 2010), the court held that the Debtor’s motion was untimely, that it appeared highly unlikely she was entitled to bankruptcy relief, and that either the state court or the district court were the appropriate fora for her action.

Statute/Rule References:
11 U.S.C. § 350(b) -- Reopening

Key Terms:
Reopening

Suzannah Meta Schmid v. Bank of America, N.A., and Associated Bank, N.A. (In re Schmid), Adv. No. 12-0160, Case No. 10-12142-13 (01/14/2013) – Judge Catherine J. Furay 01/14/2013

Case Summary:
Debtor sought an indefinite stay of her adversary proceeding. Debtor’s counsel argued that she had discovered new evidence of defects in the transfer of her client’s mortgage and note that amounted to fraud. She asserted that a stay was required to allow her to investigate the evidence, and to reconsider her posture in the adversary proceeding and the underlying bankruptcy case. After reviewing the lengthy procedural history, and evaluating counsel’s description of the evidence, the Court concluded that the motion to stay failed to show adequate cause under Fed. R. Bankr. P. 9006(b)(1) to grant a stay.

Statute/Rule References:
Fed. R. Bankr. P. 9006 -- Time

Key Terms:
Time

Michael Farms, Inc. v. Thomas J. Lundgren (In re Lundgren), Adv. No. 13-0138, Case No. 13-11962-13 (12/17/2013) (503 B.R. 717) -- Judge Catherine J. Furay 12/17/2012

Case Summary:
A creditor sought a determination that the Debtor, the sole officer and shareholder of a restaurant, was personally liable for unpaid produce bills pursuant to the Perishable Agricultural Commodities Act ("PACA"), and that the amounts owed were nondischargeable in the Debtor’s personal bankruptcy case under 11 U.S.C. § 523(a)(4). The Debtor filed a motion to dismiss, arguing that PACA did not impose fiduciary duties for purposes of nondischargeability proceedings. The Court disagreed, finding that PACA establishes a trust on perishable commodities and sales proceeds and imposes duties on the buyers of perishable goods, including fiduciary duties within the meaning of section 523(a)(4). Having also concluded that the Debtor failed to pay the creditor for deliveries of produce, the Court found that the creditor’s complaint stated a claim for relief and denied the Debtor’s motion to dismiss.

Statute/Rule References:
11 U.S.C. § 523(a)(4) -- Nondischargeability - Fraud in Fiduciary Capacity

Key Terms:
Fiduciary Capacity

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