The court denied a request for monetary sanctions for violation of the discharge injunction where a creditor received an overpayment after the bankruptcy case was completed and closed. The creditor’s counsel did not respond to repeated requests for return of the funds until a hearing was scheduled on the debtor’s motion for turnover of property. The creditor then released the funds. However, the court found no basis in the Bankruptcy Code or Rules for sanctioning a failure to promptly respond, and also noted counsel for the creditor had no reason to expect the debtor would incur significant costs to resolve the matter. The creditor’s counsel did volunteer to repay the debtor for the cost of reopening the bankruptcy case to deal with this motion.
Tuesday, September 10, 2013