Source: https://lundinonchapter13.com/Content/Section/46.4
Timestamp: 2019-08-26 02:29:10
Document Index: 673800502

Matched Legal Cases: ['§ 46', '§ 46', '§ 541', '§ 542', '§ 542', '§ 548', '§ 54717', '§ 541', '§ 1322', '§ 1322', '§ 1322', '§ 1322', '§ 1322', '§ 1322', '§ 542', '§ 542', '§ 542', '§ 542', '§ 1322', '§ 1322', '§ 1322', '§ 1322', '§ 541', '§ 75', '§ 62', '§ 130', '§ 82', '§ 45', '§ 46', '§ 52', '§ 50', '§ 50', '§ 53', '§ 75', '§ 62', '§ 48', '§ 47', '§ 1322', '§ 319', '§ 319', '§ 541', '§ 542', '§ 541', '§ 5', '§ 5', '§ 542', '§ 541', '§ 542', '§ 542', '§ 9', '§ 542', '§ 541', '§ 52', '§ 50', '§ 75', '§ 62', '§ 542', '§ 542', '§ 52', '§ 50', '§ 542', '§ 542', '§ 1306', '§ 541', '§ 541', '§ 506', '§ 547', '§ 362', '§ 542', '§ 53', '§ 50', '§ 53', '§ 548', '§ 541', '§ 548', '§ 550', '§ 548', '§ 548', '§ 129', '§ 81', '§ 130', '§ 82', '§ 130', '§ 82', '§ 108', '§ 108', '§ 108', '§ 108', '§ 1322', '§ 1322', '§ 1322', '§ 130', '§ 82', '§ 1322', '§ 130', '§ 82', '§ 362', '§ 108', '§ 108', '§ 1322', '§ 115', '§ 78', '§ 1322', '§ 79', '§ 1322', '§ 80', '§ 81', '§ 82', '§ 130', '§ 82', '§ 1322', '§ 52', '§ 50', '§ 542', '§ 108', '§ 1322', '§ 1322', '§ 1322', '§ 1322', '§ 542', '§ 1306', '§ 45', '§ 46', '§ 1322', '§ 1322', '§ 1322', '§ 115', '§ 78', '§ 45', '§ 46', '§ 415', '§ 541', '§ 542', '§ 542', '§ 362', '§ 542', '§ 342', '§ 363', '§ 1322', '§ 1322', '§ 547', '§ 362', '§ 362', '§ 362', '§ 1322', '§ 1322', '§ 1322', '§ 1322', '§ 108', '§ 1322', '§ 542', '§ 542', '§ 541', '§ 541', '§ 542', '§ 1322', '§ 1322', '§ 1322', '§ 108', '§ 1322', '§ 108', '§ 1322', '§ 108', '§ 1322', '§ 108', '§ 1303', '§ 108', '§ 1322', '§ 1322', '§ 1322', '§ 108', '§ 541', '§ 541', '§ 108', '§ 1322', '§ 541', '§ 6402']

§ 46.4 Prepetition Repossession, Levy, Sale or Conveyance
Cite as: Keith M. Lundin, Lundin On Chapter 13, § 46.4, at ¶ ____, LundinOnChapter13.com (last visited __________).
Updater Cases (113)
Chapter 13 debtors often file bankruptcy after creditors with liens or security interests have foreclosed, repossessed their collateral or dispossessed the debtor. One of the major battlefields in Chapter 13 practice is the extent of a debtor’s power to recover property that was seized or repossessed before the petition. Whether the issue arises as a turnover action by the debtor1 or as an action against the creditor for sanctions for violating the automatic stay,2 the foundation questions are whether and to what extent the property involved remains property of the Chapter 13 estate. Although the debtor’s powers may vary with the kind of property involved,3 the threshold issues are basically the same whether the property is a car or a house and whether the prepetition action was repossession by a tow truck or foreclosure on the courthouse steps.
Determining a Chapter 13 debtor’s interest in property repossessed or foreclosed upon before the petition requires negotiating a nasty intersection between bankruptcy law and state law. The broad definition of property of the Chapter 13 estate in §§ 541 and 1306 of the Bankruptcy Code4 collides with state law and with contracts that reduce or eliminate a debtor’s interest in collateral upon repossession. Complicating the mix are the special turnover, avoidance and recovery powers in the Bankruptcy Code that empower debtors and trustees to recover possession of property of the estate that was lost before the petition.5 Overlaying all of this is the automatic stay that prohibits a lienholder from exercising control over property of the estate—even property of the estate that was lawfully repossessed before the petition.6 It is not surprising that there are great conflicts in the reported decisions addressing whether property of the Chapter 13 estate includes real or personal property that was repossessed, seized or foreclosed upon before the petition. Cars and houses have drawn the most attention. Almost all of the cases claim to be applying the Supreme Court’s holding in United States v. Whiting Pools, Inc.,7 although the conflicting outcomes hardly support those claims.
In 1983, in Whiting Pools the IRS seized a Chapter 11 debtor’s personal property pursuant to a tax levy before the petition but had not sold the property. The IRS contended that the bankruptcy estate was not entitled to possession of the property because the Service’s levy was complete before the petition and divested the debtor of all interest in the property. The Supreme Court disagreed, holding that the right of possession of the property seized by the IRS was itself property of the Chapter 11 estate and that § 542(a) of the Code required the IRS to deliver possession to the debtor. The Supreme Court observed that the Bankruptcy Code changed the IRS’s nonbankruptcy entitlements and drew into the bankruptcy estate the right of possession notwithstanding prepetition loss of that right under nonbankruptcy law. The Bankruptcy Code substituted for the right of possession other rights under bankruptcy law such as the right of adequate protection.8
Consistent with Whiting Pools, many courts have concluded that the Chapter 13 estate includes cars and other personal property repossessed before the petition but still in the possession of the lienholder.9 Other courts on essentially identical facts have either distinguished Whiting Pools or found state law to support the conclusion that personal property repossessed before the petition does not become property of the Chapter 13 estate.10 This fracture in the case law creates many difficult issues for Chapter 13 practice. If repossessed property remains property of the Chapter 13 estate, the repossessing creditor is obligated by § 542 to deliver possession to the debtor or the trustee.11 A creditor in possession of estate property that refuses to deliver possession to the debtor or trustee risks sanctions for violating the automatic stay.12
When repossessed property has been disposed of by the lienholder before the Chapter 13 petition, the courts generally recognize that no interest remains in the debtor to become property of the Chapter 13 estate.13 But a fake or defective prepetition sale leaves the debtor with rights against the repossessing creditor that become property of the Chapter 13 estate.14 When the property levied upon before the petition is future wages,15 cash, securities or negotiable instruments, the reported decisions are split whether the debtor retains a property interest at the filing of a Chapter 13 petition.16 If the prepetition repossession or sale is an avoidable transfer—for example, because it is a fraudulent conveyance under § 548 or preferential under § 54717—then the property (or its value) becomes property of the Chapter 13 estate under § 541(a)(3).18
The extent to which distressed real property becomes property of the Chapter 13 estate has been a perennial source of conflicting decisions notwithstanding congressional efforts to fix the problem. The issue comes before the bankruptcy court most often in the context of a Chapter 13 plan that proposes to cure defaults and maintain payments with respect to a mortgage that proceeded from default through acceleration to foreclosure sale before the petition.19 From the earliest days of the 1978 Code, the courts have struggled to determine when in the death spiral of a home mortgage the debtor ceases to have a sufficient property interest to cure defaults and reinstate the debt.20 This question has befuddled the courts because of the difficult interaction of state property law and the special power of Chapter 13 debtors to rehabilitate home mortgages that are in default at the petition.
Similar issues arise when real property has been subject to a prepetition tax sale. Most state laws preserve in the property owner only some sort of “right of redemption” after a tax sale. Many reported decisions conclude that only the right of redemption as defined by state law becomes property of the Chapter 13 estate.21
In 1994, Congress tried to fix the problem by amending § 1322(c)(1) to provide a limit on the power of a Chapter 13 debtor to cure defaults and maintain payments with respect to a home mortgage.22 The 1994 amendment to § 1322(c)(1) forbids a Chapter 13 debtor to cure defaults and maintain payments on a home mortgage if the residence was “sold at a foreclosure sale that is conducted in accordance with applicable nonbankruptcy law.”23 Whatever hope there was that the 1994 amendment would provide a bright-line test for the minimum property interest that must remain in the debtor at the petition to support rehabilitation of a mortgage in a Chapter 13 case has been dashed by the many conflicting decisions interpreting § 1322(c)(1).24
The existence of a “right of redemption” under state law or by contract has much confused the question whether property repossessed or foreclosed upon before the petition becomes property of the Chapter 13 estate. Typically, a right of redemption permits a borrower to acquire complete ownership and possession of collateral that was repossessed or foreclosed upon by tendering the amount provided by contract or by statute within a specified time. Under state law, redemption is sometimes the only right remaining in the borrower after repossession or foreclosure.25 And typically by contract or state law, redemption after repossession or foreclosure requires tendering a lump sum, not an offer of installment payments over time.26
But under the Bankruptcy Code, Chapter 13 debtors have many more rights with respect to lienholders. For example, even though a mortgage holder has declared a default and accelerated the note, and the debtor’s only contract remedy remaining is immediate payment in full, so long as a foreclosure sale has not been conducted, Chapter 13 empowers the debtor to cure defaults and reinstate the original maturity and other terms of the underlying mortgage contract.27 Put another way, state law plays an important role in defining the property rights that come into the Chapter 13 estate, but the Bankruptcy Code enhances those rights in many ways. The Chapter 13 estate contains both the property interests the debtor held under state law at the petition and the property interests that are redefined or enhanced by the Bankruptcy Code.
With respect to home mortgages, the stage of foreclosure at which the debtor files the Chapter 13 petition determines whether there is a sufficient property interest remaining in the debtor to support the power to cure defaults.28 The existence or nonexistence of a right of redemption under state law or by contract is not outcome determinative, unless redemption rights bear on whether the property has been “sold at a foreclosure sale . . . in accordance with applicable nonbankruptcy law” for purposes of § 1322(c)(1).
With respect to personal property, there is no Code section analogous to § 1322(c)(1). In other words, the Bankruptcy Code does not specify with respect to personal property the point in the deteriorating relationship between the debtor and the creditor after which the filing of the Chapter 13 petition does not trigger the rights and powers that debtors ordinarily have with respect to lienholders. Not unlike the home mortgage cases before the 1994 enactment of § 1322(c)(1), the courts are struggling with the question whether a right of redemption is a sufficient property interest in a car to bring the car into the Chapter 13 estate and empower the debtor to manage the lien notwithstanding prepetition repossession of the car. Some courts hold that the right of redemption itself comes into the Chapter 13 estate but no other interest in the car; thus the debtor can exercise the right of redemption consistent with state law or contract through the plan, but the debtor cannot use any other powers with respect to the car—for example, turnover of possession under § 542(a)29 or the ordinary power of a Chapter 13 debtor to modify the rights of secured claim holders.30 Other courts have concluded that so long as the car has not been sold by the repossessing creditor before the Chapter 13 petition, the right of redemption remaining in the debtor is sufficient property interest to bring possession of the car itself into the Chapter 13 estate.31
This is a very curious debate. It is almost as if Whiting Pools never happened or, at least, that Whiting Pools doesn’t say what it says. The Chapter 1132 debtor in Whiting Pools lost the right of possession before the petition. The debtor in Whiting Pools could not regain possession outside bankruptcy except by tendering payment in full—in other words, by “redeeming” the collateral from the IRS by payment in full.
But the Supreme Court resplendently did not say in Whiting Pools that the only right the debtor could exercise or “use” in the Chapter 11 case was payment in full (redemption!). Instead, the Supremes say in Whiting Pools that bankruptcy law gives the debtor a right of possession enforceable by turnover under § 542(a) and bankruptcy law substitutes for the IRS’s repossession other rights such as adequate protection. Cases concluding that state law or contract redemption rights somehow limit a Chapter 13 debtor’s right of possession and use of repossessed collateral are not being honest to the holding of the Supreme Court in Whiting Pools.
Litigation of the extent to which a repossessed car becomes property of the Chapter 13 estate has become quite a drama in the Eleventh Circuit. In 1998, in Charles R. Hall Motors, Inc. v. Lewis (In re Lewis),33 the U.S. Court of Appeals for the Eleventh Circuit shocked the Chapter 13 world by interpreting the Alabama Uniform Commercial Code to preclude a Chapter 13 debtor from recovering a car repossessed but not disposed of before the petition. The Eleventh Circuit found in Lewis that the debtor’s statutory right of redemption became property of the Chapter 13 estate but this property right only permitted the debtor to redeem by paying the balance of the car loan plus the creditor’s expenses within the short time allowed by state law. In other words, according to the Eleventh Circuit in Lewis, the right of redemption under Alabama law was not a sufficient property interest to support the Chapter 13 debtor’s exercise of the right recognized by the Supreme Court in Whiting Pools to require turnover of the car itself under § 542(a).
Whatever hope there was that Lewis would be limited to Alabama car loans and Alabama repossessions evaporated four years later when the Eleventh Circuit reached a similar outcome on different logic applying Florida law in Bell-Tel Federal Credit Union v. Kalter (In re Kalter).34 Kalter involved basically the same facts as in Lewis—car repossessed before the petition but not disposed of when the Chapter 13 petition was filed. This time the Eleventh Circuit looked hard at both the Florida Uniform Commercial Code and the Florida car title registration statute. The Eleventh Circuit acknowledged in Kalter that the Uniform Commercial Code did not cause title to pass to the repossessing creditor at the time of repossession, thus title came into the Chapter 13 estate. However, looking to the title registration laws, because the repossessing creditor could cause a “repossession title” to be issued after retaking possession, the car did not become property of the Chapter 13 estate and could not be recovered by the debtor. Same outcome as in Lewis but different reasoning.
Lewis and Kalter are troubling at many levels and have been intensely criticized both within and outside the Eleventh Circuit.35 The fairly typical Article 9 provisions addressed in Lewis preserve many rights of owners in property that has been repossessed by a lienholder—the right of redemption being just the most obvious. That very similar rights remaining in the debtor in Whiting Pools were found to be sufficient by the Supreme Court to drag the right of possession into the bankruptcy estate was lightly disregarded by the Eleventh Circuit in Lewis. Kalter acknowledges the substantial rights remaining in the debtor after repossession under the Florida Uniform Commercial Code then forfeits the bankruptcy entitlements that follow from those rights by sleight of hand under the Florida title registration law. Kalter misses altogether the point that once a substantial bundle of rights came into the Chapter 13 estate, the debtor can use powers such as § 542(a) to command the return of possession and permit continued use of the car by the debtor. The creditor’s right to seek a repossession title is stayed by the bankruptcy filing and can’t trump the debtor’s bankruptcy entitlements.
In any case, Lewis and Kalter are not the end of the story in the Eleventh Circuit. In the four years between Lewis and Kalter, bankruptcy courts and district courts within the Eleventh Circuit struggled to distinguish Lewis and to explain Whiting Pools to the Eleventh Circuit.36 One of these cases, interpreting Georgia law on facts indistinguishable from those in Lewis and Kalter, reached the Eleventh Circuit in 2003.
In In re Rozier,37 the bankruptcy court distinguished Lewis and Kalter and held under Georgia law the Chapter 13 debtor retained sufficient interest in a car repossessed before the petition to support recovery by the estate:
Georgia law can be distinguished from Alabama law and Florida law because Georgia case law supports the contention that Uniform Commercial Code . . . provisions do not automatically transfer title to a secured creditor upon repossession. Thus, in Georgia, repossession is not the same as change of ownership, nor does repossession transfer all of a debtor’s interest in the property to a secured creditor. . . . Kalter is based on Florida law . . . . [T]he default provisions in Georgia’s U.C.C. statute do not automatically transfer title to a secured creditor upon debtor’s default. . . . Georgia’s transfer of vehicle by operation of law statute substantially differs from the Florida statute of the same name. . . . [O]wnership is not terminated until the sale of the collateral by the secured creditor or by legal process, neither of which has happened in this case. Thus, the repossessed automobile, which had not been sold by the creditor pre-petition, is property of Debtor’s Chapter 13 bankruptcy estate.38
The U.S. District Court for the Middle District of Georgia affirmed Rozier, accepting the bankruptcy court’s reasoning that Kalter and Lewis were “inapposite.”39 Rozier then went to the Eleventh Circuit.
A panel of the Eleventh Circuit different from the panels in Lewis and Kalter took a fresh look at the property of the estate issue and blinked. Instead of filtering Georgia law through Lewis and Kalter, the Rozier panel certified the following question to the Supreme Court of Georgia:
Does legal title, or any other ownership interest that would give a right of possession, pass to that creditor under Georgia law upon repossession of an automobile subsequent to a debtor’s default on an automobile installment loan contract, or does such legal title or other ownership interest remain in the debtor?40
At this writing, the Georgia Supreme Court has yet to respond to the question certified in Rozier. Just speculating, it has to be said that it looks as though the Eleventh Circuit panel in Rozier was not altogether satisfied with the reasoning in Lewis and Kalter. It would have been too simple for the panel in Rozier to apply Lewis and/or Kalter to the similar Georgia UCC and car registration statutes. That Rozier was instead certified to the Georgia Supreme Court kindles hope that the Eleventh Circuit will reconsider whether a Chapter 13 debtor enjoys the rights in repossessed personal property that the Supreme Court acknowledged more than 20 years earlier in Whiting Pools.
The Fourth Circuit dared to go where the Eleventh feared without the side step to certification. In Tidewater Finance Co. v. Moffett (In re Moffett),41 the Chapter 13 case was filed later on the same day that Tidewater repossessed the debtor’s 1998 Honda Accord. Tidewater refused demands to return the car. The plan was a bit unusual in that the debtor proposed to cure the delinquency in car payments over the life of the plan and to continue making the regular monthly contract payments directly to Tidewater.42 Citing Lewis and Kalter, Tidewater argued that no property interest in the car came into the Chapter 13 estate; that Moffett could not “redeem” the car in installments as provided in the plan; and in the alternative, Moffett’s interest, if any, in the car should be determined by certification to the Virginia Supreme Court.
Citing Whiting Pools, the Fourth Circuit had no trouble finding that Moffett’s rights of redemption, notice and surplus under the UCC were “unquestionably ‘legal or equitable interests’ . . . that are included within [Moffett’s] bankruptcy estate.”43 Ironically, the Fourth Circuit cites Lewis and Kalter to support the proposition that Moffett’s statutory right to redeem became part of the Chapter 13 estate.
But the Fourth Circuit departs from Lewis and Kalter by holding that the Bankruptcy Code empowered Moffett to exercise the right of redemption as proposed in the plan:
Moffett’s reorganization plan does not provide for a lump sum payment of all outstanding debts. However, even if the purchase agreement and . . . the UCC require such acceleration of her debts upon default, the Bankruptcy Code entitles Moffett to restructure the timing of her payments in order to facilitate the exercise of her right of redemption. Section 1322(b)(2) of the Bankruptcy Code permits debtors to modify the rights of holders of secured claims. Section 1322(b)(3) also allows debtors to cure their defaults. Courts have recognized that the Bankruptcy Code permits debtors to restructure the timing of payments to secured creditors by de-accelerating debts, in order to allow debtors to regain collateral necessary to their financial recuperation.44
The Fourth Circuit in Moffett is true to Whiting Pools in all the ways that aren’t evident in the Eleventh Circuit’s cases. Although careful to confine its analysis to curing default with respect to the right of redemption under § 1322(b)(3), the Fourth Circuit citation of the power to modify in § 1322(b)(2) invites the question whether a Chapter 13 debtor can also modify the right of redemption for payment through the Chapter 13 plan. Moffett is a big step in the right direction for Chapter 13 debtors. Arguably, Moffett sets up a split in the circuits for purposes of Supreme Court review.
Good arguments can be made that Congress should step in and fix the problem with respect to personal property—and, it is hoped, with more precision than § 1322(c)(1). In the meantime, debtors and creditors might look to pre-1994 mortgage cases to see how their jurisdiction is likely to analyze the issue. For example, in the Sixth Circuit, with respect to home mortgages before the 1994 enactment of § 1322(c)(1), the rule was that until sale of the property at foreclosure, the Chapter 13 debtor retained a sufficient property interest to cure default and maintain payments through a Chapter 13 plan.45 The Bankruptcy Appellate Panel for the Sixth Circuit has adopted a similar rule for cars. In National City Bank v. Elliott (In re Elliott),46 the BAP concluded there was a sufficient property right to draw a car into the Chapter 13 estate if the petition was filed before sale of the car by the repossessing lienholder. The BAP rejected the car lender’s argument that only the right of redemption came into the Chapter 13 estate.
There is some consensus in the reported decisions that “bare legal title” is not a sufficient property interest to enable a Chapter 13 debtor to use an item of property. In this context, bare legal title is shorthand for the absence of rights in property other than a nominal claim because of the debtor’s name on a deed, title or other document of ownership. With respect to real property, if a foreclosure sale was completed before the Chapter 13 petition or, with respect to personal property, if a repossessing creditor sold the property before the petition, all that remains in the debtor is title to the property—the debtor has no equitable interest by law or by contract. Consistent with § 541(d),47 the courts hold that bare legal title is not expanded by the Bankruptcy Code into anything that the debtor can use or possess in the Chapter 13 case.48 When the debtor remains in possession of the real property at the petition, that possessory interest becomes property of the Chapter 13 estate notwithstanding a prepetition foreclosure, but physical possession unsupported by any other right, title or interest is of limited use to the debtor.49
2 See § 75.1 [ Examples of Stay Violations, and Not ] § 62.1 Examples of Stay Violations, and Not.
3 See, e.g, the limitations on curing default with respect to a personal residence, discussed in § 130.1 [ Prepetition Defaults ] § 82.1 Prepetition Defaults—When is Property “Sold” at Foreclosure?.
4 See § 45.1 [ What Is Property of the Chapter 13 Estate? ] § 46.1 What Is Property of the Chapter 13 Estate?.
5 See §§ 52.1 [ Turnover of Property ] § 50.1 Turnover of Property, 53.1 [ Strong-Arm Powers, Statutory Liens, Preferences and Fraudulent Conveyances ] § 50.3 Strong-Arm Powers, Statutory Liens, Preferences and Fraudulent Conveyances and 60.1 [ Avoidance and Recovery Powers ] § 53.12 Avoidance and Recovery Powers.
6 See § 75.1 [ Examples of Stay Violations, and Not ] § 62.1 Examples of Stay Violations, and Not.
7 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983).
8 See § 48.1 [ Adequate Protection of Lienholders prior to Confirmation ] § 47.1 Adequate Protection of Lienholders before Confirmation.
9 See, e.g., Tidewater Fin. Co. v. Moffett (In re Moffett), 288 B.R. 721 (Bankr. E.D. Va. 2002) (Applying United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983), legal and equitable ownership of car remained with the debtor, subject only to creditor’s lien and remedies upon default; repossession divested the debtor of the present right to use the car but did not preclude recovery of possession in the Chapter 13 case.), aff’d, 289 B.R. 55 (E.D. Va. 2003), aff’d, 356 F.3d 518 (4th Cir. 2004); In re Rozier, 283 B.R. 810 (Bankr. M.D. Ga. 2002) (Distinguishing Charles R. Hall Motors, Inc. v. Lewis (In re Lewis), 137 F.3d 1280 (11th Cir. 1998), and Bell-Tel Federal Credit Union v. Kalter (In re Kalter), 292 F.3d 1350 (11th Cir. 2002), under Georgia law the debtor retains sufficient ownership in a car repossessed before the petition to trigger the automatic stay and provide the predicate for turnover.), aff’d, 290 B.R. 910, 913 (M.D. Ga.) (“[U]nder Georgia law, there is clear case law which provides that, under the default provisions of the UCC, title does not automatically pass to the creditor upon the debtor’s default, but instead, title remains with the debtor. . . . In light of this interpretation of Georgia’s version of Article 9 of the UCC, a debtor has more than the mere right to redeem after repossession by a creditor. More specifically, title remains with the debtor after repossession. As a result, the Eleventh Circuit’s holdings in Kalter and Lewis are inapposite.”), question certified, 348 F.3d 1305, 1307 (11th Cir. 2003); TranSouth Fin. Corp. v. Sharon (In re Sharon), 234 B.R. 676, 681 (B.A.P. 6th Cir. 1999) (Citing United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983), “possession of the Debtor’s car was property of the Chapter 13 estate from the moment of the petition” notwithstanding prepetition repossession by secured creditor. “Transouth repossessed the Debtor’s car before the Chapter 13 petition, but had not disposed of the car. In Whiting Pools, the IRS seized the debtor’s property pursuant to a tax levy before the petition but had not sold the property. Whiting Pools requires that the right to possess the Debtor’s car became property of this Debtor’s Chapter 13 estate.”); National City Bank v. Elliott (In re Elliott), 214 B.R. 148, 152 (B.A.P. 6th Cir. 1997) (Car surrendered before petition is property of Chapter 13 estate when petition is filed before sale and debtor retains statutory right of redemption under Ohio law. Applying Federal Land Bank of Louisville v. Glenn (In re Glenn), 760 F.2d 1428 (6th Cir.), cert. denied, 474 U.S. 849 (1985), “sale or other disposition . . . is the cutoff point of a Chapter 13 debtor’s power to modify a secured creditor’s claim under § 1322(b)(2).”); In re Johnson, No. 03-66402-PWB, 2003 WL 21703529, at *3 (Bankr. N.D. Ga. July 18, 2003) (unpublished) (Distinguishing Charles R. Hall Motors, Inc. v. Lewis (In re Lewis), 137 F.3d 1280 (11th Cir. 1998), and Bell-Tel Federal Credit Union v. Kalter (In re Kalter), 292 F.3d 1350 (11th Cir. 2002), “repossession of collateral in Georgia does not automatically transfer title to a secured creditor. . . . Under the principles of Whiting Pools, . . . repossession of Debtor’s vehicle did not terminate her ownership interest, and the car was property of her estate when she filed her chapter 13 petition.”); In re Sanders, 291 B.R. 97, 100–01 (Bankr. E.D. Mich. 2003) (Applying TranSouth Financial Corp. v. Sharon (In re Sharon), 234 B.R. 676 (B.A.P. 6th Cir. 1999), car repossessed but not disposed of before the petition remains property of the Chapter 13 estate and can be recovered by the debtor. “[R]epossession is merely a device to collect on the creditor’s claim, and . . . repossession does not transfer ownership to the creditor. . . . Until the creditor disposes of the property, the debtor remains the legal and equitable owner, subject only to the creditor’s debt collection remedies.” Citing United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983), bankruptcy court rejects argument that Chapter 13 estate includes right of redemption but not right of possession.); In re Bonner, 286 B.R. 917 (Bankr. M.D. Ga. 2002) (Distinguishing Bell-Tel Federal Credit Union v. Kalter (In re Kalter), 292 F.3d 1350 (11th Cir. 2002), car repossessed under Georgia law but not yet sold remained property of the Chapter 13 estate.); In re Robinson, 285 B.R. 732 (Bankr. W.D. Okla. 2002) (Applying United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983), debtor retained interest in car that became property of the Chapter 13 estate notwithstanding prepetition repossession.); In re Garcia, 276 B.R. 699 (Bankr. S.D. Fla. 2002) (Decided before Bell-Tel Fed. Credit Union v. Kalter (In re Kalter), 292 F.3d 1350 (11th Cir. 2002), under Florida law, Chapter 13 debtor’s ownership interest in a repossessed car became property of the Chapter 13 estate and will support turnover of possession of the car.); In re Shunnarah, 268 B.R. 657, 662–64 (Bankr. M.D. Fla. 2001) (“The Court respectfully disagrees with the district court decisions in [Bell-Tel Federal Credit Union v. Kalter (In re Kalter), 257 B.R. 93 (M.D. Fla. 2000)] and [Tidewater Finance Co. v. Chiodo, No. 6:00-CV0396-3A06-JGG (M.D. Fla. May 30, 2001)] . . . . The Court agrees with the Chiodo bankruptcy court’s holding that a debtor retains an ownership interest sufficient to constitute property of the estate in a repossessed vehicle until the repossessing creditor obtains a new certificate of title pursuant to Fla. Stat. § 319.28. Additionally, the Court finds that [Charles R. Hall Motors, Inc. v. Lewis (In re Lewis), 137 F.3d 1280 (11th Cir. 1998)] does not control.”); In re Clelland, 268 B.R. 539, 540–41 (Bankr. E.D. Ark. 2001) (Applying Texas law, title to car remained property of Chapter 13 estate notwithstanding prepetition repossession. “[N]either the debtor’s default or the exercise of the right to repossession, effected a transfer of title from the debtor to the credit union. . . . [I]n order for title of the property to pass after repossession, a sale must take place. . . . [P]roperty of the estate includes all interests of the debtor, even interests in property in which the debtor does not have the right of possession.”); In re Dash, 267 B.R. 915 (Bankr. D.N.J. 2001) (Car lease remained property of the estate because prepetition repossession did not terminate the lease under New Jersey Consumer Leasing Act.); Baker v. Health Servs. Credit Union (In re Baker), 264 B.R. 759, 763–64 (Bankr. M.D. Fla. 2001) (“The Court respectfully disagrees with the district court in [Bell-Tel Federal Credit Union v. Kalter (In re Kalter), 257 B.R. 93 (M.D. Fla. 2000)]. Under this Court’s interpretation of Florida law, a debtor’s ownership interest in a repossessed vehicle survives until a new certificate of title is issued pursuant to § 319.28. See In re Ratliff, 260 B.R. 526, 530 (Bankr. M.D. Fla. 2000) (adopting the reasoning of the bankruptcy court in [Tidewater Finance Co. v. Chiodo (In re Chiodo), No. 6:00-CV-396-3A06-JGG (M.D. Fla. May 30, 2001)]). If a new certificate of title to a repossessed vehicle is not issued by the petition date, then the surviving ownership interest is property of a debtor’s bankruptcy estate.”); Patterson v. Chrysler Fin. Co. (In re Patterson), No. 99-35259DWS, 00-0258, 2000 WL 1692838 (Bankr. E.D. Pa. Nov. 2, 2000) (Car repossessed before the petition but not sold by creditor becomes property of the estate under § 541, and the debtor’s right of possession is drawn into the estate by § 542(a) as interpreted by the Supreme Court in United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983).), after trial, 263 B.R. 82 (Bankr. E.D. Pa. 2001); In re Chiodo, 250 B.R. 407, 412 (Bankr. M.D. Fla. 2000) (Applying Florida law and distinguishing Charles R. Hall Motors, Inc. v. Lewis (In re Lewis), 137 F.3d 1280 (11th Cir. 1998), Chapter 13 debtor retains more than a minor interest in a car repossessed before the petition when the repossessing creditor has not applied for or received a new certificate of title; the repossessing creditor may have the right to sell the car under Florida law, but the repossessing creditor cannot transfer marketable title until a new certificate of title is issued. “Lewis is not controlling in this case. . . . Lewis rests exclusively upon an analysis of Alabama law that is not applicable in this case and that is very dissimilar from Florida law.”), rev’d sub nom. Tidewater Fin. Co. v. Chiodo, No. 6:00-CV0396-3A06-JGG (M.D. Fla. May 30, 2001); Greene v. Associates (In re Greene), 248 B.R. 583 (Bankr. N.D. Ala. 2000) (In a long, fascinating discussion of the errors of logic and law in Charles R. Hall Motors, Inc. v. Lewis (In re Lewis), 137 F.3d 1280 (11th Cir.), reh’g denied en banc, 149 F.3d 1197 (11th Cir. 1998), car repossessed but not disposed of before Chapter 13 petition remains property of the estate. Lewis is distinguishable on the facts based on the absence of a contract provision that retained title in the lender. Jim Walter Homes, Inc. v. Saylors (In re Saylors), 869 F.2d 1434 (11th Cir. 1989), not Southtrust Bank of Alabama, N.A. v. Thomas (In re Thomas), 883 F.2d 991 (11th Cir. 1989), is controlling.); In re Bunton, 246 B.R. 851 (Bankr. N.D. Ohio 2000) (Car that the debtor did not redeem, reaffirm or surrender in prior Chapter 7 case that was repossessed a few days before Chapter 13 petition became property of the Chapter 13 estate.); In re Nowell, 232 B.R. 370, 373 (Bankr. S.D. Ohio 1999) (Title to car remained in debtor and was property of the estate protected by the automatic stay notwithstanding prepetition repossession and contract for sale of car to unrelated third party. “Under Ohio law, an enforceable contract of sale also terminates a debtor’s right to redeem. . . . [T]hat the contract of sale . . . terminated the debtor’s right to redeem the car does not mean that the debtor lacked any interest in the car at the time of his bankruptcy filing. The vehicle was still titled to the debtor. Under 11 U.S.C. § 541(a)(1), therefore, that title interest, however limited it may be because of the termination of the debtor’s right to redeem, is still a legal interest which is property of the bankruptcy estate. [The repossessing creditor] was not free to exercise any control over that legal interest without first obtaining relief from the automatic stay.”); Nash v. Ford Motor Credit Co. (In re Nash), 228 B.R. 669, 673 (Bankr. N.D. Ill. 1999) (Under Illinois law, debtor retains sufficient property interest in a car repossessed before the petition to require turnover; however, creditor does not violate stay by refusing turnover until adequate protection is determined by the court after trial. Citing United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983), and distinguishing Charles R. Hall Motors, Inc. v. Lewis (In re Lewis), 137 F.3d 1280 (11th Cir. 1998), “here we look to Illinois law as the basis to discuss this debtor-plaintiff’s property interest in her repossessed vehicle. . . . ‘This court believes that the situation presented in this case falls squarely within Whiting Pools’ conclusion that until a sale has taken place, property seized pre-petition pursuant to a creditor’s provisional remedy remains property of the estate, and as such, is subject to the turnover requirements of § 5[42](a).’ . . . Therefore, Debtor can certainly attempt to vindicate her rights under § 5[42](a) in this proceeding if she can offer adequate protection to the Defendant.”); In re Iferd, 225 B.R. 501, 504–05 (Bankr. N.D. Fla. 1998) (Applying Florida law and distinguishing Charles R. Hall Motors, Inc. v. Lewis (In re Lewis), 137 F.3d 1280 (11th Cir. 1998), “under Florida law, a debtor retains title and other ownership interests in a repossessed motor vehicle until the creditor re-sells the vehicle. Here, TFCU only has possession of the vehicle, and Iferd has legal title. This interest is sufficient to make the vehicle property of the estate. . . . I direct TFCU to turn possession over to Iferd’s estate without further delay.”); Spears v. Ford Motor Credit Co. (In re Spears), 223 B.R. 159 (Bankr. N.D. Ill. 1998) (Distinguishing Charles R. Hall Motors, Inc. v. Lewis (In re Lewis), 137 F.3d 1280 (11th Cir. 1998), under Illinois law, debtor retains sufficient property interest in car repossessed before petition but not yet sold by the creditor that debtor can require turnover under § 542(a).); American Honda Fin. Corp. v. Littleton (In re Littleton), 220 B.R. 710, 714–15 (Bankr. M.D. Ga. 1998) (Debtors’ property interest in car repossessed in Georgia the day before the petition but subject to a security interest created under Alabama law is determined by Georgia law, thus Charles R. Hall Motors, Inc. v. Lewis (In re Lewis), 137 F.3d 1280 (11th Cir. 1998), does not control; under Georgia law, debtor retained a sufficient property interest to support recovery and use through a Chapter 13 plan. The retail installment contract provided that Alabama law would apply. Applying Georgia decisions, “the court concludes that . . . a Georgia court would find that Georgia law applies with respect to a car repossessed in Georgia when the parties have not specified in a contract that another state’s law would apply to determine rights after repossession. . . . [U]nder Georgia law upon repossession a creditor acquires the right of possession, but not absolute title. As a result, a debtor retains a title interest in the vehicle. . . . Furthermore, the court finds that this interest is sufficient to make the vehicle property of the estate.” Upon providing adequate protection, debtors will be entitled to turnover.); In re Pluta, 200 B.R. 740, 742 (Bankr. D. Mass. 1996) (Car repossessed prepetition remains property of the Chapter 13 estate notwithstanding that Massachusetts law only gives the debtor a right of redemption after default, acceleration, and repossession. “Chrysler had not disposed of the Collateral, entered into a contract for its disposition, or gained the right to retain the Collateral in satisfaction of the Debtor’s obligation. . . . [A]s of the Petition Date, the Debtor retained the right to redeem his Jeep. More importantly, as of the Petition Date, the Debtor remained title holder and owner of the Jeep. Thus, the Jeep constitutes property of the estate under § 541 of the Code.” Citing United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983), debtor can manage the claim secured by the Jeep through a Chapter 13 plan, but court reserves turnover pending a hearing on the creditor’s motion for stay relief.); In re Young, 193 B.R. 620, 621 (Bankr. D.D.C. 1996) (Prepetition repossession of the debtor’s car did not terminate the debtor’s title, thus the car became property of the Chapter 13 estate. “The mere seizure of the vehicle did not suffice to destroy the debtor’s title as long as the debtor had a right to redeem.” Car lender did not violate the automatic stay by refusing to turn over the car pending the debtor’s providing adequate protection. Lender was entitled to maintain the status quo postpetition.); Robinson v. Ford Motor Credit Co., 36 B.R. 35 (Bankr. E.D. Ark. 1983) (Citing United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983), automobile repossessed by creditor remains property of the estate and is subject to turnover under § 542.). Accord Coleman v. Grand Nat’l Bank (In re Coleman), 229 B.R. 428 (Bankr. N.D. Ill. 1999); In re Jackson, 142 B.R. 172 (Bankr. N.D. Ohio 1992); Associates Commercial Corp. v. Attinello, 38 B.R. 609 (Bankr. E.D. Pa. 1984); Tektronix Employees Fed. Credit Union v. Title, 37 B.R. 173 (Bankr. D. Ariz. 1984); GMAC v. Radden, 35 B.R. 821 (Bankr. E.D. Va. 1983); Willis v. Parks Chevrolet, Inc., 34 B.R. 451 (Bankr. M.D.N.C. 1983).
10 See, e.g., Bell-Tel Fed. Credit Union v. Kalter (In re Kalter), 292 F.3d 1350 (11th Cir. 2002) (Applying Charles R. Hall Motors, Inc. v. Lewis (In re Lewis), 137 F.3d 1280 (11th Cir. 1998), cars repossessed before petition are not property of Chapter 13 estate whether applying the Florida UCC or the Florida Certificate of Title statute.); Charles R. Hall Motors, Inc. v. Lewis (In re Lewis), 137 F.3d 1280, 1284 (11th Cir. 1998) (Right of redemption with respect to car repossessed under Alabama Uniform Commercial Code is insufficient interest to render the car property of Chapter 13 estate. Car was repossessed before the petition. Debtors “did not retain title, possession or any other functionally equivalent ownership interest in the repossessed automobile. . . . [W]e readily conclude that Elgin Lewis’s statutory right of redemption in the automobile became ‘property of the estate’ . . . . As such, the Lewises’ Chapter 13 estate, through the trustee, could exercise or ‘use’ this right just as Elgin Lewis could have. . . . We are not convinced, however, that the mere existence of the estate’s ability to redeem the automobile renders the automobile itself ‘property of the estate,’ at least to the extent that it should be turned over pursuant to 11 U.S.C. § 542(a). In accordance with state law, one must take certain affirmative steps to change the otherwise dormant right to redeem repossessed collateral into a meaningful ownership interest. As relevant to this case, the trustee had to ‘tender[ ] fulfillment of all [secured] obligations’ plus expenses to exercise the estate’s right of redemption.”); Manufacturers & Traders Trust Co. v. Alberto (In re Alberto), 271 B.R. 223, 226–28 (N.D.N.Y. 2001) (Creditor that repossessed car before the petition did not violate automatic stay by selling the car after notice of bankruptcy because debtor did not seek turnover and only the right to redeem, not the right of possession, became property of the Chapter 13 estate. “Once the lawful repossession occurred, Alberto no longer had the right to possess the vehicle; he merely retained the right pursuant to § 9-506 to redeem it before the secured creditor disposed of it. Alberto filed the Chapter 13 petition after the lawful repossession. Accordingly, what became property of the bankruptcy estate was the interest the debtor, Alberto, had in the property: the right to redeem but not the right to possess. . . . Alberto sat on his rights under the bankruptcy code, which provided an avenue for him to effectuate a change in the right to possession of the vehicle from M & T Trust to the bankruptcy estate. . . . [I]t is axiomatic that state law rights are unaffected unless affirmative action is taken to bring property that is not ‘property of the estate’ at the commencement of the bankruptcy proceeding within the protection of the bankruptcy code. . . . Only Alberto’s right to redeem the vehicle was property of the estate absent a turnover order. Thus, M & T Trust’s retention and sale of the collateral pursuant to state law did not violate the automatic stay.”); In re Menasche, 301 B.R. 757, 760–61, 763 (Bankr. S.D. Fla. 2003) (Citing Bell-Tel Federal Credit Union v. Kalter (In re Kalter), 292 F.3d 1350 (11th Cir. 2002), upon repossession four hours before the Chapter 13 petition “[u]nder Florida law . . . the Debtors’ ownership interest pass[ed] to the secured creditor.” Although statutory right of redemption became property of the Chapter 13 estate, “‘the mere existence of the estate’s ability to redeem the automobile [does not render] the automobile itself “property of the estate,” at least to the extent that it should be turned over pursuant to 11 U.S.C. § 542(a).’ . . . Debtors’ proposed redemption through their chapter 13 plan does not satisfy the [Florida law] requirement to ‘tender fulfillment of all obligations secured by the collateral,’ and therefore the Debtors’ proposed redemption does not operate to bring the vehicle within the property of the bankruptcy estate, such that Debtors may compel its turnover.”); In re Coleman, No. 02-11603, 2003 WL 1562140 (Bankr. D. Vt. Mar. 20, 2003) (unpublished) (Because car was lawfully repossessed the day before the petition, only “redemptive right” became property of the Chapter 13 estate and repossessing creditor’s refusal to return the car did not violate the automatic stay.); Lamar v. Mitsubishi Motors Credit of Am., Inc. (In re Lamar), 249 B.R. 822 (Bankr. S.D. Ga. 2000) (Debtor retained no interest in leased car because contract was a true lease under Georgia law and the lessor terminated all of the debtors’ interest by repossession before the petition and mailing a notice of termination. Debtors were not entitled to turnover and lessor did not violate the automatic stay by selling the car after the petition because the car was not property of the estate.); Barringer v. EAB Leasing (In re Barringer), 244 B.R. 402, 407–08 (Bankr. E.D. Mich. 1999) (Disagreeing with TranSouth Financial Corp. v. Sharon (In re Sharon), 234 B.R. 676 (B.A.P. 6th Cir. 1999), truck repossessed before the petition does not become property of the Chapter 13 estate until, after an adversary proceeding, a bankruptcy court orders turnover. “[I]n this Court’s view, the majority in Sharon erred in asserting that under ‘[United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983)], possession of the Debtor’s car was part of the bundle of rights that become “property of the estate” at the Chapter 13 petition.’ . . . When a creditor’s prepetition seizure is lawful . . . the right of possession does not automatically become part of the estate by virtue of § 541(a)(1). . . . Rather, this right remains non-estate property until it is acquired by the trustee from the creditor.” Prepetition repossessing creditor does not violate the automatic stay by refusing to turn over the truck until after ordered to do so in an adversary proceeding.); Warren v. SouthTrust Bank (In re Warren), 221 B.R. 843, 845 (Bankr. N.D. Ala. 1998) (Applying Charles R. Hall Motors, Inc. v. Lewis (In re Lewis), 137 F.3d 1280 (11th Cir. 1998), debtor’s car was not property of the Chapter 13 estate because it was repossessed before the petition and under Alabama law, upon repossession, the lender “acquires both title to and the right to possession of the automobile and the automobile’s purchaser retains only a statutory right of redemption.” Because plan did not constitute “tendering fulfillment” for purposes of the Alabama redemption statute, debtor could not bring the automobile into the bankruptcy estate through the plan.); In re Fitch, 217 B.R. 286, 289–90 (Bankr. S.D. Cal. 1998) (Right to possession did not become property of the Chapter 13 estate because of prepetition repossession of debtor’s car; creditor did not violate the automatic stay by refusing to turn over the car after the petition. “Prior to the commencement of the case the Debtor had lost her right to possession of the car. . . . Since the Debtor retained the right to redeem under California law, the mere seizure of the vehicle did not destroy the Debtor’s title to the car. . . . Debtor retained title to the car, but the right to possess the car remained with Autoflow and did not become property of the estate. . . . Since the right to possess the car was not among the property interests which became property of the estate, Autoflow’s acts to exercise control over the right to possess the car did not violate the stay. Autoflow did not violate the automatic stay by retaining the car pending adequate protection.”); Weiser v. Pennsylvania Nat’l Bank & Trust Co., 44 B.R. 224 (Bankr. M.D. Pa. 1984) (Where debtors’ truck was repossessed and the 15-day redemption period under Pennsylvania law expired prior to the petition, no property interest remained in the estate.).
11 See § 52.1 [ Turnover of Property ] § 50.1 Turnover of Property.
12 See § 75.1 [ Examples of Stay Violations, and Not ] § 62.1 Examples of Stay Violations, and Not.
13 See In re Walker, 204 B.R. 812, 816 (Bankr. M.D. Fla. 1997) (Debtor had no interest in tractor trailer where in between two Chapter 13 cases, debtor defaulted on a Motor Vehicle Title Pledge Contract, and the title holder repossessed and sold the truck to a related entity. Debtor pledged the title to his 1979 Kenworth tractor trailer in exchange for a loan of $2,028.25 from National Title Loan, Inc., pursuant to a “Contract of Title Pledge.” Debtor remained in possession of the truck but was required by the contract to redeem the title within 30 days with accrued “redemption premium” of 22% of the loan amount per month. “Debtor signed his Contract of Title Pledge with National Title Loan, Inc. on February 27, 1996. Thus, but for the Debtor’s first bankruptcy filing on March 14, 1996, the redemption period would have expired on April 27, 1997. . . . Debtor failed to redeem the truck prior to the expiration of the redemption period, and the Court finds that his interest in the property was terminated by law on May 14, 1996. National Title Loan, Inc. repossessed the truck on August 16, 1996. The repossession occurred after the expiration of the redemption period but prior to the debtor’s current bankruptcy filing. Thus, on the date of the repossession, the truck was not property of a bankruptcy estate and was not protected by the automatic stay.”); Duffy v. Big Al’s Autorama, Inc. (In re Duffy), 186 B.R. 503 (Bankr. D. Colo. 1995) (Creditor does not need relief from the stay because debtor’s car was repossessed and sold pursuant to a “purchase contract” four days before the Chapter 13 petition. No property interest remained in the debtor at the petition to trigger the automatic stay.).
14 See, e.g., Foote v. Smart Chevrolet Co. (In re Foote), Nos. 4:02-BK-11975 E, 4-02-AP-1050E, 2002 WL 32114561, at *3 (Bankr. E.D. Ark. May 14, 2002) (unpublished) (Repossessing creditor’s fake sale to itself cannot defeat the debtor’s rights under § 542. Prior to the petition, Motors Finance Company repossessed the debtor’s cars and auctioned them to Smart Chevrolet Company. Bankruptcy court found that Smart and Motors were alter egos. “[T]he creditor, Smart/Motors, had possession of property of the Debtor’s estate on the date Debtor filed bankruptcy, and the Debtor still had rights in that property. Under § 542(a), the Debtor’s property should have been returned to the Debtor upon her request. Rather than returning the property, and in reliance on ‘orchestrated’ invalid sales between the same entity, Smart/Motors transferred the vehicles from its possession following the filing of Debtor’s bankruptcy with knowledge of the Debtor’s bankruptcy. . . . [A] creditor cannot extinguish a debtor’s rights in property and avoid a turnover action in bankruptcy by trumping up a sale of the collateral to itself.”); In re Johnson, 289 B.R. 251 (Bankr. M.D. Ga. 2002) (Title pawnbroker that repossessed car prepetition is not entitled to summary judgment with respect to the debtor’s property rights in the car because title pawn contract failed to comply with Georgia law with respect to the term of the contract and the length of the grace period for redemption.). See also In re Kitts, 274 B.R. 491 (Bankr. E.D. Tenn. 2002) (Prepetition foreclosure sale did not remove residence from Chapter 13 estate because mortgage holder failed to follow default notice provisions of deed of trust and was unable to prove that it was assignee entitled to foreclose.); In re Cooper, 273 B.R. 297 (Bankr. D.D.C. 2002) (Equitable title to District of Columbia real property remained in debtor sufficient to invoke automatic stay when purchaser at prepetition nonjudicial foreclosure sale defaulted and trustees under deed of trust elected to resell the property after the Chapter 13 petition.).
15 See § 52.2 [ Relief from Garnishments ] § 50.2 Relief from Garnishments for discussion of relief from wage garnishment.
16 See United States v. Coghlan (In re Coghlan), 227 B.R. 304 (D. Ariz. 1998) (Distinguishing Whiting Pools, because the IRS received cash pursuant to its levy before the Chapter 13 petition, debtor had no legal or equitable interest in the cash, money did not become property of the estate, and debtor cannot compel the IRS to turn over the money.); Giaimo v. United States (In re Giaimo), 194 B.R. 210, 213 (E.D. Mo. 1996) ($14,198.18 in the debtor’s bank account levied upon by the IRS before the petition remains property of the Chapter 13 estate and is subject to turnover under § 542. “[A]n IRS levy on money in a bank account does not transfer ownership of the money to the IRS; rather, the debtor retains sufficient interest in the intangible property before it is surrendered to the IRS such that the money is properly included in the bankruptcy estate and therefore is subject to turnover under § 542.”); In re Gunthorpe, 280 B.R. 893 (Bankr. S.D. Ala. 2001) (Debtor had no interest in funds garnished before the petition because “condemnation” is automatic under Alabama law at the moment garnished funds are received by the clerk of the state court.); In re Steenstra, 280 B.R. 560 (Bankr. D. Mass. 2002) (Prepetition domestic relations support order did not remove a portion of the debtor’s wages from the Chapter 13 estate; § 1306(a)(2) contains no exclusion for wages that are payable for support of the debtor’s family.); Rodriguez v. First American Bank (In re Rodriguez), 278 B.R. 749, 753 (Bankr. N.D. Tex. 2002) (Bank account subject to prepetition garnishment became property of Chapter 13 estate because, under Texas law, service of writ of garnishment did not transfer title to garnished funds. “Unlike in some states, a judgment of garnishment in Texas is not self executing. . . . ‘[O]wnership of property subject to a judgment does not transfer until a writ of execution is issued and levied.’ . . . It is not the service of the writ of garnishment or the entry of a judgment of garnishment, therefore, that transfers title to garnished funds. Rather, service of the writ of execution transfers title in such funds. . . . Execution cannot issue before the expiration of thirty days from the time a final judgment is signed. . . . Debtors filed for bankruptcy protection . . . twenty-seven days after the state court signed the agreed judgment. . . . [A]s there was no execution . . . title to the garnished funds never passed . . . . Debtors’ legal and equitable interests in the garnished funds therefore became property of the bankruptcy estate.”); In re Raspberry, 264 B.R. 495, 499–500 (Bankr. N.D. Ill. 2001) (Prepetition wages subject to the garnishment of a judgment creditor are not property of the Chapter 13 estate and are not subject to turnover. Interpreting new Illinois Wage Deduction Act, “[O]nce the wage deduction order was entered pre-petition, the Debtor was divested of any claim to, or interest in, his pre-petition garnished wages. Morever, because he had no interest in those garnished wages, they did not become property of the bankruptcy estate under § 541 when he filed this case. . . . The pre-petition withheld wages . . . are not property of the bankruptcy estate pursuant to § 541 and should be turned over to the Judgment Creditor who holds a presumptively secured claim under § 506(b).” Avoidance or recovery of the prepetition wages under § 547 was not addressed because the debtor did not file an adversary proceeding or claim the wages exempt.); Boutilier v. United States (In re Boutilier), 196 B.R. 323, 327–28 n.9 (Bankr. W.D. Va. 1996) (Prepetition IRS levy on debtor’s IRA did not sever the debtor’s property right because the contents of the IRA were not yet sold by the IRS. “Whiting Pools stands for the proposition that when the IRS levies on assets of the debtor prepetition it elevates itself to the status of a prepetition secured creditor with special statutory liquidation rights under the Internal Revenue Code and that the arrival of bankruptcy prior to completion of the exercise of those special statutory rights permits the IRS to assert in the proceeding its lien status and to take steps in the proceeding to obtain relief to exercise its lien rights by sale. . . . [T]he more logical approach is to treat the property as property of the estate subject to the lien of the IRS. Then all parties may litigate in the bankruptcy proceeding their respective rights in and to the property.” The debtor’s right of redemption in the IRA may have significance because “the asset value to the debtor may be greater than its fair market value because of the tax consequences of its liquidation.”); In re Smiley, 189 B.R. 338, 341 (Bankr. E.D. Pa. 1995) (Prepetition IRS levy on debtor’s bank account divests debtor of all property interests in the money, thus debtor cannot enjoin the bank from transferring the accounts to the IRS after the petition. “When the IRS levies upon a saleable asset, the owner of the subject property retains two significant interests in the property prior to its tax sale. . . . [T]he right to redeem . . . also . . . the right to receive any surplus . . . . [A] levy on nonsalable assets, specifically cash or cash equivalents, is a different matter. After a levy on cash or a cash equivalent, the property owner no longer retains any significant interest in the cash or the cash equivalent. . . . [T]he rights of redemption or surplus are not applicable. . . . [S]ince the tax debt exceeds the funds in the Debtor’s bank account, the Debtor has no effective right of surplus. Accordingly, the Debtor did not retain any identifiable interest in her bank account after the IRS levy on the account. It follows that the funds did not become property of the subsequently created estate. Since the funds did not become property of the estate, the postpetition demand of the IRS that Sharon Savings Bank transfer Debtor’s funds to the IRS pursuant to a prepetition notice of levy does not violate the provisions of the automatic stay under 11 U.S.C. § 362(a).”); Hooper v. United States (In re Hooper), 152 B.R. 309, 310 (Bankr. D. Colo. 1993) (“The IRS levy of prepetition wages gave it a secured interest in those wages. It did not give the IRS title to those funds, however, and the IRS is required to turnover those funds to the estate if the Debtor provides adequate protection.” The debtor’s plan proposal to pay the IRS claim in full is not sufficient adequate protection to require the IRS to turn over the cash it seized prepetition from the debtor’s employer.); Sininger v. Fulton (In re Sininger), 84 B.R. 115 (Bankr. S.D. Ohio 1988) ($14,000 held by the clerk of a state court pursuant to an attachment remains property of the estate. Debtor can force turnover under § 542.).
17 See §§ 53.1 [ Strong-Arm Powers, Statutory Liens, Preferences and Fraudulent Conveyances ] § 50.3 Strong-Arm Powers, Statutory Liens, Preferences and Fraudulent Conveyances and 60.1 [ Avoidance and Recovery Powers ] § 53.12 Avoidance and Recovery Powers.
18 See, e.g., Bell v. Instant Car Title Loans (In re Bell), 279 B.R. 890 (Bankr. N.D. Ga. 2002) (Proof that prepetition forfeiture of car to pawnbroker was a fraudulent conveyance under § 548 would draw the car into the Chapter 13 estate through § 541(a)(3) notwithstanding prepetition repossession by pawnbroker; preliminary injunction is appropriate to prevent the pawnbroker from disposing of the car pending adversary proceeding under § 548. “[Section] 541(a)(3) . . . provides that property of the estate includes any interest in property that the trustee recovers under 11 U.S.C. § 550, among others; section 550, in turn, authorizes the recovery of property, or its value, from certain transferees if the transfer is avoidable under 11 U.S.C. § 548 . . . . If the vehicle is not timely redeemed, [Georgia law] provides for forfeiture of the borrower’s ownership interest. . . . Debtor’s interest in the vehicle automatically and by operation of law, and without any further act on anyone’s part, was forfeited to Pawnbroker. . . . Pawnbroker became the owner of a vehicle worth $16,735 (in Debtor’s estimation) based on Debtor’s failure to pay $5,300 within the grace period . . . . [I]f the transfer of the vehicle to Pawnbroker . . . was a fraudulent transfer avoidable under § 548, the vehicle is property of the estate.”).
19 See § 129.1 [ Overview: General Rules for Saving Debtor’s Home ] § 81.1 Overview: General Rules for Saving Debtor’s Home.
20 See § 130.1 [ Prepetition Defaults ] § 82.1 Prepetition Defaults—When is Property “Sold” at Foreclosure? and App. I.
21 See § 130.1 [ Prepetition Defaults ] § 82.1 Prepetition Defaults—When is Property “Sold” at Foreclosure?. See, e.g., Rodgers v. County of Monroe (In re Rodgers), 333 F.3d 64, 69 (2d Cir. 2003) (Under New York law, prepetition tax foreclosure sale extinguished the debtor’s legal and equitable interests notwithstanding that deed was delivered and recorded by the purchaser after the petition. Distinguishing United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983), “‘Congress intended to exclude from the estate property of others in which the debtor had some minor interest such as a lien or bare legal title.’ . . . Because Rodgers lost her legal and equitable interests in the property by virtue of the foreclosure sale, the property did not become property of the estate when the bankruptcy petition was filed.”); Tax 58 v. Froehle (In re Froehle), 286 B.R. 94, 98–103 (B.A.P. 8th Cir. 2002) (Applying Johnson v. First National Bank of Montevideo (In re Johnson), 719 F.2d 270 (8th Cir. 1983), cert. denied, 465 U.S. 1012, 104 S. Ct. 1015, 79 L. Ed. 2d 245 (1984), and Justice v. Valley National Bank, 849 F.2d 1078 (8th Cir. 1988), prepetition tax sale under Iowa law left only a right of redemption for the Chapter 13 estate; automatic stay did not toll the running of the right of redemption, and debtor’s failure to tender a lump sum before the redemption period expired precludes management of tax claim through plan.“‘[F]oreclosure extinguishes the mortgage . . . . [I]t is only the right of redemption, rather than the property itself, which passes into the bankruptcy estate if the redemption period has not expired at the time . . . the bankruptcy petition is filed.’ . . . [T]he same analysis can and should be applied in Iowa’s tax redemption context: once the Notice of the Right of Redemption is served upon the appropriate parties, the rights of the parties are fixed and the Bankruptcy Code does not toll the running of the redemption period, subject only to the additional 60 days granted pursuant to § 108(b).”); S.I. Sec. v. Dabal, No. 03 C 274, 2003 WL 21785625 (N.D. Ill. Aug. 1, 2003) (unpublished) (Right of redemption was only property interest that came into estate after prepetition tax sale; failure to redeem within redemption period plus 60 days under § 108(b) extinguished the debtor’s property interest altogether.); Smith v. Phoenix Bond & Indem., 288 B.R. 793 (N.D. Ill. 2002) (When Chapter 13 petition is filed after Illinois tax sale and before expiration of statutory redemption period, the right to redeem comes into the Chapter 13 estate as extended by § 108(b); when the debtor fails to redeem within the statutory redemption period as extended by § 108(b), the debtor cannot use § 1322(c)(1) or § 1322(b)(2) to manage the delinquent taxes.); In re Haynes, 283 B.R. 147, 155–56 (Bankr. S.D.N.Y. 2002) (Because the mandatory period for redemption of property from a tax sale expired before the petition, debtor had no interest in rental property notwithstanding that debtor remained in possession. “If a petition is filed while the redemption right is unexpired, the equitable right of redemption becomes a part of the bankruptcy estate. . . . The Debtor no longer has the right to redeem. The Mandatory Period expired on December 11, 2000. . . . [H]er petition was not filed until May 3, 2001. . . . [T]he Debtor had a possessory interest in the property. However, a possessory interest alone is ‘so tenuous as to represent merely a scintilla of an interest insufficient to warrant the continued protection of the automatic stay.’”); In re Murray, 276 B.R. 869 (Bankr. N.D. Ill. 2002) (Declining to follow In re Bates, 270 B.R. 455 (Bankr. N.D. Ill. 2001), when Chapter 13 petition is filed after delinquent tax sale under Illinois law and last day to redeem expires before confirmation, the redemption right was the only property interest that came into the Chapter 13 estate and the debtor cannot use § 1322(b)(2) to pay the delinquent taxes over the life of the plan.).
22 See § 130.1 [ Prepetition Defaults ] § 82.1 Prepetition Defaults—When is Property “Sold” at Foreclosure?.
23 11 U.S.C. § 1322(c)(1).
24 See § 130.1 [ Prepetition Defaults ] § 82.1 Prepetition Defaults—When is Property “Sold” at Foreclosure?.
25 See, e.g.,Canney v. Merchants Bank, 284 F.3d 362 (2d Cir. 2002) (Prepetition foreclosure judgment under Vermont strict foreclosure law left only equity of redemption for Chapter 13 estate; equity of redemption expired because period was not stayed by § 362 but was extended for 60 days by § 108(b).); Tax 58 v. Froehle (In re Froehle), 286 B.R. 94 (B.A.P. 8th Cir. 2002) (Prepetition tax sale under Iowa law left only a right of redemption for the Chapter 13 estate.); S.I. Sec. v. Dabal, No. 03 C 274, 2003 WL 21785625 (N.D. Ill. Aug. 1, 2003) (unpublished) (Right of redemption was only property interest that came into Chapter 13 estate after prepetition tax sale.); Smith v. Phoenix Bond & Indem., 288 B.R. 793 (N.D. Ill. 2002) (When Chapter 13 petition is filed after Illinois tax sale, only the right to redeem comes into the estate as extended by § 108(b).); In re Mangano, 253 B.R. 339, 345 (Bankr. D.N.J. 2000) (Applying New Jersey law, prepetition sheriff’s sale eliminated all of the debtor’s rights except for the right to redeem the property within the 10 days allowed by state law. “[T]he debtor’s property was sold at a sheriff’s sale on January 6, 2000. Pursuant to state law, the debtor had until January 16, 2000, or 10 days from the sheriff’s sale, within which to object and redeem the property. The debtor, however, failed to exercise that right. Instead, on January 14, 2000 the debtor filed a chapter 13 petition, and thereby extended the redemption period an additional 60 days. When the 60-day redemption period expired, the debtor had not yet exercised her right to redeem the property. As a result of that failure, therefore, the debtor has lost all title, right and interest in the property. Accordingly, the court finds that there is cause under Code section 362(d) to grant Homeside relief from the automatic stay.”); In re Dow, 250 B.R. 6, 8 (Bankr. D. Mass. 2000) (“[R]edemption rights, indeed the entire property interest, passed to the bankruptcy estate” when auctioneer’s hammer came down at 10:25 a.m., debtor filed Chapter 13 petition at 10:28 a.m. and the mortgage holder signed a memorandum of sale after the petition. The memorandum of sale was void and, accordingly, the debtor could cure default and reinstate the mortgage on the property. “[U]nder Massachusetts law redemption rights still exist until the execution of a memorandum of sale following the bidding process.”); In re Jones, 233 B.R. 799 (Bankr. E.D. Mich. 1999) (Only statutory right of redemption became property of the Chapter 13 estate when real property was foreclosed upon and sold prior to the petition. Because the confirmed plan did not redeem the property, purchaser at foreclosure sale is entitled to relief from the stay to evict the debtor.).
26 See, e.g., In re Menasche, 301 B.R. 757, 763 (Bankr. S.D. Fla. 2003) (“Debtors’ proposed redemption through their chapter 13 plan does not satisfy the [Florida law] requirement to ‘tender fulfillment of all obligations secured by the collateral,’ and therefore the Debtors’ proposed redemption does not operate to bring the vehicle within the property of the bankruptcy estate, such that Debtors may compel its turnover.”).
27 See 11 U.S.C. §§ 1322(b)(2), 1322(b)(3), 1322(b)(5) and 1322(c)(1), discussed in §§ 115.1 [ Curing Default, Waiving Default, Maintaining Payments and Combinations ] § 78.4 Curing Default, Waiving Default, Maintaining Payments and Combinations, 118.1 [ Most Home Mortgages Cannot Be Modified: § 1322(b)(2) and Nobelman ] § 79.1 Most Home Mortgages Cannot Be Modified: § 1322(b)(2) and Nobelman, 128.2 [ Providing for and Accounting for an Unprotected Mortgage: Modifying, Curing Default, Maintaining Payments and Combinations ] § 80.14 Providing for and Accounting for an Unprotected Mortgage: Modifying, Curing Default, Maintaining Payments and Combinations, 129.1 [ Overview: General Rules for Saving Debtor’s Home ] § 81.1 Overview: General Rules for Saving Debtor’s Home and 130.1 [ Prepetition Defaults ] § 82.1 Prepetition Defaults—When is Property “Sold” at Foreclosure?.
28 See § 130.1 [ Prepetition Defaults ] § 82.1 Prepetition Defaults—When is Property “Sold” at Foreclosure?. See, e.g., McLouth v. Advanta Mortgage Corp. (In re McLouth), 268 B.R. 244 (D. Mont. 2001) (Applying Montana law, foreclosure sale was complete when successful bidder paid the purchase price and trustee’s deed was delivered at 11:00 a.m.; Chapter 13 petition at 4:59 p.m. did not upset sale, and no interest in the property came into the Chapter 13 estate.); United States v. Bishop, 262 B.R. 401 (W.D. Tex. 2000) (Citing United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983), real property remained property of the Chapter 13 estate when foreclosure sale occurred at 10:00 a.m., but petition was filed at 8:03 a.m. on the same day.); St. Clair v. Beneficial Mortgage Co. (In re St. Clair), 251 B.R. 660 (D.N.J. 2000) (Bankruptcy court appropriately ordered that no future bankruptcy filed by the debtors would impose an automatic stay on mortgage holder when a sheriff’s sale took place before the Chapter 13 petition, the mortgage holder was the successful bidder and writ of possession was issued by state court before the petition.); In re Delong, No. 03-74355, 2003 WL 22989682 (Bankr. C.D. Ill. Dec. 16, 2003) (unpublished) (Real property was not property of Chapter 13 estate when foreclosure sale occurred at 9:30 a.m. on September 17, and hand delivered petition was filed at 10:24 a.m. on September 17; petition mailed September 12 was never received by the bankruptcy court and thus was never filed.); In re Grant, 303 B.R. 205 (Bankr. D. Nev. 2003) (Under Nevada law, foreclosure sale completed the day before Chapter 13 petition left no legal or equitable interest for the Chapter 13 estate.); In re Grassie, 293 B.R. 829 (Bankr. D. Mass. 2003) (At moment of Chapter 13 petition, purchaser at foreclosure sale had signed memorandum of sale but agent for creditor had not; under Massachusetts law, debtor retained equity of redemption because parties to foreclosure sale had not yet satisfied the statute of frauds, and stay prevented completion of sale.); In re Kent, No. 3:03-BK-11277, 2003 WL 21540996 (Bankr. E.D. Ark. July 1, 2003) (unpublished) (Because foreclosure sale was completed by execution of trustee’s deed before the petition, property was not property of Chapter 13 estate and debtor could not include mortgage in plan.); In re Jay, No. 02-21010, 2002 WL 31941459, at *5 (Bankr. D. Idaho Dec. 31, 2002) (unpublished) (Applying Idaho’s race-notice recording statute, mortgage holder’s purchase of debtor’s residence at foreclosure sale the day before the petition left only possession and bare legal title for the Chapter 13 estate.); In re Pellegrino, 284 B.R. 326 (Bankr. D. Conn. 2002) (Distinguishing Canney v. Merchants Bank, 284 F.3d 362 (2d Cir. 2002), because strict foreclosure under Connecticut law does not vest absolute title in the mortgagee until the unification of legal and equitable title at the expiration of all law days, filing a Chapter 13 case prior to the passage of all law days preserves the debtor’s interest in the property for purposes of curing default under § 1322(c)(1).); Martin v. USDA Rural Hous. Serv. (In re Martin), 276 B.R. 552 (Bankr. N.D. Miss. 2001) (Debtor lost all title to real property under Mississippi law upon default under the note and deed of trust before the petition; foreclosure sale cut off the debtor’s right of redemption notwithstanding that foreclosure deed was recorded after the petition.); In re Williams, 247 B.R. 449, 451–52 (Bankr. E.D. Tenn. 2000) (Residence did not become property of the Chapter 13 estate because foreclosure sale occurred two days before the petition and a trustee’s deed was executed an hour or two before the petition. Citing In re Johnson, 213 B.R. 134 (Bankr. W.D. Tenn.), modified after reh’g, 215 B.R. 988 (Bankr. W.D. Tenn. 1997), “‘Tennessee has consistently required the exchange of consideration and the satisfaction of the statute of frauds before a foreclosure sale is deemed final.’ . . . Under Tennessee law, ‘the fall of the auctioneer’s hammer is not alone sufficient to satisfy the statute of frauds requirement.’ . . . Satisfaction of the statute of frauds . . . requires a writing which evidences ‘“an existing and binding contract.”’ . . . Execution of a written contract satisfies the statute of frauds . . . . [R]ecording is not necessary.”); In re Hernandez, 244 B.R. 549, 552–53 (Bankr. D.P.R. 2000) (Because mortgage foreclosure sale was completed under Commonwealth law prior to the Chapter 13 petition, debtor does not have an interest in the underlying real property and the purchaser is entitled to relief from the automatic stay. “[T]his Court has held that in a mortgage foreclosure sale, title to the property is transferred to the purchaser when the deed of judicial sale is executed. . . . [T]wo events must have occurred in order to consummate the judicial sale: the adjudication of the sale and the execution of the deed. . . . In the case at bar, the Property was sold at a public auction on June 11, 1999 . . . . [O]n July 7th, 1999, a deed of judicial sale was executed. . . . [T]itle to the Property was conveyed to the Movant on July 7th, 1999, the date when the deed of judicial sale was executed and conveyance of the Property was consummated. Consequently, the Debtor did not have an interest in the Property when he filed his petition for bankruptcy on November 2nd, 1999.”); In re Verdi, 244 B.R. 494 (Bankr. M.D. Ga. 2000) (Installment land sales contract under Georgia law is most like a “bond for title”; because seller had not foreclosed by any legal proceeding prior to the Chapter 13 petition, debtor retained an interest in the property notwithstanding prepetition default in payments.).
29 See § 52.1 [ Turnover of Property ] § 50.1 Turnover of Property.
30 See above in this section. See, e.g., Manufacturers & Traders Trust Co. v. Alberto (In re Alberto), 271 B.R. 223, 226 (N.D.N.Y. 2001) (“Once the lawful repossession occurred, Alberto no longer had the right to possess the vehicle; he merely retained the right . . . to redeem it before the secured creditor disposed of it.”); In re Menasche, 301 B.R. 757 (Bankr. S.D. Fla. 2003) (Citing Bell-Tel Federal Credit Union v. Kalter (In re Kalter), 292 F.3d 1350 (11th Cir. 2002), under Florida law, statutory right of redemption became property of the Chapter 13 estate, but car itself is not property of the estate, and debtor cannot use turnover under § 542(a) to regain possession while payment is made through a Chapter 13 plan.); In re Coleman, No. 02-11603, 2003 WL 1562140 (Bankr. D. Vt. Mar. 20, 2003) (unpublished) (Because car was repossessed the day before the petition, only right of redemption became property of the Chapter 13 estate, and repossessing creditor can refuse to return the car to the debtor.); Warren v. SouthTrust Bank (In re Warren), 221 B.R. 843 (Bankr. N.D. Ala. 1998) (Applying Charles R. Hall Motors, Inc. v. Lewis (In re Lewis), 137 F.3d 1280 (11th Cir. 1998), because debtor’s car was repossessed under Alabama law before the Chapter 13 petition, only the debtor’s right of redemption became property of the estate; proposed plan did not constitute “tendering fulfillment” for purposes of the redemption statute, and thus the car was not brought back into the estate by the plan.); Dunlap v. Cash Am. Pawn (In re Dunlap), 158 B.R. 724 (M.D. Tenn. 1993) (Debtor’s right to redeem personal property in the context of a pawn transaction did not become property of the Chapter 13 estate because right of redemption expired before the filing of the petition. Even where the debtor filed Chapter 13 before expiration of the redemption right, the debtor’s only remedy was to exercise the right of redemption within the period provided by contract or state law, as extended by § 108. Court does not explain why § 1322(b)(2) is neutralized in the context of a pawn of personal property.).
31 See above in this section. See, e.g., National City Bank v. Elliott (In re Elliott), 214 B.R. 148, 152 (B.A.P. 6th Cir. 1997) (Statutory right of redemption under Ohio law is a sufficient property interest to bring a Chapter 13 debtor’s car into the estate notwithstanding that the car was surrendered to the lender before the petition and the lender has obtained a “repossession title” under Ohio law. Applying Federal Land Bank of Louisville v. Glenn (In re Glenn), 760 F.2d 1428 (6th Cir.), cert. denied, 474 U.S. 849, 106 S. Ct. 144, 88 L. Ed. 2d 119 (1985), “After receipt of a repossession title, but before sale of the collateral, a secured party cannot exercise unrestricted control over the repossessed vehicle due to the right of redemption, and accordingly does not have true ‘ownership,’ rights, despite holding a repossession title. . . . [W]e hold that the sale or other disposition under [Ohio law] is the cut off point of a Chapter 13 debtor’s power to modify a secured creditor’s claim under § 1322(b)(2) of the Bankruptcy Code.”); In re Sanders, 291 B.R. 97 (Bankr. E.D. Mich. 2003) (Car repossessed but not disposed of before the petition remains property of the Chapter 13 estate and can be recovered by the debtor.); In re Robinson, 285 B.R. 732, 738 (Bankr. W.D. Okla. 2002) (“[T]here is no dispute that Debtor’s right of redemption is property of the bankruptcy estate. . . . Debtor is not limited to the state law right of redemption . . . . Debtor also retains the rights conferred upon her by 11 U.S.C. § 1322(b)(2) to modify the rights of holders of secured claims, and by 11 U.S.C. § 1322(b)(3) to cure the default and thereby negate the effect of [acceleration].”); In re Jackson, 142 B.R. 172 (Bankr. N.D. Ohio 1992) (Debtor’s right under Ohio law to redeem car that was repossessed before the petition is a sufficient property interest to support turnover of the car under § 542 and to support the debtor’s right to manage the lien secured by the car through the Chapter 13 plan.).
32 Is this why courts seem to have forgotten United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983) in the Chapter 13 context?—Because it was a Chapter 11 case? This is a distinction without a difference. If anything, the definition of property of the estate is broader in Chapter 13 than in Chapter 11 because of 11 U.S.C. § 1306. See § 45.1 [ What Is Property of the Chapter 13 Estate? ] § 46.1 What Is Property of the Chapter 13 Estate?. The Whiting Pools analysis should apply in spades in a Chapter 13 case.
33 137 F.3d 1280 (11th Cir. 1998).
34 292 F.3d 1350 (11th Cir. 2002).
35 See, e.g., In re Sanders, 291 B.R. 97, 100–01 (Bankr. E.D. Mich. 2003) (Rejecting Bell-Tel Federal Credit Union v. Kalter (In re Kalter), 292 F.3d 1350 (11th Cir. 2002), and applying TranSouth Financial Corp. v. Sharon (In re Sharon), 234 B.R. 676 (B.A.P. 6th Cir. 1999) and National City Bank v. Elliott (In re Elliott), 214 B.R. 148 (B.A.P. 6th Cir. 1997), car repossessed but not disposed of before the petition remains property of the Chapter 13 estate and can be recovered by the debtor. Michigan law “does not state that the repossession alone divests a debtor of all ownership interests. . . . [T]he debtors maintain an equitable right of redemption. . . . [R]epossession is merely a device to collect on the creditor’s claim, and . . . repossession does not transfer ownership to the creditor. . . . Until the creditor disposes of the property, the debtor remains the legal and equitable owner, subject only to the creditor’s debt collection remedies.” Citing United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983), bankruptcy court rejects argument that Chapter 13 estate includes right of redemption but not right of possession.); Tidewater Fin. Co. v. Moffett (In re Moffett), 288 B.R. 721 (Bankr. E.D. Va. 2002) (Applying Virginia UCC and United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983), and rejecting Charles R. Hall Motors, Inc. v. Lewis (In re Lewis), 137 F.3d 1280 (11th Cir. 1998), and Bell-Tel Federal Credit Union v. Kalter (In re Kalter), 292 F.3d 1350 (11th Cir. 2002), “The debtor had both legal and equitable ownership of the vehicle, subject only to Tidewater’s lien and its remedies upon default. Those remedies include the right upon default to peacefully take possession of the collateral and to sell it after notice in a commercially reasonable manner. To be sure, lawful repossession of the vehicle deprives the debtor of perhaps the major incident of ownership, namely the immediate right to possession. But the immediate right of possession and ownership are not synonymous. . . . [B]oth the installment sales contract and the Virginia Uniform Commercial Code require that any surplus from the sale or other disposition of the collateral be paid to the debtor. Such a right is completely inconsistent with the notion that the debtor has no form of property interest in the collateral or at best only bare legal title. . . . [R]epossession, under the statutory scheme set forth in the UCC, merely divests the debtor of the present right to use the vehicle, but does not immediately extinguish the debtor’s title.”), aff’d, 289 B.R. 55 (E.D. Va. 2003), aff’d, 356 F.3d 518 (4th Cir. 2004); In re Robinson, 285 B.R. 732, 737–38 (Bankr. W.D. Okla. 2002) (Applying Oklahoma UCC and United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983), debtor retained interest in car repossessed before the petition but not yet sold, notwithstanding that lienholder had obtained a “repossession title.” “As of the petition date, Debtor’s rights included the right to notice of the sale of the repossessed collateral, the right to the surplus proceeds, if any, from the sale of the collateral, and the right to redeem the collateral prior to sale . . . . These are the very rights possessed by the debtor in the Whiting Pools case, where the Supreme Court found the debtor to be the owner of the property. . . . Eldorado’s interest in the Vehicle, as of the petition date, was therefore limited to enforcement of its security interest or lien . . . . Debtor retained an interest in the Vehicle, subject to Eldorado’s lien, and this interest was included among property of the bankruptcy estate. . . . [T]here is no dispute that Debtor’s right of redemption is property of the bankruptcy estate. . . . Debtor is not limited to the state law right of redemption and thus does not need any extension of time in which to exercise such right. Debtor also retains the rights conferred upon her by 11 U.S.C. § 1322(b)(2) to modify the rights of holders of secured claims, and by 11 U.S.C. § 1322(b)(3) to cure the default and thereby negate the effect of Eldorado’s acceleration clause.”).
36 See, e.g., In re Rozier, 283 B.R. 810 (Bankr. M.D. Ga. 2002), aff’d, 290 B.R. 910 (M.D. Ga.), question certified, 348 F.3d 1305 (11th Cir. 2003) (discussed below in this section); In re Johnson, No. 03-66402-PWB, 2003 WL 21703529, at *3 (Bankr. N.D. Ga. July 18, 2003) (unpublished) (Prepetition repossession did not end debtor’s property rights in car. “[In re Rozier, 283 B.R. 810 (Bankr. M.D. Ga. 2002), aff’d, 290 B.R. 910 (M.D. Ga. 2003),] and [In re Bonner, 286 B.R. 917 (Bankr. M.D. Ga. 2002)], correctly state the applicable law in this State. . . . [P]roperty that is in possession of a creditor to enforce a lien, but has not yet been disposed of, remains property of the debtor’s bankruptcy estate. . . . Under Georgia law, unlike the laws in Florida and Alabama as construed in [Bell-Tel Federal Credit Union v. Kalter (In re Kalter), 292 F.3d 1350 (11th Cir. 2002),] and [Charles R. Hall Motors, Inc. v. Lewis (In re Lewis), 137 F.3d 1280 (11th Cir. 1998)], repossession of collateral in Georgia does not automatically transfer title to a secured creditor. . . . Under the principles of [United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983)], . . . repossession of Debtor’s vehicle did not terminate her ownership interest, and the car was property of her estate when she filed her chapter 13 petition.”); In re Bonner, 286 B.R. 917, 918 (Bankr. M.D. Ga. 2002) (Distinguishing Bell-Tel Federal Credit Union v. Kalter (In re Kalter), 292 F.3d 1350 (11th Cir. 2002), car repossessed under Georgia law but not yet sold, with respect to which the debtor is still listed as owner on the certificate of title, remains property of the Chapter 13 estate. Citing In re Rozier, 283 B.R. 810 (Bankr. M.D. Ga. 2002), “ownership of a vehicle is not terminated unless the vehicle is sold by the secured creditor or by legal process. The Court is not persuaded the repossession by itself, is sufficient to terminate ownership under Georgia law.”); In re Garcia, 276 B.R. 699, 704–05 (Bankr. S.D. Fla. 2002) (Decided before Bell-Tel Federal Credit Union v. Kalter (In re Kalter), 292 F.3d 1350 (11th Cir. 2002), under Florida law, “a debtor’s ownership interest in a repossessed vehicle survives until a new certificate of title has been issued . . . . If a new certificate of title to a repossessed vehicle is not issued by the petition date, then the surviving ownership interest is property of a debtor’s bankruptcy estate . . . and the Creditors must turn over the Vehicle.”).
37 283 B.R. 810 (Bankr. M.D. Ga. 2002).
38 283 B.R. at 812–13.
39 290 B.R. 910, 913 (M.D. Ga. 2003).
40 In re Rozier, 348 F.3d 1305, 1307 (11th Cir. 2003).
41 288 B.R. 721 (Bankr. E.D. Va. 2002), aff’d, 289 B.R. 55 (E.D. Va. 2003), aff’d, 356 F.3d 518 (4th Cir. 2004).
42 “Curing default” in this manner through the Chapter 13 plan is the treatment allowed by 11 U.S.C. § 1322(b)(3). See § 115.1 [ Curing Default, Waiving Default, Maintaining Payments and Combinations ] § 78.4 Curing Default, Waiving Default, Maintaining Payments and Combinations.
43 356 F.3d at 522.
44 356 F.3d at 523 (emphasis added).
45 See Federal Land Bank of Louisville v. Glenn (In re Glenn), 760 F.2d 1428 (6th Cir.), cert. denied, 474 U.S. 849, 106 S. Ct. 144, 88 L. Ed. 2d 119 (1985).
46 214 B.R. 148 (B.A.P. 6th Cir. 1997).
47 See § 45.1 [ What Is Property of the Chapter 13 Estate? ] § 46.1 What Is Property of the Chapter 13 Estate?.
48 See Rodgers v. County of Monroe (In re Rodgers), 333 F.3d 64, 69 (2d Cir. 2003) (Apply New York law, prepetition tax foreclosure sale extinguished the debtor’s legal and equitable interests: “‘Congress intended to exclude from the estate property of others in which the debtor had some minor interest such as a lien or bare legal title.’ . . . Because Rodgers lost her legal and equitable interests in the property by virtue of the foreclosure sale, the property did not become property of the estate when the bankruptcy petition was filed.”); Boyd v. United States (In re Boyd), 11 F.3d 59, 60–61 (5th Cir. 1994) (Foreclosure sale 33 months before the petition, recording of trustee’s deed, and order of eviction severed all of the debtor’s rights in the real property. “Mississippi law provides that a valid foreclosure cuts off the mortgagor’s right of ‘redemption and any other rights in and to the property (all of which are transferred to the foreclosure sale proceeds), with the sole exception of rights perfected prior to the filing of the deed of trust under which the foreclosure sale is held.’ . . . On the date Boyd filed for bankruptcy he had no legal rights in the Property. His equitable rights, if any, were extinguished by the district court’s eviction order . . . . Having no viable interest in the Property at the time the Chapter 13 petition was filed, Boyd conveyed nothing to his bankruptcy estate.”); In re Jay, No. 02-21010, 2002 WL 31941459, at *5 (Bankr. D. Idaho Dec. 31, 2002) (unpublished) (Because mortgage holder purchased debtors’ residence at a foreclosure sale the day before the petition, “Debtors’ interest in the residence on the date of filing consisted of only (1) possession and (2) bare legal or record title”; purchaser was entitled to annulment of the stay to validate recording of trustee’s deed.); In re Moore, 267 B.R. 111 (Bankr. E.D. Pa. 2001) (Applying Pennsylvania law, bankruptcy estate contained only bare legal title because foreclosure sale was conducted between 10:00 a.m. and noon and Chapter 13 petition was time-stamped at 4:37 p.m.; that sheriff’s office designated the sale as “postponed” when it later learned of the bankruptcy petition does not neutralize sale.); In re Samaniego, 224 B.R. 154, 165 (Bankr. E.D. Wash. 1998) (Tax sale two weeks before Chapter 13 case divested the debtors of all but “bare legal title”; though recording of tax deeds two days after the petition was void, automatic stay was annulled to validate delivery and recording of the tax deed. “The debtors hold bare legal title to the lots sold at the tax sale. They retain no interest in this property of benefit to themselves or their estate. . . . [W]here the purchasers hold equitable title and the debtors retain only bare legal title, cause exists to allow the equitable owner to obtain the legal title.”); Davisson v. Engles (In re Engles), 193 B.R. 23 (Bankr. S.D. Cal. 1996) (Nonjudicial foreclosure sale four minutes before Chapter 13 petition did not divest the debtors of legal title. Bare legal title came into the Chapter 13 estate and is protected by the automatic stay. However, cause exists to lift the stay to allow the equitable owner to unite legal with equitable title.); Golden v. Mercer County Tax Claim Bureau (In re Golden), 190 B.R. 52 (Bankr. W.D. Pa. 1995) (Prepetition tax sale divested the debtor of all equitable rights under Pennsylvania law, thus only bare legal title became property of the Chapter 13 estate. Cause exists to lift the stay to allow the purchaser at the tax sale to gain legal title. The sale was not a fraudulent conveyance in light of BFP v. Resolution Trust Corp., 511 U.S. 531, 114 S. Ct. 1757, 128 L. Ed. 2d 556 (1994).).
49 See St. Clair v. Beneficial Mortgage Co. (In re St. Clair), 251 B.R. 660, 665–67 (D.N.J. 2000) (Although in possession of real property, debtor’s right to possession was terminated before the petition when state court issued writ of possession. “[U]pon issuance of a writ of possession, any possessory interest a mortgagor has vis-a-vis the purchaser, whether at tenancy at sufferance or otherwise, is expunged. . . . [W]e hold that ‘property from the estate’ encompasses property in the possession or control of the trustee or the debtor-in-possession, but only to the extent the trustee or debtor-in-possession has a good-faith colorable claim to possession or control of the property.”); In re Haynes, 283 B.R. 147, 156 (Bankr. S.D.N.Y. 2002) (Because period for redemption of property from a tax sale expired before the petition, debtor had no interest in rental property other than that debtor remained in possession; “a possessory interest alone is ‘so tenuous as to represent merely a scintilla of an interest insufficient to warrant the continued protection of the automatic stay.’”); In re Hernandez, 244 B.R. 549 (Bankr. D.P.R. 2000) (Because mortgage foreclosure sale was completed under Commonwealth law prior to the Chapter 13 petition, debtor does not have an interest in the underlying real property sufficient to overcome the purchaser’s right to evict the debtor from possession.); In re Fitzgerald, 237 B.R. 252, 258–59 (Bankr. D. Conn. 1999) (Bare possessory interest in real estate became property of the Chapter 13 estate protected by the automatic stay notwithstanding completed prepetition foreclosure and order for ejectment. “‘[A] mere possessory interest in real property, without any accompanying legal interest, is sufficient to trigger the protection of the automatic stay.’ . . . That is because a debtor’s bare possessory interest in realty is property of the estate that is protected by the automatic stay even if the realty itself is not property of the estate.” Action for ejectment is subject to the automatic stay because it is the “‘enforcement, against the debtor . . . of a judgment obtained before the commencement of the case.’”).
Eden Place, LLC v. Perl (In re Perl), 811 F.3d 1120, 1130 (9th Cir. Jan. 8, 2016) (Graber, Rawlinson, Watford) (Entry of judgment and writ of possession in detainer action before the petition ended all legal and equitable interests notwithstanding that debtor remained in unlawful possession at the petition. "The unlawful detainer judgment and writ of possession entered pursuant to California Code Civil Procedure § 415.46 bestowed legal title and all rights of possession upon Eden Place. . . . [A]t the time of the filing of the bankruptcy petition, Perl had been completely divested of all legal and equitable possessory rights that would otherwise be protected by the automatic stay. . . . Consequently, the Sheriff's lockout did not violate the automatic stay because no legal or equitable interests in the property remained to become part of the bankruptcy estate.").
Weber v. SEFCU (In re Weber), 719 F.3d 72, 77-78 (2d Cir. May 8, 2013) (Cabranes, Raggi, Carney) (Debtor retained equitable interest in car repossessed before the petition and car lender willfully violated stay by refusing to return car after petition. "New York law afforded Weber at least a continuing equitable interest in the vehicle. . . . That interest arose from Weber's right pursuant to the state Uniform Commercial Code to redeem the vehicle before sale. . . . Weber's equitable interest thus constituted 'property' of the bankruptcy estate under section 541. . . . [United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (June 8, 1983),] teaches that, upon Weber's filing of his bankruptcy petition, Weber's equitable interest under state law gave the bankruptcy estate a possessory right in the secured property, as property that the trustee could use under section 363. Under section 542, that right took precedence over the state law possessory right of SEFCU.").
Thompson v. General Motors Acceptance Corp., LLC, 566 F.3d 699 (7th Cir. May 27, 2009) (Cudahy, Williams, Tinder) (Citing United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983), there is "no doubt" that debtor had equitable interest in car repossessed but not disposed of before the petition; citing TranSouth Financial Corp. v. Sharon (In re Sharon), 234 B.R. 676 (B.A.P. 6th Cir. 1999), creditor violated automatic stay by holding car hostage for demand of adequate protection.).
In re Webb, 472 B.R. 665, (*13) (B.A.P. 6th Cir. Apr. 9, 2012) (unpublished) (Emerson, Fulton, Preston) (Recording of prepetition judgment that became a lien lis pendens under state law did not remove property from Chapter 13 estate, it only conditioned debtor's property interest. "The only effect that the lis pendens doctrine had on [debtor's] interest was to make his interest subject to, and bound by, the outcome of the Polsters' state court foreclosure action. . . . [T]he Debtor's interest in the property became property of his estate under § 541(a) and the continuation of the foreclosure action was prohibited by the automatic stay.").
Corbitt v. Aurora Loan Servs., LLC (In re Corbitt), No. EC-10-1340-KiDH, 2011 WL 3300217 (B.A.P. 9th Cir. Mar. 9, 2011) (unpublished) (Kirscher, Dunn, Hollowell) (Nonjudicial foreclosure sale completed one year before petition divested debtor of all legal or equitable title and left debtor in possession of property as a squatter; mortgagee that successfully bid at nonjudicial foreclosure sale was entitled to stay relief to dispossess the debtor.).
Chey v. Cohen (In re Chey), No. CC-09-1253-PaMoB, 2010 WL 6466579 (B.A.P. 9th Cir. Apr. 12, 2010) (unpublished) (Pappas, Montali, Brandt) (Foreclosure sale completed nine months before petition vested all right and title in property in Wells Fargo as successful bidder; at most only right of possession remained in debtor. Stay relief was appropriate to permit Wells Fargo to complete unlawful detainer action against debtor.).
Heath v. Farmer (In re Heath), No. CC-06-1275-PaDMo, 2007 WL 7532278, at *4 n.9 (B.A.P. 9th Cir. Apr. 2, 2007) (unpublished) (Pappas, Dunn, Montali) (When Chapter 13 case was filed after discharge but while Chapter 7 case was still pending, debtors' real estate remained property of Chapter 7 estate and was properly sold by Chapter 7 trustee. "The Property remained an asset of the chapter 7 estate when Appellants filed their Chapter 13 petition. . . . [I]t is generally accepted that property cannot be an asset of two bankruptcy estates simultaneously.").
Tidewater Fin. Co. v. Curry (In re Curry), 347 B.R. 596, 601-04 (B.A.P. 6th Cir. Aug. 10, 2006) (Gregg, Parsons, Whipple) (Applying National City Bank v. Elliott (In re Elliott), 214 B.R. 148 (B.A.P. 6th Cir. 1997), TranSouth Fin. Corp. v. Sharon (In re Sharon), 234 B.R. 676 (B.A.P. 6th Cir. 1999), and United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983), under Ohio law, car lawfully repossessed before petition remained property of the Chapter 13 estate; after turnover under § 542(a), debtor can provide adequate protection by cramming down car lender's claim to value of collateral and paying that value over life of plan. "The Bankruptcy Code requires any entity in 'possession, custody, or control, during the case, of property that the trustee may use, sell, or lease under section 363' to deliver such property to the trustee. . . . [T]he Ohio UCC law that requires the Debtor to redeem, by paying the full amount due under the accelerated Contract to regain possession of the vehicle, conflicts with the Bankruptcy Code. . . . Under the Bankruptcy Code, Tidewater's possessory interest in the vehicle is replaced by its right to adequate protection. . . . A vehicle repossessed under Ohio law before commencement of a bankruptcy case, which has not been sold or otherwise disposed of, is property of the bankruptcy estate. . . . [I]n accordance with Whiting Pools, § 542(a) grants to the estate a possessory interest in the repossessed collateral, and . . . to the extent Ohio law conflicts with the Bankruptcy Code, the Ohio statutory provisions are suspended. . . . Tidewater's reliance on [Bell-Tel Fed. Credit Union v. Kalter (In re Kalter), 292 F.3d 1350 (11th Cir. 2002),] is misplaced. Ohio law, unlike Florida law, does not provide for immediate transfer of full ownership until disposition, usually repossession sale, of the vehicle."), aff'd, 509 F.3d 735 (6th Cir. 2007) (Guy, Moore, Gilman) (Adopting written opinion of BAP).).
Rodriguez v. Inmobiliaria Naihomy (In re Rodriguez), 334 B.R. 754 (B.A.P. 1st Cir. Dec. 1, 2005) (Votolato, Deasy, Rosenthal) (Under Puerto Rico Rule of Civil Procedure, when real estate foreclosure was conducted under ordinary statutory sale, since debtor filed Chapter 13 before title passed to buyer, debtor's interest in property became property of estate.).
Unified People's Fed. Credit Union v. Yates (In re Yates), 332 B.R. 1, 5 (B.A.P. 10th Cir. Sept. 29, 2005) (Nugent, Thurman, Romero) (Creditor violated automatic stay by refusing to return collateral validly repossessed prior to Chapter 13 petition. "[I]f the exercise of control means anything, it means the ability to keep others from access to or use of an object. . . . As a practical matter, there is little difference between a creditor who obtains property of the estate before bankruptcy is filed, or after bankruptcy is filed. The ultimate result is the same—the estate will be deprived of possession of that property. This is precisely the result that § 362 seeks to avoid. . . . Section 362(d) works in tandem with § 542(a) to provide creditors with what amounts to an affirmative defense to the automatic stay. . . . The onus is on the creditor to seek relief from the stay. In addition, § 342(a) requires that a creditor turn over possession of 'property that the trustee may use, sell, or lease under § 363.' . . . A Chapter 13 debtor's need to retain estate property is indistinct from that of a Chapter 11 debtor.").
Title Max v. Northington, 559 B.R. 542 (M.D. Ga. Oct. 27, 2016) (Land) (When Chapter 13 case was filed after vehicle title pawn matured but before expiration of 30-day redemption period under state law, vehicle belonged to the bankruptcy estate because debtor still had an ownership interest. Title Max was a creditor with a secured claim based on its lien and Chapter 13 plan could modify Title Max’s rights consistent with § 1322(b)(2).).
Foskey v. Plus Props., LLC, 437 B.R. 1 (D.D.C. Sept. 29, 2010) (Kollar-Kotelly) (Prepetition tax sale terminated right of redemption, and only bare legal title came into Chapter 13 estate. Postpetition tender of payment to tax authority and obtaining deed did not violate stay.).
Dugas v. Claron Corp., No. 1:09-CV-990, 2010 WL 3338625 (E.D. Tex. Aug. 23, 2010) (Crone) (That schedules included interest in funds held in state court registry did not validate debtors' claim to ownership of those funds, and bankruptcy court properly concluded that debtors failed to prove ownership. Notwithstanding ultimate finding that funds were not part of bankruptcy estate, defendant's action in unilaterally obtaining possession from state court with knowledge that debtors had filed bankruptcy exposed defendant to stay violation damages.), appeal dismissed by No. 10-40897, 2011 WL 2391728 (5th Cir. June 15, 2011) (unpublished) (Jolly, Garza, Stewart).).
In re Vaughn, No. 03-CV-70906-DT, 2006 WL 44261 (E.D. Mich. Jan. 6, 2006) (unpublished) (Hood) (Applying Michigan law, debtor's interest in vehicle repossessed prepetition became property of estate. Turnover of vehicle was appropriate so that debtor could satisfy debt in Chapter 13 plan.).
In re Mapp, No. 18-30148(1)(13), 2019 WL 913043 (Bankr. W.D. Ky. Feb. 21, 2019) (Lloyd) (On reconsideration, right of redemption became property of Chapter 13 estate but not equitable ownership when foreclosure occurred before the Chapter 13 petition; debtors’ failure to exercise right of redemption within time period allowed by state law allowed right of redemption to expire, leaving no interest in debtors that could be managed through Chapter 13 plan.), denying reconsideration of No. 18-30148(1)(13), 2018 WL 6519358, at *2 (Bankr. W.D. Ky. Dec. 10, 2018) (Lloyd) (Applying gavel rule under § 1322(c), foreclosure sale on same day but moments before Chapter 13 petition divested estate of property; right of redemption came into estate but was not exercised within period permitted by state law. “[A] debtor’s right to cure a home mortgage default under 11 U.S.C. [§] 1322(c)(1) terminates when the residence is sold at a foreclosure sale. The point where the foreclosure sale occurs is ‘when the gavel comes down on the last bid . . . ,’ . . . . [T]his authority makes clear that debtors may not cure their default merely because they retain legal title, possession and/or the right to redeem the property under state law. . . . [T]he right to redeem the property does not allow the debtor to reverse acceleration on the loan and cure the default, but rather requires the debtor to pay the purchaser of the property the sum that it paid at the foreclosure sale, plus interest and costs within the statutory time period.”)).
In re Lopez, 596 B.R. 371 (Bankr. E.D. Wash. Feb. 6, 2019) (Corbit) (Under Washington law, because foreclosure sale is not complete until delivery of trustee’s deed, Chapter 13 petition after the auction but before delivery of the trustee’s deed is effective to invoke stay to stop Wells Fargo from taking delivery of deed; debtor retains an interest in the real property protected by the stay that can be managed through the Chapter 13 case.).
LSREF2 Island Holdings Ltd, Inc. v. Jimenez Marrero (In re Jimenez Marrero), No. 17-00262 (ESL), 2018 WL 5795840 (Bankr. D.P.R. Nov. 2, 2018) (Lamoutte) (In litigation brought by purchaser at foreclosure sale alleging Chapter 13 debtor is illegally constructing a wall on purchaser’s adjoining property, bankruptcy court abstains in favor of commonwealth courts. Chapter 13 trustee is not an indispensable party because the property purchased at foreclosure is not property of the Chapter 13 estate.).
Hull v. Klamath Cty. (In re Hull), 591 B.R. 25 (Bankr. D. Or. Sept. 4, 2018) (Renn) (Recording judgment of foreclosure for nonpayment of taxes several years before Chapter 13 petition divested debtor of ownership and title and that transfer cannot be avoided under § 547 because it is outside the 90-day preference period. That taxing authority acquired property worth $60,000 to $80,000 on account of unpaid taxes of $4,915.78 is unfortunate but debtor has no remedy.).
In re Redante, 579 B.R. 354, 364–65 (Jan. 4, 2018) (Frank) (Failing to schedule real property that was surrendered in prior Chapter 7 case but with respect to which the mortgagee had not foreclosed was a Rule 9011 violation by counsel who represented debtor in both cases. Defense that property had been surrendered in prior case was frivolous. Surrender does not change property rights. Counsel had duty to investigate whether mortgagee had foreclosed but counsel did no investigation. Counsel ordered to complete four hours of appropriate CLE. “[A] chapter 13 debtor may ‘surrender’ a property to a secured creditor or attempt to vest property to a secured creditor, but cannot force title to vest to a secured creditor over the objection of the creditor. Surrender merely opens the door, but does not change property rights. If surrender does not alter property rights in chapter 13, . . . a fortiori, it does not do so in a chapter 7 case . . . . Mr. Sklar made no effort to investigate the status of the Trenton Properties before the Debtor filed bankruptcy schedules that omitted any mention of those properties. . . . Mr. Sklar simply assumed that the mortgagees had completed the foreclosure process prior to the commencement of the Present Case. But that is an unreasonable assumption.”).
In re Walker, No. 17 BK 33957, 2017 WL 6547730, at *3–*4 (Bankr. N.D. Ill. Dec. 20, 2017) (Schmetterer), op. withdrawn by No. 17 BK 33957, 2018 WL 799150 (Bankr. N.D. Ill. Feb. 8, 2018) (Schmetterer) (Rejecting In re Avila, 566 B.R. 558 (Bankr. N.D. Ill. Mar. 21, 2017) (Cassling), § 362(b)(3) does not insulate city from turnover of car it booted and towed prepetition. Thompson v. General Motors Acceptance Corp., LLC, 566 F.3d 699 (7th Cir. May 27, 2009) (Cudahy, Williams, Tinder), and United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (June 8, 1983), require city to turn over car on demand. City can protect its possessory lien by filing emergency motion for stay relief. “Section 362(b)(3) does not include the language ‘act or omission[ ]’ . . . . The plain statutory language does not say that the mere possession of the debtor’s vehicle that is required to retain their earlier-perfected possessory lien affords the possessory lien holder the protection of 11 U.S.C. § 362(b)(3). The City may, of course, take some action after a debtor has filed for bankruptcy to maintain the perfection of their possessory lien. In order to do so, the City must, like thousands of other creditors, file a Motion to Modify the Automatic Stay. . . . Thompson . . . suggests that the appropriate remedy for a creditor in the City’s shoes is to file an Emergency Motion to Modify the Automatic Stay . . . . The City does not get the protection of 11 U.S.C. § 362(b)(3) simply by passively possessing the debtor’s vehicle. . . . Pursuant to Thompson, the City will be required to turnover the debtor’s vehicle upon the debtor’s request and, in order to protect its possessory lien, will be required to file an Emergency Motion to Modify the Automatic Stay.”).
In re Woodley, 579 B.R. 630, 633–36 (Bankr. N.D. Ga. Dec. 18, 2017) (Ellis-Monro) (Acknowledging deep split in district, debtor can modify rights of Georgia tax sale purchaser under § 1322(b)(2) and pay redemption amount over life of plan. Georgia state courts have determined that tax sale purchaser does not acquire the entire bundle of ownership rights until redemption period expires and right to redeem is foreclosed. When Chapter 13 case is filed before redemption period ends, debtor retains rights in property sufficient to support power to modify in § 1322(b)(2). Purchaser at prepetition tax sale has nonrecourse secured claim that can be modified under § 1322(b)(2). “The judges in this district are split on whether a Chapter 13 debtor can redeem real property sold in a tax sale through a Chapter 13 plan. The split in this district is characteristic of a broader split across the country on the same issue. . . . The judges in this district holding that a debtor cannot redeem through a Chapter 13 plan property sold in a tax sale reason that only the redemption right—not the real property itself—enters the bankruptcy estate; that § 1322 cannot be used to extend the state law redemption period, as § 108(b) speaks directly to the extension of non-bankruptcy deadlines; and that there exists no ‘claim’ secured by any estate property that can be modified under § 1322. . . . The judges holding that a Chapter 13 debtor may redeem the property through a plan have done so after concluding that the real property itself enters the bankruptcy estate and that the purchaser holds a ‘claim’ subject to modification in a Chapter 13 plan. . . . The similarities between tax deeds and security deeds in terms of property interests, rights, and obligations invite the obvious analogy between the two. . . . [N]either tax deeds nor security deeds transfer the bundle of rights that comprise what is typically understood as property ownership—the rights of possession, use, profits, exclusion of others. . . . Fortunately, the Court need not resolve the issue of who ‘owns’ property sold at a tax sale, because the Georgia appellate courts already have. . . . The Supreme Court of Georgia . . . [stated] . . . that the delinquent taxpayer continues to own the property until the redemption right terminates . . . . [G]iven Debtor’s redemption rights never terminated, Debtor remains the owner of the Property. The Property, therefore, is property of Debtor’s bankruptcy estate.”).
In re Denby-Peterson, 576 B.R. 66 (Bankr. D.N.J. Oct. 20, 2017) (Altenburg), aff'd, 595 B.R. 184 (D.N.J. Nov. 1, 2018) (Hillman) (Although legal title to Corvette remained in seller that repossessed before petition, debtor had equitable interest that became property of the Chapter 13 estate sufficient to support turnover to debtor under § 542. Personal property that was in car at repossession must be turned over as well.).
Harlan v. Nebraska Alliance Realty Co. (In re Harlan), No. 16-50317, 2017 WL 4772413 (Bankr. S.D. Ind. Oct. 19, 2017) (Moberly) (After prepetition tax sale, because taxpayer does not have a current right to tax sale surplus funds under Indiana law, debtor cannot use the surplus funds to fund the Chapter 13 plan.).
In re Hutton, No. 17-03343-5-DMW, 2017 WL 3704526, at *8 (Bankr. E.D.N.C. Aug. 25, 2017) (Warren) (Debtor is entitled to turnover of car levied upon by sheriff prepetition; debtor retained an equitable and/or ownership interest in car notwithstanding the levy and car is not of inconsequential value when debtor uses car to earn income. Citing United States v. Whiting Pools, 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (June 8, 1983), “Debtor retained an interest in the Vehicles as of Petition Date, the Vehicles are a benefit to the Debtor’s estate and the Vehicles are subject to turnover under 11 U.S.C. § 542. . . . The court’s . . . Order required the Debtor to name Principis as a loss payee on the insurance policy of the Dodge prior to turnover.”).
In re Ferrouillat, 558 B.R. 938, 943 (Bankr. S.D. Ala. Oct. 24, 2016) (Oldshue) (Right of redemption after tax sale became property of Chapter 13 estate under Alabama law when Chapter 13 case was filed before expiration of redemption period. “It is undisputed that [tax purchaser] holds a tax deed to Debtor’s Property. . . . [T]hat tax deed is inchoate and defeasible, and only secures legal title to the Property, subject to Debtor’s right of redemption. Debtor maintains all other equitable rights in the Property . . . . Debtor’s right of redemption has not expired, [and] that right becomes part of his Chapter 13 estate under § 541(a)(1). . . . [Alabama law] allows for an indefinite redemption period if possession is maintained.”).
Powell v. Shorty’s Used Cars (In re Powell), 555 B.R. 907, 914–15 (Bankr. S.D. Ga. Aug. 26, 2016) (Coleman) (Citing Motors Acceptance Corp. v. Rozier (In re Rozier), 376 F.3d 1323 (11th Cir. July 19, 2004) (per curiam) (Tjoflat, Birch, Roney), debtor retained property interest in car repossessed before petition and creditor violated stay by refusing to return the car upon demand by the debtor. Attorney fees but not punitive damages awarded. “A debtor retains a legal interest, within the meaning of § 541(a)(1), in a vehicle repossessed prior to the filing of the debtor’s petition so long as the debtor continues to hold legal title to the vehicle under applicable state law. . . . In the Eleventh Circuit, the continued possession of a repossessed vehicle is an act to exercise control over property of the estate, and a creditor who refuses to return it violates the automatic stay. . . . [T]he automatic stay and the turnover provisions of § 542(a) are self-executing and [ ] a creditor cannot condition return of the car on the debtor’s provision of adequate protection that satisfies the creditor.”).
In re Smith, No. 15-35236, 2016 WL 3582209, at *2–*3 (Bankr. S.D. Tex. June 23, 2016) (Isgur) (Chapter 13 filing terminated state court receiver appointed to sell property pursuant to divorce decree. State domestic relations court appointed a receiver to take possession and sell a property under a divorce decree. Debtor filed a Chapter 13 petition to stop action by the receiver. Receiver moved for stay relief. “[A] receiver appointed in a previous state court proceeding may not take action over property of the estate absent an order from the bankruptcy court or to take action necessary to preserve the . . . property. Section 543(b) imposes a straightforward turnover obligation upon a custodian: the custodian must deliver to the trustee and provide an accounting of any property of the estate which came into the custodian's possession, custody, or control.”).
In re Gonzalez, 550 B.R. 711, 717-26 (Bankr. E.D. Pa. May 19, 2016) (Frank) (After prepetition tax sale, when Chapter 13 is filed before expiration of statutory redemption period under Pennsylvania law, plan can provide for purchaser as a secured creditor and can modify that claim for payment over life of plan under § 1322(b)(5). "[T]he 'bundle of rights' . . . the purchaser receives through the tax sale and sheriff's deed is limited during the redemption period. . . . [T]he property owner's equitable interest in the property includes a superior right of possession. . . . When the right of redemption is viewed as an estate asset, it resembles an unexpired, unexercised option to purchase real property. . . . I conclude that the relationship between the former record owner and tax sale purchaser [is] slightly closer to the m purchaser/seller ortgagor/mortgagee relationship than to the relationship between an optionor/optionee or even a of real estate. . . . [I]n a bankruptcy filed during the redemption period . . . , the Redemption Amount is a bankruptcy 'claim' that is subject to modification and treatment in a chapter 13 plan under 11 U.S.C. §§ 1322(b)(2) and 1325(a)(5).").
In re Pittman, 549 B.R. 614, 623-29 (Bankr. E.D. Pa. May 6, 2016) (Chan) (After Pennsylvania tax sale, when owner files Chapter 13 during nine-month statutory redemption period, plan can treat purchaser as holder of secured claim that can be modified under § 1322(b)(2) for payment over life of plan. "The ownership interests of prior owners and purchasers under mortgage foreclosure sales are completely different than the ownership interests of prior owners and purchasers in tax sales . . . . [A]t the conclusion of a mortgage foreclosure sale, the prior owner has no right to redeem property and the purchaser 'obtains vested equitable ownership of the property.' . . . In contrast, . . . the prior owner in a tax sale retains the right to redeem such property until nine months after the deed is acknowledged. During this redemption period, the prior owner may continue in possession of the property and the purchaser merely holds defeasible title in the property until the redemption period expires. . . . [T]he prior owner must merely start the redemption process within nine (9) months of the acknowledgement of the deed . . . . [T]he Purchaser is bound by the filing of the Claim and the Amended Claim and holds an allowed secured claim. . . . [T]he Purchaser clearly had a right to payment of the redemption amount contingent upon whether the Debtor timely elected to redeem the Property. . . . Reading § 108(b) to preclude debtors from extending these redemption payment periods under Chapter 13 plans directly conflicts with § 1322(b)(2), which explicitly permits a debtor to modify a secured claim over time. . . . [T]he proper way to reconcile § 108(b) with § 1322(b)(2) is to require a debtor to elect to redeem by the deadline set forth in § 108(b), but to permit payment of the redemption amount over time as a secured claim pursuant to § 1322(b)(2).").
Bryant v. Hamilton Cnty. (In re Bryant), 548 B.R. 239, 243 (Bankr. E.D. Tenn. Apr. 5, 2016) (Whittenburg) (One-year right of redemption from tax sale under Tennessee law is legal or equitable interest in property that became property of the estate; debtor can use that property by exercising right of redemption within the one-year period as extended for 60 days by § 108(b). "The redemption right, as a legal or equitable interest in property, became property of the estate upon the commencement of the chapter 13 case. . . . As the chapter 13 debtor is given the rights and powers of a trustee over property of the estate by virtue of § 1303 and the right of redemption constitutes property of the estate, the extension of time to exercise that right afforded to a trustee by § 108(b) is available to the chapter 13 debtor just as it is available to the chapter 11 debtor in possession.").
In re Wells, 536 B.R. 264, 272 (Bankr. E.D. Ark. Aug. 14, 2015) (Jones) (Foreclosed residence was not property of estate when foreclosure sale was confirmed prepetition and all redemption rights were waived; but debtor's possession of property at petition coupled with confirmed plan that paid rent gave rise to a tenancy at sufferance that was property of the estate. When creditor failed to object to plan that provided for its claim, "[creditor] 'consented to the terms of the plan, thereby creating or, at least[,] acquiescing to, a lease for the term of the plan.' . . . '[S]ince the debtor is, as of the date of the petition, merely a tenant at sufferance, and the confirmed plan essentially provides for rent, the debtor may continue to reside in the residence for the duration of the plan, paying the rent specified in the confirmed plan. The debtor resides on the property not as owner, but as lessee.'").
In re Christiansen, No. 15-00156, 2015 WL 4127185, at *3 (Bankr. N.D. Iowa July 8, 2015) (Collins) (Under Iowa law, foreclosure judgment without sale does not strip debtor of equitable right of redemption. "'If a debtor files a bankruptcy petition before the foreclosure sale, the debtor's equity of redemption is property in the estate. The general tolling provisions of the Bankruptcy Act will preserve this property interest until the release of that property by the trustee.'").
In re Hall, No. 14-12406, 2015 WL 1058916 (Bankr. E.D. La. Mar. 6, 2015) (Magner) (Under Louisiana law, real property sold at sheriff's sale was immediately transferred; any rights of debtor in the property terminated at time of sheriff's sale, and appeal taken by debtor did not suspend effect of sale.).
In re Johnson, No. 14-50695, 2015 WL 778887 (Bankr. S.D. Ga. Feb. 23, 2015) (Davis) (Nonjudicial foreclosure sale conducted two weeks prior to petition divested debtors of all legal or equitable interests in the property. Notification of sale correctly addressed to debtors in accordance with Georgia law was sufficient; actual receipt of notice by debtors was immaterial to grantee's right to conduct sale.).
In re Betchan, 524 B.R. 830 (Bankr. E.D. Wash. Jan. 29, 2015) (Corbit) (Prepetition foreclosure failed to transfer debtor's interest in home when deed was not properly acknowledged under Washington law.).
Touchstone v. T & S Sawmill, Inc. (In re Touchstone), No. 14-01082-NPO, 2015 WL 401252 (Bankr. N.D. Miss. Jan. 29, 2015) (Olack) (Citing United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (June 8, 1983), logging equipment repossessed before the petition but still owned by the debtor remains property of the Chapter 13 estate subject to turnover.).
In re Shubert, 515 B.R. 536, 540-41 (Bankr. M.D. Ga. Jan. 22, 2015) (Carter) (Because judgment debtor retains title to wages garnished under Georgia law until the money is paid over to the garnishing creditor, garnished wages held by a Georgia court are property of the Chapter 13 estate. "Courts in several older cases from this district ruled that wages, held in the custody of a garnishment court when a bankruptcy case is filed, are not property of the debtor's bankruptcy estate. . . . The contrary line of cases consists of several recent decisions from the Bankruptcy Court for the Northern District of Georgia. . . . [T]hese decisions have ruled that wages, held in the custody of a garnishment court when a bankruptcy case is filed, are property of the debtor's bankruptcy estate. . . . [W]hen a summons is served on a garnishee under the Georgia garnishment scheme, a lien in favor of the garnishing creditor is created on all property subject to the garnishment action. Because the summons creates a lien on the defendant's wages in favor of the creditor, title to the wages, at the time the lien is created, must remain with the defendant/employee. . . . Therefore, title to wages subject to a garnishment action is not transferred from the defendant by service of the summons of garnishment. . . . [T]he defendant's interest in such wages passes to the garnishing creditor when the wages are distributed from the court.").
Nelson v. Arlington Auto Exch. (In re Nelson), 521 B.R. 733, 738-39 (Bankr. D.S.C. Dec. 23, 2014) (Waites) (Applying Florida choice-of-law provision, debtor was not entitled to redeem vehicle repossessed prepetition and vehicle did not become property of Chapter 13 estate. "Under Florida law, '[a] Chapter 13 debtor's statutory right to redeem a vehicle is insufficient to render a repossessed vehicle property of the estate where the debtor takes no affirmative steps towards redemption, for example, by tendering "fulfillment of all obligations secured by the collateral as well as the expenses incurred by the secured party in preparing for the disposition of the collateral."' . . . Debtor's proposed Chapter 13 plan . . . does not take the necessary 'affirmative steps towards redemption.' . . . Debtor's proposed Chapter 13 plan provides only for payment of the full balance owed on the vehicle for redemption over the life of the plan. 'Payment over time in a Chapter 13 plan does not equal a tender of the entire balance due under Florida [law governing redemption]. . . .'").
Seigfried v. Board (In re Seigfried), No. 14-01102-t, 2014 WL 7240071, at *3 (Bankr. D.N.M. Dec. 19, 2014) (Thuma) ("While in general wages paid to a garnishing creditor pre-petition are not property of the estate, . . . [when] Garnished Funds ha[ve] not been paid to [creditor] by the petition date, . . . [debtor] still owned the encumbered funds. . . . The Garnished Funds are estate property."), on further hearing, No. 14-01102-t, 2015 WL 3484408 (Bankr. D.N.M. May 29, 2015) (Thuma) (Failure to address lien rights of garnishing creditor resulted in reduction of attorney fee award.).
De Los Santos v. Nationstar, LLC (In re De Los Santos), No. 14-01091-MKN, 2014 WL 11016174 (Bankr. D. Nev. Oct. 17, 2014) (Nakagawa) (Remand of removed eviction action is appropriate when property left estate and was foreclosed before the petition and nondebtors now reside in the property contrary to unlawful detainer action under state law.).
In re Primes, 518 B.R. 466 (Bankr. N.D. Ill. Sept. 26, 2014) (Lynch) (Recording of quitclaim deed to mortgagee in context of prepetition forbearance agreement did not effect transfer of real property under Illinois law; quitclaim deed was an equitable mortgage that debtor could provide for and cure under plan.).
In re Brooks, No. 14-10096, 2014 WL 2158994 (Bankr. D. Vt. May 22, 2014) (Brown) (Prepetition recording of state court judgment awarding property to ex-spouse extinguished debtor's interest in property.).
In re Kuzniewski, 508 B.R. 678, 685-92 (Bankr. N.D. Ill. Mar. 31, 2014) (Lynch) (Failure to release Illinois citation lien on bank account did not violate stay notwithstanding that lien had effect of freezing account until bankruptcy court could determine rights in the account. Distinguishing Thompson v. General Motors Acceptance Corp., 566 F.3d 699 (7th Cir. May 27, 2009) (Williams, Cudahy, Tinder), creditor "w[as] not in possession of the funds in the account. Instead, the funds were in the Debtor's account at a third party bank. Nor were the funds under the control of [creditor]. While the third party bank had frozen the accounts in response to the pre-petition citation notice . . . , [creditor] could not obtain or direct the transfer of such funds without a further court order. . . . [Creditor] would have committed an 'act to obtain possession of property of the estate' or an act to collect a pre-petition claim against the Debtor with knowledge of the bankruptcy had they requested [the state court judge] to enter an order compelling [ ] Bank to turn over the account funds. But the state court transcript showed that after attorney Lang was informed of the bankruptcy—which the Debtor commenced less than an hour before the initial state court return hearing on the citation—she only asked to put over the citation proceeding until the bankruptcy court could make a determination. At no time did [creditor] seek to obtain possession of the funds being held by [ ] Bank after they became aware of the bankruptcy. . . . Although Section 362(a)(1) prohibits both the commencement and the 'continuation' of a judicial proceeding, most courts have held that at least in some instances a case initiated before the petition date may be stayed for the course of the bankruptcy rather than dismissed without violating the automatic stay. . . . The state court immediately stayed the citation hearing and [creditor] did not request that the court do otherwise. . . . This was sufficient and did not constitute a commencement or continuation of a judicial proceeding in violation of Section 362(a)(1). . . . [A] creditor who commenced garnishment proceedings pre-petition has an obligation to make efforts to stop the garnishment upon learning of a bankruptcy. . . . Similarly, where the creditor has set a process in motion pre-petition that will have the continuing effect of collecting a debt until terminated by such creditor, failure to act can constitute a violation of the stay. . . . Since the state court was made aware of the bankruptcy and had stayed the citation proceeding, the status quo as of the petition date was maintained until this court could determine the rights of the parties to the funds in the accounts. In this case, . . . the collateral securing [creditor]'s lien was never in [creditor's] possession or control. Therefore, neither Section 362(a)(3) nor Section 542(a) (requiring any entity 'in possession, custody, or control, during the case, of property that the trustee may use, sell, or lease under section 363' to deliver such property to the trustee) appl[ies]. . . . [D]ismissal of the citation would have destroyed any lien [creditor] had in the account. Further, to the extent that [creditor] had a security interest in that account, it constituted 'cash collateral' and, therefore, the Debtor would need to obtain court approval (or creditor consent) before using it. . . . Because of the unique nature of an Illinois citation lien and the circumstances of this case it would have been unfair to force [creditor] to have to immediately decide whether to file a motion for stay relief or dismiss its citation upon learning of the bankruptcy.").
In re Terry, 505 B.R. 660 (Bankr. E.D. Pa. Feb. 24, 2014) (Coleman) (Purchaser at prepetition tax sale is holder of secured claim that may be modified pursuant to § 1322(b)(2). Debtor retained right of redemption by filing petition before redemption period expired, and redemption could be paid in full over 60-month plan, treating tax purchaser as secured creditor.).
In re Reisbeck, 505 B.R. 546 (Bankr. D. Mont. Feb. 13, 2014) (Kirscher) (Citing United States v. Whiting Pools, Inc., 462 U.S. 198, 209, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (June 8, 1983), prepetition levy did not exempt IRS from automatic stay.).
In re Martin, 496 B.R. 323 (Bankr. S.D.N.Y. Aug. 8, 2013) (Morris) (Chapter 13 estate included equitable interest and redemption right in property purchased at prepetition tax sale when debtor filed petition before redemption period expired.).
In re Vega, 503 B.R. 38 (Bankr. E.D. Mich. June 20, 2013) (Tucker) (Auto repairman had state-law possessory lien and was not required to turn over vehicle until paid. Section 362(b)(3) exception protected repairman from stay violation.).
In re Francis, 489 B.R. 262 (Bankr. N.D. Ga. Mar. 13, 2013) (Hagenau) (Chapter 13 estate included equitable interest and redemption right in property purchased at prepetition tax sale when debtor filed before redemption period expired. Redemption could be paid in full over 60-month plan.).
In re Ohuche, No. 12-79379-JRS, 2013 WL 937571 (Bankr. N.D. Ga. Feb. 5, 2013) (Sacca) (Following completed foreclosure, equity of redemption terminated under Georgia law and no interest in foreclosed property came into bankruptcy estate. Stay modified to allow Fannie Mae to proceed against property under state law.).
In re Jones, Nos. 12-14608, 12-15179, 2013 WL 1092099 (Bankr. E.D. Tenn. Jan. 17, 2013) (Cook) (Applying Georgia Uniform Commercial Code, seller of vehicle could not retain title after delivery to buyer. Seller had security interest, but bailment of title was rejected.).
Hargest v. Horizon Auto. Group, LLC (In re Hargest), No. 12-03024, 2012 WL 5198344 (Bankr. S.D. Tex. Oct. 19, 2012) (Isgur) (Prepetition repossession of vehicle did not terminate debtor's rights; creditor was obligated to turn over car to debtor. Failure to do so was willful stay violation.).
Yaryan-Parks Trust v. Martinez (In re Martinez), 476 B.R. 627, 643-46 (Bankr. D.N.M. July 30, 2012) (Starzynski) (Debtor retains sufficient interest in mobile home to manage debt under § 1322(b)(2) and (b)(5) notwithstanding issuance of writ of replevin by state court before the petition. "[A] statutory or equitable right of redemption becomes property of the bankruptcy estate. . . . This right alone allows a debtor to cure under § 1322(b) until a foreclosure sale. . . . Although Plaintiff obtained a foreclosure judgment, Debtor retained a redemption right which allows her to cure the related obligation in her bankruptcy case. . . . [T]he mere issuance of the writ [of replevin] by the state court did not divest Debtor's interest in the mobile home under state law. Therefore, the mobile home is property of the estate.").
Craighead v. Creative Inv. Group, Inc. (In re Craighead), No. 10-05379, 2012 WL 2501137 (Bankr. N.D. Cal. June 28, 2012) (Weissbrodt) (Prepetition trustee's sale ended debtor's ownership interest in property that had been subject of another debtor's bankruptcy. Automatic stay had been annulled, and prior debtor had attempted transfer of ownership after trustee's sale.).
In re Alexieff, No. 12-03248-8-JRL, 2012 WL 2064584 (Bankr. E.D.N.C. June 7, 2012) (Leonard) (Residence was not property of Chapter 13 estate when statutory period for upset bids under North Carolina law expired before the petition.).
Shaw v. Farmers Deposit Bank (In re Shaw), No. 11-3003, 2012 WL 1190695 (Bankr. E.D. Ky. Apr. 9, 2012) (Scott) (Property remained in estate when deed in lieu of foreclosure was placed in escrow under prepetition settlement and bank received deed from escrow on default, but bank chose not to record deed because of intervening liens and instead re-instituted foreclosure. Deed was not accepted as transfer of title.).
Bolton v. Quick Cash Title Loans (In re Bolton), 466 B.R. 831 (Bankr. S.D. Miss. Jan. 5, 2012) (Samson) (Applying Mississippi Title Pledge Act, when debtor failed to redeem vehicle within 30 days after loan maturity, creditor acquired absolute right of title and ownership, with only unexpired right of redemption becoming property of estate; Act gave debtor three business days after repossession to pay amount of unpaid principal balance and other applicable charges in full, which redemption opportunity was extended on bankruptcy filing by § 108(b).).
Bishop v. GMAC Mortg., LLC (In re Bishop), No. 11-5055, 2011 WL 6813241 (Bankr. M.D. Ga. Dec. 27, 2011) (Walker) (Home was not property of bankruptcy estate when, under Georgia law, foreclosure was completed prepetition and debtor had no equitable right of redemption nor equitable right to appeal sale. GMAC had authority to conduct foreclosure under assignment of security deed.).
Sarner v. Massachusetts Dep't of Rev. (In re Sarner), No. 11-1253, 2011 WL 6026894 (Bankr. D. Mass. Dec. 5, 2011) (Feeney) (Bankruptcy estate had no interest in bank accounts levied upon by Commissioner of Revenue. If debtor had interest in account levied upon, it would have been simple to submit evidence of that fact.).
In re Diaz Esteras, No. 11-01141 (ESL), 2011 WL 5953483 (Nov. 22, 2011) (unpublished) (Lamoutte) (Funds from prepetition sale of residential real property were property of estate within debtor's exclusive right of control; trustee could not force turnover.).
In re Monroe, No. 11-05167-8-RDD, 2011 WL 5509219 (Bankr. E.D.N.C. Nov. 7, 2011) (Doub) (Debtor had no interest in property when foreclosure sale was completed and time to file upset bid expired under North Carolina law before petition. Recording of deed postpetition was not stay violation because property did not belong to estate.).
In re Nada, No. 11-45176 WJL, 2011 WL 4591890 (Bankr. N.D. Cal. Oct. 2, 2011) (Lafferty) (Applying California law, debtor lost interest in bank account on date of notice of levy by state Board of Equalization.).
In re DiGregorio, 458 B.R. 436 (Bankr. N.D. Ill. Sept. 28, 2011) (Schmetterer) (Under Illinois Condominium Property Act, debtor's possessory interest ended on entry of final state court judgment, requiring debtor to comply with conditions of judgment to restore possession. Rooker-Feldman doctrine prevented bankruptcy court from modifying or reviewing state court judgment.).
In re Castillo, 456 B.R. 719 (Bankr. N.D. Ga. May 25, 2011) (Drake) (Applying Georgia law, prepetition repossession did not give secured creditor ownership of vehicle. Automatic stay protected debtor's interest and turnover was required.).
Moore v. Complete Cash Holdings, LLC (In re Moore), 448 B.R. 93 (Bankr. N.D. Ga. Mar. 31, 2011) (Bonapfel) (Without discussion of new § 541(b)(8), when statutory period for redemption of pawned property expired under Georgia law during Chapter 13 case, pawned cars were not property of bankruptcy estate but automatically became property of pawnbroker. Debtors failed to schedule pawnbroker. Postpetition repossession did not violate stay, but was stay annulled to validate pawnbroker's rights.).
Munoz v. James B. Nutter & Co. (In re Munoz), No. 10-3039-hcm, 2011 WL 710501 (Bankr. W.D. Tex. Feb. 22, 2011) (unpublished) (Mott) (Property never entered Chapter 13 estate because foreclosure sale was completed prepetition under Texas law upon acceptance of bid.).
Lacey v. BAC Home Loans Servicing, LP (In re Lacey), No. 10-1249, 2011 WL 705479 (Bankr. D. Mass. Feb. 17, 2011) (Feeney) (Property did not become part of Chapter 13 estate because foreclosure sale was completed prepetition under Massachusetts law, equity of redemption was extinguished and debtors failed to effectively challenge foreclosure process.).
In re Weeks, No. 10-81320-TRC, 2011 WL 144141 (Bankr. E.D. Okla. Jan. 18, 2011) (Cornish) (Logging equipment became property of bankruptcy estate, subject to automatic stay when debtors dissolved corporation and transferred corporate assets to themselves between dismissal of prior Chapter 13 case and filing of current case. Even if dissolution was improper under Oklahoma corporate law, actual transfer occurred, giving debtors at least legal interest in property.).
In re Ochoa, No. 10-55950 CN, 2010 WL 3909496 (Bankr. N.D. Cal. Oct. 1, 2010) (Novack) (Debtor retained statutory right to redeem car repossessed before the petition, and refusal to turn over car violated stay.).
In re Sarver, No. 10-81039C-13D, 2010 WL 3501795 (Bankr. M.D.N.C. Sept. 1, 2010) (unpublished) (Stocks) (Filing of Chapter 13 petition after expiration of time for upset bid under state law left debtor with no property interest; stay relief was granted to allow credit union to enforce its rights after prepetition foreclosure, including recording deed and recovering possession. Under North Carolina law, debtor's equity of redemption had been lost when case was filed after close of normal business hours in state clerk's office, on last day for submitting upset bid.).
In re Sheridan, No. 10-10321, 2010 WL 3222407 (Bankr. D. Vt. Aug. 16, 2010) (unpublished) (Brown) (Boat subject to prepetition writ of replevin became property of Chapter 13 estate; under Vermont law, debtor retained equitable interest and right of redemption when bank had not actually repossessed. However, bank was entitled to stay relief to obtain possession and sell boat.).
In re Parish, No. 10-00086, 2010 WL 1372387 (Bankr. D. Haw. Apr. 6, 2010) (unpublished) (Faris) (Under Hawaii law, debtor's interest in foreclosed property became property of Chapter 13 estate because mortgagor retains equitable right to reinstate mortgage and redeem until foreclosure court enters written order confirming sale and no such order had been entered prior to the petition.).
In re Lockwood, No. 4:09-AP-01247, 2010 WL 1727447 (Bankr. E.D. Ark. Mar. 30, 2010) (unpublished) (Evans) (Purchaser of truck was entitled to obtain possession in accordance with prepetition state court judgment; debtor could not retain truck and satisfy state court judgment through plan.).
In re Warrington, 424 B.R. 186 (Bankr. E.D. Pa. Feb. 23, 2010) (Raslavich) (Title and turnover right became property of Chapter 13 estate because, under Pennsylvania Motor Vehicle Sales Finance Act, debtor had right to redeem vehicle repossessed prepetition.).
Martyak v. Tioga County (In re Martyak), 432 B.R. 25 (Bankr. N.D.N.Y. Feb. 5, 2010) (Cangilos-Ruiz) (Prebankruptcy foreclosure of tax liens terminated debtor's interest and property never came into bankruptcy estate. Notice requirements under New York law for default judgment were satisfied.).
Reid v. Citadel Fin. Credit Union (In re Reid), 423 B.R. 726 (Bankr. E.D. Pa. Jan. 13, 2010) (Fox) (Citing United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (June 8, 1983), § 541(a) includes property rights retained by debtor in vehicle repossessed prepetition. When adequate protection was provided, debtor had right to turnover of vehicle repossessed prepetition.).
In re Diaz, 416 B.R. 902 (Bankr. S.D. Fla. Oct. 15, 2009) (Mark) (2001 amendments to Article 9 of Florida Commercial Code do not change holding in Bell- Tel Federal Credit Union v. Kalter (In re Kalter), 292 F.3d 1350 (11th Cir. June 7, 2002) (Edmondson, Hull, Marcus), that ownership of a car passes to secured creditor at time of prepetition repossession.).
In re Lindo-Dmyfryk, No. 6:09-06721-KSJ, 2009 WL 3013496 (Bankr. M.D. Fla. Aug. 18, 2009) (Jennemann) (Vehicle repossessed prepetition was not property of Chapter 13 estate, and debtor was not entitled under Florida law to redeem vehicle.).
Best v. Galloway (In re Best), 417 B.R. 259 (Bankr. E.D. Pa. July 30, 2009) (Fox) (Prebankruptcy foreclosure prevented property coming into bankruptcy estate; removed cause of action alleging improper foreclosure was subject to mandatory and/or permissive abstention to be litigated in state court.).
In re Hoopai, 408 B.R. 839 (Bankr. D. Haw. June 2, 2009) (Faris) (Bankruptcy court had no authority to reduce supersedeas bond when high bidder at foreclosure sale appealed determination that debtor still had interest in foreclosed property and could sell property under plan. Any reduction in bond must be addressed to court of appeals, which could remand for purposes of reducing bond.).
In re Welch, No. 08 B 74139, 2009 WL 691189 (Bankr. N.D. Ill. Mar. 13, 2009) (Barbosa) (Vehicle repossessed after dismissal of prior case remained property of estate at refiling; creditor not obligated to turn over vehicle until provided adequate protection against declining collateral value.).
In re Lee, No. 08-61713-13, 2009 WL 981129 (Bankr. D. Mont. Jan. 28, 2009) (unpublished) (Kirscher) (Under Montana law governing title loans, debtors failed to timely redeem truck, and truck is not property of bankruptcy estate.).
In re Young, 396 B.R. 257 (Bankr. D. Conn. Oct. 21, 2008) (Dabrowski) (Plan cannot redeem property that was sold to third party at city tax sale before the petition; debtor failed to establish tolling of Connecticut's redemption period.).
In re Willette, 395 B.R. 308 (Bankr. D. Vt. Oct. 17, 2008) (Brown) (When mortgagee ambiguously proceeds by strict foreclosure under Vermont law but also schedules foreclosure sale, debtor has interest that becomes property of the estate that supports curing of default through a plan when the petition is filed three days before foreclosure sale.).
Spinner v. Cash In A Hurry, LLC (In re Spinner), 398 B.R. 84 (Bankr. N.D. Ga. Sept. 29, 2008) (Diehl) (Right of redemption of pawned vehicle had not expired under Georgia's Pawnshop Act and became property of Chapter 13 estate.).
Barnette v. Bankers Fin. Servs. (In re Barnette), No. 07-1068, 2008 WL 7842071 (Bankr. N.D. Ga. Apr. 6, 2008) (Drake) (Vehicle subject to title lien did not become property of estate because right of redemption expired prepetition.).
In re Allred, No. 07-22412, 2007 WL 2916194, at *4 (Bankr. D. Utah July 30, 2007) (unpublished) (Boulden) (Applying Utah UCC, car repossessed and sold to third party before petition left no property for Chapter 13 estate; alleged violations of UCC, such as reasonableness of sale, "do not create a new legal or equitable right for the Debtor in collateral . . . . The Debtor's remedy . . . is to pursue an action against [the creditor and others] for violation of the UCC.").
United States v. Bartlett (In re Bartlett), 353 B.R. 398 (Bankr. D. Vt. Nov. 1, 2006) (Brown) (In foreclosure action, district court reinstated debtors' right of redemption, which became property of estate.).
Snowden v. Litton Loan Servicing, Inc. (In re Snowden), 352 B.R. 848, 854 (Bankr. N.D. Ill. Oct. 11, 2006) (Schmetterer) (Citing Goldberg v. Tynan, 773 F.2d 177 (7th Cir. 1985), "under Illinois law, the only asset that passes into a bankruptcy estate when a mortgagor files a Chapter 13 petition prior to expiration of a redemption right is the statutory right of redemption . . . . Unless this right is exercised within the statutory time limits under state law or as extended by Bankruptcy Code section 108(b) . . . the debtor loses whatever right he may have to redeem the property.").
Fisher v. Moon (In re Fisher), 355 B.R. 20 (Bankr. W.D. Mich. Oct. 4, 2006) (Stevenson) (Final judgment of foreclosure for tax delinquency under Michigan law and expiration of redemption period before the petition divested debtor of all right, title and interest in property; sale of property one day after petition could not violate automatic stay.).
Howard v. Citizens Bank of Cochran (In re Howard), 351 B.R. 251 (Bankr. M.D. Ga. Sept. 21, 2006) (Hershner) (Sheriff's sale before petition but foreclosure deed delivered after petition did not divest debtor of interest in residence.).
In re Toney, 349 B.R. 516, 519-20 (Bankr. E.D. Tenn. Sept. 7, 2006) (Cook) (Prepetition foreclosure sale and delivery of trustee's deed ended debtor's interest in property and that interest cannot be resurrected by confirmation of plan that purports to deal with mortgage; foreclosing creditor that bid in its mortgage is entitled to relief from the stay. "There is no basis in the law for obtaining property belonging to another through a plan provision. . . . [T]he plan does not expressly reinstate the mortgage, nor does it contain any language resurrecting the debtor's ownership interest or terminating Beneficial's new ownership interest in the property. . . . [T]he language of the plan is wholly insufficient to revive the debtor's terminated interest in the property, reinstate the mortgage, and strip Beneficial of its ownership of the property.").
In re Morgan, No. 06-30531-DHW, 2006 WL 2338147 (Bankr. M.D. Ala. Aug. 9, 2006) (unpublished) (Williams) (Foreclosure sale four hours before Chapter 13 petition left debtor with statutory right of redemption under Alabama law which cannot be modified in a Chapter 13 plan as explained in Commercial Federal Mortgage Corp. v. Smith (In re Smith), 85 F.3d 1555 (11th Cir. 1996).).
Greenpoint Credit, LLC v. Isom (In re Isom), 342 B.R. 743 (Bankr. N.D. Miss. May 17, 2006) (Houston) (Only debtor's statutory right of redemption became property of the Chapter 13 estate when tax sale occurred in April of 2001 and petition was filed in December of 2002; two-year statutory right of redemption expired four months after the Chapter 13 petition, leaving no interest in the debtor.).
In re McKinney, 341 B.R. 892 (Bankr. C.D. Ill. May 17, 2006) (Perkins) (After sale of delinquent taxes, if Chapter 13 case is filed before tax deed issues to purchaser, ownership interest becomes property of the estate without regard to debtor's redemption right; if petition is filed before expiration of redemption period, right of redemption also becomes property of Chapter 13 estate, but that right is personal property independent of ownership of real property itself. When petition intercepts delivery of tax deed, automatic stay protects ownership interest and plan can deal with tax sale purchaser as a nonrecourse secured claim.).
In re Nolan, No. 06-60097, 2006 WL 3885137 (Bankr. E.D. Ky. Apr. 19, 2006) (unpublished) (Scott) (In re Kalter, 292 F.3d 1350 (11th Cir. 2002), is inconsistent with the current provisions of the Florida UCC and inconsistent with United States v. Whiting Pools, Inc., 462 U.S. 198, 103 S. Ct. 2309, 76 L. Ed. 2d 515 (1983); truck lender must turn over Freightliner tractor repossessed before the petition because debtor retains rights in the collateral.).
In re Snowden, 345 B.R. 607 (Bankr. N.D. Ill. Apr. 14, 2006) (Schmetterer) (Chapter 13 estate contains only special right to redeem under Illinois law when real property was foreclosed and state court confirmed the foreclosure sale before the petition; failure to exercise redemption within 30 days as extended by § 108 is fatal to power to cure defaults under § 1322(c).).
In re Wolfe, 344 B.R. 762 (Bankr. W.D. Va. Mar. 30, 2006) (Stone) (Debtors' interest in residence became property of the Chapter 13 estate because foreclosure sale was conducted before the petition but no memorandum of sale was executed for purposes of Virginia law until after the petition.).
Chase Home Fin. LLC v. Geiger (In re Geiger), 340 B.R. 422 (Bankr. M.D. Ga. Mar. 30, 2006) (Hershner) (When foreclosure sale was held before petition but not consummated under Georgia law, right of redemption is included in estate.).
In re Hines, No. 05-12959, 2005 WL 4057840 (Bankr. S.D. Ohio Aug. 10, 2005) (unpublished) (Perlman) (Interest in debtor's retirement plan vested in former spouse did not become part of the Chapter 13 estate and is held by debtor in constructive trust for ex-spouse.), aff'd, 356 B.R. 786 (B.A.P. 6th Cir. 2006) (Table decision).).
In re Johnson, 328 B.R. 234, 236 (Bankr. M.D. Fla. July 19, 2005) (Briskman) (Automobile that was property of the debtor's Chapter 13 estate when the petition was filed but that was repossessed after the Chapter 13 petition was dismissed was not property of the debtor's Chapter 13 estate when the dismissal was set aside. Extending the holding of Bell-Tel Federal Credit Union v. Kalter (In re Kalter), 292 F.3d 1350 (11th Cir. 2002), the court held that "pursuant to Florida law, the debtors ownership interest in both vehicles passed to GTE upon repossession. The debtors' remaining right to redeem the vehicles is insufficient to render the vehicles property of the estate pursuant to 11 U.S.C. § 541.").
In re Pickett, 325 B.R. 579, 581 (Bankr. E.D. Mich. June 9, 2005) (Shapero) (Upon the expiration of a redemption period, the debtor lost all interest in property and the Chapter 13 plan could not compel reconveyance of the property. Property tax authority obtained a judgment of foreclosure on March 1, 2002, and, pursuant to state law, the redemption period expired March 22, 2002. The debtor filed a Chapter 13 petition on September 17, 2002, and the state agency recorded its notice of judgment on November 7, 2002, auctioning the property on November 21, 2002. State law provided that "with the passage of the 21-day redemption period after a judgment of foreclosure . . . (i) all redemption rights expire; (ii) all existing recorded and unrecorded interests in the property are extinguished; (iii) fee simple absolute title vests in the foreclosing governmental unit; and (iv) that title is not to be stayed or held invalid." Thus, when the debtor filed the petition, he had no interest in the property that could be made a part of the Chapter 13 plan.).
In re Powers, 324 B.R. 225 (Bankr. W.D.N.Y. May 12, 2005) (Ninfo) (Auto lender that had conducted a valid repossession of the debtor's automobile prior to the filing of the Chapter 13 petition held an unavoidable possessory garageman's lien on the vehicle under state law and would not be compelled to release the vehicle unless the debtor paid reasonable repossession costs in full or provided for payment of those costs on terms acceptable to the creditor through the debtor's Chapter 13 plan.).
In re Caple, No. 05-50213, 2005 WL 1287991, at *6 (Bankr. M.D.N.C. Apr. 4, 2005) (unpublished) (Carruthers) (Applying Tidewater Finance Co. v. Moffett (In re Moffett), 356 F.3d 518 (4th Cir. 2004), and UCC, collateral repossessed but not disposed of before petition remains property of estate, subject to automatic stay and turnover in Chapter 13 case.).
Lyle v. Santa Clara County Dep't of Child Support Servs. (In re Lyle), 324 B.R. 128, 131 (Bankr. N.D. Cal. Mar. 4, 2005) (Morgan) (The state child support services office was not in violation of the automatic stay when it intercepted the debtor's tax refund from the Internal Revenue Service; the funds received from such overpayment were not property of the estate. The debtor had a substantial child support obligation owing to the State of California and had overpaid his federal taxes by approximately $3,100. He requested a refund from the Internal Revenue Service. The Internal Revenue Service, however, honoring the notice from the State of California, forwarded the entire overpayment of taxes to the state child support services agency, and the debtor brought an action for a violation of the stay. Although the debtor had overpaid taxes, such does not equate to the right to a refund. "[T]he debtor's interest in a refund does not necessarily extend to the full value of any overpayment of taxes in a given tax year. . . . Rather, the express provisions of the Internal Revenue Code make it clear that the debtor's interest in a refund is contingent on the subsequent statutory determination of what portion of the overpayment, if any, the debtor is entitled to receive as a refund. . . . In light of the mandatory scheme described in §§ 6402(a) and (c), it is apparent that Lyle never became entitled to receive any tax refund.").
Dierkes v. Crawford Orthodontic Care, P.C. (In re Dierkes), No. 05-06022, 2005 WL 6219357 (Bankr. N.D. Ga. Feb. 15, 2005) (unpublished) (Diehl) (Debtor/dentist had interest in repossessed equipment and furnishings at petition. Under Georgia law, right of redemption had not expired and redemption may be occur through plan.).
In re Rocco, 319 B.R. 411 (Bankr. W.D. Pa. Jan. 6, 2005) (Agresti) (Because foreclosure sale was completed before the petition and sheriff's deed was delivered and recorded, debtors had no legal or equitable interest in real property at the Chapter 13 petition. Without legal or equitable interest, debtors lack standing to object to purchaser's motion for relief from the stay.).