Norwest Bank Nebraska, N.A. v. Tveten

Outcome: Client rec'd Discharge by confirming Ch. 11 Plan

Description: This case resulted in 3 reported decisions includng the Eighth Circuit decison referenced here. It is one of the most cited "pre-bankruptcy planning" decisons. The debtor converted over $700,000 of non-exempot property into exempt property prior to filing bankruptcy. Although the Eighth Circuit, over a vigorous dissent, found that the debtor had done too much "planning", by getting a reorganization plan confirmed, the debtor ultimately received his discharge. This case should be read with Panuska v. Johnson, also profiled here, to understand the limits of what a debtor may do and may not do prior to filing bankruptcy to obtain the maximum benefit and fresh start. The Eighth Circuit recently reaffirmed the principles laid out in this case and Johnson in In re Addison, No. 07-2064 (8th Cir. 8/7/2008) (8th Cir., 2008) .