Juan Carlos Vega and Myrna A Vega
15-34014
Bankr. S.D. Tex.Jul 10, 2017Background
- Debtors Juan C. Vega and Myrna A. Vega filed Chapter 13 on July 30, 2015; Lincoln Automotive Financial Services (Lincoln AFS) filed an original proof of claim for a leased 2014 Lincoln M.KZ on August 6, 2015.
- Original claim listed remaining payments and a $64.42 fee but included no account statements or documentation required by Fed. R. Bankr. P. 3001(c). Debtors did not initially object.
- Debtors surrendered the vehicle on October 16, 2015; the vehicle was reconditioned and sold at auction on November 18, 2015.
- Lincoln AFS filed an amended proof of claim (Claim No. 1-3) on December 11, 2015 — three days after the bar date — asserting a deficiency of $21,682.19, including $4,010.79 in fees; again no supporting account statements were attached.
- Debtors objected, arguing (1) noncompliance with Rule 3001(c), (2) surrender satisfied the debt or the sale was commercially unreasonable, (3) the amended claim was untimely and did not relate back, and (4) Lincoln AFS lacked standing to enforce the debt. Debtors also sought attorney’s fees under Rule 3001(c)(2)(D)(ii).
Issues
| Issue | Debtors' Argument | Lincoln AFS's Argument | Held |
|---|---|---|---|
| Compliance with Rule 3001(c)(2)(A) | Claim should be disallowed or evidence precluded because required supporting statements were not attached | Omitted detail was harmless; Lincoln later provided detailed records in support of the amended claim | Court: omission violated Rule 3001(c) so prima facie effect lost, but lapse was harmless; Lincoln not precluded from using information |
| Whether surrender satisfied the debt / commercial reasonableness of sale | Surrender satisfied the obligation or sale was commercially unreasonable, so no deficiency | Sale proceeds determine deficiency; Lincoln calculated deficiency from account balance minus sale proceeds plus fees | Court: surrender does not automatically satisfy debt; sale proceeds determine deficiency; Debtors produced no evidence of unreasonableness; claim valid |
| Timeliness / relation back of amended proof of claim | Amended claim filed after bar date and does not relate back; should be disallowed | Amendment corrected claim to reflect changed circumstances (vehicle surrendered) and does not assert a new ground of liability | Court: amendment permitted as it arose from same lease and reflected changed circumstances; not a new liability; amendment valid |
| Standing / ownership of claim | Lincoln cannot prove ownership of the debt and thus lacks standing | Both original and amended claims arise from same lease; Lincoln has ownership/standing and produced transaction records | Court: Lincoln has standing and met its burden to prove ownership and amounts by preponderance |
Key Cases Cited
- In re Gilbreath, 409 B.R. 84 (S.D. Tex. 2009) (failure to attach supporting documents violates Rule 3001(c)).
- In re Hight, 393 B.R. 484 (S.D. Tex. 2008) (Rule 3001(c) document requirements and consequences).
- In re Kolstad, 928 F.2d 171 (5th Cir. 1991) (liberal allowance of amendments to timely-filed proofs of claim).
- In re International Horizons, 751 F.2d 1213 (11th Cir. 1985) (amendments to claims permitted to correct defects or plead alternative recovery theories).
- In re Breaux, 410 B.R. 236 (W.D. La. 2009) (deficiency equals claim minus net sale proceeds).
- In re Harris, 492 B.R. 225 (S.D. Tex. 2013) (discretion under Rule 3001(c)(2)(D) to bar evidence or award other relief for failure to provide required information).
Outcome: Court upheld Lincoln AFS’s amended claim as valid and enforceable, denied preclusion of evidence, but awarded Debtors $4,890.00 in attorney’s fees under Rule 3001(c)(2)(D)(ii) for Lincoln’s failure to timely provide required information.