Title owner out of loop - Posted by John Merchant
Posted by John Merchant on August 02, 2007 at 17:27:46:
Check the BK court file which is public info and can be checked out over the counter and read by anybody, but just know that even if the BK’s mtgs were omitted, those debts are likely still going to be discharged by a Ch.7.
Of course since the 13 is going to be “workout” of his debts and not just a straight discharge, his mtgs and mtgd properties are certainly going to be examined to see what equity he has in them.
But, under BK law, either Ch. 7 or 13, ALL the BK’s debts are included in his filing and he cannot exempt such debts even if he deliberately omits listing them.
I had some little correspondence with Wm Bronchik on this issue a year or so back and as I recall we pretty much agreed that this was/is the law.
And I did some little courthouse BK law briefing and remember learning that in a BK case or two in which I had some interest either as a C’or or possible buyer of such, that even those debts that had most likely been deliberately omitted by the BK, WERE included and discharged by the BK Discharge.
I remember one odd case where the BK (who’d been a bonded Securities Rep) had been found guilty in a civil lawsuit of committing some fraud or other and thus violating a surety bond on himself, thus the bonding company’s liability on the bond…although he intentionally omitted listing that debt and thus did NOT notify the Bonding Co, the law was it WAS also discharged so he was able to walk out of BK court wih ALL debts discharged.
If that bonding co. had known about the BK’s filing or that he intended to get a discharge from their J against him, they would have fought that to the death…but not knowing, they didn’t even get the chance to contest it.
If you do find that the BK has omitted listing his mortgaged property, then your telling the BK Trustee about same will get that BK petitioner jerked before the T’ee on a contempt action and make the T’ee focus on those properties which might really work for you.
Also just understand in the typical run-of-the-mill BK filing today, the title owner/BK petitioner is the least important person in the courtroom and his opinions or alleged intentions carry no weight. He’s sure not going to be one who decides if or how to sell his properties or pay his debts.