Decision Granting Plaintiffs Motion for Summary Judgment
I. Introduction
This decision concerns whether the value of the debtor’s residence set forth in
II. Facts and Procedural Background
On May 25, 2011 the debtor, Jackie A. Bennett (“Bennett”), filed a voluntary petition for relief under Chapter 13 of Title 11 of the United States Code (the “Bankruptcy Code” or the “Code”);
The meeting of creditors required by § 341 was held on June 28, 2011. See est. doc. 9 and July 1, 2011 docket entry. On that same date, Springleaf filed a proof of claim in the amount of $9,898.37 and secured by an open-end mortgage on the Property (Proof of Claim 7-1) (“Proof of Claim”). The Proof of Claim provides a value of $140,000 for the Property. On July 21, 2011, the day following the court’s entry of an order confirming Bennett’s Plan, she filed an objection to the Proof of Claim, seeking to have it reclassified as a nonpriority unsecured claim on the basis of there being no value in the Property to which Springleaf s claim attaches (est. doc. 17). Springleaf responded to Bennett’s objection to its claim, stating that the value of the Property exceeded the amount owed on the first mortgage on the Property and, therefore, Springleaf s claim should be determined to be an allowed secured claim (est. doc. 23).
No objection to the Plan or to the value set forth in the Appraisal was filed, and the court entered an order confirming the Plan on July 20, 2011 (est. doc. 16). Five days later, Bennett commenced this adversary proceeding seeking to strip Sprin-gleafs lien as being wholly unsecured. The court has subsequently entered orders in the both the estate case and this adversary proceeding consolidating this adversary proceeding and the contested matter arising out of Bennett’s objection to the Proof of Claim (adv. doc. 12 and est. doc.
A. Bivens
This is the second time recently that the court has addressed under what circumstances a value placed on a residence dim-ing the Chapter 13 confirmation process may be binding on the holder of a junior mortgage in a subsequently filed adversary proceeding.
In Bivens the debtors stated in their Chapter 13 plan that the value of their residence was $42,000. However, they also provided in their plan that they would be filing an adversary proceeding to avoid the second mortgage as being wholly unsecured. Specifically, the Amended Plan stated as follows:
There is a second mortgage on this property held by M & I Bank FSB.... The balance on the second mortgage is $32,787.74. M & I Bank FSB is to be paid as a Class five creditor with zero interest. There is no equity in the property to support paying the debt to M & I Bank FSB as a secured creditor. Debtors will object to any claim of M & I Bank FSB on this property that is filed as a secured creditor. Debtors will file an adversary complaint to strip this mortgage from the property and have the mortgage cancelled of record.
Bivens at *3 (bold in original). The debtors in Bivens also included similar language in their objection to the second mortgagee’s proof of claim. In an agreed order addressing the claim objection, the parties agreed that “the pending Proof of Claim Objection shall be resolved through the adversary proceeding.” As will be discussed, the Dayton Chapter 13 Trustee’s form plan also was different than the form plan used in this case.
Within that due process framework, this court first concluded that an adversary proceeding was not required to establish the value of property for lien avoidance purposes. The court concluded that § 506(a) and Federal Rule of Bankruptcy Procedure 3012 and precedent of this court provide for value determinations to be made through contested matters, specifically stating that:
§ 506(a) anticipates that the value of property will be determined “in conjunction with any hearing ... on a plan affecting [a] creditor’s interest”, including in conjunction with a confirmation hearing on a Chapter 13 plan. See Green Tree Acceptance, Inc. v. Calvert (In re Calvert),907 F.2d 1069 , 1072 (11th Cir.1990) (Valuation of property may be conducted in conjunction with confirmation of plan; there is no requirement of a separate hearing); In re Holmes,225 B.R. 789 , 793 (Bankr. D.Colo.1998) (Value of property may be determined as part of the Chapter 13 confirmation hearing).
Bivens at *10. The court noted that Bankruptcy Rule 3012 allows the value of property to be determined by motion:
The court may determine the value of a claim secured by a lien on property in which the estate has an interest on motion of any party in interest and after a hearing on notice to the holder of the secured claim and any other entity as the court may direct.
Fed. R. Bankr.P. 3012. The court further noted that:
The 1983 Advisory Committee Note to BR 3012 states that:
The valuation of secured claims may become important in different contexts, e.g. to determine the issue of adequate protection under § 361, impairment under § 1124, or treatment of the claim in a plan....
An adversary proceeding is commenced when the validity, priority, or extent of a lien is at issue as prescribed by Rule 7001. That proceeding is relevant to the basis of the lien itself while valuation under Rule 3012 would be for the purposes indicated above.
Bivens at *10.
However, while the court found that the value of property could be established through the confirmation process, the court found that the value placed by Bivens in their plan did not bind the junior mortgagee with respect to the adversary proceeding filed to avoid the mortgage lien, specifically finding that the Bivens’ Chapter 13 plan “did not provide sufficient
The court rejected the Bivens’ argument that the binding effect of the confirmation order under § 1327(a) precluded M & I Bank from litigating the value of their residence listed in the plan. This court noted that “a provision of a Chapter 13 plan only has preclusive effect if: a) the notice of the plan is satisfactory under the circumstances and does not deny due process (Calvert,
Both in Calvert and in Linkous, the courts held that if the creditor whose lien was being attacked did not receive specific notice that the confirmation hearing would serve as a § 506(a) or BR 3012 valuation hearing, then the creditor’s due process rights had been violated and the confirmation order was not binding on the creditor for lien stripping purposes. See Linkous,990 F.2d at 163 . In Calvert the court remarked that: “Mere notice that the bankruptcy court will hold a confirmation hearing on a proposed bankruptcy plan, without inclusion of notice specifically directed at the security valuation process, does not satisfy the requirement of Rule 3012.” Calvert,907 F.2d at 1072 . The court added that notice of “a mere possibility that they will consider collateral valuation” is not sufficient to avoid a due process violation. Id. at 1072, n. 3.
Bivens at *14-15.
First, the court found “that the Bank did not receive specific notice that the confirmation hearing would serve as a valuation hearing under § 506(a) or BR 3012 and, therefore, under the due process standards enunciated in Calvert and Linkous, the confirmation order did not bind the Bank to the value placed in the Plan for the Property. The notice of the confirmation hearing ... did not advise the Bank that the confirmation hearing would include a valuation hearing under § 506(a) or BR 3012 relating to the Property.” Bivens at *15. At that time, the Chapter 13 Trustee’s form plan contained the following conspicuous warning on the first page of the form plan (the “preamble”):
You should read this Plan carefully. Confirmation of this Plan by the Bankruptcy Court may modify your rights by providing for payment of less than the full amount of your claim, by setting the value of the collateral securing your claim, by providing for a treatment of your claim contrary to your current status, and/or by setting the interest rate on your claim. The Court may confirm this case if no objection to confirmation is*428 filed within ten (10) days after the § 341 Meeting of Creditors is concluded (L.B.R.3015-3(a)).
The court concluded that this prefatory warning language was in the vein of the “mere possibility” language that the Calvert court held was not sufficient and not specific enough to provide adequate notice to M & I Bank that the confirmation hearing would serve as a valuation hearing under § 506(a) or Rule 3012. See Bivens at *15-16, citing Calvert,
Second, the court found that the Bank did not receive sufficient due process notice that its failure to object to the value placed in the Bivens’ plan amendment would constitute a valuation of their residence under § 506(a) and Rule 3012. While the amended plan stated that the residence “is valued at $42,000,” this provision did not specifically state that the confirmation hearing would include a § 506(a) or Rule 3012 valuation hearing if M & I Bank disputed that value or that the value stated in the plan would be binding absent an objection and, rather, stated that an objection to any claim filed by M & I Bank as a secured claim would be filed and that an adversary proceeding would be filed to strip the mortgage lien. See Bivens at *16.
Finally, the court found that the value placed in the Bivens’ plan did not have preclusive effect because the plan was ambiguous as to whether the confirmation hearing was serving as a valuation hearing and whether the plan was setting the value of the residence for lien stripping purposes, noting that a plan is a contract between a debtor and his creditors and, as such, any ambiguity in the terms of the plan must be construed against the debtor, citing In re Brawders,
Subsequent to the court’s issuance of its decision in Bivens, Jeffery M. Kellner, the
B. The Plan Provisions Contained in the Plan and the New Dayton Chapter 13 Form Plan
There are several provisions of the Dayton form plan (the “Form Plan”) which are pertinent to whether the value of the Property contained in the Appraisal is binding on Springleaf. The first such provision is the preamble to the Plan, being the conspicuous colored box at the beginning of the Plan containing text in bold. By coloring that box and enclosing the two paragraphs in the box in bold text, the clear intention is to place special emphasis on that language and to try to alert the reader to it. The language in that box reads as follows:
[[Image here]]
See estate doc. 5, p. 1. (emphasis in original).
The second significant section of the Form Plan is § 18, which provides the treatment for claims secured by real estate owned by the debtor. That section, as completed by Bennett in this case with her particular elections added, provides as follows:
18. PLAN FOR REAL ESTATE (Use separate schedule for each parcel of real estate)
* * * #
(E) Valuation of real estate is set at confirmation unless the appraisal is not filed per L.B.R. 3015-3(e)(3). The confirmation hearing will include a § 506(a) or B.R. 3012 valuation hearing if a creditor disputes the value and objects pursuant to the requirements of the Local Bankruptcy Rules. If no objection is timely filed, the value as set forth in the Chapter 13 Plan and/or filed Appraisal will be binding upon confirmation of the Chapter 13 Plan.
* * * *
PARCEL NO. 1
Description and Location of Property: 366 Fairway Drive, Fairborn, OH 45324
Appraisal must be provided by Debtor and the appraisal must be filed with the Court before the Meeting of Creditors.
Personal Residence [x] Yes □ No Original Purchase Price $128,900.00
*430 Lien Holder # 1 (Must match Schedule D)
Monthly Payment
Months in Default
Total Arrearage (including month petition filed)*
□ PLAN: Mortgage payments to be disbursed by the Trustee unless this box is checked for disbursement by the Debtor
If arrearage on the mortgage at the time of filing, payment must be disbursed by the Trustee pursuant to L.B.R. 3015-l(d)(l).
□ Interest will NOT be paid on the mortgage arrearage claim unless this box is checked:
Bank of America Mortgage, Inc., 100 North Tryon Street, Charlotte, NC 28255
$1,017.15 5
$5,085.75
If Trustee disburses, then arrearage shall be paid as a class 2 creditor.
* Estimate only-the filed Proof of Claim, subject to objections, shall determine the actual arrearage.
Any Special Treatment must be addressed in Paragraph 19, “Special Plan Provisions”.
Lien Holder # 2 (Must match Schedule D) Springleaf Financial, 2628 Colonel Glenn Hwy., Fairborn, OH 45324-5612
Monthly Payment
Months in Default
Total Arrearage (including month petition filed)*
See Special Plan Provision
See Special Plan Provision
See Special Plan Provision
‡ ‡ ‡
See estate doc. 5, pp. 9-11. (emphasis in original).
The last material section of the Form Plan is § 19 which contains the “Special Plan Provisions.” This is the section in which the debtor is to place any provisions that are not otherwise provided by the terms of the Form Plan, including special treatment of a claim, such as the avoidance of a lien on an otherwise secured claim. Inclusion of this section in the Form Plan assists the court, the Chapter 13 Trustee, and creditors in reviewing and analyzing debtors’ plans because special treatment of creditor claims is to be set forth in that section — providing the parties in interest with one place to look to determine if there is any objectionable provision in the plan which might give reason to deny confirmation of any such plan. Section 19 of the Form Plan, as completed by Bennett in this case, provides as follows:
19. The Special Plan Provisions listed below, if any, are restricted to those items applicable to Debtor’s particular circumstances. NOTE: Special Plan Provisions shall NOT contain a restatement of provisions of the Bankruptcy code or local or national rules of bankruptcy procedures, nor shall this section contain boilerplate language regarding the treatment of mortgages, mortgage arrearages, proofs of claim, consumer protection provisions or similar matters.
Special Plan Provisions:
(A)D Other: None
(B) □ Surrender of Real Estate — Debt- or^) hereby surrender the real estate property located at Property Address.*431 Trustee will not pay on any mortgages, mortgage arrearages or certificate of judgments related to this real estate, nor pay any county real estate taxes on this property as the taxes will be paid at the foreclosure sale unless otherwise provided for in this Plan. Trustee will NOT pay on the claims of Mortgage Creditor(s) for any filed mortgage claims or liens until Creditor files a deficiency claim. The deficiency claim shall be filed no later than 270 days from the date that the within Plan is confirmed. If the deficiency claim is filed more than 270 days after the Plan is confirmed, then it shall be disallowed except upon further Order of the Court by the Creditor filing timely a Motion to Extend Time OR Motion to File the Deficiency Claim Out of Time. The personal liability of the Debtor(s) shall be discharged upon completion of the Plan and the entry of Discharge.
(C)|x] Avoiding Lien, Mortgage or Judgments — Debtor is filing an Adversary Proceeding/Motion to avoid the mortgage lien of Creditor Springleaf Financial on the property located at 366 Fairway Drive, Fairborn, OH 45324. Said action should be filed within thirty (30) days of confirmation. Creditor shall release the mortgage lien upon completion of the Plan as evidenced by the Chapter 13 Trustee’s Certification of Final Payment and Case History. In the event of failure of the Creditor Springleaf Financial to execute and deliver the release of the mortgage or lien within thirty (30) days after the plan completion as evidenced by the Chapter 13 Trustee’s Certification of Final Payment and Case History in the instant case, Debtor may present a certified copy of this Court’s Order regarding the mortgage or lien to the Office of the County Recorder of the proper county and said document will act as a release with regards to the mortgage or lien.
íJí íj:
See estate doc. 5, pp. 11-12.
The court will now analyze the facts of this case, including the provisions contained in the Form Plan as completed by Bennett, to determine whether the value placed on the Property by the Appraisal is binding on Springleaf in the adversary proceeding. This discussion will include an analysis of differences between the Bivens plan and the Plan.
III. Legal Analysis
A. Jurisdiction
This court has jurisdiction pursuant to 28 U.S.C. § 1334 and the standing order of reference in this District. This is a core proceeding pursuant to 28 U.S.C. § 157(b)(2)(E).
B. Summary Judgment Standard
Federal Rule of Civil Procedure 56(a), made applicable to adversary proceedings through Bankruptcy Rule 7056, sets forth the standard to address the parties’ filings. It states, in part, that a court must grant summary judgment to the moving party if the movant shows that there is no genuine issue as to any material fact and the mov-ant is entitled to judgment as a matter of law. In order to prevail, the movant, if bearing the burden of persuasion at trial, must establish all elements of its claim. Celotex Corp. v. Catrett,
C. Discussion
1.Introduction
Bennett’s motion for summary judgment arises out of the Sixth Circuit’s adoption of the majority position that mortgages granted on primary residences to which no value can be attributed pursuant to 11 U.S.C. § 506(a) can be stripped off through a Chapter 13 bankruptcy case upon successful completion of the payments under the Chapter 13 plan. Lane v. Western Interstate Bancorp (In re Lane),
2.Positions of the Parties
Bennett asserts that the new language of the Form Plan sufficiently apprises creditors, such as Springleaf, that absent a timely objection being filed to a debtor’s plan, the value contained in the debtor’s appraisal, filed with the court in accordance with the local bankruptcy rules for this District, fixes the value of a debtor’s property for lien stripping purposes and precludes the creditor’s from re-litigating that issue, including in a later adversary proceeding to strip a junior mortgage.
Springleaf argues that the terms of the plan do not meet the due process standards of the Ohio or United States Constitution. Springleaf asserts that since the time that the Bankruptcy Code was enacted in 1978, the Dayton location has required that the value of real estate for avoidance purposes must be established either through an adversary proceeding or a motion and, therefore, since this “has been the established procedure in this court for 33 years, ... creditors rely on this.” Memorandum in Opposition, p. 1. Springleaf further notes that this court’s order (adv. doc. 9) “presumes that an appraisal will be performed by the creditor and gives a deadline of December 5, 2011 to have it completed.” Id. at p. 2. Sprin-gleaf concludes by asserting that the plan provisions have “not afforded Springleaf adequate notice to alert it as to the change in the procedure.” Id.
3.Due Process
Springleaf claims that it has not been provided due process — specifically that the terms of the Form Plan did not provide Springleaf with sufficient notice of the change in procedure with respect to the valuation of real property for lien stripping purposes in light of the thirty-three year history of valuing property through a motion or adversary proceeding. In making this argument, Springleaf has neither provided the court with an affidavit or other Rule 56 evidence to support its statements, nor has it provided the court with any citations of legal authority supporting its position.
The United States Supreme Court has recently opined on due process relating to a Chapter 13 plan.
In finding that the creditor’s due process rights were not violated, the Supreme Court cited the landmark Mullane decision
In In re McLemore, this court noted that a confirmation order approving a Chapter 13 plan is res judicata and not subject to collateral attack by a creditor who has received adequate notice of the plan.
This court drew a distinction between notice that is “quantitatively defective” and notice that is “qualitatively defective.” Notice which is quantitatively defective results when a party has not been properly
Springleaf s argument is that the notice provided by the Plan was qualitatively defective. Without citing to any specific provisions or omissions in the Plan, Springleaf argues that the information in the Plan was insufficient to apprise it that the value of the Property would be determined through the confirmation process and that the Plan’s provisions were insufficient to overcome the thirty-three year precedent in Dayton of determining value for strip-off purposes through a separate hearing or adversary proceeding. Springleaf is incorrect on both points.
a. The Information in the Plan was Sufficient to Apprise Springleaf that the Value of the Property Would Be Determined Through Confirmation.
The Plan has significant differences from the Bivens plan which should have put Springleaf on notice that the confirmation hearing and confirmation process would result in the valuation of the Property for lien stripping purposes.
First, while both plans contained a conspicuous preamble with text in bold in a box at the beginning of the plan which cautioned creditors and parties in interest to read the plan carefully and that the plan “may modify your rights by providing for payment of less than the full amount of your claim, by setting the value of the collateral securing your claim, by providing for a treatment of your claim contrary to your current status, and/or by setting the interest rate on your claim;” Bennett added the following statement in that preamble to the Plan:
The confirmation hearing in this case shall include a valuation hearing pursuant to 11 U.S.C. § 506(a) and Bankruptcy Rule 3012.
See estate doc. 5, p. 1. (bold in original). Both preambles include the statement that “[t]he Court may confirm this case if no objection to confirmation is filed within ten (10) days after the § 341 Meeting of Creditors is concluded (L.B.R.3015-3(a)).” Thus, the Plan added a specific clear statement to the preamble that the confirmation hearing would serve as a valuation hearing pursuant to § 506(a) and Bankruptcy 3012. It is also significant to note that § 506(a) explicitly provides for the valuation of collateral “in conjunction with any hearing ... on a plan affecting such creditor’s interest” and Rule 3012 allows the court to make such a value determination “after a hearing on notice to the holder of the secured claim.... ”
Second, § 18 of the Plan contained the following provision which the Bivens plan did not:
(E) Valuation of real estate is set at confirmation unless the appraisal is not filed per L.B.R. 3015-3(e)(3). The confirmation hearing will include a § 506(a) or B.R. 3012 valuation hearing if a creditor disputes the value and objects pursuant to the requirements of the Local Bankruptcy Rules. If no objection is timely filed, the value as set forth in the Chapter 13 Plan and/or filed Appraisal will be binding upon confirmation of the Chapter 13 Plan.
See estate doc. 5, p. 10. (bold in original). This provision again advises secured creditors, such as Springleaf, that the confirmation hearing will include a valuation hearing if the creditor objects to the value set forth in the plan or in the debtor’s appraisal report if the appraisal report is timely filed in accordance with Local Bankruptcy Rule 3015 — 3(e)(3). The court also notes
Finally, the Plan, like the Bivens plan, contained a specific provision in § 19 of the Plan, the Special Plan Provisions, which explicitly identified the Springleaf mortgage as being the subject of a mortgage strip-off adversary proceeding. See est. doc. 5, p. 12, § 19(C). While in Bivens this language, in addition to the other particular facts in Bivens, was availing to the mortgagee, it is not so in this case. In Bivens the plan did not contain the explicit language advising the mortgagee that the confirmation hearing would serve as the real estate valuation hearing. Thus, the mortgagee could reasonably assume that the valuation hearing would be subsumed within the trial of the adversary proceeding. The language added to the Form Plan used by Bennett should have dispelled any belief that valuation of the Property would be determined through the adversary proceeding.
The language advising creditors that the confirmation hearing would serve as a valuation hearing may be difficult for a lay person to comprehend. However, individual circumstances may be taken into account when determining whether the notice provided the creditor with due process. McLemore,
If a representative of Springleaf did not understand the provisions of the Plan addressing valuation of the real estate, it was incumbent upon that representative to inquire of its legal counsel. The Form Plan is a legal document requiring some degree
Accordingly, the court finds that the provisions added to the Form Plan used by Bennett were sufficient to put Springleaf on notice that the confirmation hearing would serve as a valuation hearing pursuant to § 506(a) and Rule 3012 for lien-stripping purposes. Unlike in Bivens, the Plan contained clear, explicit provisions advising Springleaf and other creditors that the confirmation hearing would serve as a valuation hearing for real property securing creditors’ claims which were being treated under the Plan. The court will now address whether the Dayton location’s history of determining value for lien-stripping purposes through a separately filed motion or adversary proceeding deprived Sprin-gleaf of due process.
b. Bivens and the Form Plan Used by Bennett were Adequate to Apprise Springleaf of any Change in Procedures for Determination of the Value of Real Property for Lien Stripping Purposes
The thrust of Springleafs argument is that application of the subject plan sections would result in a violation of due process because those provisions are not sufficient to overcome the historical precedent of real property being valued for lien stripping purposes in Dayton through a separate motion or adversary proceeding. The court rejects this argument for three reasons.
First, Springleaf failed to support this argument with any evidence. Springleafs Memorandum in Opposition was not supported with an affidavit or other evidence submitted in conformance with Bankruptcy Rule 7056, which incorporates Federal Rule of Civil Procedure 56. Springleafs argument is premised upon unsupported assertions that:
a) “Since the bankruptcy code was changed in 1978, it has been established in the Dayton Bankruptcy Court that any Chapter 13 plan that seeks to establish the value of real estate regarding avoidance issues must be done by way of an adversary proceeding or a motion;”
b) “This has been the established procedure in this court for 33 years, and creditors rely on this;” and
c) “The wording in the chapter 13 plan sent to creditors is simply insufficient to properly advise creditors as to the dramatic change in procedure. It must be remembered that the chapter 13 plan and notice is served on the creditors directly. A reasonable creditor, upon reading the notice, would simply not understand the dramatic change in the procedure that has been in effect over 33 years.”
See Memorandum in Opposition, pp. 1-2. However, Springleaf did not submit an affidavit or other evidence that: a) it was familiar with this purported thirty-three year history; b) that it relied on this thirty-three year history; c) that a representative of Springleaf actually read the Plan; and d) that after reading the Plan, the representative did not understand that the procedure regarding when real estate would be valued for lien-stripping proce
Second, Springleafs argument regarding the thirty-three year history in Dayton of lien-stripping by motion or adversary proceeding is incomplete. Specifically, Springleafs argument ignores the Bivens decision. The history of avoiding wholly unsecured mortgages in Dayton includes Bivens. As noted, in Bivens this court held that value could be determined through the plan confirmation process if the plan adequately apprised creditors that the confirmation hearing would determine the value of the real property. While not published in one of the nationally recognized bankruptcy reporters, Bivens was placed in the court’s indexed decisions on the court’s website which is available to the bar and the general public. Thus, the possibility of valuing real property through a Chapter 13 plan in Dayton was made known on September 30, 2009 and is part of the history of mortgage avoidance in Dayton. The Form Plan used by Bennett was adopted following Bivens and presumably takes Bivens into consideration. In short, any ruling by this court that the value of real property can be determined through a Chapter 13 plan for lien-stripping purposes cannot be considered a shot out of the dark.
Furthermore, as Springleaf acknowledges, value has been determined by motion in Dayton. See Ernst v. Bank One, N.A. (In re Ernst),
Third, the perceived long history of determining the value of real property through an adversary proceeding or through a separately filed motion with a separate hearing on that motion does not rise to the level of a due process violation in light of the clear and specific language of the Plan and the fact that Bivens foreshadowed this possibility. An argument similar to that made by Springleaf in this case was made and rejected in Nissan Motor Acceptance Corp. v. Smith,
Nissan submits that the Chapter 13 Plan filed by Smith provided no notice “that it sought to overrule the past practice in this district and ignore the local rules. Accordingly, it was not afforded due process to present any objection to the proposed plan treatment.” Yet Nissan, a sophisticated and secured creditor, had adequate notice, and could have attended the creditor’s meeting or filed an objection to confirmation. Thus, in the absence of a more compelling argument by Nissan, the court finds that the Bankruptcy Code and Rules apply.
Id. at *4.
Similarly, the court finds that Sprin-gleaf s historical practice argument is not sufficiently compelling to overcome: a) the clear and conspicuous language of the Plan; b) the binding nature of the Plan as provided by § 1327(a) (see McLemore, 426 B.R. at 734-35 and In re Thaxton,
IV. Conclusion
Accordingly, Debtor Jackie Bennett’s motion for summary judgment is granted. Based upon the facts of this case, the court finds no valid reason not to enforce the
Copies to:
Andrew Zeigler, Thompson & Deveny Co. LPA, 1340 Woodman Dr., Dayton, OH 45432
Stephen D. Miles, 18 West Monument Ave., Dayton, OH 45402
Jeffrey M. Kellner (Chapter 13 Trustee), Scott G. Stout (Staff Attorney), 131 North Ludlow St., Ste. 900, Dayton, OH 45402
Office of the United States Trustee, 170 North High Street, Suite 200, Columbus, Ohio 43215
Notes
. Lane v. Western Interstate Bancorp, (In re Lane),
. Unless otherwise noted, all statutory references are to the Bankruptcy Code of 1978, as amended, 11 U.S.C. §§ 101-1532 (the “Code”), cited hereinafter in this decision as “§-”.
. This judge and the Dayton location of the United States Bankruptcy Court for the Southern District of Ohio have construed Bankruptcy Rule 7001(2) to require that an adversary proceeding be commenced and prosecuted to strip off a mortgage lien under Lane v. Western Interstate Bancorp. (In re Lane),
. Bivens v. M & I Bank FSB (In re Bivens), Case No. 08-31447, Adv. No. 08-3361 (Bankr.S.D.Ohio Sept. 30, 2009).
. The following precedent on stripping mortgages, in particular in the Southern District of Ohio and in the Sixth Circuit, support the value of real property being established through the plan confirmation process at either the confirmation hearing or a separate valuation hearing. See In re Callander,
. The form plan for the Dayton location of the Bankruptcy Court for the Southern District of Ohio contemplates an adversary proceeding to strip off a wholly unsecured mortgage. See est. doc. 5, p. 12, § 19(C).
. However, the court specifically noted that it was "not concluding that the absence of this provision prohibits the confirmation hearing from serving as a valuation hearing under BR 3012, but merely that the lack of such provision, coupled with the language of the Plan and the notice of confirmation hearing, failed to put the Bank on notice that the confirmation hearing would be a valuation hearing for the Property.” Bivens at *18-19.
. While Springleaf asserted in its Memorandum in Opposition that the Plan provisions do not "fulfill the due process requirements of the United States and Ohio Constitutions,” it provided the court with no citation to any provision of either constitution violated by the
. The due process argument made by Sprin-gleaf is weaker than the one rejected in Espi-nosa. In Espinosa the bankruptcy court confirmed the plan even though it contained a procedure that violated a specific Bankruptcy Code section and a Bankruptcy Rule governing such debts. As this court determined in Bivens, that is not the situation with respect to the real property valuation issue — the Bankruptcy Code and Rules specifically contemplate the determination of value outside an adversary proceeding.
. Mullane v. Central Hanover Bank & Trust Co.,
. Springleaf refers to the provisions of the Plan providing for valuation of the real property through confirmation of the Plan as "boilerplate.” Black’s Law Dictionary defines "boilerplate” as "[r]eady-made or all purpose language that will fit in a variety of documents.” Black’s Law Dictionary (9th ed. 2009), p. 198. The court finds that the Form Plan’s provisions were specific to real estate valuation within a Chapter 13 plan and were not boilerplate.
. In finding that the language of the Form Plan is sufficient to provide creditors with due process notice that the confirmation hearing will serve as a valuation hearing for real property, the court is not eliminating the need in the Dayton location, absent an agreed order, to file an adversary proceeding to avoid mortgage liens. The court also is not determining that valuation must be determined at the confirmation hearing. Through consent of the parties, valuation may be determined through an adversary proceeding filed to avoid the lien. This is one reason that the court has continued to enter orders providing for the parties’ filing of appraisal reports in adversary proceedings to strip off wholly unsecured mortgages. Springleaf’s argument that this court’s order (adv. doc. 9) "presumes that an appraisal will be performed by the creditor and gives a deadline of December 5, 2011 to have it completed” (Memorandum in Opposition, p. 1) is unconvincing in the context of this case. The court is merely determining that, consistent with its prior holding in Bivens, the confirmation hearing may serve as a valuation hearing for lien-stripping purposes, the Form Plan sufficiently apprises creditors that the confirmation hearing shall serve as a valuation hearing, and that absent a timely filed objection to the debtor’s value placed on the real property through the debt- or's plan or the appraisal report filed in conformance with Local Bankruptcy Rule 3015-3(e)(3), the confirmation order will preclude any properly served creditor from later contesting the value assigned to the property. See § 1327(a).