the morning may please the court michael larson on behalf of the appellate nation star your honors well you better in bankruptcy might be able to obtain a fresh start in terms of receiving a discharge from personal liability on his or her d of the original note in original mortgage and has since two thousand and thirteen let me tell you what's bothering me about this case i am troubled by the fact that there was not service on your client of some things however i mean it seems your client submitted itself to the court's jurisdiction when it filed its transfer of claim in the bankruptcy action on december twenty sixth and then we've got mr then you filed a notice of mortgage payment change in february of two thousand and fourteen and again in june and july of twenty fourteen in the intervening time mr ellis ito filed a proof of claim on your behalf which you were served with i understand there your position is that you were not served with a claim objection but then the court issued an order substantial sustaining the claim objection which you were served with and that was in april twenty ninth the twenty fourteen and in that order it said that you're not entitled to a secured claim and you're going to get only a general and secured claim and seato files a motion to strike your february and july notices of mortgage payment change and the court and by the way that is served on you and the court grants the motion to strike in october of two thousand and fourteen that again is served on you then v and it's all based on the fact that there's been found to be this unsecured claim which referenced in that other order that i told you about then we have the motion by mr to approve early payoff of the fourth modification plan which you say you did not receive but the court then issues in order granting that motion which is served on you in in august of two thousand and fifteen still there is no objection to any of this all the way along then finally the mr illis seato files a motion to extinguish the mortgage in october of two thousand and fifteen and for the first time in november of two thousand and fifteen we have a challenge by your client that is a year and a half after and fourteen order finding you to be a general and secured creditor and so doesn't there come a point at some time where you know you have waived your ability to object to this well your honor in this case nation star did timely respond because the first instance where mr ellis ito sought to extinguish the mortgage was in his motion to deem the nation motion to the nation stars mortgages extinguished interest satisfied but that's based on the fact that previously have been found to be an unsecured creditor right and we cite cases in our briefs this stand for the proposition that  bankruptcy survive the general rule is that leans in bankruptcy survive and even in the simmons case in re simmons case which we cite in our reply brief in that case the claim was treated as unsecured but the lien still survive the treatment of a claim is unsecured does not necessarily mean that the lien is extinguished there are two separate matters in we would argue that in order to extinguish the lien to go that next step mr ellis ito needed to bring in a proceeding and an adversary proceeding is required when the debtor challenges the validity priority or extent of a wane due to two problems here number one  in that case it wasn't all someone as had been served and the court found that the whole point the whole inquiry is a reasonably calculated to give you notice in other ways where you are noticed that somebody was trying to change your status from here it's undisputed that we were not served with the general my question is were you on notice we were on notice that well it's undisputed he received the order on the objection but the order just treated the claim as unsecured  that motion raised our due process challenge an adversary proceeding argument and then there was a hearing on that in his objection to the claim he filed in our name he did not actually seek for the mortgage to be extinguished only requested that it be disallowed or treated as unstable let me seventy five let's say there are seventy five orders that the court issues for some reason work keeps repeating that your claim is unsecured that you know and keeps issuing it keep striking your notices of payment change i mean does there not come a point at some time where you have to say something or i mean can you just go on indefinitely and even if let's say it wasn't even october of two thousand and fifteen that you file the let's say for seven years go on then this is going on i mean does or not come a point at some time where you must live with the consequences of having received service of all of these orders and not challenge them in any way or does the bankruptcy court have to undo everything it's done and ignore all of the work it's put in over the last seven years and drop everything because you haven't objected previously even though you've received service of these materials that show that your the nature of your interest it the court thinks it's changed well i think it's important to note that the bankruptcy court in its decision noted that service service in this case on the star was erratic the star i know that but i've asked you a hypothetical because there in addition to the fact that i greet was erratic and that that's the first thing i think i noted was it troubles me that not everything was served on you but i don't see how that a race is the problem that you have which is that while not everything was served on you many key things were served on you the court's order showing that the nature of your interest had been changed that was served on you then the orders striking your paint notice of payment change that was served on you i mean there were there were multiple things that were served on you and there was no action by you so again my question is how long is the court expected for this to go on with your saying nothing and then you're having sort of a free card to play at the end of it and say race everything that's happened before because you know we didn't get notice of the very first thing i think it would be different if mr ellis ito had sought to strike a nation star's mortgage and that these prior filings that were served on us referenced a striking or a terminations of our mortgage instead of this treatment of our claim as unsecured because the treatment of the claims unsecured did not necessarily mean that the mortgages stricken liens passed through bankruptcy bankruptcy in this court as cited simmons in rebate in for that same proposition so lien survived bankruptcy it would be different if these filings had said that this lien was going to be terminated but they did not did you did you make then  tactical decision or did you not have miletus your honor i can't speak for what bankruptcy counsel did in this case the facts are what they are we were served with certain documents and not serve not served with other email make a difference whether you had notice but you thought that tactically you didn't have to do certain things with a you had taken a position that i didn't know what was happening here in the a full we didn't do anything well i think it's important to note that it was in his motion to deem the lien extinguished in we time we responded to that you only had to file a motion one day before the hearing to file the three days before the hearing so our response to the first instance of mr seeking to extinguish the lien was timely and we also appeared at that hearing to contest it so we feel that our response was timely in this case and that nothing has been waived the argument thank you mr gibson or for mr brewer may please the court good morning your honour's stephen brewer on behalf of mr le c e o i had actually prepared a summary of the facts that judge rosenbaum just went through so i don't feel a need to repeat that one thing i do want to point out  addition to the notices that were served upon nation star repeatedly throughout this case is that there was also a motion to modify the chapter thirteen plan filed at docket issue number one twenty eight which was along with the notice of hearing served on nation star this was back in in two thousand and fifteen and very important in that plan which was confirmed after notice an hearing no objection interposed by nation star the plan provided that the claim of nation star related to this specific real property would be treated as a general unsecured claim but not that it was extinguished correct n here's my question them work could mation start decide that we don't mind having the claim treated as an unsecured claim we just but don't extinguish so we don't have any objection to treating it as an unsecured we just don't want to be extinct extinguished because it ends the claim would survive bankruptcy generally generally speaking liens do pass through they can pass through bankruptcy unaffected in this case we have different facts because we do have a confirm plan that binds the creditor by the confirm plan in advance of the confirm plan and i don't know that it is completely clear to the court at this point was that perspective discharge in the future could extinguish that lien specifically the order stated that the lien the mortgage lien related to the real property held by the nation's star shall be void and ineffective upon the debtors discharge and there would be no need for a motion th copy of the objection in the notice of the hearing with the bankruptcy gorgon just overlook rule three thousand and seven no your honor and i frankly i don't have an excellent answer for that question i will say judge jordan in a recent opinion of this court summarized what i what i believe is the sentiment in this case is that the bankruptcy terrain we traverse is not always persisting and i think there were a lot of weird issues that happened in this case but what is clear is that the bank nation star here had consistent notice of all these actions that the debtor was attempting to do to affect their lien the put him notice that the lien would be extinguished but there were the there was treating the extinguish the work they did notice that it was going to be treated as an unsecured going well they did have notice of the order that did indicate that upon discharge the lien would be void and ineffective so they did have notice of that after the entry of the order obviously there was no motion for except that would be upon discharge and so i think what judge wilson m asking and if he's not i'm asking it is well between the time that that order was issued that you're relying on and when the claim the unsecured claim was extinguished didn't that order anticipate that the nation star would have an opportunity to convince the court that it should not extinguish the claim and again nation star had notice of the motion to it but but didn't that  that order anticipate that is my question didn't the order didn't the order that modified the plan and said that it's now it's an unsecured claim and it will be discharged and it will be extinguished to discharge didn't that anticipate this idea that between the time that that warder was issued and between between that time and discharge that nation star would have an opportunity to challenge the extend the extinguishment of the claim and they certainly could have yes they did not and then the debtor went and filed a motion to get his pay to pay off his plan of his confirmed chapter thirteen plan you serve the motion he serve the nose fearing he served on a ship stars well it did not object to the early payoff or to the debtors discharge you order a discharge you say the order of discharge in a sense implemented the order sustaining the objection it implemented to the extent that it at that point invalidated and that nations daryn had noticed that order was served on them along with the motion the notice of hearing no opposition was filed they did not honor the facts your honour's the facts are a little but the adversary proceeding argument well i think that an adversary proceeding could have been maintained but was not required under the circumstances of this case we had a order sustaining the claim objection which treated it as general unsecured claim and that upon the entry of the discharge it would be extinguished we then had a modified chapter thirteen plan which as this court has held routinely that confirmed plans by the creditors they bind the debtors whether or not they accepted the plan they voted to accept the treatment in the plan whether they have depth of objected to the plan none of that happened here that's under thirteen twenty seven a levin u s c thirteen twenty seven creditors in the dead or everyone's bound by the terms of the plan and then we have there's significant case law on the same point iberia bank guys in which is eleventh circuit from two thousand fifteen and re optical tax income which is the eleventh circuit from two thousand and five a very important case side in our brief was hope first acorn financial inc which is the eleventh circuit in two thousand and thirteen and that it deals with a very similar issue and the court went and explained its rationale in just six justice oaks number two which is an eleventh circuit case from one nine hundred ninety and specifically the court stated that  in a chapter eleven case we held that certain creditors could not mount a post conformation challenge to the claim of another creditor because they had waived the right to object by failing to object prior to confirmation of the planet it went on to explain how it got to that theory by analyzing a fifth circuit case in a chapter thirteen context which is what we have here and it the eleventh circuit characterized the fifth circuit case by saying quote when the objection is based on argument that the plan misclassified the objectionable claim the objection must be made prior to confirmation of the plan and the right to object is lost when the plan start when the bankruptcy court confirms the plan that all happened here there was a confirmed plan the bank nation store had notice of the confirmed plan they had notice of the hearing they did not object the confirmed the model the modify plan was therefore implemented as the effective plan yes i am again well i don't know that he overlooked them in the in the totality of what transpired in this case and i'm going to quote again from the hope vs acorn financial case where it says relying on justice oakes two and simmons we explained in bateman that a confirmed chapter thirteen plan has re judicata effect even if the plan does not by its terms comply with the bankruptcy co confirmation of a chapter thirteen plan by a bankruptcy court of competent jurisdiction in accordance with the procedural requirements of notice and hearing of confirmation is given the same effect as any district court's final judgment on the you have due process satisfied here with plan confirmation it's undisputed that they had notice of the plan the hearing on confirmation of the plan and that the plan implemented the debtor's ultimate implemented the sustained claim objection in that it was treated only as a general unsecured claim and that upon the perspective discharge the mortgage lane would be terminated and nobody we have a case law from this circuit that says that it confirmed plan is binding it is the same effect as a final judgment rendered on the merits and i think that having a final judgment on the merits which is what we have is sufficient to overcome the court's concern about the possibility of an adversarial proceeding being filed in that in order to extinguish a mortgage lee let me just ask you something i mean it is troubling to me and i don't understand why your client did not serve the nation star with everything throughout the entire proceeding maybe you can explain that your honor and i think i can to some extent this was a very if you look through the record it's a little bit complicated as to who owns what when where why and how it's it it's almost seemed like a shell game to me not being personally involved with the actual bankruptcy case and looking back but even so there are times when your client said that nation star was served and yet did not serve nation star at the address that it had filed on record with the court and that i don't really understand if it was referring to something earlier in the case than that that i may not have a good answer for you but one of the things i did not point out that i should make clear and that i believe the district court did make clear is that what nations are did in this case well in a number of cases they had entered into a notice in agreement with the bankruptcy noting center and this is implemented implemented under eleven u s c three forty two f three section three forty two f of the bankruptcy code it allows a creditor to designate a notice address with the bankruptcy noticing center it which would she did hear they did hear urban and the address it was a peel box and it was great it was originally an irving and then it went to lewis fell but the b n c doesn't notice everything i mean i ran and pulled out all the b and c notices and it says specifically that it doesn't notice everything and if you go through every time it notices nation star there's a documentary so you all would be aware that nation star was not receiving notice or the kind of notice it was receiving based on the b and c certificates that's correct and  can tell you that there were certainly some could this there was certainly some confusion on service of the initial papers but everything that your honor has pointed out to you today and that i could i could go through again basically they got notice at their preferred their designated preferred notice address which was the p o box i guess it was in irving texas and later changed to dallas i think i'm not sure  get back to your question it's there was an attorney that first appeared for us bank we went to mediation with bank of america as the service or for us bank and during the process was advised that the loan was something which transferred either servicing or the loan itself was then transferred to nation star so we had a number of different parties and even in the the appellant's brief they are claiming they whole they have held the note and mortgage since two thousand and thirteen the record  lies that and maybe they did but it was never of record we had u s bank first appear as the as the holder of the note that was back in the inception of this case and bank nation starting to appear in the case until i guess when they first filed the the transfer of claim and then the notice of mortgage payment changes which again we used the notices of payment changes we moved to strike them and obtained order striking them giving them adequate notice based all on the premise of the claim objection being sustained and the confirmed plan treating them as a general unsecured claim which upon discharge would effectively eliminate your honors i would just like to respond to a few of the points just raised in particular the plan there was some discussion of the plan in particular the modified play in the fourth modified plan or the bankruptcy court which is the operative plan the bankruptcy court found that that plan might not be binding on the star because mr ellis ito did not serve the nation start with the motion to modify that plan in also the order on the order granting that motion also was not served on nation star so the bankruptcy bankruptcy court found that the operative plan might not by nation star and even if you look to that plan it does not have race judicata effect here because an adversary proceeding is required to extinguish a lien in the plan itself and not even extinguished alina just treated the claim is unsecured so even if the plan is binding on the star which we submit that it most likely is not especially given the on appeal ruling from the bankruptcy court it did not actually extinguish nation stars mortgage lien we let me i'm sorry i just want to make sure i have the facts straight my notes in my notes i i have down th order granting he motion to for an early payoff on the fourth modification plan was served on nation star you saying that that's not correct right the order granting the early payoff i believe was sort of a nation star but there was a separate order granting the motion to modify the plan to remove all future payments to the i said the motion to strike no this is  look at docket one thirty eight so there was a separate motion to remove all future payments to nations or actually believe it was doc at one twenty eight one twenty nine if there was a motion to modify the plan enlisted us an unsecured creditor right but it was in the motion was not served at the proper address it wasn't served at the address that we submitted with the corps either as or so we submitted with the courts and the order on that plan was not served on us in the bankruptcy court notes that the order granting them the modification the plan in the bankruptcy court found that that plan might not bind us so not only were we not served with the objection to the relevant claim we weren't served with this order modifying the operative plan so we have a case here where a lien is been extinguished in the confirm plan might not even bind us so but the order the order that was entered discharging once elysee to fulfill the obligations under the modified modified plan was served on you through b c s right we don't we don't dispute that however if we look to the language of the order on the b n c write the order on the objection to void because it was entered without due process but even if it is not void further action was still required by mr alyse to avoid the leaning that language is not self executing further further action was required especially we would submit in the form of adversary proceeding but mr ellis ito simply filed his motion which we timely responded to and raised our concerns here and i ask you question didn't give you an opportunity to answer do you have any any thoughts on  the supreme court's decision on united stude made versus a spinoza requiring either actual notice or notice recently calculated where there was a violation of the bankruptcy rule and the  supremes found that nevertheless they had not been no due process violation and i can't speak to that case as i don't believe it was it was brief but here i believe that we cited numerous cases where it clear in objection to a claim objection but here it was granted and it was granted relief was granted beyond that even requested by mr ellis ito and finally as i see my time is getting close to expiring i would just like to point out that bankruptcy proceedings or proceedings in equity creditors must be treated equitably the client security claim here was for five hundred seven thousand dollars the plan payments came nowhere close to satisfying the security claim and now the nation's star has no recourse because it's lien has been improperly extinguished so unless the court has any further questions i would speculate request this court reversed the decisions of the district court in bankruptcy court and direct that our mortgage lien be reinstated thank you  will be in recess until nine o'clock tomorrow morning