In re DeSouza

Summarized by David Baker , Law Office of David G. Baker
12 years 8 months ago

Citation:

BAP No. MW12-091

Tag(s):

Ruling:

BAP REVERSED and remanded, holding that post-petition divorce court orders for alimony did not violate the automatic stay in a chapter 13 case, but when the debtor was found in contempt and incarcerated for failure to pay alimony, the contempt and incarceration were stay violations because they impacted "property of the estate" under §541 and §1306.

Procedural context:

Debtor sought bankruptcy court order relating to automatic stay violations relating to post-petition divorce court actions. Bankruptcy court found no stay violations. Debtor appealed. BAP reversed and remanded after finding that alimony order did not violate stay, but contempt and incarceration did.

Facts:

Debtor filed a chapter 13 case in January, 2011. In June, 2011, his wife filed a complaint for divorce. After hearings in divorce court, debtor was ordered to pay alimony of $150 per week. When he couldn't make the payments, his ex-wife commenced contempt proceedings in the divorce court, which ultimately found him in contempt. In June, 2012, the debtor failed to appear at a hearing in divorce court, so a civil arrest warrant was issued against him. In the bankruptcy court, he filed an amended plan and budget, including an expense of $600 per month for the alimony, but the amended plan did not provide for any alimony arrears. Nonetheless, the plan was confirmed, apparently without objection from any party in interest. Thereafter, in December, 2012, the debtor was arrested on the civil arrest warrant. Unable to make a $5,000 payment immediately as ordered by the divorce court, the debtor spent about three weeks in jail until the payment was made. Faced with the incarceration, the debtor asked the bankruptcy court to determine the validity of the divorce court orders. The bankruptcy court found no stay violations, but the BAP reversed as to the incarceration and contempt.

Judge(s):

Deasy, Kornreich and Tester.

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