OpinionsWilmington Savings Fund Society, FSB, a mortgage creditor of the chapter 13 debtors, sought relief from the automatic stay and abandonment. The debtors did not oppose the motion, so Wilmington filed an affidavit of no objection and proposed order in accordance with Local Rule 9014.1. While granting Wilmington relief from the automatic stay and abandonment as to the subject property was appropriate, Wilmington's proposed order requested that its claim be deemed withdrawn so it could avoid the requirements of Federal Rule of Bankruptcy Procedure 3002.1 (which requires mortgage creditors to provide chapter 13 debtors, who propose a "cure and maintain" on their principal residence under 11 U.S.C. section 1322(b)(5), notice of mortgage payment changes and a statement about whether the debtors cured their default and whether they are otherwise current with their mortgage payments upon plan completion), and also requested an award of attorneys' fees. The court granted Wilmington relief from the automatic stay and abandonment and deemed its claim withdrawn, but explained that without a timely-filed proof of claim in the claims register, an award of attorneys' fees was not appropriate. In re Antoinette Benton, Case No. 14-33505, Harry Kaufmann Motorcars, Inc. v. Debtor, Adv. No. 15-2067 (October 2015) -- Judge M.D. McGarity Plaintiff filed complaint to determine dischargeability of debt based on a fraudulent check tendered for the down payment on a vehicle purchased by Chapter 7 Debtor. The debt owed by the Debtor was found to be excepted from discharge under 11 U.S.C. § 523(a)(2)(A) due to Debtor's silence and concealment of a material fact. In re Romero, 539 B.R. 557 (October 2015) -- Judge S.V. Kelley Debtor's Chapter 13 plan violated equal payments requirement by proposing to pay adequate protection to creditor until attorney's fees were paid and then increasing payments to secured creditor. The decision offers suggestions for provisions that do not violate the equal payments requirement. In re Tina Enders, Case No. 15-21737 (September 2015) -- Chief Judge G.M. Halfenger Creditor objected to confirmation of the debtor's chapter 13 plan contending that the plan's payment of its secured claim in pro rata distributions did not comply with 11 U.S.C. §1325(a)(5)(B)(iii)(I)'s requirement that periodic payments on secured claims be made in “equal monthly amounts”. The court sustained the objection. In re Ashley Phillips, Case No. 14-29453 (September 2015) -- Chief Judge G.M. Halfenger The United States Department of Education filed a late claim in this chapter 13 case. The trustee objected. The Department argued that the claim should be allowed under 11 U.S.C. §105 or based on “due process considerations” because the debtor had not listed the claim and it had not received notice of the bankruptcy until after the claims bar deadline. The court sustained the objection. In re Tamera Kuchenbecker, Case No. 10-33067 (September 2015) -- Chief Judge G.M. Halfenger The debtor filed a motion to reconsider the court's denial of her post-conformation motion to modify a chapter 13 plan that would change payments on unsecured claims from 100% to 0%. She contended that she lacked a valuable interest in joint tenancy property, and, therefore, her proposed modification did not fail the best-interests-of-creditors test. Although the property deed lists her as a cotenant, she argued that her interest lacks liquidation value because she holds only “bare legal title” or, alternatively, that her interest in the property is impaired by an equitable lien. The court denied the debtor's motion for reconsideration and held that (1) as against a trustee representing the interests of creditors, the deed's designation of ownership determines the allocation of real property rights and cannot be disregarded based on the debtor's limited use of the property or lack of contribution to maintaining it; and (2) under Wisconsin law, the debtor could not employ the equitable lien doctrine to shield property from creditors. In re Thomas and Natasha Rowell (September 2015) -- Judge S.V. Kelley Construing the language of § 707(b)(2)(D) that certain veterans are exempt from "any form of means testing," the Court dismissed the case under the totality of the circumstances because the wealthy debtors had a large surplus of income over their lavish expenses and they cited no factors such as a medical condition, calamity or inability to fund a Chapter 13 plan to demonstrate their need for Chapter 7 relief. In re Guerrero, Case No. 15-26746, 536 B.R. 817 (September 2015) -- Judge B.E. Hanan Creditor and debtor were, respectively, vendor and vendee of the debtor's principal residence pursuant to a land contract. When the land contract matured, the debtor failed to make a “balloon” payment of the outstanding balance as required by the contract, and the creditor moved for strict foreclosure in state court. After the debtor filed her bankruptcy case, the creditor moved for relief from the automatic stay under sections 362(d)(1) and (2), and from the codebtor stay as to the debtor's non-filing spouse under section 1301(c), to continue the strict foreclosure action. The creditor argued that she was entitled to relief because: (1) she would be unable to pay off a second mortgage that her husband and his ex-wife took out on the creditor's own home if the debtor were allowed to spread the balloon payment over the life of her chapter 13 plan; (2) the land contract was either an executory contract that the debtor was required to accept in its entirety, or a security interest that the debtor could not modify pursuant to section 1322(b)(2); and (3) the debtor had no equity in the property until completion of the land contract. The court denied the motion. The court first looked to Wisconsin law to conclude that the land contract was a security device and not an executory contract within the meaning of the Code. The court then found that the creditor was not entitled to relief because: (1) the creditor failed to establish a decline in the value of the collateral; (2) the debtor was authorized to pay off the balloon payment through her plan under section 1322(c)(2); (3) the creditor failed to prove that the debtor lacked equity in the property; and (4) mere delay in payment does not constitute irreparable harm sufficient to lift the codebtor stay. In re Gary J. Ambrosius, 536 B.R. 814 (August 2015) -- Judge S.V. Kelley Failure to pay post-petition taxes was not cause for dismissal of Chapter 13 case where the Plan did not require the payment of § 1305 claims. The tax claims will survive the discharge, and the Debtor is liable for all applicable interest and penalties, but nonpayment did not constitute a violation of the confirmed Plan. In re Carl and Linda Segebrecht, 536 B.R. 810 (August 2015) -- Judge S.V. Kelley Homeowners Association Claim for attorneys' fees in litigating with Debtors was not allowed secured claim in Debtors' Chapter 13 case. |