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We are Phillips and Thomas LLC, a Kansas City law firm practicing in the areas of bankruptcy, debtor-creditor relations, and criminal defense.

Exemption Of Funds From Student Loan Proceeds In Bankruptcy

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Are the funds that a debtor deposits in his or her bank account exempt, if those funds are exclusively the proceeds of a federal student loan?  This was the question recently examined by a Kansas bankruptcy court.  The case was In Re Decena, and it was decided on March 30, 2015 (Case no. 14-10668,  Dist. Of Kansas).

In the Decena case, the debtor filed a Chapter 7 bankruptcy and listed on the schedules a bank account that held funds that were exclusively loan proceeds from federally-guaranteed student loans.  There was about $4500 in the account on the day of the filing of the case.

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Commissions From Pre-Petition Real Estate Sales Contracts: Property Of The Bankruptcy Estate?

There are situations in which bankruptcy debtors work in fields that involve “commissions” rather than regular salary.  Examples of these types of employment are real estate agents, insurance brokers, or any other job that pays commissions rather than salary.  Under what circumstances are commissions property of the bankruptcy estate?  What happens, for example, when a real estate agent enters into a sales contract before he files a bankruptcy, but does not “close the sale” until after the bankruptcy is filed?

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Exemption Of Child Tax Credits And Earned Income Credits In Bankruptcy

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To what extent are “child tax credits” from a debtor’s income tax refund considered exempt in a bankruptcy case as a “public assistance benefit”?  This was the question considered by the Eighth Circuit Bankruptcy Appellate Panel (B.A.P.) in the 2013 case of In Re Pepper Hardy (B.A.P. No. 13-6029).  The answer was:  not at all.  The appeal involved a Chapter 13 bankruptcy case coming from the Kansas City-based Chapter 13 Trustee, Richard V. Fink.

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Construction Contracts, Bankruptcy, And Objections To Discharge Under 523(a)(4): Fraud Or Defalcation In A Fiduciary Capacity

Adversary proceedings objecting to the discharge of certain debts sometimes arise in the context of bankruptcy cases.  One such type of adversary proceeding, one based on “fraud or defalcation while acting in a fiduciary capacity,” is based on Section 523(a)(4) of the Bankruptcy Code.  But to prevail under this section requires that certain conditions must exist.  A recent case illustrated how such conditions may in fact exist.  The case was a 10th Circuit B.A.P. case, NM-12-017, Hawks Holding LLC v. Kalinowski, decided in 2012.

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In 2008, Hawks Holdings, LLC (“Hawks”) contracted with K2 Construction Company, LLC (“K2”) to build three homes on property Hawks owned near Santa Fe, New Mexico, for a contract price of more than $3.6 million. K2 was formed in 2007 as a New Mexico limited liability company, and held a general contractor’s license issued under the New Mexico Construction Industries Licensing Act (the “Contractors Act”). K2 neither completed the construction 1 called for by the Hawks contract, nor paid all of the subcontractors and material suppliers that had contributed to the project.

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Curtilage, Search Warrants, And Illegal Drug Seizures In Kansas

What is the “curtilage” of a residence?  Under what circumstances can law enforcement search the outside of a residence without a search warrant?  These are some of the questions considered by the Kansas Supreme Court in its recent decision in State v. Talkington (No. 107,596), decided on March 6, 2015.

The Talkington case involved a drug search in the area outside of a residence.  Three issues were implicated in the case:  (1) whether a residential backyard is part of the “curtilage” under the Fourth Amendment to the United States Constitution; (2) whether a social guest in the residence can challenge the search of host’s residence; and (3) whether drugs found on the defendant’s person after an illegal search of the curtilage should be suppressed as “fruit of the poisonous tree.”  Many search and seizure issues were implicated in this case.  It is an important case and one that deserves careful reading.

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Claiming Missouri’s Head Of Household Exemption In Bankruptcy

The bankruptcy “head of household” exemption in Missouri applies to your children, and not someone else’s children.  The children have to be related to the head of the family (either a man or a woman) either biologically or by adoption.  That was the gist of a ruling by the Eighth Circuit B.A.P. in a recent Missouri case.  The case was In Re Mark Turpen (B.A.P. 12-6039), from the Western District of Missouri.

Turpen was single and lived with his two minor children, an unrelated woman, and the woman’s three minor children. He filed a voluntary Chapter 7 petition in 2011.  He then filed amended schedules B and C on February 20, 2012. The amended schedule B listed a 2011 tax refund of $8,491.00.  The amended schedule C listed claimed exemptions in that refund totaling $3,600.00:  $600.00 under § 513.430.1(3) and $3,000.00 under § 513.440, $1,250.00 for Turpen as head of the family, and $350.00 each for his two minor children and the woman’s three minor children.

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The Good Faith Exception To The Exclusionary Rule Saves A Deficient Missouri Search Warrant

When will a search warrant be supported by probable cause?  What is the “exclusionary rule”?  And what is the “good faith exception” to the exclusionary rule?  These were some of the questions considered by the Missouri Court of Appeals last month (February 2015) in the case of State v. Gregory Robinson Sr, (WD 77664), which came out of Randolph County, Missouri.

The Defendant (Robinson) was charged with manufacturing drugs.  At his trial, his attorney filed a motion to suppress the evidence seized in the case, claiming that the search warrant used by the police officers did not show sufficient “probable cause” to search the premises.  He won his motion, and the evidence was suppressed.  The State, however, appealed.

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Kansas Exemptions For Life Insurance Proceeds In Bankruptcy

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Under what circumstances are life insurance policies exempt in bankruptcy? Can the exemption ever be forfeited? These were some of the questions considered by the 10th Circuit Bankruptcy Appellate Panel in the case of In Re Larry Erickson and Betty Moore, filed in August 2011 (KS-11-005). Life insurance proceeds are normally exempt in bankruptcy provided certain conditions are met, but this case had an unusual set of facts.

Husband and wife Larry J. Erickson and Betty L. Moore filed a petition for Chapter 7 relief on March 30, 2010. At the time the petition was filed, Erickson owned several insurance policies on his life with respect to which Moore was the designated beneficiary. Debtors neither scheduled the life insurance policies as assets, nor claimed them as exempt.

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“Jury Box” Or “Hot Box” Jury Selection In Kansas Felony Criminal Trials

Does it matter how a jury is selected in a criminal case?  Can the method used in seating a jury cause reversible error?  According to the Kansas Court of Appeals, the answer is yes.  A recent case discussed these issues and how they would be applied.  The case was State v. Crabb, decided in February of this year (KS Court of Appeals No. 110,673).

In the Crabb case, defendant Christopher Crabb appealed his conviction of one count of interference with law enforcement. Crabb claims the district court committed reversible error by using the so-called “hot-box” method of jury selection over Crabb’s objection instead of using the statutory method of jury selection set forth in K.S.A. 22-3411a.  He also argued that the district court erred in instructing the jury and that he was denied a fair trial based on prosecutorial misconduct and cumulative error.

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What Is A “Core Proceeding” In A Bankruptcy Case?

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What is a “core proceeding” arising from a bankruptcy case?  What standard is used to evaluate this issue?  These were the questions asked by the Eighth Circuit case of In Re Schmidt, decided in 2011 (11-6028 to 11-6030).  In this case, Klein Bank appealed the bankruptcy court’s order  denying its motions to remand its replevin actions which had been removed from the state court to the bankruptcy court.

In denying the motions, the bankruptcy court had originally concluded that the replevin actions were core proceedings. The Eighth Circuit B.A.P. disagreed, stating that  core proceedings are limited to those “arising under or arising in” a bankruptcy case.

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