A Chapter 7 debtor brought an action against Security Federal Credit Union, alleging discrimination and violation of the automatic stay.   The bankruptcy court held that:   (1) termination of debtor’s member services at the credit union was not discrimination; (2) an administrative freeze on debtor’s account did not violate the automatic stay; (3) credit […]

Here, Debtors’ Bankruptcy was Dismissed for Substantial Abuse by the Debtors. In this case, the Chapter 7 bankrupts filed their estimated monthly budget with the bankruptcy court, which included a $350 contribution to their church. The court found that such a large monthly contribution by the debtors to their church each month constituted an abuse of […]

Here, William Lowrence alleged that he was injured when he slipped and fell on ice on the sidewalk outside the credit union. The sidewalk was owned by the City of Kenosha and not by the credit union. The credit union, however, allegedly customarily engaged in snow removal practices on this sidewalk to comply with a city […]

In this case, the court addressed the issue as to whether a bank’s policy of refusing to hire college graduates violated the law prohibiting discrimination based on age. Here, Sol Stein was 58 years old and a college graduate. The bank had a policy not to hire college graduates for certain positions. Mr. Stein applied […]

Most of our fifty States have adopted the Uniform Commercial Code (UCC), which prescribes the method for a creditor to perfect security interests in collateral. Credit unions utilize the UCC filing provisions to perfect their security interest in items pledged as collateral on a loan, such as on a vehicle. Once a creditor files the […]

In this case, debtor filed a Chapter 7 bankruptcy seeking to discharge his unsecured obligations. The debtor listed over $55,000 of unsecured debts on his bankruptcy schedules, including a $9,500 loan from a credit union. The bankruptcy Trustee reviewed debtor’s monthly budget and found that debtor could afford to repay some of his obligations (such […]

In some states, a debtor’s wages are generally not subject to garnishment. Here, however, debtor’s wages were directly deposited into the debtor’s account at I.B.M. Employees Southwest Federal Credit Union. A judgment creditor thereafter garnished debtor’s account at the credit union and debtor brought an action to dissolve the garnishment, arguing that the funds in […]

The two cases below held that the Bankruptcy Code section exempting “student loans” from discharge in bankruptcy, does not apply to student loans issued from credit unions. The first case of TI Federal Credit Union vs. John Delbonis, involved a debtor who, in a four year period, obtained more than $43,000 from TI Federal Credit […]

Bank of the Mountains granted a loan to debtors secured by a second mortgage on debtors’ primary residence. Debtors filed a Chapter 7 bankruptcy, which was later converted to a Chapter 13 case. Debtors listed the bank as an unsecured creditor since the value of their residence was less than the balance owing on the […]