(Bankr. E.D. Ky. Aug. 10, 2015)
The bankruptcy court grants judgment in favor of the defendants in this turnover action brought by the Chapter 7 trustee. After the petition was filed, the debtor's mother transferred $50,000 to the debtor's criminal defense attorney for legal representation. The trustee argued and presented evidence at trial that the funds were actually the debtor's funds and sought a judgment directing that the $50,000 be turned over to the estate. The bankruptcy court holds that even if the funds originated with the debtor, because the transfer had not been avoided, the funds were no longer property of the estate and thus not subject to turnover under 11 U.S.C. § 542. Opinion below.
2015-08-10 – spradlin v khouri
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