In a 5-3 decision handed down on May 15, the Supreme Court of the United States held that the federal Fair Debt Collection Practices Act (FDCPA) is not violated when a debt collector files a proof of claim for a debt subject to the bar of an expired limitations period. The decision:
The U.S. Court of Appeals for the Ninth Circuit recently affirmed the Bankruptcy Appellate Panel’s determination that a creditor’s pre-bankruptcy, non-recourse lien on two debtors’ real property is extinguished following a non-judicial foreclosure sale.
A copy of the opinion in In re: Salamon is available at: Link to Opinion.
The U.S. Court of Appeals for the Eleventh Circuit recently affirmed the dismissal of a mortgage loan borrower’s federal Fair Debt Collection Practices Act and related state law claims because the defendant mortgagee was not a “debt collector” as defined by the FDCPA.
In so ruling, the Court also rejected the borrower’s allegations that the monthly statements the mortgagee sent to the borrower after her bankruptcy discharge were impermissible implied assertions of a right to collect against her personally.
The U.S. Court of Appeals for the Ninth Circuit recently reversed a ruling that disallowed an unsecured creditor’s claim filed in a California bankruptcy court based on the forum state’s statute of limitations.
In so ruling, the Ninth Circuit held that, although courts typically apply the forum state’s statute of limitations if the contract is silent on the issue, exceptional circumstances warranted the application of a longer statute of limitations here, because the creditor had no option but to enforce its claim in the forum based on where the bankruptcy petition was filed.
The U.S. Court of Appeals for the Eleventh Circuit recently held that a court cannot extinguish a secured creditor’s state-law security interests for failure to file a proof of claim during the administration of an equity receivership over entities involved in a Ponzi scheme.
A copy of the opinion in Securities and Exchange Commission v. Wells Fargo Bank is available at: Link to Opinion.
The U.S. Court of Appeals for the Ninth Circuit recently reversed the dismissal of a Fair Debt Collection Practices Act claim arising out of a non-judicial foreclosure. The Ninth Circuit ruled that section 1692f(6) of the FDCPA applies to non-judicial foreclosure activity.
A copy of the opinion in Dale Dowers v. Nationstar Mortgage, LLC is available at: Link to Opinion.
The Supreme Court of Indiana recently confirmed a mortgagee’s ability to seek an in rem judgment against property for which there was an outstanding lien balance after the borrowers obtained a discharge of their Chapter 7 bankruptcy.
In so ruling, the Court distinguished the difference between an in rem and in personam judgment, and rejected the borrowers’ unsupported argument that the debt was paid in full by the time the mortgagee initiated foreclosure proceedings against the borrowers.
In its judgment of 9 December 2016, the Supreme Court ruled that once the debtor of a receivable has been notified of a right of pledge over that receivable, the holder of the right of pledge not only has the power to collect the amount due under the receivable but also is entitled to file for the debtor's bankruptcy if the debtor fails to pay this amount.
The qualification of a right as a 'right in rem' (zakelijk recht), within the meaning of Article 5 of Regulation No 1346/2000 of 29 May 2000 on insolvency proceedings (the "Regulation") must be determined according to the law of the place where the asset concerned is situated and the right in rem must satisfy certain criteria set out in Article 5(2) of the Regulation.
The U.S. Court of Appeals for the Fifth Circuit recently held that the collection of garnished wages earned during the 90 days prior to the filing of a bankruptcy petition is an avoidable transfer, even if the garnishment was served before the 90-day preference period.
The ruling creates a potential split with the Second, Seventh, and Eleventh Circuits, with the Fifth Circuit joining with the Sixth Circuit on the issue.