Posted by NCBRC - March 23rd, 2015
The debtor’s pre-petition TILA claims were part of his chapter 7 bankruptcy estate and, therefore, only the trustee had standing to bring those claims while the bankruptcy was pending. Bernstein v. Wells Fargo (In re Bernstein), No. 14-65054, Adv. Proc. 14-5306 (Bankr. N.D. Ga. Jan. 2, 2015). Read More
Posted by NCBRC - December 17th, 2014
Like a ray of sunshine through a storm of obfuscation and false compliance, the Bankruptcy Court for the Southern District of New York found that Wells Fargo’s administrative freeze on bankruptcy debtors’ accounts violates the automatic stay, and debtors injured by the violation have standing to seek damages. In re Weidenbenner, No. 14-35443, 2014 Bankr. LEXIS 5009 (Bankr. S.D. N.Y. Dec. 12, 2014). Read More
Posted by NCBRC - February 10th, 2014
A chapter 13 debtor may exercise the trustee’s avoidance powers under section 544 if doing so will benefit the bankruptcy estate. In re Aiwohi, 13-90038 (Bankr. Haw. Jan. 31, 2014). Read More
Posted by NCBRC - November 15th, 2013
A debtor has standing under section 522(h) to bring an action to avoid a statutory lien under section 545(2). In In re McCarthy, No. 13-6042 (B.A.P. 8th Cir. Oct. 28, 2013), the debtor filed an adversary proceeding seeking to avoid an attorney fee statutory lien as impairing his homestead exemption under Minnesota law. The bankruptcy court dismissed the proceeding on the basis that, under section 545(2), the debtor “lacks the authority and ability to exercise the strong-arm powers of the trustee to defeat a statutory lien.” The BAP found that, while section 545 does provide that the “trustee may avoid the fixing of a statutory lien on property of the debtor,” the bankruptcy court’s inquiry should not have stopped there. Section 522(h), in conjunction with section 522(g)(1), provides an avenue for the debtor to avoid a lien that is avoidable by the trustee under section 545. Under these sections the BAP set forth five requirements that must be met to allow a debtor to avoid a statutory lien: “(1) the debtor’s transfer of property must have been involuntary; [§ 522(g)(1)(A)] (2) the debtor must not have concealed the property [§ 522(g)(1)(B)]; (3) the trustee must not have attempted to avoid the transfer [§ 522(h)(2)]; (4) the debtor must seek to exercise an avoidance power enumerated under § 522(h); and (5) the transferred property must be such that it could have been exempted if the trustee had avoided the transfer under the provisions of § 522(g) [§ 522(h)(1)].” Finding that section 522 gives the debtor the power to avoid the statutory lien, despite section 545’s limitation to the trustee, the court reversed and remanded to allow the bankruptcy court to address the merits of the debtor’s lien avoidance action.
McCarthy opinion
Posted by NCBRC - September 16th, 2013
In In re Gandy, No. 11-30369 (Bankr. E.D. Tenn. July 12, 2013), the court found that a creditor had no standing under section 707(b) to seek dismissal of a chapter 7 petition, after conversion from chapter 13, where debtor’s petition documents showed him to be below-median. Read More
Posted by NCBRC - May 22nd, 2013
The Fourth Circuit confirmed the chapter 13 debtor’s standing to pursue a pre-petition cause of action against his former employer. Wilson v. Dollar General Corp., No. 12-1573 (4th Cir. May 17, 2013). Read More
Posted by NCBRC - February 12th, 2013
The Bankruptcy Court for the Southern District of New York denied U.S. Bank’s motion for relief from stay on the basis that U.S. Bank had failed to show that it had standing to obtain such relief. In re Idicula, No. 12-12120 (Bankr. S.D. N.Y. Jan. 10, 2013). Read More
Posted by NCBRC - December 20th, 2012
A Michigan state court found that a debtor may oppose foreclosure on the basis that the assignment of the mortgage to the foreclosing party was in violation of the Pooling and Service Agreement and, therefore, ineffective. HSBC Bank, USA v. Young, No. 11-693 (Cir. Ct. Mich. Oct. 16, 2012). HSBC conducted a foreclosure by advertisement and bought the property at the foreclosure sale. When it moved the court for possession of the property the debtor challenged the legitimacy of the foreclosure on the basis that the assignment of the note and mortgage from Wells Fargo to HSBC took place after the note was in default in violation of the terms of the PSA. Read More
Posted by NCBRC - April 4th, 2012
The Eastern District of New York found that the Bankruptcy Court overstepped its jurisdictional bounds when it entered an advisory opinion that MERS, as “nominee,” had no power to assign mortgages. In re Agard, No. 11-1826 (E.D. N.Y. March 28, 2012). Read More
Posted by NCBRC - February 7th, 2012
Last week, the Tenth Circuit Court of Appeals found that Deutsche Bank (DB) had not proved its status as a “party in interest” in a motion for relief from stay due to its failure to produce evidence of possession of the promissory note. In re Miller, No. 11-1232 (10th Cir., Feb. 1, 2012). The Millers filed a chapter 13 petition to prevent foreclosure sale of their home after the Colorado state court had granted an “Order Authorizing Sale” (OAS) under Civil Rule 120. In its motion for relief from stay DB presented only a copy of the Note indorsed in blank The bankruptcy court granted relief from stay based on the evidentiary showing, and the BAP affirmed on the basis of the state court’s OAS and the Rooker-Feldman doctrine. Read More