TheFloridaBankruptcyLawBlog

Florida’s Chapter 7 bankruptcy debtors may exempt $1,000 of personal property per debtor, and if not claiming homestead exemption, an additional $4,000. The value of personal property for bankruptcy purposes is based on flea market, garage sale, or liquidation value. Bankruptcy attorneys rely upon their clients to list and value their property.

Florida common law is that entireties property is exempt from all creditors of either spouse, but it is not exempt from joint creditors. Tenants by entireties property in bankruptcy proceedings has been the subjection of judicial debate over the years when one spouse files bankruptcy, and where the debtor spouse has both individual debts and joint debts with their non-filing spouse.

One of the defenses to a fraudulent transfer action is that the debtor’s transfer in question was for “reasonably equivalent value.” The general rule is that a transfer to repay a loan is a transfer for value because the transferor receives a deduction in the principal and interest owed on the debt.

Where may a business file bankruptcy? The president of a small family business based in Georgia called me to ask whether his business could file a Chapter 11 bankruptcy in Florida. The business was a Georgia corporation with offices in Atlanta, Orlando, and Tampa. The caller preferred to file bankruptcy in Florida because he thought doing so would reduce the publicity and his own embarrassment in Atlanta where the president resided.

A criminal attorney called me this week to discuss the possible Chapter 7 bankruptcy by one of his current criminal clients who had been convicted of a financial crime against individual victims. The court ordered payment of restitution to the victims which the client could not afford to pay following his conviction and incarceration.When the client had served his criminal sentence the criminal court converted the restitution order to a civil judgment.