Kentucky Bankruptcy Law

Counsel with Care

Plan Payments by Payroll Deduction

This blog post about monthly plan payments is a crucial one. Many of the persons that I assist in a Chapter 13 do NOT want their employer to know they filed bankruptcy. However, I have never seen an employer have a problem with it and the payroll deduction is the best way to prevent problems with the plan later down the road.

Chapter 13 Trustee, EDKY: Trustee's Blog

Plan payments in the EDKY must be made by payroll deduction unless otherwise ordered by the court or agreed to by the trustee.  Many debtors’ attorneys are inadvertently causing their clients to get behind in plan payments because the attorneys and their staff don’t know the rules.  Download this detailed Attorney Info Sheet on Mandatory PDO’s 08252017, and keep reading for important reminders for debtors’ attorneys and their staff regarding payroll deduction orders and plan payments.

If the debtor’s income is from employment, the debtor’s attorney must submit a completed payroll deduction order (“PDO”) at the same time the plan is filed.  Tender the payroll deduction order to the court promptly.  Expect that it will take 4 to 6 weeks for the employer to get the payroll deduction set up, and advise your clients accordingly.

A debtor’s first full monthly plan payment is due 30 days after the…

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September 6, 2017 Posted by | Uncategorized | Leave a comment

Claims Based on Time-Barred Debts in Kentucky

As always – solid information.

Chapter 13 Trustee, EDKY: Trustee's Blog

In Midland Funding, LLC v. Johnson, 137 S.Ct. 1407 (May 15, 2017), the U.S. Supreme Court held that Midland Funding did not violate the Fair Debt Collection Practices Act (FDCPA) by filing a proof of claim in the debtor’s chapter 13 case for a credit card debt on which the statute of limitations “obviously” had expired.  If the claim is unenforceable because it is time-barred, the remedy is to object to the claim.  What do practitioners in Kentucky need to know about statutes of limitations on credit card debts before filing or objecting to claims?

Which state’s statute of limitations applies?  The procedural law of the forum state will determine which state’s statute of limitations applies.  In the Midland Funding case, the Supreme Court and all the lower courts applied, without discussion, the forum state’s statute of limitations (Alabama).

However, the choice of law is not as easy…

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September 6, 2017 Posted by | Uncategorized | Leave a comment