Danduran v. Kaler (In re Danduran)

Summarized by Mark Bossi , Thompson Coburn LLP
15 years 3 months ago

Citation:

United States Bankruptcy Appellate Panel for the 8th Circuit, Case No. 10-6042, November 23, 2010

Tag(s):

8th Circuit

Ruling:

The Eighth Circuit BAP rules that proceeds the debtor received from the sale of his home and certain personal property are exempt under North Dakota's homestead exemption statute. To the extent that the proceeds are attributable to personal property, such proceeds were converted into exempt homestead proceeds when the debtor paid its mortgage lender and deposited the balance of the poceeds into a segregaged savings account established for the specific purpose of holding the proceeds.

Procedural context:

Appeal from bankruptcy court's denial of a claim of exemption under North Dakota's homestead exemption statute.

Facts:

Prior to filing bankruptcy, the debtor sold his homestead. Included in the sale were various items of non-exempt personal property. The debtor used the proceeds from the sale to satisfy a mortgage and deposited the remaining proceeds into a savings account he established for the specific purpose of holding the proceeds. After filing bankruptcy, the debtor claimed a homestead exemption under North Dakota law in all of the proceeds in the bank account. The trustee objected, asserting that $7,700 of the money in the account wasn't exempt because those funds were attributable to the sale of non-exempt personal property. The bankruptcy court sustained the trustee's exemption. On appeal, the BAP reverses.

Judge(s):

Venters (concurring Federman, Saladino)

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