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Thelma McCoy v. USA

Summarizing by Craig Geno

United Joint Venture, LP v. Noble (In re Jennings)

Citation:
Case No. 12-16371 (11th Cir. July 15, 2013) [Not for Publication]
Tag(s):
Ruling:
Chapter 7 Trustee's business judgment to close estate as a "no asset" and not sell or settle Michigan Judgment was within his business judgment under Section 544(a) and District Court deference to that decision was affirmed.
Procedural context:
Creditor objected to Trustee's Chapter 7 Report of No DIstribution and abandonment of a Michigan judgment. After a hearing, the Bankruptcy Court overruled creditor's objection. Appeal was made to District Court. District Court found Trustes' decision was made in good faith, upon a reasonable basis and within the scope of his authority. Circuit Court agreed and afifrmed.
Facts:
Debtor, Jennings, filed a Chapter 7. Schedule B showed a Michigan Judgment in the sum of $363,698.55 as an asset. Unsecured creditor offered the Trustee $10,000 for the Michigan Judgment in settlement. A third party also offered to purchase the Michigan judgment from the Trustee for $10,000. The judgment itself was actually a $125,000 judgment for the Debtor against United, a $238,698.55 judgment for the Debtor and his co-defendants against United for legal fees and costs, and a judgment in favor of United for $255,367.29. The Trustee refused to settle or sell. Instead Trustee filed a Report of No DIstribution. United objected to the Report and effective abandonment of the Michigan judgment as a windfall to the Debtor. The Trustee testified that the estate had no interest in the Michigan Judgment. The Trustee also argued that he deemed the $10,000 offered to him to be an inconsequential value. The Court noted that the approximate $540,000 in claims meant that the creditors would receive less than two cents on the dollar, even before considering costs of administration.
Judge(s):
Hull, Jordan and Hill

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