Creditors failed to satisfy their burden of establishing Debtor’s lack of equity   in property, but were entitled to relief from the automatic stay for “cause” based on the totality of the surrounding facts and circumstances. Debtor filed three prior   bankruptcy cases, had not made any payments to the creditors in four years, and appealed a state court foreclosure judgment without posting a supersedeas bond. Creditor’s lien   and right of first refusal contained in an agreement executed by the Debtor to obtain the property under the City of Santa Fe’s affordable housing opportunity program constituted an encumbrance against the property which survived the Debtor’s prior discharge, and,  assuming the agreement was an executory contract, rejection of the agreement did not terminate the contract. 

Chapter 7 trustee sought order compelling debtor to turn over three pieces of irrigation equipment that trustee claimed was part of the bankruptcy estate.  The Court held a trial on the merits and concluded that the trustee’s motion for turnover must be denied. Under Section 348(f)(1)(A) equipment acquired by debtor during chapter 13 case prior to conversion to chapter 7 was not property of chapter 7 estate, and therefore not subject to turnover. Equipment that debtor acquired and disposed of prepetition was not property of the chapter 13 or chapter 7 estate, and therefore was not subject to turnover. Equipment that debtor sold prepetition, retained possession of after the conversion date, and delivered to the buyer during chapter 7 case was property of chapter 7 estate subject to turnover, but because evidence of the property’s value was insufficient and the whereabouts of the equipment is unknown, neither the equipment nor its value could be turned over to trustee.  

A creditor objected to confirmation of Debtor’s plan of reorganization on the ground that it was not feasible because Debtor’s income derived in part from Social Security benefits for his minor son. The Court concluded that it could consider Debtor’s son’s Social Security benefits as part of Debtor’s income when determining whether Debtor’s plan was feasible, and that Debtor’s plan was feasible. The creditor also argued that the plan was not proposed in good faith because Debtor proposed to retain and continue to pay for a truck that is expensive to maintain and operate. The Court found and concluded that, under the circumstances, the truck is not a luxury item and that Debtor proposed the plan in good faith.

Debtor filed a complaint seeking to discharge her student loans based on a theory of undue hardship. Debtor, who is participating in an income based repayment plan, based her undue hardship complaint primarily on the potential tax consequences that may arise if the balance of her student loan debt is discharged at the end of her repayment term. Based on Debtor’s interrogatory responses, in which she appeared to concede that she could afford her monthly repayment obligation, Defendant sought summary judgment on the ground that Debtor cannot satisfy the Brunner test. Defendant is entitled to partial summary judgment that the potential tax consequences of student loan debt forgiveness, by themselves, are not enough to render the debt dischargeable. Because Debtor’s response to the summary judgment motion raised genuine issues of material fact about whether Debtor can afford her monthly repayment obligation, the balance of the motion is denied.