Bankruptcy Trustee Ordered to Return Inheritance Money to Debtor

The problem. A bankruptcy trustee obtained thousands of dollars which should have been distributed to a debtor according to the terms of the trust. The bankruptcy trustee argued the money was the property of the bankruptcy estate because it was a bequest, devise or inheritance made within 180 days of filing the bankruptcy petition.

The solution. Dave successfully moved the court to order the bankruptcy trustee to return all of the money to the debtor because the trust distribution was not property of the bankruptcy estate under the Bankruptcy Code and Minnesota law.