good morning your honour's stephen warren of i'm of the myers on behalf of fannie mae appellant lender and defendant in the matter below your honor so the appeal here consists of one single issue of federal m it is uniquely and exclusively federal and the court approaches it with the novo review and that is what is the impact if any of the federal bankruptcy discharge on the a cruel and running of the statute of limitations foreclose in washington said another way does the discharge constitute a new maturity date does it and for that to be the case certain elements would have to be present as a result of the discharge it would have to terminate all of the future payments it would have to cause those future payments to accrue as of an earlier day it would be an acceleration in all elements none of these things are true and consequently the answer to our single question is no the discharge has no effect on the accrual of the statute of limitations all that does is render the obligation and recourse it eliminates the ability to reach in problem when these folks receive the water bill what were they supposed to do there was the pay it your honor with respect to the water bill whether they have an obligation to the water company i don't know that would be that i mean that there's certainly a world in which in which they do do they have an obligation to they have any obligation under under washington law or under any federal law to sort of maintain the property for fannie mae so that it by turning off the water turning off the gas turning off the electricity that may be spoiling the property if it is an obligation to maintain it for you or whenever you decide to do it between now and two thousand and forty two you're i guess what i'd say to that is i don't know what the underlying obligations would be between them but what i can say is whatever those obligations are they were established under washington law whether or not there was a discharge it's clear under washington law without a discharge the statute of limitations can run for thirty years that is a consequence of washington law the question here is whether the discharge changed that whatever the ambient rules were between the parties who is responsible for paying the water bill those things matter of federal law when washington gives effect to the implication of mortgages under washington law and others will it was washington sort of recognizing the federal judgment and giving any particular meaning in washington how does that interfere with any federal law well going to washington establishes what the ambient rules are for an installment contract and it has they run from each installment there's no dispute about what the washington statute would apply absent this charge the only question is whether the discharge changed that if there had been no bankruptcy there's no question what the result would be the statute has not run sure but why isn't why isn't this a matter of washington what you characterize this i think i think very smartly as a matter of federal law so you get to novo review i don't understand any federal law that's at issue here the effect of a of a bankruptcy that ha be dealt with by a whole variety of parties public and private and the effect of it is seems to me to be of no interest to the bankruptcy court new respectfully no your hon think the core of the bankruptcy is what the discharges the meaning of the discharge federal rules established what that effect is what happened here was the court treated the discharge as having been a determination of installment contract payments it doesn't do that that is uniquely federal question and there is a tense federal issue in terms of what happens with the discharge if washington were able to and i do not believe it is established a rule that in bankruptcies will have a different statute of limitations than we do apt absent a bankruptcy but if they did have that power could the washington rule that in a bankruptcy there's a different statute of limitations the two cases that were cited there clearly dicta it's there's no difference between the bankruptcy and nine bankruptcy and indeed it will be looking to the law does say if edmonson versus bank of america has any of the lives of the it all that the statute of limitations for each subsequent monthly payment accrued on the last day of the month until  my problem is if i look at this and i say edmonds of no longer had personal liability under the note then i look at what happened in this particular situation they had no longer personal liability under the note after the discharge your honor for that to be the case there are myriad different ways an obligation can become non recourse right it can be a bankruptcy destroys where the parties could agree at the beginning of the transaction that the bar were doesn't have personal liability there are other circumstances where there's no personal and then why isn't this just a six year statute of limitations on an interim action the because the six year statute of limitations runs from each payment that accrues whether it's recourse of what the installment each installment continues to come to your view is the banker you just charged of past being an arm you know a future payment six years and if you don't if you don't do anything in that time then then the debt is done your honor i think first of all washington hasn't said that because a foreclosure action is always in ram we've cited cases it's hertzog itself i mean these are all in ram causes of action that are being brought the foreclosure action is always in ram it's never in persona so in has to be something to trigger the right to exercise your right that is correct that is correct and that's where we come back to the discharge did the discharges stop instalments from running for office and well what is it what is the former debtor to do post discharge well your honor as as the cases indicate henry for can surrender the property to the secure debt or didn't happen they can redeem the property by paying the foreign fair market value didn't happen they can reaffirm the debt they didn't do that or they can ride through the bankruptcy they did that and re in re parker says when you arrive through the bankruptcy you continue to make the payments without reaffirming the debt it allows a debtor to retain the property with no personal liability but when the debtor doesn't make a payment the creditor can foreclose and in this instance the debtor made no payments and so at that point the creditor could a foreclosed and washington says you gotta do it within the last payment that had to be made and therefore the six years runs that's the way parker a federal case would suggest it would run your honor i think actually the obligations continue to accrue and the lender well may even it that's not what parker says distinguishes tell me why parker says that parker says yes you can continue to make your payments but it says when the debtor doesn't make the payments then the creditor can foreclose and washington law says if you haven't got that done within six years you could bring a quiet title action but remember that each in fact there were no bankruptcy and they didn't pay ever pay that your client should be able to foreclose if the years there if that term is for thirty years wouldn't need to grieve for close until thirty years even though they never paid that is exactly what washington law is it is not what washington law yes your honor the debtor can be in default for many more years than the limitation period i think we do cite washington law fort washington revenue code twenty eight three hundred says a property title holder make quiet title against  mortgage or deed of trust when an action to foreclose such mortgage or need to trust would be barred by the statute of limitations the statute of limitations says that on a written contract it is six years and the deed of trust is such a contract therefore if you don't foreclose you're dead but only as to the installments that have accrued what hurts says what given says we get a new statute of limitations each time an installment comes due to the statute may pass as to that particular installment but what you are saying your honor is that a installment contract is treated just like a demand obligation the first time there more than six years because each time an installment comes due there is a new statute that comes into effect so your honor is right with respect to an installment that accrued on more than six years ago the right to foreclose and the right to collect that particular installment is gone but what hertzog says and and what the other washington cases that we cite including given say is that as long as there is a continuing installment each installment begins a new another general washington the question is does the u s charge for bankruptcy that you know that's the issue i don't that is i would argue with that proposition that's throughout the united statute of limitations as to the installment there may be installments for which the limitations period is passed right so if the installment came due seven years before the lender can collect that installment it's gone but all of the installments that came due within six years and every installment that remains to come to will trigger the statute in new it is a shrinking it is a shrinking obligation that's the law  obligations doesn't cancel obligations all it does is make them in ram non recourse it would be no different than if fannie mae agreed at the inception with the borrower that it would be a non recourse obligation that wouldn't cancel the future obligations washington doesn't impose a different rule and the the plaintiffs cited not that as a general proposition and non recourse debt has a different statute of limitations if were true it would mean when a purchaser acquired a property subject to the mortgage but didn't assume that there would be a different statute of limitations that's actually given there was on the sign my house almost went out for you and it in a very very different place from where you started you started by telling us this was a matter of federal law we had a noble review and you're now talking to us exclusively about washington law because we dragged you there but i don't i didn't i didn't see any place in the that there was really any role for federal law other than the fact of bankruptcy well you about the i asked you about preemption you told me there was no preemption problems like i'm not sure what the i'm not sure where the de novo review of federal law comes in now what is it is washington law is willing to have a different rule pre bankruptcy versus post bankruptcy your honor that the district it but it is definitely preempted if washington were to impose a different result here it would be preempted it is barred that's the m s r decision the there may be issues of state law that are relevant ultimately to have a different rule on the debtor creditor relationship is preempted it is barred i don't think washington has a different law if it did it would be preempted that is what i meant to say  it please the court my name is lauren combs representing the jarvis's i don't think there's a federal question here other than there was a bankruptcy involved the state statutes are always looked to in these sorts of cases to give the court the answer to what it should or should not do and it starts back in the eighteen hundreds with a case cited by appellants called long versus all heard one seventeen us six seventeen it cited at their brief their opening brief it fifteen and i'd like to read to you what the court actually said as opposed to what counsel said it said in their brief at six twenty one the court said the supreme referring to an earlier case this was a foreclosure some cases when foreclosure case the supreme court actually held and here's the quote the dispute in the court below was as to the existence of the lien at the time of commencement of the proceedings in bankruptcy that depended entirely on state law as to which the judgment of the state court is final and not subject to review here that's what that case felt the state of washington as to its statute of limitations very succinctly tells the story of what the statue of limitations is all about in the stenberg case cited in our brief that page eleven in washington at this is that page seven fourteen in washington the goals of our limitations statutes are to force claims to be litigated while pertinent evidence is still available and while witnesses retain clear impressions of the occurrence our policy is one of propose you know went into bankruptcy stop making payments and are going to end up with a free house so why would they say why did this all the water bill coming well that's a good question they haven't obligated they feel that they had an obligation did they actually have an obligation under washington law to maintain it for the well here's the interesting part on these facts your honor remember the client before bankruptcy stopped making payments and said bank look we can't make the payments please come take the house we're moving now and they moved out and they moved out so they're not in the house or the hole right through argument is a red herring are they back in the house now i couldn't tell you if they're back there today but when they started getting notices from a governmental agency that they're responsible for a bat a debt they moved back in because they started getting concerned that holy cow if something goes wrong and this is all in our name and they move back they received if they did that were there any other obvious payments they were obligated to pay and they were not good to pay the property taxes on it where the property taxes were in their name your honor that's how come we could use the second statute to come before this court and quiet title because we are the owner of records my clients were the owners of records there this bank slept on their rights whether they did it intentionally or not that's the issue here the bankruptcy the state law is clear herzog said the state law on this and there's numerous appellate court cases that say the same thing including edmonson but what the state law says is hey when the obligation a cruise for that payment on the debt so prior to bankruptcy it doesn't matter what's in bankruptcy or not judge layton ruled in a bankruptcy or non bankruptcy cait judge  our from the western district ruled in and the same similar set of facts except he said hell hey it didn't run the six years didn't run but he still applied the six years it's when the cause of action accrued on the underlying debt that's when the statute of limitations starts to run all bankruptcy does is it passes through bankruptcy it's the mortgage the the trust is still there but attached to it is the running of the statute of limitations which is determined solely by state law this isn't a federal question at all the same rules apply it's just bankruptcy happened if this were in florida mr warren says the effect of bankruptcy was to take recourse to make it non recourse that instalments through out there even though there was no personal liability for that so that under generally accepted walking along probably every state in the union every time some of payments not made the statute begins to run again and if the tail and after six years expires those prior stone payments are eliminated but he that's his view right what's responsible my response to that is if he were a supreme court justice in the state of washington or in the court of appeals the decisions would read differently than they do today because that is not the law in the state of washington it may continue but the statue of limitations started admission did quite hit on this specific issue to close but it was kind of addictive best if you think no i don't think it was central to the case remember the ensign case broken into two parts this is in the second part it's critical of the case and the judge below looked at it that way as as well and all the ninth circuit court cases that i could find including the one cited by the appellant seem to seem to not disagree with what i'm telling you today including the cases that were just cited by the which i would like to spend a couple minutes talking about but but what's really important is what the state of washington does with that statute of limitations statute because in florida which i think is worth looking at florida final installment of the obligation is ascertainable from the record of the mortgage the stack to the limitations cell run from the maturity date of the final installment so in florida we would have a different result we would have a different result in a lot of cases because this is a state law question not a federal law question the feds the federal courts have humored to states if you will by allowing them to decide this question but what you and your because in the silver case that was the motion it was before the court in the silver court said this the state law from the state of washington is so clear on this that we're not going to send it back to the state court issue on messing with five twenty four j which is not a political here anyway because this case this decision state law does not affect a right through case if right through on real property were existing today we're not in possession for right through to take effect i mean i think your client was living in the house at the time all of this happened he was not in the house he but you know you could tell me whether he's living in a house today and he told me to move back no i can't tell you where they're living in today three when they started getting the notice two or three years after bankruptcy was over was discharged the house was fake and for two to three years they then they had moved out before the discharge but they've moved back before the six years ramp they moved back when they started getting done letters from a governmental agency ok so are in possession then least they were at some point during the running of the statue of limitations yes but remember on a right through there was no contact with the bank they asked the bank to cut a deal with them but that's in i don't mean to remind you of the facts but the facts are there because you know them well but the facts are there they approach the banks say hey we can't afford to do this we'd like to work something out with you bank doesn't work anything out with them they say ok we're walking away we can't pay we can't afford this how in the terms is offered to give them a quit claim deed they did they offer to give them what's a deed in lieu and foreclosure they offered to do that they did everything they could to get this back in the hands of the bank the bank does nothing they start jarvis's start getting done by another governmental agency and said whoa we've still got responsibility here we better get back in there and take care of the house i cannot tell you whether they're still in there today but they were in there for two to three years and that's not what a right through case is all about it's where the debtor wants to stay in the house agreed to stay in the house and the bank acquiesced in the continued making payments this has no interference with that section five twenty four j there's none at all that's made up different fact better be a different argument if we are here today perhaps but the state law is clear that when ssion could the last time the cause of action could be brought whenever that cons of action could be brought that's when the statute of limitation runs in the state not in not in florida might be different in other cases the only reason i know about florida put it in play in their brief but i now know that in florida that is not the law in florida it is statutory made law in florida in the state of washington it's judge made law that interpreted the state statute in the legislature has not overridden that long history of cases going back to herself so our position is i don't know why i'm here other than i have to be here but there's no there's no federal question here state laws applied even though each state is different supreme court has acknowledged that it doesn't matter to state law anyway in the federal courts even the supreme court is not supposed to mess with that it's a state decision state law is clear  have a couple minutes left but i'm not going to ramble on less you have more questions no i don't think they're for the questions thank you and the relief we want of course is for you to uphold what was done down below we would like our attorneys fees as we played in  briefly this is an issue of federal law because as the court noted each installment begins a new statute of limitations and the only question is whether the discharge stopped the accrual of those obligations it did not as a matter of federal law uncontroverted federal law what if washington actually had a statute that says if you can a chapter seven discharged in bankruptcy we will apply a six year statute of limitations on any in rem action w interfere with with bankruptcy law absolutely your honor the state cannot impose a different statute of limitations for as a result of a bankruptcy that's igs that's it that's the core element of the what the discharge does think about mean what's debts of limitations would would be in effect i mean if you if we came in and struck that law down what statute limitations would be in effect this exact same statute of limitations that would apply had it not go that's a washington statue of limitations how c washington state should limit what your honor there's no federal statute limitations that issue here counselor no your honor but you would you would revert to exactly the statute of limitations that would have applied without a discharge it's no different it's absolutely no different they cannot punish a debtor they can't punish a lender by virtue of allowing any of the discharge you know they can punishment your client had six years to figure this out and couldn't figure it out but your honor it would be no different had there not been a de the idea your honor is it has to be the same whether there's a discharge or not if there hadn't been a discharge being washington is clearly treating the bankruptcy in the way that the supreme court a senate should it's a discharge of personal that the in ram remedies are not affected and washington says as to those in ram remedies when there's been a discharge that's that's the that's the start of the statue of limitations your honor foreclosure is in ram remedy it is always an in ram remedy it is always the case in washington law that a new statute accrues with each new installment whether or not there's personal liability but your honor the point is if washington had a rule and it does not that personal liability is required for installments to come due if it had such a rule it would be preempted if it had a rule that we have a different statute of limitations because you have a bankruptcy discharge even though without that special statute of limitations the discharge the limitations period would be exactly the same would run in tell the last installment of your time i do have one last question actually make sure i understand your argument so you would have  i believe it's the twenty forty two to the close on that's the that's the term of the contract plus the six year statue of limitations are out on that that would be that would be the only time when a quiet title action would lie but that there would be but some of the inst there in twenty forty one or twenty forty two if the bank finally decided to get around here and foreclose it would only be entitled to some eight hundred dollars or twelve hundred dollars or whatever that with a month left by the time you there is a consequence but it the consequence is not that all of the mortgage is gone that it's deemed as if there had been an acceleration that's not the consequence of the bankruptcy that's not the consequence of the discharge are ok thank you