The debtor’s Chapter 7 means test showed monthly disposable income of $1,600, which exceeds the threshold for a presumption of abuse under the Bankruptcy Code. The debtor claimed special circumstances because he contributes $1,500 per month to the living expenses of his daughter’s and grandsons’ separate household.

The court ruled that the record did not sustain the debtor’s argument because there was no evidence the daughter’s alcoholism and ADHD were chronic or disabling conditions or that the debtor’s support was reasonable and necessary. In fact, the daughter was gainfully employed and lived independently with her two young sons. Even a small reduction in the debtor’s monthly contribution to his daughter would allow him to fund a Chapter 13 plan.

The court directed the debtor to convert the case to Chapter 13 or face dismissal.

The debtor and the plaintiff used to be married to each other. As part of the dissolution of their marriage and the arrangements for child custody and support, the debtor was ordered to pay a certain amount of monthly child support. She also was ordered to pay attorney fees incurred by the plaintiff as part of the district court and appellate court litigation they engaged in.

In this adversary proceeding, the bankruptcy court determined that under 11 U.S.C. § 523(a)(5), only the child support was excepted from discharge. The attorney fee awards were not in the nature of support and could not be considered to be domestic support obligations. However, the attorney fees do fall within the scope of 11 U.S.C. § 523(a)(15), which excepts from discharge certain debts incurred in connection with a divorce that do not constitute domestic support obligations. Accordingly, the attorney fees are not dischargeable.

After trial on whether the debtor was insolvent when it made transfers to three defendants, the court ruled the transfers were fraudulent because the debtor was not paying its debts as they became due. (The other elements of the fraudulent transfers had previously been established on summary judgment.) Transfers to a fourth defendant were found not to be fraudulent because the defendant was a “mere conduit” for the transfers and did not exercise dominion or control over the funds.

A deficiency remained after a deed of trust sale, so the creditor sought to pursue that debt in bankruptcy court. The court ruled that the creditor lacked standing because it had not obtained a deficiency judgment under Nebraska law and therefore was barred from bringing “an action” to recover the balance due. However, the creditor is likely entitled to pursue its non-judicial remedies under the UCC, and the bankruptcy court would go forward with a trial on the creditor’s motion for relief from stay to do so.