Seaver v. Klein-Swanson, No. 12-6054 (8th Cir. 2013)
Annotate this CaseDebtor appealed from the judgment of the bankruptcy court. At issue was whether the bonuses debtor received from her employer were considered property of debtor's estate. Because the bankruptcy appellate panel (BAP) held that the bonus payments were not property of debtor's bankruptcy estate because she had no cognizable interest in the payments on the date the petition was filed, the court must reverse the bankruptcy court's revocation of debtor's discharge pursuant to 11 U.S.C. 727(d)(2); avoidance of the transfer under 11 U.S.C. 549 of bonus funds she received postpetition from her employer and entering judgment for recovery of those funds by the Chapter 7 trustee, pursuant to 11 U.S.C. 550; and granting the trustee's motion for costs filed by the trustee pursuant to Federal Rule of Bankruptcy Procedure 7054(b).
Court Description: Bankruptcy Appellate Panel. The bankruptcy court erred in finding post-petition bonus payments were the property of debtor's estate as she had no cognizable interest in the payments on the date the petition was filed; revocation of her discharge reversed; further, the bankruptcy court's avoidance of the transfer and its order entering judgment for recovery of the funds by the Chapter 7 trustee is also reversed; award of costs to the trustee reversed as he is no longer the prevailing party.
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