- 9th Cir. (Bankruptcy Appellate Panel) April 11, 2013 Case No. EC-12-1537-DJuMk (NOT FOR PUBLICATION).
- AFFIRMING the bankruptcy court's order which sustained the chapter 7 trustee's objection to debtors' claim of exemptions.
- Procedural context:
- Debtors appeal the bankruptcy court's order sustaining the chapter 7 trustee's objection to debtors' claim of exemption in a contingent beneficial interest in an irrevocable trust. Further, the bankruptcy court order granted the trustee's claim in up to 25% of the future beneficial interest in the trust.
- On March 7, 2012, debtors Santiago and Michelle Hernandez filed their voluntary chapter 7 petition. In their schedules, Ms. Hernandez had a beneficial interest in an irrevocable trust contingent she survive her mother in order to receive a mandatory distribution of trust principal. On Schedule B, the debtors identified the trust interest with $7,000 from annual gifts and in their Schedule C, claimed an exemption in the amount of $7,000. On June 22, 2012, debtors amended their Schedule C to further include an exemption in "100% of Fair Market Value" of their trust. The chapter 7 trustee filed a timely objection to debtors' claim of exemptions arguing that (1) Section 541(c)(2) did not provide a valid basis to claim an exemption and (2) the debtors did not provide any description of the value of the trust or what assets were included. The chapter 7 trustee also filed a claim for 25% of debtor's future beneficial interest in the trust.
- Dunn, Jury and Markell.
3098 in the system
0 Being Processed