April 22, 2018

Memo from the Desk of Theresa Rose DeGray, Esq.

“Leverage: the use of a small initial investment…to gain a very high return.”

— Dictionary.com

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I have been debating how to talk about this in a delicate manner and I simply could not figure it out. So, I will just come out and say it: People being crushed by debt can leverage their tax refunds to file Bankruptcy and get a Fresh Start. There, I finally said it.

 

It may not sound kosher but it is. Instead of using your tax refund to pay off a portion of your debt, or to buy a big screen TV, people can pay for their legal fees to get out of massive amounts of debt if they qualify and it is the right thing for them to do based on their circumstances.

 

If you, or someone you know, is struggling with debt and wants to explore this option, please contact my office and schedule a free and confidential consultation.

Not an April Fools Joke: Means Test Numbers Going Up!

2Means Test Numbers April 2018

 

 

 

 

 

 

 

Find out if you qualify for FREE:

Qualification for Bankruptcy is based solely on income. It is calculated using your last six months of income. The Means Test used to determine qualification allows you to make up to certain amounts of money based on your state and household size. We’re excited about the new Means Test Numbers (above) as they are going up, therefore allowing many more people to file for Bankruptcy relief.

Please click here to schedule your free consultation which includes a FREE Means Test.

Basic Principles of the CT Child Support Guidelines

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“The Connecticut Child Support Guidelines are based on the Income Shares Model. The Income Shares Model presumes that the child should receive the same proportion of parental income as he or she would have received if the parents lived together. Underlying the income shares model, therefore, is the policy that the parents should bear any additional expenses resulting from the maintenance of two separate households instead of one, since it is not the child’s decision that the parents divorce, separate, or otherwise live separately.

The Income Shares Model has proven to be the most widely accepted, particularly due to its consideration of the income of both parents. Thirty eight states follow the Income Shares Model. Four states and the District of Columbia have shifted over to the Income Shares Model since Connecticut last revised its guidelines in 2005. The other models used by states are “Percentage of Obligor Income” (ten states) and “Melson Formula” (three states). The Income Shares Model reflects presently available data on the average costs of raising children in households across a wide range of incomes and family sizes. Because household spending on behalf of children is intertwined with spending on behalf of adults for most expenditure categories, it is difficult to determine the exact proportion allocated to children in individual cases, even with exhaustive financial affidavits. However, a number of authoritative economic studies based on national data provide reliable estimates of the average amount of household expenditures on children in intact households. These studies have found that the proportion of household spending devoted to children is systematically and consistently related to the level of household income and to the number of children.

In general, the economic studies have found that spending on children declines as a proportion of family income as that income increases. This spending pattern exists because families at higher income levels do not have to devote most or all of their incomes to perceived necessities. Rather, they can allocate some proportion of income to savings and other non-consumption expenditures, as well as discretionary adult goods. This principle was reflected in past guidelines, since 1994, and is continued in these guidelines. Again, following the pattern of prior guidelines declining percentages at all levels of combined net weekly income begin outside the darker shaded area of the schedule. However, the commission had no economic data that supports a conclusion that this pattern continues when parents’ net weekly income exceeds $4,000. This commission therefore decided to not extend either the range of the schedule or the application of the concept of declining percentages beyond its current $4,000 upper limit.

Economic studies also demonstrate that a diminishing portion of family income is spent on each additional child. This apparently results from two factors. The first is economy of scale. That is, as more children are added to a family, sharing of household items is increased, and fewer of those items must be purchased. The second is a reallocation of expenditures. That is, as additional children are added, each family member’s share of expenditures decreases to provide for the needs of the additional members.

Based on this economic evidence, adjusted for Connecticut’s relatively high income distribution (as explained later in this preamble), the guidelines allow for the calculation of current support based on each parent’s share of the amount estimated to be spent on a child if the parents and child live in an intact household. The amount calculated for the custodial parent is retained by the custodial parent and presumed spent on the child. The amount calculated for the noncustodial parent establishes the level of current support to be ordered by the court. These two amounts together constitute the current support obligation of both parents for the support of the child. Intact households are used for the estimates because the guidelines aim to provide children the same support they would receive if the parents lived together. More than this, however, support amounts would be set unduly low if based on spending patterns of single-parent families, as they generally experience a high incidence of poverty and lower incomes than intact families.”

Source: The Connecticut Child Support Guidelines

For more information, please contact us here.

BAPCPA Report – 2016

2016 Report of Statistics Required by the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005.

Introduction

Under 28 U.S.C. § 159(b) (link is external), enacted as part of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA), the Director of the Administrative Office of the United States Courts (AO) is required to submit an annual report to Congress on certain bankruptcy statistics detailed in 28 U.S.C. § 159(c) (link is external). Section 159(a) provides that clerks of the bankruptcy courts “shall collect statistics regarding debtors who are individuals with primarily consumer debts seeking relief under chapters 7, 11, and 13 of title 11.” The Director of the AO is required to compile this information, analyze it, and make it accessible to the public as well as Congress. This report is prepared to fulfill the statutory requirement. Tables in the report display data nationally, by circuit, and by district.

Summary of Findings

During calendar year 2016, nearly 750,000 bankruptcy petitions were filed by individuals with debts that are predominantly consumer in nature (“consumer cases”), 6 percent fewer than in 2015. Approximately 61 percent of the petitions, down from 63 percent in 2015, were filed under chapter 7, in which a debtor’s assets are liquidated and the nonexempt proceeds distributed to creditors. About 38 percent, up from 37 percent in 2015, were filed under chapter 13, in which individuals who have regular income and debts below a statutory threshold make installment payments to creditors under court-confirmed plans. One-tenth of one percent of petitions filed by individuals with predominantly consumer debt were filed under chapter 11, which allows businesses and individuals to continue operating while they formulate plans to reorganize and repay their creditors.1

Approximately 870,000 consumer cases were closed during calendar year 2016. Approximately 60 percent of the closed consumer cases included in the data analyzed for this report were closed under chapter 7, about 40 percent under chapter 13, and less than 1 percent under chapter 11.

Consumer debtors seeking bankruptcy protection under chapters 7, 11, or 13 during 2016 reported holding total assets in the aggregate amount of $72 billion and total liabilities in the aggregate amount of $191 billion. The total assets reported by consumer debtors fell 7 percent below the comparable 2015 amount. The total liabilities for the same set of cases increased 70 percent from the comparable data for 2015; however, this growth was primarily due to one debtor in the Western District of Washington (WA-W) who reported total liabilities of $85,122,168,563. Excluding the data for WA-W, the total liabilities decreased by 8 percent. (When considering the magnitude of these decreases, one should keep in mind that consumer filings in 2016 fell 6 percent over the previous year.)

The median average monthly income reported by all debtors was $2,668 (1 percent higher than in 2015), and the median average reported monthly expenses were $2,590 (less than 1 percent higher than in 2015).2 From filing to closing, chapter 7 consumer cases terminated in 2016 had a mean time interval of 209 days and a median time interval of 115 days. A total of 148,088 reaffirmation agreements were reported as filed in 105,469 chapter 7 consumer cases terminated during 2016. In 38 percent of the chapter 13 cases filed during 2016, debtors reported that they had filed for bankruptcy protection during the previous eight years, the same as in 2015.

Tables

In accordance with BAPCPA, the bankruptcy statistics in this report are itemized by chapter of Title 11 (the Bankruptcy Code (link is external)) and report only data in consumer cases. The tables noted in the list below have been created for this report as specified in 28 U.S.C. § 159(c).

BAPCPA Report Tables
Code Description BAPCPA Table
28 U.S.C. § 159(c)(3)(A) &
28 U.S.C. § 159(c)(3)(C)
Assets and Liabilities Reported by Debtors and Debts Discharged 1
28 U.S.C. § 159(c)(3)(B) Income and Expenses Reported by Debtors 2
28 U.S.C. § 159(c)(3)(D) Time Interval from Filing to Closing 3
28 U.S.C. § 159(c)(3)(E) Reaffirmation Agreements 4
28 U.S.C. § 159(c)(3)(F)(i) Property Valuation Orders 5
28 U.S.C. § 159(c)(3)(F)(ii) Chapter 13 Cases Closed by Dismissal or Plan Completion and Plan Modifications 6
28 U.S.C. § 159(c)(3)(F)(iii) Prior/No Prior Filings Reported by Debtors 7
28 U.S.C. § 159(c)(3)(G) Creditor Misconduct and Punitive Damages 8
28 U.S.C. § 159(c)(3)(H) Rule 9011 Sanctions Imposed Against Debtors’ Attorneys and Damages Awarded 9

The naming convention used for the tables in this report provides that the alphabetic character immediately following the table number indicates the chapter⁠⁠(s) of the Bankruptcy Code associated with the cases included in the table. “A” indicates cases under chapter 7 only; “B” indicates cases under chapter 11 only; “D” indicates cases under chapter 13 only; and “X” indicates cases under chapters 7, 11, and 13 combined. For example, Table 1D reports assets and liabilities for cases filed under chapter 13. 3

Methodology and Data Limitations

Debtor-Provided Data

The U.S. bankruptcy courts send data to the AO when a case is filed, when certain motions are filed in the case, and when the case is closed. The data are then compiled annually for the purpose of this report. Many BAPCPA tables, particularly those reporting data on debtors’ assets, liabilities, income, and expenses, rely on data provided by debtors when they submit required forms, schedules, motions, agreements, and other filings to the court. Most of these data, as specified in 28 U.S.C. § 159(c), are provided exclusively by the debtors and are not validated either by the courts or the AO.

With respect to data collected from forms and schedules submitted at filing, debtors may fail to provide some or all of the data required for the BAPCPA tables. Therefore, analyses involving two or more columns in any table may overstate or understate differences. When all required data from a debtor are missing, either because of omission or delayed submission, analyses involving the data and the number of cases become unreliable. Therefore, caution should be used when analyzing columns of data or comparing any column of data to the number of cases filed.

Reliance on debtor-provided data may introduce other sources of error. One likely source of error arises when a debtor inaccurately reports assets, liabilities, income, or expenses at the time of filing. Those inaccuracies, if significant enough, may affect district, circuit, and national totals for the relevant fields in the tables in this report.

Data on Cases Filed and Closed

Another limitation relates to the first column of data in each table, which presents total cases. Some tables include reopened and transferred cases in the totals, but others omit these cases. Reopened and transferred cases are excluded when the data would be duplicative. For example, totals for assets and liabilities at the original filing of a case are the same for each reopening of that case. Counting the cases twice (once at filing and once at reopening) would distort the data on reported assets, liabilities, income, and expenses. In all other instances in which the duplication would not affect the results, these cases are included.

Transaction Data

Transaction data include reports of case-related events such as reaffirmation agreements, valuation orders, creditor misconduct, and attorney sanctions that occur during bankruptcy proceedings (see Tables 4, 5, 8, and 9). Such data are typically captured in the courts’ docketing activity.

In many instances, BAPCPA requires a report of the total number of cases in which a specific type of transaction has occurred. This affects the way that transaction data are reported. A case may have more than one occurrence of a particular type of transaction. For this reason, the case must be concluded before the AO can report whether the case meets the requirement to be counted and to ensure that no case is counted more than once. Thus, tables based on transaction data are based only on data from cases closed during the reporting period. These tables are subject to the same limitations noted in the section on cases filed and closed. Case activity that occurred prior to October 17, 2006, in a case that closed during the reporting period would not have been captured, causing transaction data to be underreported.

In addition, because a case may have more than one occurrence of a specific type of transaction, but the characteristics of each transaction may be different, the case must be counted in each column of a table whenever any occurrence meets the criteria for data in that column. If, for example, a debtor enters into three reaffirmation agreements, two of which include certification from the debtor’s attorney and one of which does not, the case is counted in the column representing “number of cases with agreements filed pro se” as well as the column representing the “total number of cases with agreements filed.” Furthermore, if, in the example above, the court approves one reaffirmation agreement and denies the other two, the case is also counted in the column representing the “number of cases with agreements approved.”

Because transaction data are captured from docket activity, the collection of accurate transaction data relies on debtors, their attorneys, and other case parties who file motions, agreements, and other documents with the courts to identify them appropriately. If a filer fails to note the correct court event at docketing, the data may not be reported accurately or at all. If the filer submits multiple matters under a single court event, the activities may be undercounted or not counted at all.

Assets and Liabilities Reported by Debtors

Tables 1A, 1B, 1D, and 1X set forth the assets and liabilities reported by debtors in total and by category of assets and liabilities, as well as the total net scheduled debt reported by the debtors on Official Bankruptcy Form 106Sum—Summary of Your Assets and Liabilities and Certain Statistical Information (B 106 Summary). All tables that report assets and liabilities (1A, 1B, 1D, and 1X) present data on cases filed during the reporting period by individual debtors with primarily consumer debt. The data for these tables are provided exclusively by the debtors and cannot be validated by the courts. These data typically are provided by a debtor at the time of filing or within 14 days thereafter as required by Federal Rule of Bankruptcy Procedure 1007 (link is external). They are not typically updated as the case proceeds. Data for reopened and transferred cases are excluded to prevent duplicate reporting.

“Net scheduled debt” is defined as the difference between the total amount of debt and obligations of a debtor reported on the schedules and the amount of such debt reported in categories that are predominantly non-dischargeable. Debt that is predominantly non-dischargeable may include, but is not limited to, domestic support obligations, taxes, student loans, and pension obligations. Thus, net scheduled debt approximates the amount of debt reported by the debtor at the time of filing that may be eligible for discharge (without regard to security interests) during the case and is referred to in 28 U.S.C. § 159(c)(3)(C) as the “aggregate amount of debt discharged in cases filed during the reporting period.”

“Net scheduled debt,” however, overstates the amount of debt actually discharged by the amount of secured debt (e.g., mortgages on real property and many car loans) that remains after the discharge. A discharge in bankruptcy releases the debtor from personal liability for certain specified types of debts. Although a debtor is not personally liable for discharged debts, a valid lien secured by property that has not been voided in the bankruptcy case will remain in effect after the bankruptcy case has been closed as to that secured property. Therefore, unless the debtor continues repaying the discharged debt, a secured creditor may enforce the lien to recover the property that secures payment of the debt. In determining dischargeable debt, the statute does not provide for a deduction of either real or personal property valuations from the claims by creditors secured by such property.

Table 1X shows that individual debtors with primarily consumer debt seeking bankruptcy protection under chapters 7, 11, or 13 during 2016 reported holding total assets in the aggregate amount of $72 billion. Seventy percent of these assets were categorized as real property, and 30 percent as personal property. Apart from districts with fewer than 200 case filings each (the Districts of the Northern Mariana Islands, U.S. Virgin Islands, and Guam), debtors in the Southern District of California and the Northern District of California (CA-N) reported the highest average assets per petition at $344,000 and $224,000, respectively. Filers in the Western District of Tennessee (TN-W) reported the lowest average assets at $43,000.

Debtors reported total liabilities in the aggregate amount of $191 billion, with 32 percent of liabilities categorized as secured claims, 3 percent as unsecured priority claims, and 65 percent as unsecured non-priority claims. Overall, debtors categorized 94 percent of debts and obligations as dischargeable debt. Excluding districts with fewer than 200 case filings each, debtors in WA-W reported the highest average liabilities per filed petition at $8,348,000,4 and filers in TN-W had the lowest average liabilities at $65,000.

Income and Expenses Reported by Debtors

Tables 2A, 2B, 2D, and 2X present data on the income and expenses as reported by debtors on Official Bankruptcy Form 106Sum—Summary of Your Assets and Liabilities and Certain Statistical Information (B 106 Summary). Current monthly income data reflect income from all sources. Average monthly income data reflect total income for the last full six months prior to the bankruptcy filing, divided by six. The data for these tables are provided exclusively by the debtors and are not validated by the courts. A debtor typically provides the data at the time of filing or within 14 days of filing as required by Federal Rule of Bankruptcy Procedure 1007 (link is external). Only data provided during the initial filing of each case are counted in Tables 2A-2X. Data for reopened and transferred cases are excluded to prevent duplicate reporting. Median values are calculated only when 10 or more cases are reported.5

Table 2X shows that 747,117 consumer cases were filed in 2016 under chapters 7, 11, and 13 across the nation and 690,108 debtors completed the forms needed to include their data in these tables. 6 The median current monthly income7 of debtors who completed the relevant forms was $2,934, slightly more than the $2,886 median current monthly income reported in 2015. The median average monthly income8 was $2,668, a 1 percent increase from 2015, and the median average expenses9 were $2,590, a decrease of less than 1 percent from 2015. CA-N had the highest median current monthly income with $4,032, and the District of Puerto Rico (PR) had the lowest median current monthly income with $1,740. Filers in CA-N had the highest median average monthly income with $3,500, and filers in PR had the lowest median average monthly income with $1,848. Filers in the District of Connecticut had the highest median average expenses with $3,520, and filers in TN-W had the lowest with $1,720.

Time Interval from Case Filing to Closing

In accordance with 28 U.S.C. § 159(c)(3)(D), Table 3 reports the mean time interval between case filing and closing of consumer cases filed on or after October 17, 2006, under chapters 7, 11, and 13 and terminated during 2016. The median time interval also has been included to provide perspective on the mean value by reducing the effect of data outliers, although median values are calculated only when 10 or more cases are reported.10 Reopened cases are excluded from this table because most reopened cases are filed and closed relatively quickly to settle administrative matters and do not proceed in the same way as original filings.11 For transferred cases, the mean and median time intervals are calculated from the date the case is received at the new location to the closing of the case at that location.

During the 12-month period ending December 31, 2016, a total of 844,549 consumer cases opened on or after October 17, 2006, were closed under chapters 7, 11, and 13, with a mean time interval from filing to closing of 592 days and a median time interval of 156 days. The higher mean closing time (relative to the median time) reflects particularly long-running cases. The mean is 1 percent higher than that for 2015, and the median is 3 percent greater than in 2015.

Of the 504,951 chapter 7 consumer cases filed on or after October 17, 2006, and closed in 2016, the mean time interval from filing to closing was 209 days, and the median time interval was 115 days. By comparison, the mean time interval in 2015 was slightly higher at 215 days, and the median held steady at 115 days. The District of Wyoming had the highest median of any district at 312 days, and the Southern District of Iowa had the lowest median at 97 days.

A total of 996 chapter 11 consumer cases filed on or after October 17, 2006, were closed in 76 districts during 2016. The mean time interval from filing to closing was 760 days (up from 752 days in 2015), and the median time interval was 590 days (down from 625 days in 2015). Only 21 districts had 10 or more chapter 11 cases closed in 2016. Of those 21 districts, the District of Nevada had the highest median at 912 days, and the Eastern District of New York (NY-E) had the lowest median at 268 days.

A total of 338,602 chapter 13 consumer cases filed on or after October 17, 2006, were closed during 2016. The mean time interval from filing to closing was 1,162 days (down from 1,181 days in 2015), and the median time interval was 1,255 days (down from 1,284 days in 2015). The Northern District of West Virginia had the highest median at 1,961 days, and NY-E had the lowest median at 99 days. However, the median and mean do not accurately convey the time required for a typical chapter 13 case; rather, they are proxies for the percent of chapter 13 cases closed by plan completion, as plan completion typically takes much longer than dismissal.12

Reaffirmation Agreements

A debtor may enter into a reaffirmation agreement with a creditor to continue paying a dischargeable debt following bankruptcy. This may occur when, for example, a debtor wants to keep an automobile and continue making payments on it. If an attorney represents the debtor during the bankruptcy, the debtor’s attorney may or may not represent the debtor during negotiation of a reaffirmation agreement. For purposes of this report, a reaffirmation agreement is considered “pro se” if it was submitted without the certification of an attorney contained in Part IV of Director’s Bankruptcy Form 2400A—Reaffirmation Documents (Form B2400A), regardless of whether the debtor was otherwise represented in the case by an attorney.

Table 4 reports only on reaffirmation agreements filed in cases under chapter 7.13 Varying local practices govern the procedures for approving and denying reaffirmation agreements filed with the courts. In many districts, the court does not issue orders with respect to reaffirmation agreements filed with certification by debtors’ attorneys. In these instances, the reaffirmation agreement between the debtor and creditor is implicitly accepted without further court action and may or may not be recorded or otherwise noted in court documentation of the case. As a result, the difference between the number of reaffirmation agreements filed and the number of reaffirmation agreements approved does not represent the number of reaffirmation agreements denied. Moreover, sometimes multiple reaffirmation agreements are submitted together, some with and others without attorney certification, and a court order may fail to specify decisions of the court on the individual reaffirmation agreements. For these reasons, the data reported for approved reaffirmation agreements may not be representative of the total number of valid reaffirmation agreements executed by the parties.

As Table 4 illustrates, a total of 148,088 reaffirmation agreements were reported as filed in 520,925 chapter 7 consumer cases closed during the 12-month period ending December 31, 2016. The Northern District of Illinois had the highest total number of cases in which reaffirmation agreements were filed (5,899), followed by the Central District of California (CA-C) (4,572 cases) and the Eastern District of Michigan (4,327). Nationwide, 20 percent of chapter 7 cases closed had at least one reaffirmation agreement filed, up 1 percentage point from 2015. The Northern District of Florida reported the highest percentage of cases closed that had at least one reaffirmation agreement filed (41 percent). In 10 percent of cases with reaffirmation agreements filed, one or more agreements were submitted without attorney certification (pro se). The District of Kansas (KS) had the highest number of cases in which at least one pro se reaffirmation agreement was filed (1,112 cases). At least one pro se reaffirmation agreement was filed in 2 percent of chapter 7 cases closed. The Middle District of Alabama (29 percent of cases) and KS (26 percent) had the highest percentage of chapter 7 cases closed in which one or more pro se reaffirmation agreements were filed.

One percent of cases in which a reaffirmation agreement was filed had at least one reaffirmation agreement approved by order of the court. However, as described above, this does not indicate that reaffirmation agreements were denied in 99 percent of the cases. In 2016, MT reported the highest percentage of cases in which at least one reaffirmation agreement had been approved (88 percent), followed by the District of Colorado (CO) (27 percent), and the Southern District of Illinois (20 percent). These three districts accounted for 56 percent of the cases in which at least one reaffirmation agreement was approved.

Property Valuation Orders

In some cases, motions are made to the court to determine the value of property securing an allowed claim under 11 U.S.C. §§ 506 (link is external) and 1325 (link is external) and Federal Rule of Bankruptcy Procedure 3012 (link is external). Table 5 shows the number of cases closed in 2016 in which final orders were entered determining the value of property securing a claim in an amount less than the amount of the claim, as well as the number of final orders entered determining the value of property securing a claim. Additional columns of data were added to provide further perspective on the required data.

A total of 345,058 chapter 13 consumer cases were closed in 2016. Final orders determining the value of property securing a claim were entered in 14,887 of the cases. In 9,151 cases, the value of property was reported in one or more final orders; in 6,053 (66 percent) of those cases, at least one final order valued the property at less than the full amount of the claim.

A case may have more than one final order determining the value of property securing a claim. In total, 18,525 final orders were entered in the 14,887 cases. Determinations of the value of property were reported in 11,756 final orders, of which 7,529 (64 percent) were valued below the amount of the claim. The Southern District of Florida (FL-S) reported that 4,613 final orders had been entered determining the value of property securing a claim, the highest total of any district. Seventy-three percent of the final orders determining the value of property securing a claim (13,559 final orders) were entered in five districts (FL-S, the Eastern District of California, the Middle District of Florida, the District of South Carolina, and CO); 48 districts reported no final orders determining the value of property securing a claim.

Chapter 13 Cases Closed by Dismissal or Plan Completion

Table 6 shows the number of cases in which plans were completed in chapter 13 consumer cases, separately itemized by the number of modifications made to the plans. Table 6 also reports the number of chapter 13 consumer cases dismissed, the number dismissed for failure to make payments under the plan, and the number refiled after dismissal. For purposes of this table, a chapter 13 consumer case is counted as “refiled after dismissal” if the case was filed during the reporting period by one or more debtors who were party to a separate chapter 13 consumer case that was dismissed no more than 180 days prior to the filing date of the current case. Cases that are reopened are not included in the total for cases refiled after dismissal.

A total of 344,852 chapter 13 consumer cases filed on or after October 17, 2006, were closed by dismissal or plan completion in 2016. Table 6 illustrates that 165,238 of these cases were dismissed. In 52 percent of the cases closed (179,614 cases), the debtors were discharged after completing repayment plans, down from 54 percent in 2015. Among districts with at least 10 closed cases, the District of Vermont had the highest percentage of cases (82 percent) closed by plan completion, followed by the District of Guam (78 percent) and District of Maine (77 percent). Of the 179,614 chapter 13 consumer cases in which debtors completed repayment plans, 38,571 (21 percent) had plans that were modified at least once prior to plan completion, the same percentage as in 2015.

Nationwide, failure to make plan payments was cited in 53 percent of cases as the reason for dismissal, down from 54 percent in 2015. Among districts with at least 10 closed cases, the Eastern District of North Carolina had the greatest percentage of dismissals (89 percent) that were for failure to make payments. MT had the lowest percentage of its dismissals made for failure to make payments (5 percent), followed by CA-C (10 percent). Table 6 shows that 20,141 cases were refiled after dismissal.

Prior Filings Reported by Debtors

Table 7 reports the number of cases in which individual debtors with primarily consumer debts filed for protection under chapter 13 during the reporting period and stated on the voluntary bankruptcy petition (Official Bankruptcy Form 101) that they previously had filed a case under any chapter of the Bankruptcy Code during the preceding eight years (“prior filings”). For this table, data are captured at the time of filing, and only data on the initial filing of each case are counted. Data on reopened cases are excluded to prevent duplicate reporting. The data for Table 7 are provided exclusively by the debtors and are subject to the limitations described in the section above on debtor-provided data.

In 38 percent of the 287,556 (110,202) chapter 13 cases filed in 2016, debtors stated that they had filed a bankruptcy petition during the previous eight years. In the remaining 177,354 cases, debtors stated that they had not filed for bankruptcy during the previous eight years. In 2016, the District of Utah recorded the highest percentage of cases with prior filings at 59 percent, followed by District of Idaho (58 percent). The districts with the lowest percentage of cases in which debtors indicated prior filings were the District of Alaska (prior filings were reported in 13 percent of cases) and District of North Dakota (16 percent).

Creditor Misconduct and Punitive Damages

28 U.S.C. § 159(c)(3)(G) requires the Director of the AO to report on “the number of cases in which creditors were fined for misconduct and any amount of punitive damages awarded by the court for creditor misconduct.” Creditor misconduct, however, is not a specific cause of action under the Bankruptcy Code. At least five violations of the Bankruptcy Code could be considered creditor misconduct:

At least six other activities related to litigation procedures could also be considered creditor misconduct under certain circumstances:

What may be reported as creditor misconduct in one district may not be reported in another. In addition, because a creditor may be reprimanded or penalized for misconduct in many ways, many of which may not be explicitly recorded on a court’s docket as a sanction, this table does not provide a comprehensive picture of sanctions imposed against creditors in bankruptcy courts. Moreover, a sanction imposed for creditor misconduct is likely limited to what is sufficient to deter repetition of such conduct or comparable conduct by others similarly situated. Although sanctions may consist of or include directives of a nonmonetary nature, an order to pay a penalty into court, or an order directing payment to the movant of some or all of the reasonable attorneys’ fees and other expenses incurred as a direct result of the violation, the Bankruptcy Code and Bankruptcy Rules do not permit the award of punitive damages for every violation classifiable as creditor misconduct. However, only punitive damages are reflected in the Table 8 series.

Table 8X shows that creditors were fined for misconduct in 164 consumer cases closed during 2016 and that orders to pay punitive damages totaling $106,173 were issued in 17 of those cases.

Rule 9011 Sanctions Imposed Against Debtors’ Attorneys

Federal Rule of Bankruptcy Procedure 9011 (link is external) provides that attorneys may be sanctioned for improper or frivolous representations to the court submitted in any petition, pleading, written motion, or other paper. The rule states that “[a] sanction imposed for violation of this rule shall be limited to what is sufficient to deter repetition of such conduct or comparable conduct by others similarly situated.” Any “sanction may consist of, or include, directives of a nonmonetary nature, an order to pay a penalty into court, or . . . an order directing payment to the movant of some or all of the reasonable attorneys’ fees and other expenses incurred as a direct result of the violation.” Fed. R. Bankr. P. 9011(c)(2). The Table 9 series captures only misconduct by debtors’ attorneys that rises to the level required for sanctions under Federal Rule of Bankruptcy Procedure 9011. Because a debtor’s attorney may be reprimanded or penalized for misconduct in other ways, this table does not provide a comprehensive picture of sanctions imposed against debtors’ attorneys in bankruptcy courts.

Table 9X shows that of the 867,282 consumer cases filed on or after October 17, 2006, and terminated in 2016, sanctions were imposed against debtors’ attorneys in 40 cases, with damages totaling $48,640 awarded in 34 cases.

Notes

1Consumer cases filed under chapter 11 are relatively infrequent and are generally believed to result when debtors exceed the debt restrictions of 11 U.S.C. § 109(e), which in calendar year 2016 restricts chapter 13 to debtors with less than $394,725 in noncontingent, liquidated, unsecured debts and less than $1,184,200 of noncontingent, liquidated, secured debts.

2Debtors calculate their average monthly incomes and average monthly expenses and report them to the courts on line 10 of Official Bankruptcy Form 106I—Schedule I: Your Income (B 106I) and line 22 of Official Bankruptcy Form 106J—Schedule J Your Expenses (B 106J). The AO then calculates the median of the average monthly incomes reported by debtors for all districts and circuits.

3 “C” is reserved for cases filed under chapter 12, which does not apply to consumer cases.

4 Three debtors—one each in WA-W, the Western District of Oklahoma, and the District of Montana (MT)—each reported liabilities exceeding $1 billion, skewing the averages. Excluding those three districts, the District of New Jersey had the highest average liabilities per completed petition at $277,000. Excluding those three debtors, total liabilities in the aggregate amount for the nation equaled $102 billion.

5 It is not meaningful to calculate medians when the number of cases is small. For this reason, the AO does not calculate medians for fewer than 10 cases at any aggregate level (e.g., district, circuit).

6 The number of cases with completed schedules differs between the Table 1 series and the Table 2 series because those tables draw data from different parts of the summary of schedules. If a debtor completed all necessary fields for inclusion in the Table 1 series, but not the Table 2 series, then that case and its data were included in the appropriate tables in the Table 1 series but not in the Table 2 series, and vice versa.

7Current monthly income is provided by chapter 7 debtors on line 11 of Official Bankruptcy Form 122A-1—Chapter 7 Statement of Your Current Monthly Income (B 122A-1), by chapter 11 debtors on line 11 of Official Bankruptcy Form 122B—Chapter 11 Statement of Your Current Monthly Income (B 122B), and by chapter 13 debtors on line 11 of Official Bankruptcy Form 122C-1—Chapter 13 Statement of Your Current Monthly Income and Calculation of Commitment Period (B 122C-1).

8See note 2.

9 See note 2.

10 See note 6.

11Tables 4, 5, 6, 8A-8X, and 9A-9X include reopened cases, whereas Table 3 does not include reopened cases. Accordingly, the total for cases closed in Table 3 may differ from the total in other tables

12 See Table 6.

13 Although reaffirmation agreements are technically possible under other chapters of the Bankruptcy Code, they are found almost exclusively in chapter 7 cases. Because no modification of a secured creditor’s rights may be obtained under chapter 7 without consent of the creditor, a debtor who wishes to retain collateral securing a claim must negotiate a reaffirmation agreement acceptable to the creditor. In contrast, under chapters 11, 12, and 13, subject to certain restrictions, the terms of a secured claim may be altered to allow the debtor to retain use of the collateral, thereby obviating the need for a reaffirmation agreement.

REPOSTED FROM: http://www.uscourts.gov/statistics-reports/bapcpa-report-2016

All About the [Connecticut] Lemon Law Program

The “Lemon Law” is a nickname for Connecticut General Statute Chapter 743b, “Automotive Warranties. It establishes arbitration as an informal process for resolving disputes between consumers and automobile manufacturers. The law defines a lemon as a new motor vehicle (passenger car, combination or motorcycle) purchased or leased in Connecticut which does not conform to the manufacturer’s express warranty and which, after “a reasonable number of attempts” cannot be repaired. The Lemon Law covers all new passenger, combination passenger/ commercial vehicles and motorcycles purchased or leased in Connecticut:

  • Which do not conform to the manufacturer’s express warranty;
  • Which have substantial defects affecting the use, safety or value of the vehicle AND
  • The repairs must have been addressed during the eligibility period*;
  • Have manufacturer’s defects that occurred during the first two (2) years from the original owner’s delivery date or the first 24,000 miles on the odometer (whichever period ends first).
*The time period involved may be extended when repair service is unavailable due to war, strike or natural disaster.
The eligibility criteria for the Lemon Law arbitration refers to occurrences / days that must be met within the specified time frame.  However, you do not have to apply within this time period.
Items NOT covered under the law include:
  • Defects not covered under the manufacturer’s express warranty
  • Defects caused by the consumer’s abuse, neglect or unauthorized modification of the vehicle
For a car to qualify, the same problem has to be subjected to a reasonable number of repair attempts and continue to exist after these attempts at repair. The law presumes that a “reasonable number” of repair attempts is four.  However, your car may be eligible if you have less than four repair attempts for the same problem and can justify this is a reasonable number of repair attempts, and repairs have been performed within the eligibility period.  
– OR –
  
When the vehicle has been out of service for repair at the dealership for a cumulative total of thirty days or more for any number of unrelated problems. These problems must occur within the eligibility period. 
– OR – 
In the case of a safety defect which is likely to cause death or serious injury if the vehicle is driven, the defect continues to exist after two or more attempts during the first year of operation or the term of the express warranty, whichever period end first.
How to Get Started
If you believe you are eligible and wish to pursue the Department of Consumer Protection’s Arbitration Program, please print the arbitration form from this website, complete it and return it by U.S. mail to the Department as soon as possible with the required fee.
Of course, you should report the vehicle’s problems immediately to the dealer or the manufacturer.  Check your owner’s manual/warranty booklet for the address and telephone number of the zone office designated to receive your complaint. The manual will also tell you if the manufacturer requires written notification of a claim requesting a refund or replacement vehicle.  If such notification is required, you must write to the manufacturer. Please send us a copy of your letter to the manufacturer when you submit your Lemon Law application.
If you lease your vehicle, you must advise the leasing company that you are applying for Lemon Law arbitration and if they wish to be a party to the proceedings, they must notify the Department of their intent within ten (10) days of their receipt of your letter. The letter to the leasing company must be sent certified or registered mail, and a copy of the letter and postal receipt must be included with your Lemon Law application to us.
If it is determined that your case does not qualify for arbitration, the fee will be returned to you. Additionally, the manufacturer is required to pay a fee.
Once your Request for Arbitration and filing fee are received, the Department will review your application to make sure all necessary documents have been submitted. If information has been omitted, your Request for Arbitration and filing fee will be returned to you along with a list of the information or documents required to complete the submission. If all documents and information have been included, we will complete an initial review of your case to determine whether basic eligibility criteria have been met. You will be notified within five business days of the results.
If the our review indicates your case is not eligible for arbitration, your filing fee will be returned to you with an explanation as to why your case did not qualify. You may file a written appeal with the Department if you do not agree with our findings.
If our review indicates your case is eligible for arbitration, the manufacturer will be notified and asked to submit a manufacturer’s statement and filing fee. An arbitrator and an Automotive Technical Expert comprise an arbitration panel.
The arbitration panel will make the final determination as to the eligibility of your case. It is possible for a case to be deemed ineligible by the arbitration panel even though it was initially deemed eligible by the Department.
Types of hearings
When you file your Request for Arbitration, you must choose between an “oral” or “documentary” hearing. The oral arbitration process generally results in a more expeditious rendering of a decision.
Oral Hearing:  If you choose oral arbitration, you and the manufacturer’s representative will be present at the scheduled hearing. Both parties will have the opportunity to present their case before the  arbitration panel. The hearing is informal and not structured like a court of law. Typically, the consumer is heard first, followed by the manufacturer. Either party is able to ask the other questions. The arbitration panel may also have questions and may order the Automotive Technical Expert to inspect the vehicle. If possible, bring the vehicle to the hearing to avoid scheduling an inspection for a later date.
Use your “Request for Arbitration” form as a guide when preparing for an oral arbitration hearing. The form contains much of the information you will need at the hearing.
  • Bring records of everything pertaining to the dispute including all correspondence, work orders, receipts, and warranties.
  • Organize your records – Putting them in chronological order will help guide you in presenting the history of the problem.
  • Prepare an outline of the major points you wish to present to help you remember relevant information.
Be prepared to discuss the problem in its entirety.  You should:
  1. State the specific nature of the defect;
  2. Restate any conversations with dealer’s or manufacturer’s representatives;
  3. Describe any new developments which may have occurred since you submitted your “Request for Arbitration” form;
  4. Describe any repair attempts or other actions taken;
  5. State your opinion as to what action would constitute a fair resolution of the dispute;
  6. State why you feel the vehicle is a “Lemon.” For example, how has the use, safety, and/or value been substantially impaired?
  7. Prepare a list of questions to ask the manufacturer’s representative.
  8. Prepare a final summary, which should briefly review the facts you have discussed, this should include a statement regarding your opinion of a fair resolution to the dispute.
Remember, the purpose of the hearing is to allow the arbitrators to gather facts, evaluate information presented by both sides and render a fair decision. Therefore, be prepared to offer SUBSTANTIAL PROOF of each point you make especially those you feel the manufacturer may dispute.
Documentary Hearing:  If you choose documentary arbitration, you and the manufacturer’s representative will be required to submit to the Department sworn statements and other evidence you would like the panel to consider. You will receive copies of each other’s statements and have the opportunity to respond to them in writing. The arbitration panel will meet and review the statements and responses. The panel will base its decision solely on documentation and materials submitted by the parties prior to the hearing. Parties cannot present oral testimony, but may observe documentary hearings. If the panel orders a vehicle inspection, one will be scheduled at a later date and the panel will reconvene to render their decision.
Use of an Attorney
The ”Lemon Law” Program is designed to be accessible to the lay person. Most consumers coming through the program do not use an attorney; however, you are free to use one if you so choose. If your attorney will be presenting your case, you must notify the Department of Consumer Protection no later than two (2) days prior to the hearing. Also, if anyone other than the purchaser of the vehicle will be presenting the case, you must also notify the Department no later than one (1) day prior to the hearing. If someone is going to accompany you and present testimony, no prior notification is required. You also have the right to have a third party assist you in your presentation or act as a consultant or interpreter.

Nisi Period (Latin for “Cooling-Off Period”)

Divorce

Please be aware that in Connecticut, all parties must wait 90 days to obtain a divorce, unless the parties are eligible for a nonadversarial (simplified) divorce or unless the parties have an agreement on all terms of the divorce and ask the court to waive the 90-day waiting period.

Connecticut law provides individuals with options when filing for a divorce.

The following are the different types of divorce processes:

Nonadversarial (simplified or “non-ad”) divorce
This type of divorce is a simplified process by which eligible parties may obtain a divorce within days without having to appear before a judge.
Divorce with an Agreement (or “waive 90”)
If you and your spouse have an agreement as to all issues, you may ask the court to waive the 90-day waiting period that is otherwise required by law, and get divorced at almost any time you choose.
Divorce without an Agreement
It is always preferable for you and your spouse to agree on the terms of your divorce. However, if you are unable to do so, a judge will make decisions regarding alimony, custody and visitation.

(Reposted from the State of Connecticut Judicial Branch Website)

Administration and Operation of the [Connecticut] Courts

The Chief Justice of the Supreme Court is the head of the Judicial Branch. Its administrative director is called the Chief Court Administrator.

Judicial Functions
The judicial functions of the Branch are concerned with the just disposition of cases at the trial and appellate levels. All judges have the independent, decision-making power to preside over matters in their courtrooms and to determine the outcome of each case before them.

Administrative Operations
The Chief Court Administrator is responsible for the administrative operations of the Judicial Branch. In order to provide the diverse services necessary to effectively carry out the Judicial Branch’s mission, the following administrative divisions have been created: Administrative Services Division | Court Support Services Division | External Affairs Division | Information Technology | Superior Court Operations

 

Administrative Services Division – Provides a wide array of centrally conducted, statewide services for the benefit of all divisions within the Judicial Branch, such as data processing, financial services, personnel matters and facilities management.

Court Support Services Division

  • Office of Adult Probation – Conducts presentence investigations ordered by the Superior Court and supervises probationers in all cases except juvenile matters.
  • Office of Alternative Sanctions – Creates and sustains a full range of alternatives to incarceration for both pre- and post-conviction adult and juvenile populations.
  • Bail Commission – Interviews and investigates individuals accused of crimes to assist the Superior Court in determining terms and conditions of pretrial release.
  • Family Services Division – Assists the Superior Court in the resolution of problems and the adjudication of cases involving family relationships, family support, child protection and juvenile delinquency. Among the services provided by the Family Division are: mediation of domestic disputes, evaluation of child custody and visitation conflicts, juvenile probation services, divorce counseling, residential placement, restitution and community services.
  • Division of Juvenile Detention Services – Provides pretrial secure detention and programming services to juveniles accused of delinquent acts.

External Affairs DivisionCoordinates a variety of legislative, educational and informational activities designed to inform and educate the public and private sectors about the mission, activities and goals of the Judicial Branch.

Information Technology Division –
The Information Technology (IT) Division consists of:

  • The Commission on Official Legal Publications (COLP) – COLP prints and distributes all Judicial publications including such things as the Connecticut Law Journal, Connecticut Reports, the Connecticut Practice Book and official court forms.
  • Judicial Information Systems (JIS) – JIS is responsible for Applications Development and Support, Network and Systems Support, Architecture & Standards as well as Service & Delivery Support.

Superior Court Operations – The Superior Court Operations Division includes the following:

  • Administration – Provides support services and guidance to all segments of the Division by directing the administrative, strategic planning, staff training and business activities, and provides for court transcript services, interpreter services, and the preservation and disposition of seized property; and, the maintenance, retrieval and destruction of records.
  • Court Operations – Ensures that the Superior Court Clerk’s offices process all matters in accordance with Statutory, Practice Book and Judicial Branch policy provisions in an efficient and professional manner through the provision of technical assistance and support services including the Centralized Infractions Bureau and Jury Administration.
  • Judge Support Services – Ensures the prompt delivery of services and programs to Superior Court judges and Family Support Magistrates pertaining to law libraries, legal research, judicial performance evaluations, continuing education and support for technology; and manages grants program.
  • Legal Services – Determines legal issues and provides support services in the areas of attorney ethics, discipline and bar admission.
  • Support Enforcement Division – Enforces, reviews and adjusts family support orders in accordance with federal and state regulation, rules and statutes.
  • Office of Victim Services – Advocates for victims of crime, arranges services, provides assistance and financial compensation.

(Reposted from the Connecticut Judicial Branch Website)

Role of the [Connecticut] Courts

Maintaining Order – The judicial system in Connecticut exists to uphold the laws of the state. Our courts help to maintain order in our society by:

  • determining the guilt or innocence of persons accused of breaking the law;
  • resolving disputes involving civil or personal rights;
  • interpreting constitutional provisions of laws enacted by the legislature and deciding what is to be the law of the state when none exists for certain situations. The court decision then becomes a precedent to be applied in like situations unless later overruled or modified by the Supreme Court or the General Assembly; and,
  • determining whether a law violates the Constitution of either the State of Connecticut or the United States.

Separation of Powers – Under our constitution, the courts are one of three branches of government:

  • The Legislative Branch (the Senate and House of Representatives) is responsible for creating new laws.
  • The Executive Branch (the Governor and executive branch agencies) is responsible for enforcing them.
  • The Judicial Branch (the courts) is responsible for interpreting and upholding our laws.

Relationship of Connecticut Courts to Federal Courts
In Connecticut, as throughout the United States, there are two judicial systems. One is the state system, established under the authority of the state constitution; the other is the federal system, established under the United States Constitution. Connecticut courts are courts of general jurisdiction. These courts handle most criminal matters and a variety of civil matters, including contracts, personal injury cases, dissolution of marriage and other legal controversies. In some instances, decisions of state courts may be appealed to the United States Supreme Court if a question of federal constitutional law arises.

Federal courts have jurisdiction over matters involving federal law, and over the following matters: cases brought by the United States, cases between two states or the citizens of two different states, cases between a state and a foreign state or its citizens, admiralty and maritime cases, and cases affecting ambassadors and other diplomatic personnel.

(Reposted from the Connecticut Judicial Branch Website)

Organization of the Courts [In Connecticut]: Probate Court

In addition to the state-operated courts, Connecticut has probate courts, which have jurisdiction over the estates of deceased persons, testamentary trusts, adoptions, conservators, commitment of the mentally ill, guardians of the persons, and estates of minors.

Each Probate Court has one judge, who is elected to a four-year term by the electors of the probate district. There are 54 Probate Court districts and six Regional Children’s Probate Courts. State law requires that probate judges be attorneys, and they are paid through a statutory formula. Probate Courts are housed in municipal facilities, most often town and city halls.

(Reposted from the Connecticut Judicial Branch Website)

Organization of the Courts [In Connecticut]: Superior Court

The Superior Court hears all legal controversies except those over which the Probate Court has exclusive jurisdiction. Probate Court matters may be appealed to the Superior Court.

A superior court courtroom The state is divided into 13 judicial districts, 20 geographical areas and 12 juvenile districts. In general, major criminal cases, civil matters and family cases not involving juveniles are heard at judicial district court locations. Other civil and criminal matters are heard at geographical area locations. Cases involving juveniles are heard at juvenile court locations.

The Superior Court has four principal trial divisions: civil, criminal, family and housing.

Civil Division – A civil case is usually a matter in which one party sues another to protect civil, personal or property rights. Examples of typical civil cases include landlord-tenant disputes, automobile or personal accidents, product or professional liability suits and contract disputes. In most civil cases, the accusing party (plaintiff) seeks to recover money damages from another party (defendant). Cases may be decided by the judge or by a jury, depending on the nature of the claim and the preference of the parties.

Criminal Division – A criminal case is one in which a person (defendant) is accused of breaking the law. The two sides in a criminal case are the state, represented by a state’s attorney (because crimes are considered acts that violate the rights of the entire state), and the defendant. Crimes (felonies and misdemeanors), violations and infractions are heard in the Criminal Division.

Housing Division – Cases involving housing are heard in special housing sessions in the Bridgeport, Hartford, New Haven, Stamford-Norwalk and Waterbury judicial districts. In all other judicial districts, these cases are part of the regular civil docket.

Family Division – The Family Division is responsible for the just and timely resolution of family relations matters and juvenile matters. Examples of family relations matters include: dissolution of marriage, child custody, relief from abuse and family support payments. Juvenile matters include: delinquency, child abuse and neglect, and termination of parental rights.

(Reposted from the Connecticut Judicial Branch Website)

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