In Re Steinberg
447 B.R. 355
Bankr. S.D. Florida2011Background
- Amended order granted 1st United Bank's motion to compel the Debtors to reaffirm, redeem, surrender, or defer discharge pending resolution.
- Debtors filed a Chapter 7 petition on October 4, 2010; initial 341 meeting was set for November 10, 2010.
- Property at 4289 N.W. 63rd Place, Boca Raton, valued at $425,000, listed as exempt; secured claim by Creditor of $90,223.69 plus a second mortgage for Chase of $231,555.66.
- Debtors' Schedule D indicates mortgage debt totaling $321,779.35 and asserts equity in the Property.
- Debtors intend to retain the Property and continue payments without reaffirming; Chase did not join the motion or appear at the hearing.
- Court addresses whether Taylor and BAPCPA affect 521(a)(2) and explores 524(j) in the context of discharge and post-discharge payments.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| May a Chapter 7 debtor retain secured property without redeeming or reaffirming? | Steinbergs argue Taylor permits retention while continuing payments without reaffirmation. | Court adopts Taylor’s three-option framework (surrender, redeem, reaffirm) and rejects the retain-without-action view. | Taylor remains controlling; debtor must surrender, redeem, or reaffirm. |
| Do BAPCPA changes and 524(j) affect Taylor's holding on 521(a)(2)? | Debtors contend BAPCPA abrogates Taylor; Collier commentary suggests limited effect via 524(j). | Court aligns with Linderman and Habersham, keeping Taylor intact and recognizing 524(j) as a post-discharge option for creditors. | Taylor remains the law; 524(j) provides creditor alternatives after discharge, not a requirement to reaffirm or redeem. |
| What is the appropriate remedy and timing if the debtor fails to perform under the statement of intention? | Creditor seeks relief from the stay to pursue in rem rights if the Debtors do not comply. | Court requires amended intention and action within 14 days; discharge deferment pending compliance. | Motion granted; conditions set for amended intention, potential stay relief, and discharge deferment. |
Key Cases Cited
- In re Taylor, 3 F.3d 1512 (11th Cir. 1993) (debtor must choose among surrender, redeem, or reaffirm)
- In re Linderman, 435 B.R. 715 (Bankr. M.D. Fla. 2009) (BAPCPA amendments; Taylor remains the law in this circuit)
- Habersham Bank v. Harris, 421 B.R. 597 (Bankr.S.D. Ga. 2010) (BAPCPA impact; Taylor remains controlling in this circuit)