Bankr. E.D.N.C.: In re Cowstone, L.L.C.- Contempt for Violation of Consent Order

Summary: The Debtor and Nicholas Stratas, the sole manager of the Debtor, agreed to a Consent Order, to allow and cooperate with Paragon in its foreclosure against real property owned by the Debtor. Despite this agreement, Stratas filed a motion to set aside the subsequent foreclosure proceeding because the Substitute Trustee mumbled and was rude at the Foreclosure Hearing, depriving him of the opportunity (preserved in the earlier Consent Order) to bid at the foreclosure. Paragon file a Motion for Contempt. At hearing, the Bankruptcy Court found that Stratas had no credible evidence that he would have been able to bid at the foreclosure sale and consequently, any alleged mumbling or rudeness was irrelevant. Stratas had filed a Withdrawal of his Motion to set aside the foreclosure, but such withdrawal was, in violation of the Consent Order, contingent on Paragon withdrawing its pending Motions (presumably the Contempt Motion.) As a result, the Bankruptcy Court ordered the U.S. Marshall to incarcerate Stratus until the foreclosure was completed and a Trustee Deed recorded. Stratus was also ordered to pay $10,000 in damages to Paragon. For a copy of the opinion, please see: Cowstone, L.L.C.- Contempt for Violation of Consent Order.pdf