Jacksonville Bankruptcy Lawyer Blog

Published on: November 17, 2011

Jacksonville Trucking Company, Trailer Bridge, Files Bankrutpcy

Florida Middle District Bankruptcy Court Florida was hit harder than most states when the recession of 2007 hit. The so named, “Middle District” being the third highest rate in the nation from mid-2010 to mid-2011.

As a result, it’s no surprise that Trailer Bridge, a local trucking and shipping company, filed for Chapter 11 bankruptcy reorganization yesterday. Truckers have been hit hard by the economic downturn and several of them are seeking loan modifications on their trucks. In a Chapter 13 reorganization, the secured amount owed on a truck can be reduced to what it’s fair market value is on the date of filing rather than what the driver actually owes in the contract. This method is called, “Redemption“. The loan new amount is also re-amortized to five years so that the driver leaves the bankruptcy owning the vehicle free and clear.

If you would like to learn more about “Redeeming” a vehicle, contact a Jacksonville Bankruptcy Attorney or call us at (904) 685-1200 to schedule a free initial consultation.

Published on: November 16, 2011

Madoff Family Sued

By David M. Goldman

An Amended Complaint was filed on Monday in the case against the Madoff family bringing the amount of the lawsuit up to $226.4 million from $198.7 million. Most of the sum reflects salaries and bonuses obtained by Bernard Madoff’s family members during the ponzi scheme. Those being sued are Peter Madoff who invested $32k but withdrew over $16 million, Andrew Madoff and Mark Madoff’s estate who withdrew more than $35 million (Mark’s estate, not him due to his recent suicide) and Shana Madoff (Peter’s daughter) who was a member of the company’s compliance division at Bernard L. Madoff Investment Securities LLC.

Although the family “steadfastly contend their involvement with BLMIS was entirely legitimate…” they appear to have made withdraws of unreasonable sums of money based on their investments. Shana Madoff, who appears to have taken no withdraws herself is being sued for the lowest sum, $12.7 million for being “derelict” in her duties on the securities firm’s legal board.

The legal justification for the suit comes from fraudulent transfers, preferential payments (favoring one creditor over others when making payments just prior to bankruptcy) and turnover of property, which will allow the court to obtain property or cash from the defendants.

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Published on: November 15, 2011

Jacksonville Residents Filing Bankruptcy Due to Medical Debt

By David M. Goldman

One of the most common reasons for filing a bankruptcy is due to illness or other medical problem. In fact, according to the Census Bureau, one in six Americans lives without health insurance.

Most of us live on the edge in the current economic climate. According to Census data the average American cardholder carries about $5,100 in revolving debt at any one time. All it takes is one accident or illness and we’re behind on our bills. Then the credit card companies increase interest rates and it quickly becomes impossible to get back on our feet.

Declaring bankruptcy is not an easy decision, but sometimes it’s the only thing that can get life back on track. Medical debts incurred for reasonable health and welfare can almost always be discharged in a bankruptcy and as long as you’re well enough to return to work, your life can start getting back to normal.

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Published on: November 14, 2011

Jacksonville Residents Opportunity to Lower Mortgage Principle Owed

By David M. Goldman

To say that the state court run Residential Mortgage Foreclosure Mediation program has been a failure is an understatement. This program was created by the Florida Supreme Court in an attempt to help Florida citizens modify their home loans so that they’d not be foreclosed upon for being unable to pay. With only a 3.6 success rate, the Supreme Court of Florida is now considering termination of the program.

On the heels of this debate comes an attractive Federal Court alternative: forcing modification in a Chapter 13 bankruptcy and using the threat of giving the home to the bank as a means of lowering principle and interest payments. This method started last year in Orlando, it appears to be working, and it makes total sense.

For a long time banks have been foreclosing on the homes of good people who can’t make their payments only to be unable to sell the property for anywhere near the debt owed. The banks can write-off this difference as a tax loss, but they can only claim so much tax loss each year. Jacksonville judges are now allowing debtors to file motions to force the lenders into mediation where we can show them what they’ll get if the debtor gives the house up in the bankruptcy vs. what they’ll get if they willingly drop principle and interest on the loan.

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Published on: November 11, 2011

Jacksonville Medical Malpractice Debts Dischargeable in Bankruptcy

By David M. Goldman

doctor-284x290 Doctors practicing in the Jacksonville area should consider their options in bankruptcy if they’ve been found liable for medical malpractice, especially if they were not covered by insurance.

Some debts are non-dischargable, as referred to in our previous entry. However, 11 U.S.C. 523(a)(6) prevents a debtor from discharging debts arising from willful and malicious injury to another person.

In Kawaauhau v. Geiger attorneys argued about the definition of “Willful”, as it could mean an intentional act that brings about an injury or an act that brings about an intentional injury. The Supreme Court oversaw the case and unanimously found that Congress intended the statute to prevent only intentional injuries, not intentional acts that lead to injuries. This means that a doctor who commits negligence can still discharge their liability for that injury in bankruptcy.

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Published on: November 10, 2011

Jacksonville Bankruptcy Bar Association Annual Conference

By David M. Goldman

Marriott Bankruptcy, Ponte Vedra Bankruptcy Ponte Vedra’s Sawgrass Marriott played host to this year’s Jacksonville Bankruptcy Bar Association (JBBA) seminar. The new Chief Judge Karen Jennemann was in attendance as well as the former Chief Judge, Paul M. Glenn.

As usual the event was both educational and interesting and the accommodations were elegant. An interesting discovery for me was to find that the Resort had been lost to Goldman Sachs Group, Inc., as part of RQB Resort’s Chapter 11 bankruptcy.

Apparently, the reorganization plan does not require Goldman Sachs to keep the hotel under the, “Marriott” name. This could mean that the 348 room hotel could change names come November when formal control is relinquished. RQB showed that the recession had caused a 25% drop in business for the resort in 2009, bringing about the bankruptcy. The value of the resort is currently $132 million dollars.

Published on: November 10, 2011

Jacksonville Bankruptcies Down for 2011

By David M. Goldman

Both Chapter 7 and Chapter 13 bankruptcy filings are down 16.35% when compared to the year to date filings from last year. These filings, which are traditionally down at the end of December and early January traditionally peak in the month of March. This is likely because people hold off filing their cases for those two months due to the holidays and come around to filing as soon as March hits and the financial strain of the holiday season is over. You can see the peaks on the above graph. Blue represents 2010, while red represents this year thus far.

Hopefully, this is a sign of economic recovery, however it may just say that those who were going to bankrupt have already done so.

Published on: November 9, 2011

Filene’s Basement Files for Bankruptcy, closes doors in 2012

By David M. Goldman

Few southerners are familiar with the department store Filene’s, especially since it’s retail outlet was bought out in 2006 by Macy’s. Macy’s then removed Filene’s name from the stores and replaced them with it’s own. Filene’s Basement was the “outlet” version of the retail store, having served as a place to liquidate overstock back in the early 1900’s. The companies diverged in 1988.

Now, in 2011 Filene’s Basement, the last storefront bearing the name will be closing it’s doors. This is sad to me not only because I used to shop there with my mother as a young child but also because my grandfather, Richard Fyler Sr., retired as a caretaker for Mr. Filene’s decedents. They had a profound influence on my upbringing as they built a recreation center for the children of the town as well as funding the only local library.

This once great business now has between $1 and $10 million in assets and between $50 and $100 million in liabilities per Boston.com. It may be nostalgia, but I think it’s always sad when a legacy dies and this company is no exception.

Published on: November 8, 2011

It’s Better to File Your Bankruptcy Before the Holidays

By David M. Goldman

Christmas, Hanukkah, Kwanza, Holidays, Bankruptcy Jacksonville bankruptcy filings are always down from November through February and the reason is obvious: the holidays are upon us and no one wants to file bankruptcy during the holidays.

The problem with the delay is that despite the fact that people are in debt, they are still obliged to buy gifts. 11 U.S.C. § 523 lists various, “Exceptions to Discharge” which include under (c)(i)(I) any, “luxury goods or services incurred… …within 90 days]” of the day of filing over $500 in value and any “cash advances aggregating more than $750… ….within 70 days of filing. There is an exception for goods and services that are reasonably necessary for the support or maintenance of the debtor or debtor’s dependents. Presents, even though traditional, are likely to be considered a luxury unless especially modest. These purchases just prior to filing would be non-dischargable in the bankruptcy causing debtors to enter life after the bankruptcy already in debt again.

Purchases made without the intent to repay the debt are fraud under 11 U.S.C. § 727(a)(2) which can lead to a denial of discharge (bankruptcy case closed and debts still owed), or even jail time.

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Published on: November 8, 2011

Jacksonville Collection Agent’s Outrageous Method

By David M. Goldman

Imagine that you’re a single woman who has some unpaid debt but like everyone else you’re just trying to live your life and get by. Perhaps one lonely evening you create a personals ad on an online dating service. Soon you are happy to get a response from a young man who asks you to meet him. You prepare for the date, show up on time and he shows up too. You order drinks, then food and then he declares that he is in fact a debt collector for the company you owe. He tells you that you need to pay your debts, gets up and leaves.

Does this sound impossible? Well it isn’t. In fact, someone seeking help with creditor harassment described a very similar situation to me just yesterday. This behavior comes out of left field for creditors as it requires more time and resources than we’d expect from a creditor. It also appears to violate the Fair Debt Collect Practices Act (FDCPA) as creditors cannot use deceptive means in an attempt to collect or enforce a debt.

If you think that a creditor is doing something unethical in an attempt to collect a debt, it may be illegal. Contact a Jacksonville Bankruptcy Lawyer for a free consultation.