Other State's Law


Ca. Civ. Code § 3115
Cavu/Rock Properties Project I, LLC v. Gold Star Construction (August 27, 2014)
Issue:  Whether Defendant’s lien was valid under California state law.

Holding:  Defendant’s lien on property in California was invalid pursuant to California state law.  When Defendant recorded its lien, the California Civil Code allowed a mechanic to file its lien after completing the relevant contract but before either 90 days after completing the work of improvement or 60 days after recording a notice of completion or notice of cessation.  A contract is completed when all work is finished or the mechanic is excused from performance.   Defendant stopped work and recorded its lien after Plaintiff fell behind in payments.  Work was not yet complete, and Defendant was not legally excused from its contractual duties at that time.  The lien was, therefore, not valid under California state law.

California Civ. Proc. Code Section 704.710-730
In re Arredondo-Smith (July 22, 2010)

Issue: Whether the Debtor, who, under the choice-of-law provision of section 522(b)(3)(A) and Cal. Civ. Proc. Code § 704.710-730, may apply California homestead exemption law extraterritorially to property located in Austin, Texas?

Holding: California exemption law may apply extraterritorially to property located in the State of Texas, but because Debtor had declared “homestead” in California she may not now abandon such, and claim a homestead different than the family homestead that she and her former spouse previously established.

 

Fla. Stat. Section 222.20 (2008), Nonavailability of federal bankruptcy exemptions
In re Camp

Issue: Whether Florida’s exemption laws are unavailable to the Debtor because they do not apply to property outside of Florida and whether the Debtor may claim the exemptions offered under 11 U.S.C. § 522(d)?

Holding: Under § 522(b)(2) and (3)(A), the exemption laws of the State of Florida, including its opt-out statute (§ 222.20 of the Florida Statutes), apply to the Debtor herein. Additionally, the restriction in Fla. Stat. § 222.20 to non-residents is pre-empted by the federal choice of law provision of § 522(b)(3)(A), and therefore Florida’s opt-out from the exemptions provided in 11 U.S.C. § 522(d) binds the Debtor.

 

Nevada Rules of Professional Conduct, Rule 1.5
In re Boulder Crossroads (December 1, 2010)
Issue: (1) Whether Creditor (a Nevada law firm) should be disallowed its fees for failure to provide Debtor Boulder Crossroads with reasonable value; (2) whether Creditor’s fees should be disallowed due to alleged conflicts of interest; and (3) whether the application of a deposit paid by Debtor to outstanding attorney’s fees was a violation of the automatic stay?
Holding: (1) The reasonable value should be analyzed under both the state’s rules of professional conduct (if applicable) and a federal reasonableness scrutiny. The attorney bears the burden of establishing the reasonableness of their fees in this case. The Court finds that creditor has met its burden to prove that its’ fees are reasonable under Nevada and federal standards. (2) The Court finds there was no conflict of interest to warrant a disgorgement or disallowance of Creditor’s fees. (3) Portions of a retainer earned prepetition are not property of the estate. Therefore, the application of the retainer to outstanding debt was not a violation of the automatic stay. Debtor’s Objection to Claim of Creditor is DENIED.