In re Augusta Center, LLC, 491 B.R. 298 (Bankr. S.D. Ga. 2013) –
The debtor owned and operated a hotel property. After it filed bankruptcy, it asked the court for authorization to use cash collateral (e.g. rents and revenues of the hotel). The lender objected, arguing that the debtor had absolutely conveyed its interest in rents and revenues so that the bankruptcy estate did not have any remaining interest. The bankruptcy court denied the lender’s objection. Continue reading
NTP Marble, Inc. v. Papadopoulos (In re NTP Marble, Inc.), 491 B.R. 208 (Bankr. E.D. Pa. 2013) –
Prior to bankruptcy, a claimant obtained a $4 million judgment, which supposedly represented one-third of the value of the debtor’s business. The debtor filed a bankruptcy complaint alleging that the creditor’s interest was equity rather than debt, so that its claim should be recharacterized or subordinated under Section 510 of the Bankruptcy Code. The creditor moved to dismiss the complaint; the bankruptcy court rejected the motion to dismiss, finding that the debtor’s allegations provided sufficient grounds to proceed. Continue reading
DeGiacomo v. Traverse (In re Traverse), 45 B.R. 815 (1st Cir. B.A.P. 2013) –
A chapter 7 trustee sought to avoid an unrecorded first mortgage on the debtor’s property and to preserve the mortgage lien for the benefit of the bankruptcy estate. The debtor responded by claiming that even if the trustee was successful, he could not sell the property without first foreclosing the mortgage in accordance with state law. The bankruptcy court rejected the debtor’s claims and granted the trustee’s motion for summary judgment. The debtor appealed to the bankruptcy appellate panel. Continue reading
In Re 4848, LLC, 490 B.R. 343 (Bankr. E.D. Wis. 2013) –
The debtor had entered into a forbearance agreement with its mortgage lender that included a stipulation that the lender would be entitled to relief from the automatic stay if the debtor became involved in a bankruptcy. After the debtor filed bankruptcy to stop a foreclosure sale, the lender moved for relief from the stay arguing that (1) the prepetition stay waiver constituted “cause” for relief, and (2) relief should be granted because the debtor’s plan did not have a reasonable possibility of being confirmed within a reasonable time. Continue reading
In re Benchmark Capital, Inc., 490 B.R. 566 (Bankr. E.D. Tenn. 2013) –
Unbeknownst to a foreclosing creditor, the personal representative of the deceased sole shareholder of a corporation that had been administratively dissolved more than a decade ago filed a chapter 7 bankruptcy petition on behalf of the corporation three days before the foreclosure sale of real estate owned by the corporation. After learning of the bankruptcy, the creditor sought to annul the automatic stay and retroactively validate the foreclosure sale. Continue reading
In re Marble Cliff Crossing Apartments, LLC, 485 B.R. 849 (Bankr. S.D. Ohio 2013) –
A secured creditor (MTGLQ) challenged the votes of another creditor that purchased claims on the grounds that either (1) the creditor should be treated as an insider or (2) it cast its votes in bad faith. The votes were important because the debtor wanted to count them in meeting a requirement under the Bankruptcy Code that its plan of reorganization be accepted by at least one impaired class without counting votes of insiders. Continue reading
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