Oscar Calderon v. U.S. Bank National Association as Trustee for SG Mortgage Securities Trust 2006-FRE2 Asset Backed Certificates Series 2006-FRE2
860 F. App’x 686
| 11th Cir. | 2021Background
- In May 2006 Oscar Calderon closed a residential mortgage loan in Florida.
- On April 3, 2009 Calderon sent defendants a written demand for rescission under TILA; the demand was denied in writing.
- About five months later Calderon filed a voluntary Chapter 7 petition, listed the mortgage as a secured claim, did not disclose the rescission demand, and received a discharge in January 2010.
- More than nine years after discharge the Calderons filed suit seeking declaratory relief and rescission of the 2006 loan, termination of defendants’ security interest, return of payments, and damages/fees.
- The district court granted summary judgment for U.S. Bank, holding that the rescission claim was a pre-petition asset that vested in the bankruptcy estate at filing and, because the trustee had not abandoned it, the Calderons lacked standing to pursue it.
- The Eleventh Circuit affirmed, concluding the rescission claim became estate property upon commencement of the Chapter 7 case and only the trustee had standing to prosecute it.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Calderons had standing to pursue rescission after filing Chapter 7 | The rescission was effective when defendants received the notices pre-petition, so it was not estate property and Calderon retained the claim | The rescission claim was a pre-petition cause of action that vested in the bankruptcy estate at filing; only the trustee could bring it | The claim was property of the estate at commencement; Calderons lacked standing because the trustee did not abandon the claim |
Key Cases Cited
- In re Witko, 374 F.3d 1040 (11th Cir. 2004) (bankruptcy estate consists of debtor’s interests as of commencement)
- Parker v. Wendy's Int'l, Inc., 365 F.3d 1268 (11th Cir. 2004) (trustee is sole party with standing to prosecute estate causes of action)
- Ajaka v. Brooksamerica Mortg. Corp., 453 F.3d 1339 (11th Cir. 2006) (debtor duty to disclose all assets and potential claims to the bankruptcy court)
- In re Alvarez, 224 F.3d 1274 (11th Cir. 2000) (pre-petition claims rooted in pre-bankruptcy events are estate property)
- A&M Gerber Chiropractic LLC v. GEICO Gen. Ins. Co., 925 F.3d 1205 (11th Cir. 2019) (standing determinations reviewed de novo)