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December 2011 Archives

Syracuse Temporary Bankruptcy Judgeship May Be Extended

One rumor floating around related to the soon-to-be-vacant bankruptcy judgship in Rochester is that the Hon. Margaret Cangilos-Ruiz, currently the bankruptcy judge in the Northern District of New York, Syracuse Division, would be appointed to the Rochester position.

Debtor Who Spent Annuity After Filing Bankruptcy Granted Discharge - In re Leone Albany Case

"Something went awry in this case", and indeed it did. This understated line opens the conclusory paragraph of the decision by Judge Robert E. Littlefield Jr. in In re Leone, Bankruptcy Court Northern District of New York (Albany Division) Chapter 7 #05-16603; AP #07-90199; Decision Dec. 9, 2011.) The debtors refinanced their home, filed bankruptcy, and transferred the refinance funds to an annuity while the petition was being filed. The original chapter 13 trustee did not go after the refinance cash or object to the annuity exemption. When converted to chapter 7, the new trustee objected to exempting the annuity, but by them the money was mostly spent. The chapter 7 trustee sought to deny the debtors a discharge.

NY Homestead Exemption Applies to Entire Property Even If Partially Rented Out: In re McCarthy (Syracuse case)

Syracuse bankruptcy judge Margaret Cangilos-Ruiz has ruled that a bankruptcy debtor can claim a homestead exemption on an entire parcel or residential property, even if the debtor only resides in part of the property.
In re Craig Michael McCarthy; WDNY Bk #11-31499; decision Nov. 18, 2011. Mr. McCarthy owned property containing a two family house, both units of which were rented out, and a smaller building in the back where the debtor both worked and lived. In my review of the docket, it appears that the debtor moved to avoid the judicial lien of a creditor, and the creditor, in turn, objected to the debtor's homestead exemption claim. The creditor argued that the homestead exemption should only be allocated to that portion of the lot that is used as the debtor's residence. The court ruled that the debtor could exempt the entire parcel.

Retirement Package for Bankruptcy Judges - Full Salary after 14 Years if Over 65

With the impending retirement of Bankruptcy judge John C. Ninfo II of Rochester, it might be interesting to review the retirement package available to bankruptcy judges. Under 28 USC Sect. 377, a bankruptcy judge over the age of 65 who has served at least 14 years is entitled to a lifetime annuity equal to his or her salary upon retirement.

Bankruptcies continue decline to 23 year low; Share a Judge with Syracuse?

Through the end of November, bankrutcy filings in the Western District of New Yor continue to decline, off 20% from the first eleven months of of 2010.  Rochester's share of filings are down slightly more - 21%, with Buffalo's filings down 19%. This follows a 10% decline in WDNY filings in 2010, compared to 2009.

Pillar Processing Closes in Buffalo - Fallout of Baum Closure

As I reported two weeks ago, the large-volume foreclosure firm Steven J. Baum PC of Amherst NY is closing. The Buffalo News is now reporting that Pillar Processing LLC, a foreclosure services company affiliated with the Baum office is also shutting its doors. Pillar employees 590 full-time and part-time employees in Amherst.I wrote an extensive blog last year (October 22, 2010) exploring the unisual arrangement between Pillar and the Baum office. My analysis is that Baum basically spun off the back office foreclosure processing services into a separate non-law firm entity, and then sold it to private investors for something like $60 million. If this is accurate, I would suspect those investors might be somewhat unhappy now.

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