670 B.R. 349
Bankr. W.D. Wis.2025Background
- Debtors Marilyn May Sloniker and Pedro Balderramo Justo filed for Chapter 7 bankruptcy; Deere & Company and John Deere Financial sought relief from the automatic stay to repossess a tractor and mower deck secured by two loan agreements.
- Sloniker executed both a 2021 security agreement for a tractor and a 2023 line of credit for a mower deck, acknowledging she signed and made payments until October 2023.
- As of the bankruptcy filing, the balance due on both debts ($34,793.89) exceeded the scheduled value of the equipment ($15,000).
- Sloniker contested Deere's claims by asserting there was no debt, claiming government-held trust funds paid all debts, and raising arguments unsupported by law.
- The court held a hearing; evidence confirmed the validity of Deere's security interests and Sloniker’s nonpayment post-petition.
- The court also addressed whether the bankruptcy stay still applied due to recent prior bankruptcy dismissals, and whether the property should be abandoned from the estate due to its lack of equity.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Relief from automatic stay for equipment | Deere not adequately protected, debt unpaid | No debt owed; government trust covered payments | Relief from stay granted |
| Existence/validity of debt and security | Debt and security agreements valid, unpaid | No valid debt; security interest invalid; fraud alleged | Debt and security agreements are valid |
| Whether property is of consequential value | Equipment worth less than secured claims | Alleged trust interest; property not needed for creditors | Property has no consequential value |
| Necessity of property for reorganization | Debtors have no equity, not necessary in Ch.7 | Property necessary due to special status/trust claims | Property not necessary for reorg. |
Key Cases Cited
- In re Holcomb, 380 B.R. 813 (B.A.P. 10th Cir. 2008) (majority interpretation of § 362(c)(3) only terminating the stay as to the debtor’s non-estate property)
- In re Jumpp, 356 B.R. 789 (B.A.P. 1st Cir. 2006) (stay remains for estate property after 30 days in second bankruptcy case)
- In re Roach, 555 B.R. 840 (Bankr. M.D. Ala. 2016) (discussing interpretation of stay termination under § 362(c)(3))
- In re Wade, 592 B.R. 672 (Bankr. N.D. Ill. 2018) (Seventh Circuit approach—stay terminates as to all property after 30 days in consecutive filings)
- In re Daniel, 404 B.R. 318 (Bankr. N.D. Ill. 2009) (analyzing “with respect to the debtor” in § 362(c)(3) to support broad stay termination)