Farm Debtor May Be Entitled to State Law Exemption.

The debtor filed Chapter 12 bankruptcy and listed the bulk of his crop sale proceeds on his bankruptcy schedules as exempt "farm earnings" in accordance with Minn. Stat. Sec. 550.37(13)(exemption for disposable earnings).  The crop sales were evidenced by checks made jointly payable to the debtor and several secured creditors.  A creditor and the bankruptcy trustee objected to the claimed exemption.  Disallowing the claimed exemption would mean that more funds would be available to pay secured creditors.  A creditor later claimed that because the checks had ultimately bee turned over to another creditor that the issue was moot because the debtor no longer had any interest in the funds.  The court, reversing the bankruptcy court, disagreed.  The court held that the turnover of the checks to a creditor did not constitute a determination of what amount would be paid to unsecured creditors.  Thus, the issue of whether the state law exemption provision applied was not moot.  In re Seifert, No. 14-6044, 2015 Bankr. LEXIS 1723 (B.A.P. 8th Cir. May 22, 2015).  

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