In this case,  debtor filed a Chapter 7 bankruptcy attempting to liquidate some $67,000 of unsecured credit card debts.

The Court denied the discharge as to Corestates Bank.

Here, the debtor used his credit cards to obtain cash advances for daily living expenses. The debtor’s charge cards were nearly all charged to the maximum limit. He had over 19 credit cards at the time he filed for bankruptcy.

Four months prior to the debtor filing for bankruptcy, he took a total of $5,000 in cash advances on his charge card with Corestates Bank. The bank filed a complaint with the Bankruptcy Court seeking to exempt these cash advances from discharge.

The Bankruptcy Code does not discharge an individual from any debt obtained by false pretenses, false representations or actual fraud.

In this case, the Court found that there was hardly any question that the debtor knew, or should have known, that he did not realistically have the ability to meet his obligation to Corestates bank, as well as to his other unsecured creditors, totaling nearly $70,000.

The Court held that the $5,000 of cash advances made by Corestates Bank would not be discharged and the debtor would still need to repay that obligation.

This case did not address the issue of the debtor’s discharge on his other credit card debts owing to other creditors. Corestates Bank v. Joseph Kurali, 132 B.R. 468.

Author: Charles R. Harroun, Attorney at Law