- Case Type:
- Case Status:
- 16-1415 (4th Circuit, Dec 09,2016) Not Published
The Fourth Circuit Court of Appeals upheld the bankruptcy court's dismissal of the debtor's adversary proceeding on the grounds that because the claims asserted in the adversary proceeding arose from a prepetition contract, they were property of the estate and the debtor lacked standing to pursue the action. Alternately, the complaint failed to state a claim under Rule 12(b)(6) because, although the defendant bank was not the owner of the debtor's promissory note, it was a holder in due course with standing to enforce the promissory note against the debtor
- Procedural context:
The bankruptcy court issued proposed findings of fact and conclusions of law granting the defendant's motion to dismiss the debtor's adversary proceeding. The debtor appealed the district court's order adopting the bankruptcy court's findings of fact and conclusions of law. Without discussion or oral argument the Fourth Circuit Court of Appeals upheld the district court's order in an unpublished, per curiam decision.
Debtor entered into a loan agreement prepetition and executed a negotiable promissory note and security agreement giving the loan originator a lien on real property. The loan originator sold the note and loan interests to a third party bank. After the debtor filed her chapter 7, the holder of the note was granted stay relief. The debtor, acting pro se, filed an adversary proceeding asserting various claims under federal and state consumer protection statutes. In addition, the debtor asserted that the note holder had no standing to enforce the note as it was not the note owner. The bankruptcy court granted the note holder's motion to dismiss for lack of standing on the grounds that the claims asserted in the adversary proceeding arose from a prepetition contract and, because they were property of the estate, only the chapter 7 trustee had standing to pursue such claims.
- Before Motz, Wynn, and Floyd, Circuit Judges
3044 in the system
2 Being Processed