United States Trustee v. Cortez (In re Cortez), 457 F.3d 448 (5th Cir. 2006);

Behrooz P. Vida

Case Conclusion Date:July 20, 2006

Practice Area:Bankruptcy / Debt

Outcome:District Court was affirmed.

Description:On an issue of first impression, the appellate court concluded that dismissal for substantial abuse in 11 U.S.C.S. § 707(b) included a consideration of post-petition events because the absence of limiting language regarding the consideration of charitable contributions indicated that Congress did not intend to place any other limitations on the bankruptcy court in ruling on a motion to dismiss under § 707(b). Moreover, the phrase "or continues to make" suggested that the bankruptcy court was entitled to focus on subsequent developments in the debtor's financial condition, except to what charities the debtor was presently contributing. Although post-petition earnings were not property of the estate under 11 U.S.C.S. § 541(a)(6), the bankruptcy court was to take them into account.