In re Brown

Summarized by J. Debbeler , Bricker Graydon LLP
11 years 11 months ago

Citation:

14b0003n.06

Tag(s):

Ruling:

The Sixth Circuit BAP dismissed the appeal by a Chapter 7 Debtor of an order granting relief from the automatic stay ("Order") to a first mortgagee (whose mortgage debt was greatly in excess of the value of the residence property) holding that the Chapter 7 Debtor lacked standing to appeal as the Order affected the disposition of property of the estate and (i) a successful appeal would not lead to a surplus in the estate and (ii) the Order did not affect the Debtor's discharge.

Procedural context:

Chapter 7 Debtor had been fighting attempts by mortgagee to foreclose the mortgage on his residence. Mortgagee filed a motion for relief from stay due to lack of equity by Debtor in the residence. After mortgagee amended motion for relief from stay to properly correct the name of the holder, the Debtor failed to oppose the amended motion for relief from stay. The Chapter 7 Trustee had filed a no asset report. The Debtor and non-filing spouse (pro se) appealed the Order which granted relief from stay (to which no objection had been filed). A Chapter 7 debtor is rarely a "person aggrieved" by an order affecting disposition of property of the estate. The proper person to appeal such an order would be a Chapter 7 Trustee and not a debtor. The two exceptions are if the appeal would either generate a surplus or would affect the debtor's discharge- neither of which applied in this case.

Facts:

Debtor's residence was valued at $131,000 and mortgage debt was $309,750.35. Debtor was discharged. The Chapter 7 Trustee filed a report of no distribution but had not abandoned the property. Mortgagee sought relief from stay but mis-identified the holder of mortgage. Motion was amended and no objection was filed. Debtor and non-filing spouse (both pro se) appealed the order granting relief .

Judge(s):

Joan A. LLoyd (author) with other BAP Judges Emerson and Harrison

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