thank your honour's michael dunn on behalf of melissa mather paca talent i will reserve five minutes on rebuttal unlike the last case this is a corporation versus corporation it's supported by her mother going through a divorce three kids don't know what to do we consulted we looked at chapter seven as being the best option for her let's eliminate the debt part of that that was student loans that would not go away but at least we can get rid of the bulk of it let go of a car one car she was unsure of let's approach that a little differently and see where that goes we filed chapter seven august  sufficient that's what we did a couple weeks later still ensure she contacts toyota finds out if she can keep the car and instead of twelve sending a reaffirmation agreement they send out an assumption agreement began to pursue her under the theory of three hundred and sixty five dollars p now three hundred and sixty five dollars p has no mention of the discharge whatsoever except that it provides limited immunity to negotiate an assumption whereby you won't two statutes that are not exactly models of clarity and some courts have you would the statute the way that you do most recent courts haven't so what is your best but let's make that assumption and why should it still survive discharge well the most recent decision actually came out in september i thought i had it here in front of me from  exists independently of each other and you can have one of the other and you cannot force three hundred and sixty five dollars on a creditor but essentially the court said there's no liability the only time you going to get liability is if you come back in and sixty five dollars p we have a hearing and i make a ruling that there was a waiver of discharge in that case and i can provide that cite later but that was i believe september six just last last month but i don't think a sums and i guess the question i have is why would any creditor agreed to allow at least assumption under three hundred and sixty five if it didn't create any personal liability that survives bankruptcy discharge what with the rash i why would any creditor permit the assumption of at least if it's going to be discharged through the bankruptcy why not with the rationale be why not and there is no prejudice to the creditor whatsoever in this case my client failed to comply with as soon as the sixty day timeframe was up for the trustee not to assume the lease they didn't now if toyotas afraid of my client not making payments they can pick up the car if toyota is afraid of my client crashing the car that's a post petition claim if there is excess wear and tear if there's any post petition damage that's not part of the discharge there is absolutely no prejudice to toyota  her keeping the car that the only thing they get is a benefit they get money for depreciating car that they tried to sell they probably would not get eighty percent of that price your council can i ask you mentioned a few minutes ago the i think it's three  to see which says that negotiating the assumption doesn't violate either the automatic stay or the the post discharge junction and that that seems to contemplate that c that's not something you can do after discharge so i'm wondering what do you think that part of three hundred and sixty five is therefore it doesn't seem to make sense that's not my theory i don't know where that came from and sixty five p doesn't even say that it says the personal liability may be a simple let's that not the personal liability the liability not even the personal either the liability may be assume and that's where you get to these agreements that come out of nowhere so six months after a discharge that debt has been discharged no re after no waiver discharge ability my client behind my back signs a waiver she don't know what it lesa sumption she doesn't know what it is and now that debt is non dischargeable how does that make sense how does that protect the consumer this law that went into effect in two thousand and five part of it's the consumer protection act since then newsom's doing laws to protect consumers  but are trumped just in the haven act this is bucking the trend how does that protect the consumer who has no court supervision no disclosures no attorney to talk to and then all of a sudden after discharge she creates a title the section in acting three hundred and sixty five pm back to legislation was giving debtors the ability to keep at least property by assumption wasn't waiving discharge it was simply to give the debtors and ability to keep a car before two thousand and five there was no such thing as a lease assumption by a debtor it's an oxymoron you can't assume something you already have a trustee can assume it because he doesn't have it it's on behalf of somebody else and that's why when the trust nine you've got to have a court blessing on these assumptions but then all of a sudden we have this lease assumption after discharge that has no supervision whatsoever and it now waves the holy grail of the chapter seven it just does not make sense of bucks the trend it's a it's against the entire congressional th of you do a chapter seven you get a just charge you move on there's certain exceptions reaffirmation agreement if you're without an attorney we're going to have a hearing on it if your income is upside down you can't afford it we're still going to have a hearing on estate i have researched lined up he was adopted to to give the debtor a chance to keep the car wasn't true exactly and that's what the title says giving debtors the ability to keep lease personal property by assumption and when it was adopted there was no cross reference to five hundred and twenty four dollars it references five hundred and twenty four dollars says when you negotiate this after discharge we're not going to come after you for violating the discharge that's the only immunity you get it doesn't say oh and by the way it's also waived that's a non dischargeable debt there's no to no part of the case for that whatsoever unfortunately there's not a lot of history behind congress putting this in here but the title of it if you look it up it's giving debtors the ability personal property by assumption has nothing to do with discharge so my client never sent the creditor what's required by three hundred and sixty five p a request in writing all right congress put that in there for a reason if we're going to throw it out today wh initiated that was released in the adversary's initial presentation that your honor asked a very specific question which is why would any less or one's ever going to do this and that's confirmed in the amicus brief that was filed in connection with this case by the american financial services association if this court were to take that position the the rights and remedies the tools provided to debtors under three hundred and sixty five p will effectively go away and that can't be what's supposed to happen there's basically three things i wanted to present to the court today three points st i wanted to talk to you a little bit about mismatch there and the fresh start so the fresh start is really what a consumer bankruptcy is about not discharge a fresh start the nd thing i want to talk to you about is the independent and separateness of section three  and twenty four the rd thing i wanted to explain to you is why the thompson decision upon which the other side relies is just erroneous we decided as the court noted the overwhelming majority of more it comes down to just the same way that your honor suggested it would let me read you a quote from the decision i cannot square the holding in crighton with the requirements of th and that's really the whole point your honor getting back to consumer debtors and what miss mather was trying to do here did the holy grail isn't discharge the holy grail is a fresh start that is part of the package of benefits that the consumer bankruptcy process is supposed the winner for debtors but it's not as simple as saying you get to walk away from all your liabilities and all your contractual obligations because that would mean you also have to walk away from all of your assets and contract rights and that's why the bankruptcy code provides consumers with a whole tool box that's available to them in order to get a fresh start through the bankruptcy process sometimes the debtor needs to i don't know keep their home and that's why you've got section five  c six b that allows a debtor to reaffirm mortgage debt and by the way they get to make that decision to affirm to him to reaffirm their pre partition mortgage  without any judicial supervision whatsoever without any input from a bankruptcy lawyer that is totally their decision and something they get to decide solely within their discretion that's because sometimes you get a fresh start you've got to keep your hands you know what else that tool box of mechanisms available for debtors includes to allow them to obtain a fresh start the ability to assume a pre it consumer debt or happened that right to assume the pre partition vehicle lease life soley with the trustee but you know what congress did when they passed that c p a they said look let's give people the opportunity to do this if the trustee either affirmatively rejects that lease or just elect not to assume it in a timely manner i'm going to let the debtor make their own decision assume that lease if they want to do it i'm not going to make the less or accept that but i'm going to create a procedure and allow them to do and allow the debtor to do it and allow them to do it any time they want pre to post this charge at fine and that's fine because it doesn't create an obligation of the bankruptcy estate it doesn't require notice and a hearing in an opportunity for creditors to be heard because it doesn't affect the obligations of the bankruptcy estate it is by its terms an obligation borne solely by the debtor i mean one thing it does require and it was like one of the south is compliance with the procedural requirements of  writing within thirty days and you didn't comply with all of those requirements and i understand your position to be that those are just protect the loss or but doesn't doesn't the requirement of a writing also protect assuming there's no ambiguity they signed or they didn't sign a written lease assumption agreement and miss mather did that here then you get into the  requirement of providing notice in writing and i think she bankruptcy judge laura taylor hit this one out of the park she noted that protection is there for the lender if the lender proceeds to keep the car that's what three hundred and sixty five p is supposed to allow it's what it did allow in this very hands and the amicus and mr don't again today in the context of his big guy little guy i want to keep my car and toyota said fine we'll send you a lease asuncion agreement they didn't send it to miss bob they sent it to her lawyer miss she wasn't in  she wasn't improper her in connection with the appeal to the district court and she's not improve her now the facts before this case are any zealously competently represented lawyer work better represented by a lawyer in this case we don't know what this mother asked or didn't ask of her lawyer we don't know what her lawyer did or didn't tell her but what we know is an assumption agreement went to the lawyer the lawyer client signed it p and that just is wrong if you look at three hundred and sixty five p and five hundred and twenty four see the court will know these are independent and separate machinations the was just a subset of five hundred and twenty foresee it doesn't need to exist and in fact the recent cases where the debtor is trying to get at its preposition lease obligations mostly cases out of the eastern district of new york bankruptcy court and there's three of them they file their largest stipulation it says hey pursuant to the stipulation will reaffirm that lease you know the bankruptcy courts and they say no there's not a hearing on this there's not a motion on it but i'm not going to sign it anyways because this is an attempt to assume a pre partition lease you need to do that under three hundred and sixty five dollars p and that doesn't require any involvement of this court so they walk away from it look at the literal language of three hundred and sixty five dollars p it talks about the result of that process is that liability under the lease will be assumed by the debtor and not the estate either that has meaning or it doesn't and we try to trying to read it out of the statute makes absolutely no sense i think this panel earlier as the question about timing and the timing issue is just one of two issues that i think notes the potentially anomalous to absurd result that would flow from a decision along the lines of what is requested by the debtor you have different priming you can assume at least under three hundred and sixty five p in the post discharge world that's why you have three empowers the debtor to make their own decision independently without judicial supervision and their sound policy behind that like i mentioned it doesn't saddle up the bankruptcy estate we're giving you your fresh start the way you want it and you want this by it's your choice but the final twenty four c works differently you need to if you are represented at the very least have the bettors neuer sign off and say you know what i've looked at this and it doesn't an undue hardship and it makes sense alternatively if you're in pro per you can't do it by yourself you need to have a motion filed in a bankruptcy judge needs to look at it and confirm that this makes sense for years and  the blinking light things working for me both the chief bankruptcy judge taylor and judge curial they got it right here there analyses are thorough and detail and thoughtful chief don't all of these things need to work together though they've done the human what you have to do is reconcile the entire bankruptcy and that's what she does it goes in judge curio she doesn't just rubber stamp this this isn't a one sentence here by a firm it's a twenty nine dollars page detail discussion that goes on all the issues that i've just gone through all the issues raised in the amicus brief of all the issues that were addressed in the underlying briefing at the end of the day you have a competent represented debtor who chose to assume this debt to assume this contract to accept the benefits the bankruptcy code does not require and there is no evidence to suggest that congress ever intended for both assumption and reaffirmation to have occurred before there is a binding agreement between the preposition less or in the debtor that's what she bankruptcy judge taylor like trying to make as much sense of back or requires bankruptcy judges to adopt the approach of the white queen and believe in as many as six impossible things before breakfast it's a disaster it goes without saying we all know that i think of the specialist i've done thousands of cases i've done this for twenty five years and i told my client there is no liability this is why you can assume it there's no waiver it says the liability under the police will be assumed by the debtor and not the estate it's state it's a sentence of possession they're trying to confirm that the chapter seven estate and the trustee are not liable they're not saying the debtor personally assumed it they said the liability will be assume and there's a big difference between personal liability which is specifically referenced in five hundred and twenty four dollars in the discharge and liability here and for practical matters we hardly ever do lease assumptions we hardly ever do reaffirmation agreements because the auto industry would rather receive their money and do right through how it's always been and that goes without saying you can pull any that debtors attorney but the fact of the matter is this really pops up but what's going to happen now if the