Section 727 Discharge (Judge Gargotta)

Randall v. Atkins (September 1, 2011)
Issue: When Plaintiffs have shown that Debtor used business loan proceeds for personal purposes, commingled funds, wiped business computer hard drives, and failed to meet terms of promissory notes, have the plaintiffs met their burden of establishing by a preponderance of the evidence that the debt is: non-dischargeable under 11 U.S.C. § 727(a)(2), (3), (4) or (5), or under 523(a)(4) or (6)?
Holding: Plaintiffs met their burden and the Court found the debt to be non-dischargeable under § 727(a)(2)&(5) and § 523(a)(4)&(6). Plaintiffs did not meet their burden under § 727(a)(3)&(4) or § 523(a)(2).

Corn v. Corn (July 11, 2008)
Issue: At issue is the dischargeability of three debts incurred during the marriage of Channing and Elizabeth Corn. Plaintiff asserts that Defendant should remain liable to Plaintiff for certain marital debts pursuant to 11 U.S.C. § 523(a)(15), an exception to discharge for debts arising out of a divorce. Defendant contends in her motion for summary judgment that the Court must determine whether these obligations constitute spousal support under § 523(a)(5) (which she claims they are not), and therefore such debts are dischargeable.
Holding: The Court grants the Plaintiff’s Motion for Summary Judgment and will deny the Defendant’s Motion for Summary Judgment. Plaintiff is entitled to judgment as a matter of law because the debts were not in the nature of a domestic support obligation but were incurred in the course of the dissolution of the parties’ marital relationship.

Partners in Family Medicine v. Nolen (Dec. 19, 2007)
Issue: Whether cause is shown that Debtor made a number of omissions and/or false statements in her sworn Schedules of Assets and Liabilities and Statement of Financial Affairs such that Debtor’s discharge should be denied under 11 U.S.C. § 727(a)(4)(A)?
Holding: The Court finds that the Plaintiffs’ Complaint should be denied, and judgment entered in favor of the Debtor/Defendant. Based on the Debtor’s testimony and the Court’s assessment of her credibility and veracity, the Court finds that, even considering all the matters the Plaintiffs have raised, they have failed to sustain their burden of proving the Debtor exhibited a reckless disregard for the truth in filling out her Schedules and Statement of Financial Affairs.

Collins v. Johnson (August 14, 2012)
Issue: Was Debtor’s conduct in failing to disclose information, including compensation, transfers, and assets from his business sufficient to grant summary judgment for Plaintiff, thereby denying discharge for making a “false oath or account” under § 727(a)(4)(A)?
Holding: Where Debtor did not list the existence and sale of a lingerie business on his schedules until challenged at the 341 meeting, there was no genuine issue of material fact as to the existence of the elements of a § 727(a)(4)(A) claim. Summary judgment granted in favor of Plaintiff. Discharge denied.

Lowry v. Croft, et al. (October 22, 2013)

Issue: Whether the Debtor’s conduct in failing to disclose trust assets, failing to disclose the transfer of assets, failing to keep and provide records, and failing to explain the loss of trust assets is sufficient to deny the Debtor his discharge under 11 U.S.C. §§ 727(a)(2)-(5).

Holding: The Court found that the Debtor was the alter ego of the trust because he maintained control over the trust and its assets since the trust’s creation. As such, failure to disclose trust assets, transfer of assets and failure to keep and provide records as the alter ego of the trust was sufficient to deny the Debtor his discharge under 11 U.S.C. §§ 727(a)(2) – (5) for fraud, concealment, falsification of documents, failure to keep and provide records, and failure to satisfactorily explain loss of assets.