CURRICULUM VITAE OF EDWARD ELLINGTON. Graduated Mississippi State University 1962 with a degree in Banking and Finance

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1 CURRICULUM VITAE OF EDWARD ELLINGTON Born November 10, 1940, in Lexington, Mississippi Graduated Lexington High School 1958 Graduated Mississippi State University 1962 with a degree in Banking and Finance September September 1964 Active Duty, U. S. Army September January 1967 University of Mississippi, School of Law Received Juris Doctor Degree, January 1967 President, Law School Student Body January June 1967 Law Clerk, Mississippi Supreme Court September July 1968 Law Clerk, Judge J. P. Coleman U. S. Court of Appeals for Fifth Circuit July January 1986 Active practice of law in Jackson, Mississippi Served as Counsel to the Judiciary Committee, Mississippi House of Representatives, during regular session, President, Jackson Young Lawyers Association Chairman, Mississippi Law Institute, 1975 Member of the State Senate, Member Mississippi Medicaid Commission, January 15, 1986 Sworn in as a United States Bankruptcy Judge for the Southern District of Mississippi Married to the former Cleta Shirley of Jackson, Mississippi and have three children Member of United Methodist Church

2 Bio of James L. Henley, Jr. James L. Henley, Jr., a native of Jackson has served as a Chapter 13 Bankruptcy Trustee for the Southern District of Mississippi since March He is a Certified Public Accountant, an Attorney and holds a certification in Financial Forensics from the American Institute of Certified Public Accountants. Mr. Henley also serves as Chairman of the Board of Commissioners for the Jackson Municipal Airport Authority (JMAA). Mr. Henley is a past President of the Magnolia Bar Association and Magnolia Bar Foundation. He is a graduate of Callaway High School, Millsaps College, and the Mississippi College School of Law. He is a life member of Omega Psi Phi Fraternity, Inc. He is extensively involved in the development of inner-city youth through Fresh Start Ministries, Inc. He previously served on the boards of Bethany Christian Services, the Jackson Metropolitan YMCA, and the Jackson Young Lawyers Association. He and his wife, Vivian, have four children.

3 Ronald Gawyn Mitchell Born, January 22, 1949 in Monroe Georgia. Graduated from the University of Georgia in 1971 with a B.A. in History. Graduated from University of Mississippi Law School in Admitted to the Mississippi Bar Association in Admitted to the Georgia Bar Association in Military Background: B52 pilot in Vietnam in Air Force Instructor pilot at Columbus Air Force Base, Mississippi Air National Guard Jag, Retired from Mississippi Air National Guard. Professional Practice: Associate in Lawson & Davis, Atlanta, GA Partner in Woolbright & Mitchell, Columbus, MS Partner in Farrow, Dalrymple and Mitchell, Columbus, MS Shareholder in R. Gawyn Mitchell, PA, Columbus, MS 1995-Present Shareholder in Mitchell & Cunningham, PC, Tupelo, MS Present Shareholder in of Mitchell, Cunningham & Fava, Southaven, MS Present Primary Practice Area Consumer Bankruptcy Law Family Married to Dawn Peterson Mitchell, four daughters, three granddaughters and four grandsons.

4 BANKRUPTCY SURVEY AND PRACTICE POINTERS The Mississippi Bar Summer School June 23-25, 2014 Judge Edward Ellington, U.S. Bankruptcy Judge, Southern District of Mississippi Attorney R. Gawyn Mitchell and James L. Henley, Jr., Chapter 13 Bankruptcy Trustee Southern District of Mississippi

5 Bankruptcy Origins Deuteronomy 15:1-3 (New International Version) Deuteronomy 15 The Year for Canceling Debts 1 At the end of every seven years you must cancel debts. 2 This is how it is to be done: Every creditor shall cancel the loan he has made to his fellow Israelite. He shall not require payment from his fellow Israelite or brother, because the LORD's time for canceling debts has been proclaimed. 3 You may require payment from a foreigner, but you must cancel any debt your brother owes you.

6 OPTIONS CHAPTER 7 BANKRUPTCY CHAPTER 13 BANKRUPTCY CHAPTER 11 BANKRUPTCY CHAPTER 12 BANKRUPTCY

7 Northern and Southern Districts of Mississippi Bankruptcy Case Filing Statistics Twelve Months Ended March 31, 2014 Ch 9 Ch 11 Ch 12 Ch 7 Ch 13 Total Adversary Pending Filings Filings Filings Filings Filings Filings Filings Cases N.D. Miss ,241 3,199 5, ,311 S. D. Miss ,862 3,441 7, ,781 Totals ,103 6,640 12, ,092

8 DO I NEED TO FILE? You are facing home foreclosure and fear losing your house There has been a wage garnishment assigned to your pay check You have been laid off or face other job problems There has been a medical crisis to you or one of your family members There are pending lawsuits You have recently been divorced You want to stop creditor harassment

9 Do I Qualify to File? You first must take a financial counseling course that is approved by the court. Is your current monthly income more than the median income? If the answer is yes then you must file a five year chapter 13 bankruptcy If your answer is no then you can file a chapter 7 bankruptcy In both cases you must take an approved Credit Counseling Course to get a discharge from your bankruptcy. Note: Qualifying for the bankruptcy means test = current monthly income minus expenses times that by 60 = result RESULT = More than 25% = $10,000 or more? Less than 25%=$6,000 or less

10 MS MEDIAN INCOME PERSON $35,823 2 PERSON $44,796 3 PERSON $44,796 4 PERSON $51,889 ADDITIONAL $8,100 FOR EACH ADDITIONAL FAMILY MEMBER IN EXCESS OF 4. Cases filed on or after May 1, 2014

11 MS MEDIAN INCOME 2014 MS Median Family income taken from Census Bureau Data Data published by Census Bureau according to state and family size Data updated on a yearly basis Pursuant to 11 U.S.C. Sec. 101 (39A)(B), data further adjusted early each calendar year based upon Consumer Price Index for All Urban Consumers(CPI).

12 CHAPTER 7 TRUSTEE APPOINTED DISCHARGE ON ALL DISCHARGEABLE DEBTS REAFFIRMATION CAR, HOME SHORTEST ROUTE NON EXEMPT ASSETS LIQUIDATED EXEMPTIONS STATE OR FEDERAL?

13 CHAPTER 13 $1,149,525 SECURED/$383,175 UNSEC WAGE EARNER PLAN 3 TO 5 YEAR REPAYMENT PLAN FIRST PAYMENT DUE WITHIN 30 DAYS OF FILING PLAN TO GET DISCHARGE ALL PLAN PAYMENTS MUST BE COMPLETED TILL RATE SECURED DEBTS (NOT HOME)

14 HOW MUCH? * CHAPTER 7 FILING FEE - $335 CHAPTER 13 FILING FEE - $310 CONVERSION FEE - $25 (CHANGE FROM 13 TO 7) ATTORNEY FEES CHAPTER 7 VARIES GREATLY (GET WHAT YOU PAY FOR) CHAPTER 13 STANDARD $3,000 PLAN * New Chapter 7 and 13 fees effective June 1, 2014

15 #1 Mistake People Make Before Filing For Bankruptcy Thinking they will lose everything and then selling or disposing of property, real or personal, cashing in retirement accounts, etc., before meeting with a bankruptcy lawyer. (Checking account versus Cash $10K)

16 Filing Types Doctors Dentists Engineers Even Lawyers Tend to make the same mistake (often a yoking problem is involved)

17 Bankruptcy Extends The Statute Of Limitations Stanley v. Trinchard (In re Hale), 579 F.3d 515 (5th Cir. 2009). The Fifth Circuit affirmed that under section 108(a) of the Bankruptcy Code a trustee is given a two year time extension to bring a claim, in this case a legal malpractice claim, to protect the estate and debtor's rights, assuming the original limitation period for the state filing has not expired before the date of the filing of the bankruptcy petition.

18 Personal Injury Do You Know?

19 Personal Injury And Tort Claims Regardless of when the debtor finds out or discovers the claim, any claim arising before the filing of a Chapter 13 bankruptcy belongs to the bankruptcy estate. For Chapter 13 s, any claim arising during the Chapter 13 case also belongs to the bankruptcy estate.

20 Personal Injury And Tort Claims Regardless of when the debtor finds out or discovers the claim, any claim arising before the filing of a Chapter 7 bankruptcy belongs to the bankruptcy estate. For Chapter 7 cases, any claim arising after the filing date of the Chapter 7 case is NOT part of the bankruptcy estate.

21 Personal Injury And Tort Claims Attorney for an injured debtor must have his fee contract approved by the Bankruptcy Court. Attorney for injured debtor must be appointed Special Counsel by the Bankruptcy Court. Get this done early on when there is no money.

22 All Causes of Action Must Be Disclosed "It goes without saying that the Bankruptcy Code and Rules impose upon bankruptcy debtors an express, affirmative duty to disclose all assets, including contingent and unliquidated claims." The duty to disclose is continuous. In re: Superior Crewboats, Inc., 374 F3d 330 (5 th Cir. 2004)

23 Special Counsel and Getting Paid Motion, Notice and Affidavit are filed asking that you be appointed as Special Counsel and your contract approved. 21 day notice to all creditors and parties. Order is entered appointing you as Special Counsel and your contract is approved. Case proceeds outside of bankruptcy and is resolved at some point.

24 Special Counsel and Getting Paid Motion and Notice are filed asking that the settlement be approved. Motion and Notice are filed asking that your fees and expenses be approved. 21 day notice to all creditors and parties. Order is entered granting approval of settlement and your fees and expenses.

25 Special Counsel and Getting Paid In a Chapter 7 you work for the Trustee. The trustee must request that you be appointed as Special Counsel and your contract approved. All recovered funds must be paid over to the Trustee. Trustee will write you checks for fees and expenses.

26 Special Counsel and Getting Paid In a Chapter 13 you work for the Debtor. You or the debtor can file the request that you be appointed as Special Counsel and your contract approved. Only the debtor s share of recovered funds are paid over to the Trustee.

27 Special Counsel and Getting Paid In a Chapter 13 you should get the Debtor s attorney to do the work for you. Debtor s attorney can contract with the debtor to be paid a fee from the recovery for handling the paperwork to have you appointed Special Counsel and to have the settlement and fees approved.

28 Worker s Compensation Benefits and Awards are fully protected under state law. Miss. Code Attorney for injured worker must have fee contract approved by the Bankruptcy Court. Attorney for injured worker should also be appointed Special Counsel by the Bankruptcy Court.

29 Social Security Income Social security income is exempt. Debtor not statutorily required to include social security income (SSI) in his projected disposable income calculation. Inclusion of SSI in projected disposable income would violate both the Bankruptcy Code and the Social Security Act. In re Ragos, 700 F.3d 220 (5 th Cir. 2012)

30 Bankruptcy Before Divorce or Divorce Before Bankruptcy? The timing of a bankruptcy case or a divorce case can be critically important. Consider is the possibility of obtaining joint relief in bankruptcy. A couple may file a joint bankruptcy while they are married and obtain a discharge of their individual and joint debts. This can eliminate contentious issues that a husband and wife might litigate in a contested divorce case, or that could hold up or prevent the spouses from reaching accord in a separation agreement or property settlement agreement. Filing a joint bankruptcy case before divorce could save the couple from spending thousands of dollars in attorney s fees or mediation fees. After the divorce, the former spouses would no longer be eligible for a joint bankruptcy case, and would have to file an individual case limited to discharging his or her liability alone on a joint debt.

31 Domestic Actions Bankruptcy Automatic Stay applies to all Family Law and Domestic Actions. If the action involves money or property, the action is stayed. Domestic Support Obligation (DSO) creditors have priority in bankruptcy.

32 Child Support Creditors Child support creditors or their representatives can appear without charge and without meeting local rules for attorney appearances as long as a form is filed showing information about the debt. Form B281. Adversary proceedings and motions for relief from the stay can be filed without fee by child support creditors. Appendix to 28 U.S.C. 1930(6), (20). It appears that other proceedings may be filed without fee by child support creditors, even if unrelated to child support. See Official Form 17 Notice of Appeal.

33 Family Law Automatic Stay Exceptions 11 USC 362(b)(2)(A) & (B). Child Custody and Visitation. Domestic Violence actions. Establishment or modification of an order for domestic support. Divorce, to the extent the divorce does not seek to divide the property of the estate. Collection of Support from property that is not property of the bankruptcy estate.

34 A Domestic Support Obligation Is - 11 USC 101(14A) The term "domestic support obligation" means a debt, including interest, that is-- (A) owed to or recoverable by-- (i) a spouse, former spouse, or child of the debtor or such child's parent, legal guardian, or responsible relative; or (ii) a governmental unit; (B) in the nature of alimony, maintenance, or support (including assistance provided by a governmental unit) of such spouse, former spouse, or child of the debtor or such child's parent, without regard to whether such debt is expressly so designated; (C) established or subject to establishment, by reason of applicable provisions of-- (i) a separation agreement, divorce decree, or property settlement agreement; (ii) an order of a court of record; or (iii) a determination made in accordance with applicable nonbankruptcy law by a governmental unit; and (D) not assigned to a nongovernmental entity, unless that obligation is assigned for the purpose of collecting the debt.

35 Child Support Arrears Even though the Automatic Stay would not apply to an action for the establishment or modification of an order for domestic support, If there are arrears and they are provided for in the plan, the order confirming the plan under 1328 prohibits any party from continuing a state court action to collect the arrears.

36 Property Settlement Agreements Property Settlements and Marital Dissolution Agreements are not dischargeable in a Chapter 7, but can be discharged in a Chapter 13. Specifically, 11 USC 727 excepts from a Chapter 7 discharge any debt described in 523(a)(15), among others. But 11 USC 1328(a) omits 523(a)(15) from the exceptions to discharge in Chapter 13 s. The debtor need only list the obligation in the bankruptcy. It is then up to the ex-spouse to object to the discharge, if he or she wants to try. Obligations under 523(a)(15) are not discharged in those cases where the debtor gets an early discharge or a hardship discharge.

37 Wording of Document is Immaterial The Bankruptcy Court has jurisdiction to determine if a marital dissolution obligation is a property settlement or a domestic support obligation, regardless of the wording or characterization of the obligation or document.

38 Foreclosure Bankruptcy filing will stop foreclosure. A foreclosure can also be set aside by a bankruptcy filing if the filing is done before the trustee s deed is delivered. Bankruptcy filing took place in between the sale and delivery of the trustee s deed. In re Gomez, 388 B.R. 279 (Bankr. S.D. 2008)

39 Avoiding Liens and Transfers Although the Bankruptcy Code provides that the strong-arm avoidance power belongs to the trustee, in the Fifth Circuit a Chapter 13 debtor may exercise this avoidance power in certain circumstances. 11 U.S.C.A. 522(h), 544(a)(3).

40 Stripping Off Mortgage Liens If home value is less than or equal to the amount owed on the 1 st mortgage; Then 2 nd and 3 rd mortgages can be stripped off and treated as unsecured debts.

41 Cram Down Of Mortgage Liens A debtor s principal residence can be reduced down to its present value if the secured creditor has additional security (such as a vehicle) securing the debt. Any real property that is not the debtor s principal residence (such as rental property) can be reduced down to its present value.

42 Discharging Taxes Taxes must be over 3 years old. (2010 taxes, due in 2011 would be eligible now) Return must have been filed more than 2 years ago prior to filing bankruptcy. Taxes were assessed more than 240 days prior to filing bankruptcy. Penalties and interest are discharged. State taxes are treated like Federal taxes.

43 Obtaining Relief From the Automatic Stay File Motion for Relief. Court will set motion for hearing. Obtain agreed order or attend hearing to obtain an order from the court.

44 OTHER ISSUES COLLECTIONS PROOF OF CLAIMS TILL RATE CURRENTLY 7% SECTION 910 CARS CREDIT COUNSELING SMALL BUSINESS CHAPTER 11 CASES STUDENT LOAN DISCHARGE GOOD FAITH EFFORT CHAPTER 13