Central District Consumer Bankruptcy Attorney's Association

Perhaps you will find the attached bankruptcy court opinion persuasive.The following is just one part of the long opinion which resulted inRule 9011 sanctions against the attorney who singed the petition.
A petition filed as a litigation tactic where the debtor had only one creditor, its available assets could be liquidated outside bankruptcy, and where the bankruptcy filing delayed completion of nonbankruptcy litigation was sanctionable "[g]iven the timing of the bankruptcy, its delay of state court action, and absence of anything to reorganize." St. Paul Self Storage Ltd. Partnership v. Port Authority of City of St. Paul (In re St. Paul Self Storage Ltd. Partnership), 185 B.R. 580, 584 (1995). Peter M. Lively, J.D., M.B.A.
Law Office of Peter M. Lively * Personal Financial Law Center I
11268 Washington Boulevard, Suite 203, Culver City, California 90230-4647
Telephone: (310) 391-2400* Toll Free: (800) 307-3328 * Fax: (310) 391-2462
On Friday, April 24, 2015 8:18 AM, "sam@southbaybk.com [cdcbaa]" wrote:
Thanks for sharing your opinion. I don't agree with your conclusion that these cases violate rule 9011. But if you think they do, by all mea
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Not havinganyone complain yetis not a license to lest the limits ofrule 9011.
As an officer of the court, youshould reconsider filing cases that aren't intended to proceed to plan confirmation and are merely delaying tactics to "cause unnecessary delay or needlessly increase the costs of litigation".
Law Office of Peter M. Lively * Personal Financial Law Center I
11268 Washington Boulevard, Suite 203, Culver City, California 90230-4647
Telephone: (310) 391-2400* Toll Free: (800) 307-3328 * Fax: (310) 391-2462
On Thursday, April 23, 2015 1:50 PM, "sam@southbaybk.com [cdcbaa]" wrote:
I structure it as a normal 13 catching up on mortgage arrears. Then I set the first 3 months payments artificially low. I don't put anything in the plan about selling. However, we then typically advise the trustee about the possible short sale. I really haven't had anyone complain, a
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Usingchapter 13solely to defeat a state court proceedingmakes it a bad faith filing. In reMitchell, 357 B.R. 142, 154 (Bankr. C.D. Cal. 2006)
Those types of filing skew the statistics regarding chapter 13 cases andI strongly suggest that members of cdcbaa not to participate in such cases. Peter M. Lively, J.D., M.B.A.
Law Office of Peter M. Lively * Personal Financial Law Center I
11268 Washington Boulevard, Suite 203, Culver City, California 90230-4647
Telephone: (310) 391-2400* Toll Free: (800) 307-3328 * Fax: (310) 391-2462
On Thursday, April 23, 2015 10:31 AM, "Giovanni Orantes go@gobklaw.com [cdcbaa]" wrote:
You can draft a Chapter 13 plan that pays creditors out of sale proceeds and get it confirmed if nobody objects (after providing them strictly compliant notice) or if the affected parties agree. I just confirmed one like that a week or two ago. To be fair, I did threaten to convert to 11 by actually filing a motion to convert when a second attorney showed up and was able to enunciate the magic words (e.g., you cannot have a non-consensual balloon payment in 13s anymore). In general, however, I don't like filing 13s for short-sales because they usually are being done for the benefit of the real estate broker only (though they usually don't mind funding the 13s in my experience), but I can see the benefit to a debtor if a junior lienholder agrees to full and final satisfaction of its claim through the short-sale. Hopefully, the Debtor will enjoy the protection of some law to avoid the tax implications, which is something I expressly disavow unless separately engaged to ensure it exists.
Giovanni Orantes, Esq.*Orantes Law Firm, P.C.
3435 Wilshire Blvd. Suite 2920
Los Angeles, CA 90010
Tel: (213) 389-4362
Fax: (877) 789-5776
e-mail: go@gobklaw.com
website: www.gobklaw.com
*Certified Bankruptcy Specialist, State Bar of California, Board of Legal Specialization
*Board Certified - Business Bankruptcy Law - American Board of Certification
*Board Certified - Consumer Bankruptcy Law - American Board of Certification
Commercial LitigationEstate PlanningOutside General Counsel
WE ARE A "DEBT RELIEF AGENCY" AS DEFINED BY FEDERAL LAW.
SERVING BAKERSFIELD, LOS ANGELES, ORANGE COUNTY, RIVERSIDE, SAN BERNARDINO AND SANTA BARBARA AND THE WORLD FOR CHAPTER 11 AND 15 CASES.

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You can draft a Chapter 13 plan that pays creditors out of sale proceeds
and get it confirmed if nobody objects (after providing them strictly
compliant notice) or if the affected parties agree. I just confirmed one
like that a week or two ago. To be fair, I did threaten to convert to 11 by
actually filing a motion to convert when a second attorney showed up and
was able to enunciate the magic words (e.g., you cannot have a
non-consensual balloon payment in 13s anymore). In general, however, I
don't like filing 13s for short-sales because they usually are being done
for the benefit of the real estate broker only (though they usually don't
mind funding the 13s in my experience), but I can see the benefit to a
debtor if a junior lienholder agrees to full and final satisfaction of its
claim through the short-sale. Hopefully, the Debtor will enjoy the
protection of some law to avoid the tax implications, which is something I
expressly disavow unless separately engaged to ensure it exists.
Giovanni Orantes, Esq.*
Orantes Law Firm, P.C.
3435 Wilshire Blvd. Suite 2920
Los Angeles, CA 90010
Tel: (213) 389-4362
Fax: (877) 789-5776
e-mail: go@gobklaw.com
website: www.gobklaw.com
**Certified Bankruptcy Specialist, State Bar of California, Board of Legal
Specialization*
*Board Certified - Business Bankruptcy Law - American Board of Certification
*Board Certified - Consumer Bankruptcy Law - American Board of Certification
Commercial Litigation
Estate Planning
Outside General Counsel
WE ARE A "DEBT RELIEF AGENCY" AS DEFINED BY FEDERAL LAW.
SERVING BAKERSFIELD, LOS ANGELES, ORANGE COUNTY, RIVERSIDE, SAN BERNARDINO
AND SANTA BARBARA AND THE WORLD FOR CHAPTER 11 AND 15 CASES.
You can draft a Chapter 13 plan that pays creditors out of sale proceeds and get it confirmed if nobody objects (after providing them strictly compliant notice) or if the affected parties agree. I just confirmed one like that a week or two ago. To be fair, I did threaten to convert to 11 by actually filing a motion to convert when a second attorney showed up and was able to enunciate the magic words (e.g., you cannot have a non-consensual balloon payment in 13s anymore). In general, however, I don't like filing 13s for short-sales because they usually are being done for the benefit of the real estate broker only (though they usually don't mind funding the 13s in my experience), but I can see the benefit to a debtor if a junior lienholder agrees to full and final satisfaction of its claim through the short-sale. Hopefully, the Debtor will enjoy the protection of some law to avoid the tax implications, which is something I expressly disavow unless separately engaged to ensure it exists.--
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Sam,
How do you phrase the plan provisions in that scenario?
On Apr 23, 2015 8:49 AM, "sam@southbaybk.com [cdcbaa]" wrote:
>
>
> I've done it many times on referrals from realtors. We know what their
> motivation is, but the primary motivation from the debtor's standpoint is
> that we can buy them a few more months in the home and they usually get
> relocation money at the conclusion of the sale. I have actually even
> combined the 13 with a 522 judgment lien avoidance to further facilitate
> the sale. A big problem is that the mortgage companies sometime balk at the
> bankruptcy filing, and often will make the debtor start the short sale
> process over again. So these are my tips: Do a complete bankruptcy filing
> so that you can buy as much time in 13 as possible; collect a
> substantial fee in advance; and make sure the Debtor is using a competent
> and knowledgeable realtor.
>
>
Sam,
How do you phrase the plan provisions in that scenario?
On Apr 23, 2015 8:49 AM, "sam@southbaybk.com [cdcbaa]" <cdcbaa@yahoogroups.com> wrote:
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Hale:
All cases use 362 to game some time. The question of when this is an abuse is answered differently by creditor and debtor lawyers. Our job is to use the auto stay to protect our clients.
I lean toward protecting debtors, not toward the creditors variable claim of abuse.
d
Dennis McGoldrick, 350 S. Crenshaw Bl., #A207B, Torrance, Ca 90503 310-328-1001-voice
> On Apr 22, 2015, at 3:14 PM, 'Hale Andrew Antico' bk.lawyer@gmail.com [cdcbaa] wrote:
>
> Legal answer: Reasonable people can disagree, but cases intended to (ab)use the automatic stay to "buy some time" strike me as bad faith.
>
> Practical answer: Why not just let the property go via foreclosure? Credit will be trashed by the bankruptcy anyway, and short sales could result in tax liability.
>
> Hale
>
> Sent: Wednesday, April 22, 2015 11:33 AM
> To: Cdcbaa Yahoo Listserv
> Subject: [cdcbaa] filing ch 13 for short sale
>
>
> Have any you have had any luck filing a chapter 13 to give debtors time to pursue a short sale, then dismissing the case?
>
>
> --
> Kirk Brennan
>
> CONFIDENTIALITY NOTICE: This e-mail and any attachments are for the exclusive and confidential use of the intended recipient. If you are not the intended recipient, please do not read, distribute or take action in reliance on this message. If you have received this message in error, please notify us immediately by return e-mail and promptly delete this message and its attachments from your computer system. We do not waive attorney-client or work product privilege by the transmission of this message.
> TAX ADVICE NOTICE: Tax advice, if any, contained in this e-mail does not constitute a "reliance opinion" as defined in IRS Circular 230 and may not be used to establish reasonable reliance on the opinion of counsel for the purpose of avoiding the penalty imposed by Section 6662A of the Internal Revenue Code. The firm provides reliance opinions only in formal opinion letters containing the signature of a director.
>
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Ch 13 requires a plan and payments in 30 days. It is not a structure you can use for a short sale. You can use chapter 11 for this, but you have to find something else to reorganize. (of course, if you get judge Z, and have a year to face a ch 13 confo hearing, maybe you could use ch 13 to accommodate a short sale.)
Why would you like to try this?
This answer is theoretical only. I would not file an 11 to accommodate a short sale. The benefit of a short sale will be out weighted by the negative effect of a ch 11, or ch 13.
d
Dennis McGoldrick, 350 S. Crenshaw Bl., #A207B, Torrance, Ca 90503 310-328-1001-voice
> On Apr 22, 2015, at 11:33 AM, Kirk Brennan kirkinhermosa@gmail.com [cdcbaa] wrote:
>
> Have any you have had any luck filing a chapter 13 to give debtors time to pursue a short sale, then dismissing the case?
>
>
> --
> Kirk Brennan
>
> CONFIDENTIALITY NOTICE: This e-mail and any attachments are for the exclusive and confidential use of the intended recipient. If you are not the intended recipient, please do not read, distribute or take action in reliance on this message. If you have received this message in error, please notify us immediately by return e-mail and promptly delete this message and its attachments from your computer system. We do not waive attorney-client or work product privilege by the transmission of this message.
> TAX ADVICE NOTICE: Tax advice, if any, contained in this e-mail does not constitute a "reliance opinion" as defined in IRS Circular 230 and may not be used to establish reasonable reliance on the opinion of counsel for the purpose of avoiding the penalty imposed by Section 6662A of the Internal Revenue Code. The firm provides reliance opinions only in formal opinion letters containing the signature of a director.
>
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I have seen this done many times. I have no opinion as to its legitimacy.
There are good reasons for going the short sale route including making it
so that the second trust holder gets something. Particularly good if the
2nd is a secured tax debt.
Sincerely,
*Michael Avanesian, Esq. *
Simon Resnik Hayes, LLP
15233 Ventura Blvd., Suite 250
Sherman Oaks, CA 91403
Tel: 818.783.6251 | Cel: 818.817.1725
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On Wed, Apr 22, 2015 at 3:14 PM, 'Hale Andrew Antico' bk.lawyer@gmail.com
[cdcbaa] wrote:
>
>
> Legal answer: Reasonable people can disagree, but cases intended to
> (ab)use the automatic stay to "buy some time" strike me as bad faith.
>
> Practical answer: Why not just let the property go via foreclosure? Credit
> will be trashed by the bankruptcy anyway, and short sales could result in
> tax liability.
>
> Hale
>
> ------------------------------
> *From:* cdcbaa@yahoogroups.com [mailto:cdcbaa@yahoogroups.com]
> *Sent:* Wednesday, April 22, 2015 11:33 AM
> *To:* Cdcbaa Yahoo Listserv
> *Subject:* [cdcbaa] filing ch 13 for short sale
>
>
>
> Have any you have had any luck filing a chapter 13 to give debtors time
> to pursue a short sale, then dismissing the case?
>
>
> --
> Kirk Brennan
>
> CONFIDENTIALITY NOTICE: This e-mail and any attachments are for the
> exclusive and confidential use of the intended recipient. If you are not
> the intended recipient, please do not read, distribute or take action in
> reliance on this message. If you have received this message in error,
> please notify us immediately by return e-mail and promptly delete this
> message and its attachments from your computer system. We do not waive
> attorney-client or work product privilege by the transmission of this
> message.
> TAX ADVICE NOTICE: Tax advice, if any, contained in this e-mail does not
> constitute a "reliance opinion" as defined in IRS Circular 230 and may not
> be used to establish reasonable reliance on the opinion of counsel for the
> purpose of avoiding the penalty imposed by Section 6662A of the Internal
> Revenue Code. The firm provides reliance opinions only in formal opinion
> letters containing the signature of a director.
>
>
>
I have seen this done many times. I have no opinion as to its legitimacy. There are good reasons for going the short sale route including making it so that the second trust holder gets something. Particularly good if the 2nd is a secured tax debt.Sincerely,Michael Avanesian, Esq.Simon Resnik Hayes, LLP15233 Ventura Blvd., Suite 250Sherman Oaks, CA 91403Tel: 818.783.6251 | Cel: 818.817.1725
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Legal answer: Reasonable people can disagree, but cases intended to (ab)use
the automatic stay to "buy some time" strike me as bad faith.

Practical answer: Why not just let the property go via foreclosure? Credit
will be trashed by the bankruptcy anyway, and short sales could result in
tax liability.

Hale
_____

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Have any you have had any luck filing a chapter 13 to give debtors time to
pursue a short sale, then dismissing the case?
Kirk Brennan
CONFIDENTIALITY NOTICE: This e-mail and any attachments are for the
exclusive and confidential use of the intended recipient. If you are not
the intended recipient, please do not read, distribute or take action in
reliance on this message. If you have received this message in error,
please notify us immediately by return e-mail and promptly delete this
message and its attachments from your computer system. We do not waive
attorney-client or work product privilege by the transmission of this
message.
TAX ADVICE NOTICE: Tax advice, if any, contained in this e-mail does not
constitute a "reliance opinion" as defined in IRS Circular 230 and may not
be used to establish reasonable reliance on the opinion of counsel for the
purpose of avoiding the penalty imposed by Section 6662A of the Internal
Revenue Code. The firm provides reliance opinions only in formal opinion
letters containing the signature of a director.
Have any you have had any luck filing a chapter 13 to give debtors time to pursue a short sale, then dismissing the case?-- Kirk BrennanCONFIDENTIALITY NOTICE: This e-mail and any attachments are for the exclusive and confidential use of the intended recipient. If you are not the intended recipient, please do not read, distribute or take action in reliance on this message. If you have received this message in error, please notify us immediately by return e-mail and promptly delete this message and its attachments from your computer system. We do not waive attorney-client or work product privilege by the transmission of this message. TAX ADVICE NOTICE: Tax advice, if any, contained in this e-mail does not constitute a "reliance opinion" as defined in IRS Circular 230 and may not be used to establish reasonable reliance on the opinion of counsel for the purpose of avoiding the penalty imposed by Section 6662A of the Internal Revenue Code. The firm provides reliance opinions only in formal opinion letters containing the signature of a director.

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