SCHELIN & WATSON V. MALLOY
- Summarized by Danielle Scott , U.S. Bankruptcy Court, Southern District of West Virginia
- 2 months 3 days ago
- Case Type:
- Consumer
- Case Status:
- Affirmed in part and Reversed in part
- Citation:
- 24-2271 (4th Circuit, Nov 25,2025) Not Published
- Tag(s):
-
- Ruling:
- The Fourth Circuit affirmed the district court's order to uphold the modification of the automatic stay, and dismissed the portion of the order where the bankruptcy court decided to abstain and remand the case back to state court pursuant to 28 U.S.C. 1334(c),(d). The Court determined that it lacked jurisdiction to review the decision to abstain.
- Procedural context:
- The Debtor/Appellant, Karl Linard Malloy, appealed the bankruptcy court's order to modify the automatic stay to allow a state court action to proceed to final judgment. The state court action involved a real estate contract dispute that the Debtor had removed to the bankruptcy court to be addressed in his Chapter 13 case. The bankruptcy court abstained and remanded the case back to state court pursuant to 28 U.S.C. 1334(c)(2). The Debtor appealed, and the district court affirmed the bankruptcy court's order. The Debtor contends that the bankruptcy court erred by modifying the automatic stay and determining that abstention was mandatory.
- Facts:
- The Debtor/Appellant, Karl Linard Malloy, appeared pro-se and appealed the decision from the district court that affirmed the bankruptcy court's order. The underlying dispute was a state court action involving a real estate contract. The Debtor removed this state court action to the bankruptcy court to be addressed in his Chapter 13 bankruptcy. The bankruptcy court determined it must abstain under 28 U.S.C. 1334(c)(2) and remanded the case back to state court. The bankruptcy court also modified the automatic stay to allow the state court action to proceed with the condition that any judgment cannot be executed without seeking relief from the bankruptcy court.
- Judge(s):
- Wynn, Richardson, and Keenan
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