Mendaros v. JPMorgan Chase Bank, N.A.
- Citation:
- Maritess Tamondong Mendaros v. JPMorgan Chase Bank, N.A. (In re Mendaros), BAP No. NC-12-1322-JuPaD (9th Cir. B.A.P. Oct. 2, 2013) (unpublished)
- Tag(s):
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- Ruling:
- The Bankruptcy Appellate Panel of the Ninth Circuit affirmed the Bankruptcy Court's order annulling the automatic stay and granting appellee JPMorgan Chase Bank's motion to validate a postpetition foreclosure sale of the debtor's property.
- Procedural context:
- A foreclosure sale of the debtor's property happened on the same day, but hours after, the debtor filed a Chapter 13 bankruptcy petition. The bankruptcy court granted JPMorgan Chase's motion to validate the foreclosure sale and annulled the automatic stay retroactively to the petition date. The bankruptcy court balanced the equities and found that "cause" existed to annul the automatic stay under Section 362(d) of the Bankruptcy Code. The bankruptcy court found that the debtor engaged in unreasonable or inequitable conduct to delay or hinder JPMorgan Chase by the debtor's, and her co-tenant in interest's, multiple bankruptcy filings, the debtor's failure to comply with chapter 13 requirements, and because the debtor's loan was 42 months in default. The debtor appealed. Reviewing the bankruptcy court's decision for an abuse of discretion, the Ninth Circuit B.A.P. affirmed.
- Facts:
- On March 9, 2009, JPMorgan Chase Bank, N.A. ("Chase") recorded a notice of default with respect to real property owned in California by debtor and her joint tenant in interest. The debtor and her joint tenant in interest thereafter filed multiple separate bankruptcies under both Chapter 7 and Chapter 13. In August 2010, Chase obtained relief from the stay to file a notice of sale and proceed with a foreclosure. On September 21, 2010, one day prior to the scheduled foreclosure sale, the debtor filed a chapter 13 petition, which was dismissed on October 7, 2010. On December 19, 2011, the debtor filed another chapter 13 petition, hours before a scheduled foreclosure sale took place. The debtor could not produce evidence that Chase had notice of the bankruptcy filing prior to the time of the sale. Approximately two months later, Chase filed a motion to validate the foreclosure sale, stating that the automatic stay should be annulled because the debtor's bankruptcy was filed in bad faith.
The bankruptcy court, citing In re National Enviromental Waste Corp., 129 F.3d 1052 (9th Cir. 1997), balanced the equities to conclude that cause existed to annul the automatic stay. The bankruptcy court noted the lack of evidence that Chase had notice of the latest bankruptcy filing prior to the sale and found that the debtor's multiple bankruptcy filings, among other things. supported a finding that the debtor engaged in unreasonable or inequitable conduct that showed she was using the bankruptcy process to delay or hinder her creditor.
- Judge(s):
- Jury, Pappas, and Dunn, Bankruptcy Judges
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