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Auslander v. Murray

Summarizing by Timothy McKeon

Kaye v. Blue Bell Creameries, Inc.

Summarizing by David Bury

Bray v. U.S. Bank National Assoc.

Case Type:
Consumer
Case Status:
Affirmed
Citation:
CC-17-1373-SKuF (9th Circuit, Aug 07,2018) Not Published
Tag(s):
Ruling:
Bankruptcy court did not commit a reversible error when it annulled the automatic stay nunc pro tunc to validate a postpetition nonjudicial foreclosure sale of real property where the debtor was part of a “fractional interest” scheme. Debtor lacked standing to appeal order reopening the case because the order was nonjurisdictional and did not have “independent legal significance.”
Procedural context:
Appeal to the Ninth Circuit Bankruptcy Appellate Panel from judgment of bankruptcy court granting motions to reopen case and to annul automatic stay.
Facts:
A chapter 7 involuntary petition was commenced against the debtor in June 2017. A secured creditor objected arguing the petition was filed in bad faith with for the purpose of hindering, delaying, and defrauding creditors. Debtor was allegedly part of a fractional interest scheme, where a borrower facing foreclosure transfers all or part of her ownership interest in real property to potential debtors. The Court dismissed the case and U.S. Bank moved to reopen a few months later seeking annulment of stay to validate a postpetition foreclosure sale. Bank provided evidence that in 2006, Mr. Horton borrowed $860,000 to purchase real property. After default, foreclosure sale was delayed due to multiple bankruptcies and transfers of fractional interests to various parties including the debtor, who received a 10% interest right before the involuntary petition was filed. Bankruptcy court granted the Bank’s motions to reopen and annual stay, and found that the involuntary petition was filed in bad faith.
Judge(s):
SPRAKER, KURTZ, and FARIS

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