Evidence that would be inadmissible hearsay in state court satisfied Bankruptcy Rule 3001 for purposes of establishing the validity of the debt buyer’s proofs of claim. Walston v. PYOD, LLC, No. 14-14593 (11th Cir. June 2, 2015). [Read more…] about Debtor Takes Road Less Traveled to POC Challenge and Hits Dead End
One of Three Illinois Cases Gets it Right in FDCPA Case
Three cases out of the Northern District of Illinois address the issue of whether filing a proof of claim in Chapter 13 bankruptcy for a stale debt can be the basis for an FDCPA claim. In Murff v. LVNV Funding (In re Murff), No. 13-44431, Adv. Proc. 14-790 (Bankr. N.D. Ill. June 15, 2015) and LaGrone v. LVNV Funding (In re LaGrone), 525 B.R. 419 (Bankr. N.D. Ill. Jan. 21, 2015), the courts essentially found the element of deception for a FDCPA violation is not present in the context of a bankruptcy case. In Avalos v. LVNV Funding (In re Avalos), No. 13-40865, Adv. Proc. 15-91(Bankr. N.D. Ill. June 12, 2015), Judge Schmetterer found that the determination of whether debt-collector conduct is deceptive is an issue of fact to be addressed on a case-by-case basis. [Read more…] about One of Three Illinois Cases Gets it Right in FDCPA Case
Proof-of-Claim Deadline Applies to Secured and Unsecured Alike
“The deadline for filing a proof of claim in Federal Rule of Bankruptcy Procedure 3002(c) applies to all claims, including those of secured creditors.” In re Pajian, No.14-2052 (7th Cir. May 11, 2015). [Read more…] about Proof-of-Claim Deadline Applies to Secured and Unsecured Alike
Priority of Noteholders in Duplicate Note Scheme
A Florida appellate court addressing a fraudulent scheme involving selling duplicate promissory notes found that “the bank that first perfected its interest in a note and related mortgage is entitled to the priority of its interest.” HSBC Bank USA v. Perez, No. 4D13-3193 (Fla. Dist. Ct. App. May 6, 2015). [Read more…] about Priority of Noteholders in Duplicate Note Scheme
Ocwen Stuck with Debtor’s Proof of Claim for $1
Relying on equitable principles, the court declined to allow Ocwen’s late-filed proof of claim after the debtor filed a proof of claim on its behalf for $1. In re Egan, No. 14-36831, __ B.R. __ (Bankr. S.D. N.Y. March 2, 2015). [Read more…] about Ocwen Stuck with Debtor’s Proof of Claim for $1
Court Turns Jaundiced Eye on Wells Fargo Robo-Mischief
Wells Fargo lacked standing to assert a claim under a Note secured by a Deed of Trust, where a forged endorsement in blank did not give it “holder” status under applicable Texas law. In re Franklin, No. 10‐20010 (Bankr. S.D. N.Y. Jan. 29, 2015). [Read more…] about Court Turns Jaundiced Eye on Wells Fargo Robo-Mischief
Creditor’s Failure to Comply with Rule 3002.1(g) Is Basis for Violation of State Consumer Law
The district court denied PNC’s motion to dismiss the borrowers’ complaint for violations of California consumer protection laws and common law claims based on PNC’s foreclosure action after the plaintiffs completed their Chapter 13 plan. Sokoloski v. PNC Mortgage, No. 14-1374, 2014 WL 6473810 (E.D. Cal. Nov. 18, 2014). [Read more…] about Creditor’s Failure to Comply with Rule 3002.1(g) Is Basis for Violation of State Consumer Law
No Presumption of Validity of Claim under Rule 3002.1
On January 3, 2013, the Chapter 13 trustee filed “Trustee’s Notice of Final Cure Payment and Motion to Deem Mortgage Current,” filed under Rule 3002.1(f) seeking an order that the debtor’s mortgagee was current, that all escrow deficiencies had been cured, and that all fees had been satisfied in full. The mortgage creditor filed a timely objection under Rule 3002.1(g), arguing that the debtor had incurred post-petition arrearages of $25,798.02. However, the creditor did not present any evidence of any disbursements to substantiate the arrearage. The court found that supplemental claims did not enjoy a presumption of validity and, because the debtor had made all payments required by the amended plan, it granted the trustee’s motion. In re Rodriguez, No. 08-80025 (Bankr. S.D. Tex. July 8, 2013). [Read more…] about No Presumption of Validity of Claim under Rule 3002.1
Court Rejects Unsupported Escrow Charges
In In the Matter of Breit, the chapter 13 trustee filed an objection to JPMorgan Chase’s proof of claim relating to the debtor’s residential mortgage. No. 11-32461 (Bankr. N.D. Ind. March 27, 2013). In its POC, Chase claimed an arrearage in the amount of $27,897.09, encompassing unpaid monthly installments of $1,102.53 which represented a principal and interest component of $804.79, and an escrow component of $297.74. Under this calculation, Chase sought $7,145.76 attributable to the escrow deficiency. Although RESPA contemplates the creation of an escrow account to cover, among other things, tax and insurance payments that the mortgage servicer is forced to pay on behalf of a delinquent debtor, the trustee argued that the arrearage claim should be reduced by $3,379.35 because Chase had actually paid only $2,909.37 for those obligations. The court agreed. It rejected Chase’s “mathematical manipulation” (Chase’s phrase) in calculating the pre-petition escrow shortfall and permitted recovery only of those expenditures authorized by RESPA. Thus, even though Chase had met its initial burden of proof with respect to Rule 3001, it failed to counter the trustee’s evidence refuting the POC and therefore failed to meet its ultimate burden of proving the validity of the claim.
Bank is Sanctioned for Rule 3001 Violation
A bankruptcy court in Colorado sanctioned FirstBank for failure to comply with the itemization requirements of Rule 3001. In re Jimenez, No. 12-26282 (Bankr. Colo. Feb. 1, 2013). [Read more…] about Bank is Sanctioned for Rule 3001 Violation