Update on Trump’s Coup: Do Not Think That This Is Guaranteed to End Well

NEIL H. BUCHANAN

UF Levin College of Law professor Neil H. Buchanan explains why “being patient with Trump” is a recipe for disaster, why there are still reasons to be guardedly optimistic, and why this all could still end very badly. Buchanan argues that the present situation is not guaranteed end badly, but he cautions that a Trump coup is eminently possible.

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In re Glenview Health Care Facility, Inc.

Court: US Court of Appeals for the Sixth Circuit

Docket: 19-8028

Opinion Date: November 6, 2020

Judge: Dales

Areas of Law: Bankruptcy, Legal Ethics

Glenview, a Glasgow, Kentucky nursing home, jointly owned by Bush and Howlett for over 30 years, filed a voluntary chapter 11 bankruptcy petition. The Official Creditors Committee was formed and filed an application to retain DBG, with a declaration from DGB's managing partner, disclosing that DBG had previously represented Howlett in estate planning matters, unrelated to the Chapter 11 case, that the representation concluded in 2017, and that the professionals who represented Howlett would not represent the Committee. Glenview filed an objection, although Howlett did not, asserting that DBG assisted Glenview and Howlett with the preparation of a buy-sell agreement for Glenview and all its assets, attaching an invoice from DBG for a period in 2016. DBG asserted that no buy-sell agreement was consummated, and that the representation related only to estate planning. The bankruptcy court heard arguments but did not conduct an evidentiary hearing, then denied the Committee’s application to employ DBG. The Sixth Circuit Bankruptcy Appellate Panel vacated, finding that the court abused its discretion under 11 U.S.C. 1103. State and federal courts jealously guard the attorney-client relationship and that solicitude extends to a committee’s choice of counsel in bankruptcy.

Brace v. Speier

Court: US Court of Appeals for the Ninth Circuit

Docket: 17-60032

Opinion Date: November 9, 2020

Judge: David A. Ezra

Areas of Law: Bankruptcy

Chapter 7 debtor and his wife (collectively, "appellants") appealed the bankruptcy appellate panel's order affirming the bankruptcy court's judgment in an adversary proceeding brought by the Chapter 7 trustee. At issue is the characterization of two properties acquired by appellants during their marriage but before debtor individually filed for bankruptcy protection. The panel certified to the Supreme Court of California the question whether, in Chapter 7 bankruptcy proceedings, Cal. Evid. Code 662, which affords a presumption based on the property's form of title, supersedes Cal. Fam. Code 760, which applies a presumption in favor of community property for property purchased during the marriage with community property. The California Supreme Court determined that for joint tenancy property acquired during marriage before 1975, each spouse's interest is presumptively separate in character. For such property acquired with community funds on or after January 1, 1975, the property is presumptively community in character. For property acquired before 1985, the parties can show a transmutation from community property to separate property by oral or written agreement or a common understanding. For joint tenancy property acquired with community funds on or after January 1, 1985, a written declaration is required. In light of the Supreme Court of California's opinion answering the panel's certified question, the panel held that the bankruptcy courts properly applied California law to the characterization of the Redlands Property. In this case, the community property presumption applied because the property was acquired with community funds on or after January 1, 1975. However, the panel held that the bankruptcy courts did not make the necessary factual finding regarding when the San Bernardino Property was purchased to apply the proper presumptions when characterizing that property. Finally, the panel saw no clear error in the bankruptcy courts' finding that appellants failed to meet the requirements for a transmutation of either property. Accordingly, the panel affirmed in part and vacated and remanded in part.