Same-sex marriage is a hot topic, and whatever your own opinion about the matter, twenty (of the twenty-four) Central District of California bankruptcy judges, in a unique showing of solidarity, made their opinions public in the Chapter 13 case of partners Gene Balas and Carlos Morales. The couple filed their case (2:11-bk-17831) on February 24, 2011, having been legally married in California on August 20, 2008. [Note: about 18,000 same-sex couples were legally married in California during a brief period prior to the passage of Proposition 8, a voter-approved prohibition against same-gendered marriage. While the issue is not yet officially resolved, most believe that marriages which took place before Proposition 8's passage remain valid. Accordingly, Balas and Morales, who are amongst the 18,000 couples who wed during the permissive period, have a presumably valid and binding marriage.] 
The United States Trustee moved to dismiss the bankruptcy on the auspices that the debtors were ineligible to file jointly (specifically by alleging that a single petition may be filed when filed by a debtor and the "individual's spouse). The Defense of Marriage Act - as is bankruptcy, of course, despite various nuance between states - a federal matter. This 1996 law states that "the word 'marriage' means only a legal union between one man and one woman as husband and wife, and the word 'spouse' refers only to a person of the opposite sex who is a husband or a wife."
The bankruptcy judge actually assigned to the case, Thomas B. Donovan, could not rule on the constitutionality of the Defense Against Marriage law itself, of course, as that ulimtate issue will likely find its way to the US Supreme Court eventually. Rather, the judge expressly narrowed the issue to that which presented before his court: "whether some legally married couples are entitled to fewer rights than other legally married couples..." The judge held that all married couples are on equal footing and, accordingly, Balas and Morales could, indeed, file jointly. Here is a link to the ruling.
Assuming standing, ripeness, and a will to proceed, an interlocutory appeal up the federal court ladder might be filed by the trustee so as to set aside the ruling of Judge Donovan or perhaps delay its implementation. In any event, the signature portion of the ruling is four pages long, signed by 19 other judges, in a clear and unabashed statement that they all believe gay marriage should be allowed.
To say that twenty judges signed an order otherwise about no more than a narrow issue of standing to file a bankruptcy is to miss the point: the judges were signaling explicitly that each of them supports gay marriage. It is a passive way of joining a Political Action Committee, donating to a campaign, writing a newspaper editorial, etc. They are using the bench to announce their private opinions - something judges are generally discouraged from doing. Judging is applying the facts to the law; it is not a pulpit. While I appreciate that the judges are real people and that the issue of gay marriage is vogue, perhaps we could let the legislators legislate and/or the people vote on their own referendums without hearing it from the bench, too.
Continue reading "Same-Sex Couple Okay to File Joint Bankruptcy Says California Judge -- Not Applicable in Philadlephia (yet?)" »
President Obama on Monday announced a major overhaul to the Home Affordable Refinancing Program (HARP) in an effort to help those facing foreclosure. The move is also aimed to stimulate the national economy, generally, as the avoidance of foreclosures means less REO ("real estate owned" or bank owned) property and improved investment and expenditure. HARP was intended, when originally passed in 2009, to do these very same things, but the program has far under performed. Some of the reasons for failure seem to be addressed in this 2011 iteration. 
Ms. Lorraine McNeal argued that her wholly unsecured second mortgage should be subject to a lien strip in a Chapter 7 bankruptcy case. The result was unsurprising: a lien strip is not appropriate in a Chapter 7 bankruptcy case. This upholds the status quo of a case called Dewsnup, which specifically denied a lienstrip under the auspices of 11 USC ยง506 strip-off. Nonetheless, it is good to ask the question. When one domino falls - that is, when one judge grants the relief - the door becomes slightly cracked, allowing other judges to rely on it, thereby opening the door ever so gradually. Ultimately, a case which fundamentally changes the established framework of lienstrips will find its way up the ladder to, presumably, the United States Supreme Court, but it takes a case to get a case heard before the court. 
