Mano-Y&M Ltd. v. Field (In re Mortgage Store, Inc.), 773 F.3d 990 (9th Cir. 2014) –
A chapter 7 trustee sought to avoid a transfer by the debtor as a fraudulent conveyance and then to recover funds disbursed by the debtor to the seller of a shopping plaza. The trustee contended that the seller, and not the purchaser, was the “initial transferee” and consequently was absolutely liable. The bankruptcy court and district court agreed, and the seller appealed to the 9th Circuit. Continue reading
The debtor objected to a secured creditor’s claim on a number of grounds: it did not default, if it defaulted it was entitled to an opportunity to cure, the prepayment penalty was unreasonable, default interest was calculated incorrectly, and a lender cannot recover both default interest and late charges. The debtor actually won one of these arguments. Continue reading
Rev Op Group v. ML Manager LLC (In re Mortgages Ltd.), 771 F.3d 623 (9th Cir. 2014) –
Under the terms of a debtor’s confirmed plan of reorganization, an entity (ML Manager) was designated to manage the debtor’s portfolio of mortgage loans. The issue in this appeal was whether ML Manager was authorized to act as an agent for pass-through investors in selling loans over the objection of some of the investors. Continue reading
Morris v. Ark Valley Credit Union (In re Gracy), 522 B.R. 686 (Bankr. D. Kan. 2015) –
A chapter 7 trustee sought to avoid a credit union’s security interest in a manufactured home by asserting his strong arm powers as a hypothetical lien creditor based on the lender’s failure to perfect its lien. The bankruptcy court declined to avoid the lien since it held there was no lien to avoid. Continue reading
A Chapter 7 trustee objected to the proof of claim filed by a downstream assignee of a lost mortgage note. The trustee sought both to reject the claim and to avoid the mortgage (so that he could preserve the mortgage lien for the benefit of the estate). The bankruptcy court held for the trustee with respect to the note and for the mortgagee with respect to the right to enforce the mortgage. Both parties appealed. Continue reading
In re Sky Ventures, LLC, 523 B.R. 163 (Bankr. D. Minn. 2014) –
After a debtor obtained court approval to retroactively reject a lease as of the bankruptcy filing date, the landlord moved to reset the rejection date and for allowance of an administrative expense priority claim for post-petition rent. Continue reading
Bankruptcy-RealEstate-Insights 