UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF KENTUCKY
COVINGTON DIVISION
IN RE:
LAURIE
NIENABER CASE NO. 00-20612
DEBTOR
MEMORANDUM OPINION AND ORDER
There is before the court a Motion by debtor, Laurie
Nienaber, to Avoid a Lien with Michael Brumback filed herein on March 24,
2000. Brumback has filed his Response
and the matter was heard on July 3, 2000.
At that hearing, the court gave the parties an opportunity to further
brief the matter and the debtor filed Debtors Reply on Motion to Avoid
Judicial Lien on Exempt Property Under Section 522(f) on July 12, 2000 and the
creditor filed Creditors Response to Debtors Reply as to Avoiding Judicial
Lien on July 18, 2000.
Prior to filing this Chapter 7 proceeding, the
creditor, Michael Brumback, was the spouse of Laurie Nienaber. At some point after that marriage, Brumback
obtained a judgment against the debtor in the approximate amount of $13,190 in
the Campbell Circuit Court.
Subsequently, the debtor has remarried and has acquired, jointly with
her new spouse, real property at 6048 Kenner Drive, Florence, Kentucky.
The debtor asserts that she is entitled to avoid the
lien pursuant to 11 USC §522(f)(1)(A).
The creditor responds that because that Section allows avoidance only
where an exemption is impaired, avoidance is not allowed here because the
exemption does not apply to this creditor.
The creditor proceeds to point out that KRS 427.060, which provides the
homestead exemption, also provides as follows:
...This exemption shall not apply if the debt or
liability existed prior to the purchase of the property or the erection of the
improvements thereon.
The debtor also asserts that KRS 427.160 is applicable
in that the $1,000 wildcard exemption of the debtor leaves a balance also to
apply to this property. The creditor
argues that the debtor has more than used up the wildcard exemption on other
property, including cash in a checking account and other property.
With respect to the homestead exemption, it appears
that the plain language of KRS 427.060 precludes the assertion of the homestead
exemption as against this creditor since the property was acquired after the
debt to this creditor was created. In
re Bush, 197 BR 378 (Bankr. W.D.Ky. 1995).
In re Kincaid, 55 BR 652 (Bankr. W.D.Ky. 1985). Therefore, the debtor is not entitled to
avoid the judgment lien of creditor, Michael Brumback in this matter. Further, even if the debtor has not used all
of her wildcard exemption as she contends, that exemption arises only upon
the filing of the bankruptcy case which is after the creditors execution lien
had already attached so it would be inferior to the execution lien. KRS 427.160.
Wherefore, it is hereby ordered that the Motion to
Avoid the Lien of creditor, Michael Brumback, herein against the debtors
residence be, and the same hereby is, OVERRULED.
Dated this day of July,
2000.
BY
THE COURT
JUDGE
COPIES TO:
Steven Schiller, Esq.
Justin Verst, Esq.
James Nolan, Esq.