All’s fair in love and war. I had a client who gave his fiancée a $20,000 diamond ring. Client decided not to push through with the marriage and asked fiancée to give him back the diamond ring. Ex-fiancée refused to give it back saying he gave her the ring so it belongs to her. Client contended that he gave her the ring on condition that she became his wife. Since that condition would not be fulfilled, client contended that he only lent her the ring. Both parties then filed for Chapter 7 separately. Since there was no exemption to cover the ring in both cases, the Chapter 7 trustee for fiancée’s case ended up claiming the ring as part of her bankruptcy estate. Be careful before you part with something valuable. Giving a valuable gift to someone because you were struck by Cupid’s arrow is a legally valid transfer of ownership. Once ownership has been transferred, it is hard to get it back.

In Re Mead, the Chapter 7 debtor listed Ms. Ward, his former fiancée, as a creditor with a disputed claim in an unknown amount. The debtor’s schedules said Ward sued him in Federal court regarding ownership of property in Illinois. She also sued him in bankruptcy court, asking the court to deny his discharge. It’s a thin line between love and hate. Ms. Ward said debtor promised her the sun, the moon and the stars but all he gave her was an empty lot in Nevada, ten miles from the strip. We all know that property values in Vegas have gone to the South Pole since Obama told us not to gamble our unemployment benefits there. The Federal civil suit and the adversary proceeding were both dismissed. In September 2011, seven months after debtor received his discharge, Ms. Ward filed a motion to reinstate the Federal lawsuit. Hell knows no wrath as a woman scorned. The motion was denied on October 4. The next day, debtor moved to reopen his Chapter 7 case, and to hold Ms. Ward in contempt of the discharge order. A bankruptcy discharge order is a Federal court order that prohibits continued collection efforts against debtor. Thus, post discharge, collection efforts against debtor are in contempt of the discharge order.