In re Gomery
OPINION DENYING CONFIRMATION AND GRANTING TRUSTEE’S MOTION TO CONVERT CASE TO CHAPTER 7 >
I. INTRODUCTION AND ISSUES PRESENTED.
Clarence Kenyon Gomery (the “Debt- or”), filed a voluntary petition under chapter 13 of the Bankruptcy Code
The Debtor now seeks confirmation of his Modified First Amended Chapter 13 Plan (the “Plan”). The Trustee and To-pous have objected to the Plan on the grounds that the Plan is not feasible, § 1325(a)(6), and that neither the Plan nor the petition was filed in good faith under § 1325(a)(3) and (7). Pursuant to § 1307(c), the Trustee has also requested that the Debtor’s case be converted to chapter 7 due to the Debtor’s lack of good faith. Topous and the United States Trustee have concurred in this request. For the reasons that follow, the Court will deny confirmation of the Debtor’s Plan and will convert this case to chapter 7.
II. JURISDICTION.
The Court has jurisdiction over this bankruptcy case. 28 U.S.C. § 1334. This bankruptcy case and all related proceedings have been referred to this Court for decision. 28 U.S.C. § 157(a); L. Civ. R. 83.2(a) (W.D. Mich.). This contested matter is a core proceeding and this Court may enter a final order. 28 U.S.C. § 157(b)(2)(A) (matters concerning the administration of the estate), (L) (confirmation of plans), and (0) (other proceedings affecting the liquidation of assets or the adjustment of the debtor-creditor ... relationship). This opinion constitutes the Court’s findings of fact and conclusions of law pursuant to Fed. R. Bankr.P. 7052.
III. FACTS AND PROCEDURAL HISTORY.
Evidentiary hearings on confirmation of the Debtor’s proposed chapter 13 Plan and the Trustee’s motion to dismiss or convert this bankruptcy case were held before this Court on August 28, 2014, November 24, 2014, and December 10, 2014.
The Court also admitted numerous exhibits into evidence at the hearings. The following findings of fact are based on the documents filed in this.case, the exhibits admitted at the hearings, and testimony of the various witnesses.
A. The Pre-Bankruptcy State Court Litigation.
Prior to the filing of the Debtor’s bankruptcy case, Topous obtained a judgment against the Debtor and the Debtor’s law firm, Gomery and Associates, PLLC, in the Circuit Court for the County of Grand Traverse, Michigan. (Topous Exh. 1; Tr. II at 16; 22-23.) The state court litigation arose from the Debtor’s representation of Topous in various business transactions, including the purchase of property referred to by the parties as the Old Mitchell Creek Golf Course, in Traverse City, Michigan. In the state court litigation, Topous alleged that the Debtor drafted an Operating Agreement creating a limited liability company, T & G Real Estate Development, LLC (“T & G”), to purchase and hold the Mitchell Creek property. Although Topous paid the full purchase price to acquire the property, Topous asserted that the Debtor breached his professional responsibilities and defrauded Topous in the transaction by surreptitiously giving himself a one half ownership interest in T & G in the Operating Agreement he drafted. (Topous Exh. 4 at 4, 8-9; Tr. II at 65-66.) After a trial in the state court, the .jury awarded ownership of the Mitchell Creek property to Topous and ordered the Debtor to pay Topous damages in the net amount of $11,622.22.
After the judgment was entered, the Grand Traverse County Circuit Court also entered an Order Granting [Topous’s] Motion for Sanctions for Frivolous Defense and for Spoliation of Evidence. (Topous Exh. 2.) A subsequent’ order imposed sanctions against the Debtor and his law firm, jointly and severally, in the total amount of $314,629.27. (Topous Exh. 3.)
The Debtor appealed the judgment and the sanctions order, but was unable to post the bond required to stay the state court judgment and order pending appeal. (Topous Exh. 5; Tr. II at 36-39.) The appeal was pending at the time the Debtor’s bankruptcy case was filed, and a hearing on the motions for stay and the request for a bond was scheduled to be held in the state court on April 7, 2014. (Tr. II at 38.)
B. The Filing of the Bankruptcy Case.
When it became apparent that the Debt- or would be unable to post the appellate bond required to stay collection of the Topous judgment and sanctions order, the Debtor filed for bankruptcy relief. (Tr. II at 11-13.) His voluntary chapter 13 petition was filed in this Court on April 2, 2014. (Dkt. No. 1.) The Debtor also filed a chapter 7 case on behalf of his law firm, Gomery and Associates, PLLC on April 2,
Brett N. Rodgers was appointed as the Chapter 13 Trustee in the Debtor’s case and a § 341 meeting was held on May 6, 2014.
The evidence presented at the hearings established that the Debtor’s schedules and § 341 testimony failed to disclose a significant and valuable asset, JACCK Enterprises, LLC (“JACCK”), in which the Debtor had an interest. The Debtor’s ownership interest in JACCK is not disclosed anywhere in his schedules or SOFA. The assets of JACCK consist of two commercial buildings located at 413 and 423 Eighth Street in Traverse City, Michigan. Ownership of these buildings was originally transferred by the Debtor and Aileen Gomery to JACCK via a quit claim deed dated April 15, 2004. (Tr. Exh. G.) According to a March 31, 2014, balance sheet admitted into evidence at the hearings, the book value of JACCK was $149,112.55. (Tr. Exh. A.) A reconstructed balance sheet prepared by the Trustee’s office estimated the fair market value of JACCK to be $241,939.31. (Tr. Exh. B.) At the § 341 meeting, the Debtor testified that JACCK was owned solely by his wife, Aileen Gomery. (Topous Exh. 7 at 36-37.) When questioned about tax returns that showed Debtor as having a fifty percent ownership interest in JACCK, the Debtor insisted the tax returns were filed in error. (Id. at 37-38.)
The evidence presented at the hearings also raised serious questions about the accuracy of other disclosures on the Debtor’s schedules. For example, the only bank account disclosed on the Debtor’s Schedule B is a “checking and savings account with Members Credit Union on which only the Debtor may draw.” (Dkt. No. 1.) The balance of the account is listed as $19.00. (Id.) The Debtor’s Schedule B also does not disclose that the Debtor owns any firearms, sports, or other hobby equipment. (Dkt. No. 1.)
C. The Debtor’s Arrest and Incarceration.
In July 2014, the Debtor was arrested and charged with solicitation of murder. (Tr. I at 5.) At the evidentiary hearings, Detective Gomez from the Grand Traverse County Sheriffs Department testified about the circumstances that led to the criminal charge, including a recorded conversation between the Debtor and Dale
D. Plan Confirmation and Motions to Dismiss or Convert.
The Debtor’s Original Chapter 13 Plan was filed on April 16, 2014. (Dkt. No. 25.) The plan proposed that the Debtor would make monthly plan payments of $465 per month, and that the total distribution to unsecured creditors would be $23,000. 'The Trustee objected to the plan on several grounds, including the Debtor’s failure to disclose his ownership interest in JACCK, failure to commit all disposable income, and failure to provide requested information to the Trustee. (Dkt. No. 41.) These issues also caused the Trustee to file a motion to dismiss or convert the Debtor’s chapter 13 case on June 30, 2014. (Dkt. No. 50.)
After the Debtor’s arrest, the Trustee filed an Amended Objection to Confirmation of the Debtor’s Plan. (Dkt. No. 56.) In addition to the objections previously raised, the Trustee’s Amended Objection objected to the feasibility of the plan due to the fact that the Debtor was incarcerated and would be unable to make plan payments. The United States Trustee also filed a concurrence in the Trustee’s motion to dismiss or convert the Debtor’s case, arguing that conversion of the case would be most appropriate, given the Debtor’s failure to disclose assets and provide documents to the Trustee. (Dkt. No. 63.)
On August 6, 2014, the Debtor filed a First Amended Chapter 13 Plan. (Dkt. No. 65.) The First Amended Plan proposed reducing payments to $100 per month, because the Debtor had been charged with a criminal offense and was “currently without wages or draws from his law practice.” (Id.) The amended plan also acknowledged a “ ‘fact issue” regarding Debtor’s ownership interest in JACCK. (Id.) The Debtor proposed to address this issue by providing that, with the agreement of Aileen Gomery, one parcel of real estate owned by JACCK would be sold, and one-half of the proceeds of the sale would be used to fund the Debtor’s plan.
The Trustee and Northwestern Bank filed objections to confirmation of the First Amended Plan. (Dkt. Nos. 73 & 80.) The Trustee also filed an Amended Motion to Dismiss the Debtor’s chapter 13 case.
On August 26, 2014, the Debtor filed a Second Amended Chapter 13 Plan. (Dkt. No. 81.) In this amended plan, the Debtor asserted that only two unsecured claims, one held by Members Credit Union and one by Northwestern Bank, were timely •filed. The plan proposed to withdraw funds from the Debtor’s exempt retirement plan to pay these claims in full. The Second Amended Plan made no provision for the payment of the unsecured claims filed by Topous, one for $11,622.22, the net amount owed under the state court judgment, and the other for $314,629.27, the
After withdrawing his Second Amended Plan, the Debtor filed a Notice of Modification of his First Amended Plan. (Dkt. No. 135.) The Modified First Amended Plan, which is the Plan currently before the Court, again states that the Debtor “was charged with a criminal offense and is currently without wages or draws from his law practice.” (Id.) It provides that the Debtor “shall pay $100.00 per month until he is able to secure employment” and contemplates that the Debtor will “resume payments at a level which is consistent with the requirements of 11 U.S.C. § 1325” when the Debtor is able to obtain employment in the future. (Id.) The Plan further provides that the amount paid in to the Plan “shall not be less than the liquidation value” and that the unsecured creditors shall be paid their pro rata share of the amounts paid in by the Debtor, after deduction of administrative expenses. (Id.) Finally, the Plan provides that both parcels of real estate owned by JACCK will be sold, and one half of the proceeds will be turned over to the Trustee to be administered as part of the bankruptcy estate. The Plan states that the Debtor has negotiated this resolution with his wife, Aileen Gomery, to settle the dispute over ownership of JACCK, although he continues to maintain that JACCK is “solely owned by his wife.” (Id.)
The Trustee did not file an additional objection to the Modified First Amended Plan.- However, at the evidentiary hearings, the Trustee restated his prior concerns about the Debtor’s lack of good faith and stood on his motion to dismiss or convert the case. The United States Trustee also asked that the case be converted due to the Debtor’s lack of good faith and objected to confirmation based on lack of good faith and feasibility. Topous stood on his prior objections to the Debtor’s proposed Plan and concurred in the request to convert to chapter 7, due to the Debtor’s lack of good faith in filing his chapter 13 case.
E. Evidence Regarding Good Faith and Plan Feasibility.
As noted previously, many of the arguments regarding the Debtor’s lack of good faith in filing his chapter 13 case and plan are based on his failure to fully disclose various assets. The evidence presented at the hearings establishes the following material omissions:
1. JACCK Enterprises, LLC.
The most troubling and clear cut omission is the Debtor’s failure to disclose his ownership interest in JACCK. The joint income tax returns of the Debtor and Aileen Gomery and the tax returns of JACCK. from 2009 to 2013 were admitted into evidence at the hearings. (Topous Exh. 11.)
The accountant who prepared the Debt- or’s tax returns, Jerry Keelan, testified that he always reported income from JACCK as partnership income. (Tr. Ill at 74.) He also testified that the Debtor and Aileen Gomery were aware that the returns were being prepared in this manner. (Topous Exh. 30; Tr. Ill at 74, 85.) He explained that neither the Debtor nor Aileen Gomery objected to the returns listing them as equal owners of JACCK until early in 2014. (Tr. Ill at 75.) The Debtor also admitted that the tax returns showed that he and Aileen were each a fifty percent owner of JACCK. (Tr. II at 71.)
In addition to the tax returns, various other documents were admitted into evidence, showing that the Debtor held himself out to be a fifty percent member of JACCK. (Topous Exh. 29.) These documents included a Limited Liability Resolution to Borrow / Grant Collateral dated April 15, 2004, and executed by the Debtor as a “Member” of JACCK; a Promissory Note dated April 15, 2004, signed by the Debtor as a “Member of Jacck Enterprises, LLC;” and a Note Modification Agreement dated September 8, 2005, also signed by the Debtor as a “Member” of JACCK. (Id.; see also Tr. Exh. E and F.)
Despite all of this evidence, the Debtor and Aileen Gomery both testified repeatedly that it was their intention that JACCK be owned solely by Aileen. (Tr. II at 54, 56, 70, 84,127,129,150; Tr. Ill at 18-19.) However, the Debtor did not produce a copy of the LLC’s Operating Agreement or any other documentary evidence in support of the assertion that JACCK was owned only by Aileen Gom-ery.
2. Bank Accounts and Law Firm Draws.
At the evidentiary hearings, evidence was presented showing that, during the thirty days prior to the filing of the Debt- or’s bankruptcy case, approximately $15,000 in draws were made from Gomery and Associates, PLLC’s account at Northwestern Bank, and paid either to the Debt- or directly or to third parties, for the Debtor’s benefit.
The majority of the checks from the law firm directly to the Debtor, which total
The Court also notes that these sizeable payments to the Debtor or for his benefit were not adequately disclosed in the Gom-ery and Associates chapter 7 case. The Debtor signed the Gomery and Associates petition, schedules, and SOFA on behalf of the PLLC, and he testified that he certified that the information contained in the documents was true and correct under penalty of perjury.
3. .308 Rifle and Other Personal Property.
The Debtor’s Schedules did not disclose that he owned any firearms. At a 2004 exam held on June 5, 2014, the Debtor testified that he owned a “30-06 deer rifle” and that any other guns were owned by his son. (Topous Exh. 10 at 81-82.) Dale Fisher testified at the evidentiary hearings that he had personally observed a .308 rifle on the gun rack in the Debtor’s residence. (Tr. Ill at 100.) When the Debtor was questioned at the hearings about whether he owned a .308 rifle, he invoked his rights under the Fifth Amendment. (Tr. II at 107.)
J. Feasibility and Eligibility.
At the hearings, there was little direct evidence regarding the status of the criminal case against the Debtor and his prospects for future income. However, the representations made by counsel suggest that a trial has been scheduled in the criminal matter. Even if the Debtor is ultimately acquitted of the criminal charges, it is uncertain whether the Debtor will ever practice law again. Reference was made to a grievance that is pending against the Debtor with the State Bar of Michigan. (Tr. Ill at 149.) The Debtor’s attorney also candidly acknowledged that it is unlikely that the Debtor will be able to practice law in the future. (Tr. Ill at 129.) No other evidence of the Debtor’s future earning potential was presented.
IV. DISCUSSION.
Despite the long procedural history of this case, including the multiple plan amendments proposed by the Debtor, the primary objections raised by the Trustee, the United States Trustee and Topous in opposition to confirmation of the Debtor’s chapter 13 Plan and in support of dismissal or conversion of the Debtor’s chapter 13 case have remained constant. The objecting parties argue that the Debtor has shown a lack of good faith, both in the filing of his chapter 13 Plan, § 1325(a)(3), and in the filing of the chapter 13 case itself, § 1325(a)(7) and § 1307(c). The various objections also assert that the Debtor’s Modified First Amended Plan is not feasible, § 1325(a)(6), and that the Debtor’s lack of regular income makes him ineligible for chapter 13 relief, § 109(e). The Court will address each of these assertions.
A. Good Faith.
“Chapter 13 relief is reserved for the ‘honest but unfortunate debtor,’ ” and in chapter 13 cases, a debtor’s good faith may be relevant in several respects. In re Alt,
Section 1307(c) also provides that a chapter 13 case may be converted or dismissed, “whichever is in the best interests of creditors and the estate,” for “cause.” 11 U.S.C. § 1307(c) (identifying eleven potential examples of “cause,” including prejudicial delay by the debtor, failure to timely file a plan, failure to commence making payments under § 1326, denial of confirmation of a plan, and material default by the debtor under a confirmed plan.) The Sixth Circuit Court of Appeals has held that “cause” for dismissal or conversion may also exist if the debtor lacked good faith in the filing of the chapter 13 casé. In re Alt,
The concept of good faith under both § 1325(a) and § 1307(c) is an “amorphous notion” that is both flexible and fact-specific. See In re Alt,
The factors that are relevant to the good faith determination under either § 1325 or § 1307(c) obviously overlap to some extent, and the “same policy” of protecting against “an abuse of the provisions, purpose or spirit” of chapter 13 is embodied in both evaluations. See In re Love,
1. The Debtor’s Interest in JACCK Enterprises, LLC.
The evidence is indisputable that the Debtor possessed an ownership interest in JACCK. The Debtor’s own individual tax returns for 2009 through 2013, along with the returns of JACCK itself, reflect his income from JACCK and show him as having a one half ownership interest in the LLC. Several other documents admitted into evidence at the hearing also demonstrate that the Debtor held himself out as a half owner of JACCK and signed documents in that capacity.
In light of this evidence, the Debtor’s testimony that JACCK is owned solely by his wife strains credulity. The Debtor has been a practicing attorney for twenty-five years and certainly has more than a rudimentary understanding of business law. For instance, in this matter, the Debtor testified about his formation of another limited liability corporation, T & G Real Estate Development, its operating agreement, and his understanding of the members of that entity. Yet neither the Debtor nor Aileen Gomery offered any documentary evidence in support of their asserted belief that the Debtor had no interest in JACCK. Even if he genuinely believed that he had no ownership interest in JACCK, the tax returns and other documents should have, at a minimum, caused the Debtor to disclose his potential interest as “disputed” on his bankruptcy schedules and SOFA. Not listing the as
Similarly, the Debtor’s original chapter 13 plan did not include any provisions for the Debtor to account for his interest in JACCK for the benefit of his creditors. Subsequent plan proposals called for one parcel of property owned by JACCK to be sold, and for one half of the proceeds to be used in the Debtor’s chapter 13 case. The Modified First Amended Plan now provides for both parcels of JACCK’s property to be sold and states that Aileen Gomery has agreed that “to resolve the dispute” over ownership of the LLC, one half of the proceeds from the sale may be used to fund the Debtor’s chapter 13 Plan. Again, the Debtor and his wife have made these offers only after the omission of the Debtor’s interest in JACCK was discovered and objected to by the Trustee and Topous. This is simply too little, too late.
2. Bank Account and Law Firm Draws.
The evidence at the hearings established that the Debtor received over $8,000 in draws from his law firm, Gomery and Associates, LLC, during the thirty days preceding the filing of his bankruptcy case. The Debtor disavowed any knowledge of these transfers. Aileen Gomery testified that these funds were deposited into a joint bank account at Members Credit Union. She explained that she was the principal owner of the account, but that the Debtor was a joint owner and had been for twenty-two years. This testimony was un-controverted; however, other than Aileen Gomery’s testimony, no evidence was admitted to support her assertion that the account was jointly owned. In the absence of such evidence, the Court cannot conclusively determine that the account was jointly owned by the Debtor. If Aileen Gomery was correct that the Debtor is a joint owner of the account, the Debtor had an affirmative duty to disclose his interest in this joint account on his bankruptcy schedules. He did not do so. The nondisclosure of the bank account is further evidence of the Debtor’s lack of good faith. If the funds had been in the account at the time of the bankruptcy filing, they could have been a valuable asset to the bankruptcy estate. If the funds were transferred, the transfers could be subject to avoidance and recovery for the benefit of creditors in the Debtor’s chapter 13 case or the law firm’s related chapter 7 case. Even if Aileen Gomery was mistaken in her characterization of the Members Credit Union account as joint, the Debtor offered no explanation of why his income was deposited in a bank account he neither owned nor disclosed during the month preceding the filing of his bankruptcy case.
In addition to the transfers made directly to the Debtor, significant other payments were made to third parties — including the $16,000 paid to the attorney representing the Debtor and Gomery and Associates in the Topous appeal — in the month prior to the bankruptcy filings. The Court has serious concerns as to whether these transfers were adequately disclosed in the Gomery and Associates, PLLC chapter 7 case. The original SOFA filed in the chapter 7 case identified the Debtor as an insider creditor who had received payments in the year preceding the bankruptcy filing, but did not disclose the amounts of these transfers. After the - Debtor was questioned about the transfers at the evidentiary hearings, the chapter 7 SOFA was amended to reiterate that the Debtor had received compensation prepetition and that records had been provided to the chapter 7 trustee. Still, no details were provided to the
The Debtor testified that he had no knowledge of these transfers, yet he signed the Gomery and Associates petition, schedules, and SOFAs as President of the PLLC entity. The Debtor did not disclose an ownership interest in the bank account about which Aileen Gomery testified in his own bankruptcy schedules, yet he acknowledged in his testimony that no transfers to Aileen Gomery are disclosed in the chapter 7 SOFA under Question 10. He further acknowledged in his testimony that these transfers are not disclosed as withdrawals or distributions to an insider, under Question 23 or any other portion of the chapter 7 SOFA. Given the timing, amount, and purpose of these transfers, the Court finds that the Debtor’s failure to adequately disclose the payments in his law firm’s chapter 7 case is further evidence that the Debtor has not been honest in his filings with this Court. In the totality of circumstances, the Debtor’s inadequate, inaccurate disclosures support a finding that the Debtor lacked good faith in filing his chapter 13 Plan and petition.
3. The .308 Rifle.
The Debtor’s bankruptcy schedules do not disclose ownership of any firearms, sports or other hobby equipment. At his § 341 meeting, the Debtor stated that he owned a hunting rifle, and Dale Fisher testified that he had personally observed a .308 rifle when visiting the Debtor’s home. When the Debtor was asked at the hearing if he owned a .308 firearm, the Debtor invoked his rights under the Fifth Amendment. See U.S. Const, amend. V (“No person shall be ... compelled in any criminal case to be a witness against himself-”) The Court may draw a negative inference from the Debtor’s refusal to answer this question. Wazeter v. Michigan Nat’l Bank (In re Wazeter);
4. Other Considerations, Conclusion, and Appropriate Remedy.
Based on the totality of circumstances in this case, the Court concludes that the Debtor lacked good faith in filing his chapter 13 Plan and his chapter 13 petition. The Debtor sought bankruptcy relief when he was unable to obtain an appellate bond to stay collection of the Topous judgment and sanctions order, a large portion of
Having found that the plan and petition were not filed in good faith, the Court must next determine “if the appropriate remedy is dismissal [or conversion] under § 1307(c), or the less harsh remedy of denial of confirmation” under § 1325(a)(3) and (7). In re Hall,
B. Feasibility and Eligibility.
The objections raised by the parties as to the feasibility of the Debtor’s proposed chapter 13 Plan and lack of eligibility for chapter 13 relief lend further support to the Court’s conclusion that confirmation of the Debtor’s Plan must be denied and that conversion to chapter 7 is appropriate. In addition to the good faith required for confirmation of a chapter 13 plan, § 1325(a)(6) requires that the debtor “be able to make all payments under the plan and to comply with the plan.” 11 U.S.C. § 1325(a)(6). Feasibility is a factual issue and the burden of demonstrating the feasibility of the proposed chapter 13
In this case, the Debtor has failed to establish that his proposed Plan is feasible. Although the Plan requires minimal monthly payments of $100, the Debtor has offered no evidence of how he will obtain the funds to make even these nominal payments. The undisputed evidence is that the Debtor has been incarcerated since July 2014; the Debtor presented no evidence demonstrating, or even suggesting, that he has any income at this time. Under these circumstances, the Debtor’s Plan is not feasible. See In re Scott,
The Debtor’s incarceration and lack of income also raise concerns about the Debtor’s eligibility to be a chapter 13 debtor. Under § 109(e), only individuals “with regular income” and debts totaling less than the statutorily-prescribed limits are eligible for chapter 13 relief. 11 U.S.C. § 109(e). The Bankruptcy Code defines an “individual with regular income” as an “individual whose income is sufficiently stable and regular to enable such individual to make payments under a plan under chapter 13 of this title, other than a stockbroker or a commodity broker.” 11 U.S.C. § 101(30). “The test for regular income is not the type or source of income, but rather its regularity and stability.” In re Lovell,
Again, the Debtor has offered no explanation, let alone evidence, of the-source of the funds he proposes to use to make the $100 monthly payments required under his proposed Plan. The Debtor is currently incarcerated and has offered no evidence that he has any current income. The Debtor’s Plan also proposes increasing his payments in the future, if he is able to obtain employment. However, there is no assurance that the Debtor will be able generate income in the future. Even if the Debtor is acquitted of the criminal charges, the evidence before the Court suggests that his ability to resume his law practice will be limited. In his closing argument at the evidentiary hearing, the Debtor’s attorney admitted that it is unlikely that the Debtor will resume his legal practice in the future. Because the Debt- or has no current income, and limited prospects for income in the future, the Court concludes that the Debtor is not eligible to be a debtor under chapter 13. Conversion of the Debtor’s case to chapter 7 is warranted.
V. CONCLUSION.
For the foregoing reasons, confirmation of the Debtor’s Modified First Amended Plan is DENIED under § 1325(a)(3), (6),
IT IS SO ORDERED.
Notes
. The Bankruptcy Code is set forth in 11 U.S.C. §§ 101-1532 inclusive. Specific provisions of the Bankruptcy Code are referred to in this opinion as “§-.”
. In this opinion, the exhibits admitted into evidence by Creditor Topous shall be cited as "Topous Exh._and the Chapter 13 Trustee’s exhibits shall be cited as "Tr. Exh._”
The transcript from the hearing on August 28, 2014, shall be cited as "Tr. I at_the transcript from the hearing on November 24, 2014, shall be cited as "Tr. II at_and the transcript from the hearing on December 10, 2014, shall be cited as "Tr. Ill at_”
. The judgment awarded Topous $25,000 in damages for a cash payment that was fraudulently obtained by the Debtor. This amount was offset by $13,377.38 in improvements the jury found that the Debtor had made to the Mitchell Creek Property. (Topous Exh. 1.)
. At the evidentiary hearing, the parties mistakenly stated that the § 341 meeting was held on May 5, 2014. (Tr. II at 16.) The court's docket shows that the meeting was actually held on May 6, 2014.
. A § 341 meeting was held in the Gomeiy and Associates chapter 7 case on May 28, 2014. The Debtor also testified under oath at that meeting that the information in the chapter 7 schedules and SOFA was true and accurate. (Tr. II at 76.)
. Despite its title, the Trustee’s Amended Motion to Dismiss actually requests that the Debtor’s “case be converted to Chapter 7.” (Dkt. No. 78 at 2.)
. Portions of the 2011, 2012 and 2013 tax returns were also admitted as Trustee’s Exhs. B, C, D, and H.
. The exhibits provided to the Court do not include copies of JACCK’s Form 1065, Schedule B-l from 2009.
. These draws included: a $3,800 check to the Debtor on March 4, 2014; a $1,000 check to the Debtor on March 4, 2014; a $6,000 check to Speaker Law Firm on March 6, 2014; a $500 check to the Debtor on March 15, 2014; a $3,000 check to the Debtor on March 20, 2014; and a $870 check to LPL Financial for "retirement contributions” on March 20, 2014. (Topous Exh. 14C at 56, 59, 60, 61, 63, 64.)
. At the evidentiary hearings, the Debtor was questioned about the Gomery and Associates petition and the disclosures he made on behalf of the PLLC in the chapter 7 SOFA. (Tr. II at 4249.) Although a copy of the chapter 7 petition and SOFA were referenced at the hearings and were used to refresh the Debtor’s recollection during his testimony, the chapter 7 petition and SOFA were not formally admitted into evidence. (Id.) Notwithstanding, the Court may take judicial notice of the Gomery and Associates chapter 7 petition, schedules and SOFA. See Fed.R.Evid. 201; Matter of Holly’s, Inc.,
. "BAPCPA” refers to the amendments to the Bankruptcy Code made by the Bankrupt
. The full list of "non-exhaustive” factors identified by the Sixth Circuit includes: "(1) the debtor’s income; (2) the debtor’s living expenses; (3) the debtor's attorney fees; (4) the expected duration of the Chapter 13 plan; (5) the sincerity with which the debtor has petitioned for relief under Chapter 13; (6) the debtor’s potential for future earning; (7) any special circumstances the debtor may be subject to, such as unusually high medical expenses; (8) the frequency with which the debtor has sought relief before in bankruptcy; (9) the circumstances under which the debt was incurred; (10) the amount of payment offered by [the] debtor as indicative of the debtor’s sincerity to repay the debt; (11) the burden which administration would place on the trustee; (12) the statutorily-mandated policy that bankruptcy provisions be construed liberally in favor of the debtor.” In re Barrett,
. The Sixth Circuit Court of Appeals has not yet addressed the application of § 1325(a)(7), but at least one bankruptcy court within the Sixth Circuit has held that it is "appropriate to draw guidance from previous Sixth Circuit precedent addressing § 1307(c)” when analyzing § 1325(a)(7). In re Hall,
. At the hearings, Topous raised numerous other allegations and introduced evidence regarding personal property that was not disclosed or may have been undervalued in the Debtor’s bankruptcy petition. Because the Debtor is incarcerated and had limited ability to refute these allegations, the Court makes no conclusions as to these matters.