Best, Jr. v. Nationstar Mortgage LLC

Summarized by Myrna Ruiz-Olmo , MRO Attorneys at Law, LLC
10 years 3 months ago

Citation:

John F. Best, Jr. v. Nationstar Mortgage LLC, BAP NO. NH 15-019 (October 30, 2015)

Tag(s):

Ruling:

The bankruptcy court did not err in granting Nationstar’s motion for judgment on the pleadings. The pleadings failed to set forth facts sufficient to establish a plausible claim that Nationstar violated the § 542(a)(2) discharge injunction. And, even if any of the facts alleged in the complaint constituted a violation of the discharge injunction, the facts presented in the pleadings established that Nationstar’s defense of the § 524(j) exception applied.

Procedural context:

Debtor appeals pro se from the bankruptcy court’s ruling granting mortgagee’s motion for judgment on the pleadings and denying Debtor’s complaint for alleged violations of the discharge injunction.

Facts:

The Debtor filed two chapter 13 plans in which he identified Nationstar as a mortgagee but claimed that no assignment of mortgage existed transferring the note from the original mortgagee, thus no debt existed. Nationstar objected to both plans, asserting that it was the holder of a note secured by a mortgage on certain of the Debtor’s property. The bankruptcy court denied confirmation of both plans. Meanwhile, Nationstar filed a proof of claim asserting a secured claim. The case was later converted to chapter 7, and an order discharging the Debtor was entered. The case was reopened and the Debtor filed an adversary proceeding against Nationstar seeking damages for alleged violations of the discharge injunction asserting that, after the discharge, Nationstar had sent communications demanding money for the discharged debt. In its answer to the complaint, Nationstar admitted it sent the post-discharge letters to the Debtor, but denied that its actions violated the discharge injunction. Nationstar filed a motion for judgment on the pleadings asserting the post-discharge letters did not violate the discharge injunction because they included disclaimers indicating they were not attempting to collect a discharged debt from the Debtor, and that the § 524(j) exception applied. The bankruptcy court granted Nationstar’s motion for judgment on the pleadings, finding that the bankruptcy discharge did not impact the presumed validity of Nationstar’s lien and that Nationstar’s actions fell within the exception to the discharge injunction set forth in § 524(j). The BAP affirmed and concluded that in granting Nationstar’s motion for judgment on the pleadings, the court was entitles to look at the pleadings, exhibits attached to the pleadings, and documents sufficiently referenced in the pleadings. The BAP also agreed that the discharge injunction did not prohibit Nationstar’s from enforcing its valid prepetition mortgage lien as long it did not pursue in personam relief. The BAP concluded that, other than the fact that Nationstar sent the post-discharge correspondence to the Debtor, there was nothing in the pleadings that demonstrated that Nationstar was attempting to collect the discharged debt from the Debtor personally, or that it was demanding or coercing the Debtor to make payment on the account. Moreover, the post-discharge correspondence included disclaimer language making clear that, because the Debtor had received a bankruptcy discharge, the correspondence was not an attempt to collect the debt from him personally and was provided for informational purposes only in the event he wanted to cure the default in order to prevent foreclosure.

Judge(s):

Tester, Bailey, and Finkle (Per Curiam)

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