In re Leeds

589 B.R. 186
CourtUnited States Bankruptcy Court, D. Nevada
DecidedAugust 1, 2018
DocketCase No.: 11-19593-MKN
StatusPublished
Cited by4 cases

This text of 589 B.R. 186 (In re Leeds) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, D. Nevada primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Leeds, 589 B.R. 186 (Nev. 2018).

Opinion

Honorable Mike K. Nakagawa, United States Bankruptcy Judge

On June 27, 2018, the court heard argument regarding SFR Investment Pool 1, LLC'S Motion to Retroactively Annul the Automatic Stay ("Annulment Motion").2

*190The appearances of counsel were noted on the record. After arguments were presented, the matter was taken under submission.

BACKGROUND

On June 17, 2011, a voluntary Chapter 7 bankruptcy petition was filed, in pro se , by Myong Leeds ("Leeds"). The case was assigned to David Rosenberg ("Rosenberg") as Chapter 7 trustee. (ECF No. 2).3

On July 5, 2011, Leeds filed her schedules of assets and liabilities ("Schedules"), along with her statement of financial affairs ("SOFA"). (ECF No. 11). On her real property Schedule "A," Leeds disclosed her interest in a residence located at 8254 Bowman Woods Circle, Las Vegas, Nevada ("Leeds Residence"). Leeds stated under penalty of perjury that the value of her residence was $307,554. On her secured creditor Schedule "D," previously filed with her petition, Leeds listed BAC Home Loans as having a claim in the amount of $610,000 secured by the Leeds Residence.

On July 21, 2011, Rosenberg filed an application to employ the law firm of Howard Kim & Associates ("Kim Firm") as special counsel on behalf of the estate. (ECF No. 13).

On July 29, 2011, attorney Seth D. Ballstaedt ("Ballstaedt") filed a notice of appearance as bankruptcy counsel for Leeds. (ECF No. 18).

On August 15, 2011, an order was entered approving the employment of the Kim Firm as special counsel to the estate. (ECF No. 20).

On September 13, 2011, Ballstaedt filed the Debtor's amendments to her Schedules and SOFA, including a Disclosure of Compensation of Attorney for Debtor(s) - Amended, required under FRBP 2016(b) ("2016 Statement"). (ECF Nos. 25 and 26).

On September 20, 2011, the court entered an order granting Leeds her Chapter 7 discharge. (ECF No. 30). As a result of her discharge, the automatic stay terminated as to Leeds under Section 362(c)(2)(C), but remained in effect as to the Leeds Residence.

On February 29, 2012, an order was entered approving the settlement of a preference action that had been commenced by the Kim Firm on behalf of the bankruptcy estate. (ECF No. 40).

On July 10, 2012, Rosenberg filed a final report and proposed distribution ("TFR"). (ECF No. 54). The TFR stated that the Leeds Residence would be abandoned pursuant to Section 554(c).

On October 15, 2012, an order was entered approving the TFR. (ECF No. 62).

On May 8, 2013, the Leeds Residence was purchased for $42,000 by SFR Investments Pool 1, LLC ("SFR") at a foreclosure sale conducted on behalf of Butler Estates Homeowners Association ("Butler HOA" or "HOA") through its foreclosure *191trustee, Alessi & Koenig, LLC ("A & K"). See Exhibit "F" to Declaration of Jamie Combs in Support of Bank of America N.A.'s Opposition to SFR Investments Pool 1, LLC's Motion to Retroactively Annul the Automatic Stay ("Combs Declaration").4 (ECF No. 107).

On September 10, 2013, A & K filed a complaint in State Court commencing the Interpleader Action. See Exhibit "1" to Notice of Removal, filed March 8, 2017, in Alessi & Koenig Bankruptcy ("Removal Notice"). A & K was in possession of excess funds from the foreclosure sale and sought a determination of claims to the funds.

On August 1, 2013, Rosenberg filed a final distribution report ("TDR"). (ECF No. 65). The TDR attested that the Leeds Residence was fully administered and that no funds were received by the bankruptcy estate.

On January 29, 2014, a final decree was entered closing the Chapter 7 proceeding and discharging Rosenberg from any further duties. (ECF No. 72). As a result of the case closure, the automatic stay terminated as to the Leeds Residence pursuant to Section 362(c)(2)(A), and any interest of the bankruptcy estate in the Leeds Residence was abandoned under Section 554(c).

On December 13, 2016, A & K commenced the Alessi & Koenig Bankruptcy proceeding.

On March 8, 2018, Bank of America, N.A. ("BOA") filed the Removal Notice indicating that the Interpleader Action was removed from the State Court to the bankruptcy court pursuant to 28 U.S.C. § 1452(a). (A & K ECF No. 187). Upon removal, the Interpleader Action was assigned Adversary Proceeding No. 17-01038-ABL.

On August 24, 2017, the bankruptcy court entered an order remanding the Interpleader Action to the State Court. (A & K v. Leeds AECF No. 22).

On April 16, 2018, the State Court in the Interpleader Action entered the default of the Debtor, as well as her non-debtor spouse, Marc Leeds.

On May 3, 2018, an order was entered granting the motion of SFR to reopen the Leeds proceeding ("Reopening Order"). (ECF No. 75). The purpose of the motion was for SFR to seek a further court order annulling the automatic stay that arose under Section 362(a) when Leeds filed her Chapter 7 bankruptcy petition.

On May 9, 2018, notice of entry of the Reopening Order was served by SFR ("Reopening Notice"). (ECF No. 76).

On May 10, 2018, SFR filed the instant Annulment Motion, accompanied by the supporting Declaration of Christopher J. Hardin ("Hardin Declaration"). (ECF Nos. 77 and 79). SFR also filed a notice of hearing that the Annulment Motion would be heard on June 13, 2018, accompanied by a Certificate of Service ("COS"). (ECF Nos. 80 and 81).

On June 6, 2018, an order was entered granting BOA's request to continue the hearing to June 27, 2018. (ECF No. 102).

On June 13, 2018, BOA filed an opposition to the Annulment Motion ("BOA Opposition"), accompanied by the Combs Declaration. (ECF Nos. 106 and 107).

On June 18, 2018, the State Court in the Interpleader Action entered an order granting summary judgment in favor of BOA ("BOA SJ Order"). See Exhibit "A"

*192to Declaration of Jamie K. Combs, Esq. Regarding Clark County District Court's Entry of Order Granting Bank of America, N.A.'s Motion for Summary Judgment ("Supplemental Combs Declaration"). (ECF No. 110). The State Court concluded that BOA had standing to challenge the validity of the Butler HOA foreclosure sale as a violation of the automatic stay, see BOA SJ Order at ¶ 12, that a foreclosure sale conducted in violation of the automatic stay is void ab initio, see id. at ¶ 13, that a void foreclosure sale does not extinguish a deed of trust, see id.

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Cite This Page — Counsel Stack

Bluebook (online)
589 B.R. 186, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-leeds-nvb-2018.