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The Security National Bank of Sioux City, IA v. Vera T. Welte Testamentary Trust

Summarizing by Amir Shachmurove

Radiance Capital Receivables N v. Thomas Crow (In re Thomas Crow)

Case Type:
Case Status:
BAP No. WY-18=083 & WY-18-086 (10th Circuit, Nov 26,2019) Not Published
BAP for 10th Cir. affirmed bankruptcy court (D. Wyo.), which overruled objections to chapter 7 debtor's claim of millions of dollars in exemptions in entireties property. Under Wyoming law, half of the entireties properties belonged to the non-debtor spouse. While debtor’s half of the entireties property was potentially subject to administration as non-exempt, bankruptcy court properly denied turnover request for non-exempt portion in context of objection. Non-exempt portion was dependent upon joint debt; trustee was required to pursue turnover in adversary proceeding.
Procedural context:
Chapter 7 trustee and creditor objected to debtor's claim of exemption in home and account based on ownership in entireties. Bankruptcy court (D. Wyo.) denied objection. Trustee and creditor appealed to BAP for 10th Cir.
Several years prior to filing bankruptcy, formerly wealthy chapter 7 debtor and his non-debtor spouse sold their marital home held as tenants by the entirety for $10 million, realizing approximately $5.2 million in net proceeds. Debtor and his spouse used a portion of sale proceeds to purchase another home for $1.5 million, partially financing the purchase with a $500k loan/mortgage. Some of the net proceeds were used to purchase a new marital home, and the remainder were transferred to a joint investment account, both of which are also purportedly held as tenants by the entirety. In his bankruptcy case, debtor claimed the marital home and the investment account as exempt under Wyoming’s tenancy by entireties exemption. The chapter 7 trustee and a creditor objected to debtor’s claimed exemptions.
Cornish, Hall, Loyd

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