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Spousal support, alimony not dischargable in bankruptcy

The Chapter 13 debtor could not discharge the creditor-ex-wife's $12,500 claim for payment of a second mortgage and a judgment lien on the former marital home, because this debt was "in the nature of alimony, maintenance, or support." The debtor argued this claim was not a domestic support obligation but was instead "for a second mortgage debt and judgment lien on property that were satisfied when the real estate was sold by creditor previously . . . ." Chapter 13 "distinguishes between domestic support obligations, which are non-dischargeable, and other . . . 'post-marital obligations,' including property settlements, which are dischargeable." Domestic support obligations, "as a priority debt, must be paid in full during the chapter 13 plan." The bankruptcy court analyzed the claim at issue using the Calhoun factors, considered the two consent decrees from the parties' divorces and a later trial court order in the second divorce, and "determined that it was the intent of the state court and the parties to create a support obligation." The fact "the mortgage payments helped provide a residence for the children is a strong indication that the payments were intended as support rather than a property settlement." The court concluded that the "state court intended Creditor to keep the family home as a residence and shelter for the children or to have the proceeds of the sale of the home as support." Further, the bankruptcy court correctly held that "the $5,000 debt that arose from Creditor paying off a judgment lien against the home was a domestic support obligation." The judicial lien filed against the home reduced the amount of support that the children received when the home was sold. At the time of the 2009 order, the home had already been sold. The court reasoned that if the state court's "intention had been for the proceeds of the sale to be a property settlement, the state court could have made that clarification. Because the payment of the second mortgage is tied to support issues in all three judgments, and the judgment lien debt reduced the amount of support received and is provided for as part of a support order, the bankruptcy court's finding that the state court intended both these debts be treated as support obligations is not clearly erroneous." Affirmed.

MICHIGAN WILLS/TRUSTS 33: Trustees required to provide notice informing recipients that they may challenge the validity of a trust and the period allowed for bringing such a challenge.

The notice sent clearly advised her that if she wanted to contest the validity of the Trust in a judicial proceeding, the law required her to do so within six months from the date of the letter. Nothing in the statute requires a trustee to inform the recipients of the specific legal consequences of not acting during the time allowed.

MICHIGAN REAL ESTATE 97: The court imposed a constructive trust on defendant’s one-half interest in the property in favor of plaintiff.

The trial court found that plaintiff sustained her burden of establishing that a constructive trust was necessary to prevent defendant from being unjustly enriched. Accordingly, the court imposed a constructive trust on defendant’s one-half interest in the property in favor of plaintiff and ordered defendant to convey his interest in the property to plaintiff.

MICHIGAN REAL ESTATE 95: Property owners did not place a condition upon the delivery of the deed; rather, they delivered the deed to themselves.

When the delivery of a deed is contingent upon the happening of some future event, title to the subject property will not transfer to the grantee until the event has occurred. However, in this case A and J did not place a condition upon the delivery of the deed; rather, they delivered the deed to themselves, then deposited the deed with their attorney with the instruction to record the deed only upon the happening of a future event, thereby placing a condition only upon the recording of the deed.

MICHIGAN PROBATE 57: Brother granted permanent guardianship of siblings.

At a multiday hearing to address the extension of the guardianship, the eldest children, the mother’s relatives and friends, and school personnel testified regarding the mother’s care of the children, appellant’s treatment of and interaction with the children, and the eldest siblings’ role in aiding the mother to raise the children.

FAMILY LAW 88: The trial court found that the children did not have an established custodial environment with defendant because, before the separation, he did not have a large role in the children’s lives.

The trial court credited plaintiff’s testimony that, before the parties’ separation, defendant spent minimal time helping to care for the children, so its finding that the children would not have looked to defendant for guidance, discipline, the necessities of life, and parental comfort during that time was not against the great weight of the evidence.

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