High Court Asks US To Weigh In On Ch. 7 Surcharge Question

Law360, New York (December 3, 2012, 4:54 PM EST) -- The U.S. Supreme Court on Monday asked the U.S. solicitor general to weigh in on whether a bankruptcy court can seek a special charge against a Chapter 7 debtor’s exempted residential property due to alleged debtor misconduct.

The high court sought the U.S. government's opinion in an appeal by Stephen Law, a California man who is appealing a Ninth Circuit decision upholding a $75,000 surcharge on his exempt property.

In 2006, the bankruptcy court ordered the surcharge at the request of Law’s Chapter 7 trustee, Alfred...
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