Mr. Myrick brought suit against Equifax under the FCRA for willfully failing to verify the discharge of a debt in his Chapter 7 bankruptcy. In light of Daughterty v. Ocwen Loan Servicing, the district court reconsidered its previous grant of summary judgment and instead found that Equifax had in its possession “records that would have enabled it to confirm the status of the … account through an identified source, i.e., PACER.” Instead, there was a factual issue of “whether Equifax conducted a reasonable investigation by limiting its efforts to confirming the disputed information” with the creditor and not checking PACER or elsewhere.… Read More
Mr. And Mrs. Cox, through their then attorney, entered into a settlement agreement in a civil forfeiture action brought for the collection of taxes, wherein they agreed to pay the government more than $3 million and granted Deeds of Trust against thirty-five tracts of land located throughout Alabama and North Carolina. After entering into this settlement, the government then initiated criminal prosecution of both of the Coxes and they subsequently pleaded guilty, with Mr. Cox being sentence to 33 months imprisonment, Mrs. Cox to 3 years probation, and each being fined $50,000. The when the Coxes failed to pay the agreed amount (perhaps in part because they were in prison), the government sought to judicially foreclose on the properties.… Read More
Ms. Collins, representing herself pro se, in an action alleging multiple claims arising from a mortgage lending scheme by the defendants failed to comply with multiple orders regarding discovery. Upon the motions of the defendants, the district court (lamenting that no attorneys from the Pro Bono Panel had stepped up to assist Ms. Collins) applied the four-part test from Belk v. Charlotte-Mecklenburg Bd. of Educ., 269 F.3d 305, 348 (4th Cir. 2001) to determine what sanctions to impose:
1) whether the non-complying party acted in bad faith;
(2) the amount of prejudice that noncompliance caused the adversary;
(3) the need for deterrence of the particular sort of non-compliance; and
(4) whether less drastic sanctions would have been effective.… Read More
Leaving aside the multiple foreclosure proceedings and subsequent appeals, Mr. Garvey eventually filed a short-lived, pro se Chapter 13 bankruptcy. Attorneys for Seterus filed a Notice of Appearance and Objection to Confirmation. Mr. Garvey then sent a demand to the attorneys, as debt collectors, pursuant to 15 U.S.C. § 1692g, provide verification under penalty of perjury to substantiate that the alleged debt was owed to Seterus and further stating that failure to comply within seven days would constitute a waiver of all claims against him.
Following the dismissal of the bankruptcy, Mr. Garvey commenced suit in federal district court, which held that, pursuant to 15 U.S.C.… Read More
Following the entry of a discharge in 2011 of his Chapter 13 case, First Federal Bank (“FFB”) continued to report on Mr. Myrick’s credit report with Equifax that he owed an outstanding balance of $41,603 that was past due by $2,000. In November 2014, Mr. Myrick submitted a dispute with Equifax regarding this balance, raising his bankruptcy discharge. Equifax sent a Automated Consumer Dispute Verification (“ACDV”) to FFB, which responded that the balance information was correct. Later in February 2015, Mr. Myrick again disputed the FFB trade line, this time attaching a copy of his discharge order. As the discharge order does not specifically list discharged claims, Equifax requested additional details regarding the account names, numbers and nature of the dispute. … Read More
Ms. Crow filed a Chapter 13 bankruptcy, but after a creditor raised issue with her exceeding the §109(g) debt limits, converted to Chapter 7. Eight months after the initial filing of her voluntary bankruptcy petition, Ms. Crow sought to amend her schedules to claim an exemption in an individual retirement account (IRA) that had been omitted from her original petition, but would otherwise indisputably have been exempt. The Trustee opposed this amendment, arguing that Ms. Crow failed to show the change in circumstances required for modifications of exemptions by N.C.G.S. § 1C-1603(g). The bankruptcy court found that the omission was inadvertent due to the complexity of the case (which involved Ms.… Read More
Following the re-opening of Ms. Washabaugh’s Chapter 7, the Bankruptcy Administrator sought revocation of her discharge. Ms. ’s motion to dismiss that complaint, alleging that the Bankruptcy Administrator lacked standing for such action, was denied by the bankruptcy court and Ms. Washabaugh sought leave to bring an interlocutory appeal to the district court.
The district court began with 28 U.S.C. § 158, which allows “with leave from the court” appeal of interlocutory orders based on the following factors:
(1) the appeal involves a controlling question of pure law, the resolution of which will completely determine the outcome of the litigation;
(2) as to which there is a substantial ground for difference of opinion between courts; and
(3) the resolution of the question as a whole would materially advance the termination of the litigation.… Read More
Bankruptcy Court Characterization of Equitable Distribution Awards
Cheryl Jones brought motions against the Debtor, her ex-husband, Sean Jones, seeking relief from the stay and for determination of Domestic Support Obligation, with the primary question being whether the family court’s Equitable Distribution Order award of $116,182 from the debtor’s 401(k) plan and $63,736 from the debtor’s retirement account were in the nature of a domestic support obligation, pursuant to §§ 101(14A) and 523(a)(5), or, as argued by the debtor, were property distributions within the scope of §523(a)(15). If the former, the obligation would be nondischargeable, but the latter would be discharged in a Chapter 13 case, pursuant to § 1328(a).… Read More
Mr. Sheetz filed a Chapter 7 bankruptcy on June 1, 2015, listing, among other creditors, Mr. Engell. The last day to oppose a discharge was August 31, 2015. On August 26, 2015, Mr. Engell filed an pleading titled as “Creditor’s Objection to Debtor’s Exemption” (“the objection”), but which, in fact, asserted that judgment held against Mr. Sheetz was nondischargeable due to fraud and unfair and deceptive trade practices. Subsequently, on October 27, 2015, Mr. Engell filed a motion to amend. On December 31, 2015, the bankruptcy court overruled the objection and denied the motion to amend, holding that Mr. Engell had been required to bring an Adversary Proceeding to oppose discharge and the objection was insufficient.… Read More
The Farags (who were eventually represented by my law firm in their Chapter 13 bankruptcy- all statements in this posting are taken solely from the court decisions) obtained a line of credit in 2002 with Wells Fargo, secured by their real property. This was refinanced in 2004 by PNC, which, based on a pay-off statement from Wells Fargo, paid the balance owed and requested that the Deed of Trust be marked as satisfied and record. Wells Fargo failed to do so and the Farags continued to take advances from the line of credit totaling over $300,000.00.
Upon filing Chapter 13 on March 29, 2012, the Farags indicated that the real property would be surrendered.… Read More