In re Thomas
Aug 25, 2018OUTCOME: Andrew's client was able to keep the money from selling her house
In this case, Ms. Thomas had sold her house prior to filing Chapter 7 Bankruptcy in Minnesota and had kept the sales proceeds separate from other money. Under Minnesota Homestead Law, the money from s ... elling a house is exempt from the claims of creditors or bankruptcy trustees for 1 year from the date of the sale. The bankruptcy trustee argued that because the proceeds from the sale of the house are only exempt for 1 year from sale, that if they hadn’t been spent within 1 year, then the debtor should pay the proceeds into the bankruptcy. Andrew Walker argued that whether an assets is protected in bankruptcy or not depends on the status of the asset only on the day that the bankruptcy is filed. Because the bankruptcy was filed within 1 year of selling the house, the money was protected from the bankruptcy forever. Judge Ridgway agreed with Andrew Walker’s argument and formally adopted the snapshot rule for the Minnesota Homestead Exemption.
