24 B.R. 738 | Bankr. M.D. Ala. | 1982
In re Willie Lee SCOTT and Emma M. Scott, Debtors.
United States Bankruptcy Court, M.D. Alabama.
Karen Knight, Watkins, Carter & Knight, Montgomery, Ala., for plaintiff.
Charles N. Parnell, Wood, Minor & Parnell, Montgomery, Ala., for defendants.
ORDER
LEON J. HOPPER, Bankruptcy Judge.
The motion of the debtors to set aside a foreclosure was set for hearing at Montgomery, Alabama, October 20, 1982, and there were present attorneys Karen Knight for the debtors and Charles N. Parnell for the creditor, Avco Financial Services of Alabama, Inc.
No testimony was taken and the matter was submitted to the court on the motion of the debtors and the response of the creditor thereto.
The debtors filed this Chapter 13 case September 2, 1982, and prior to the receipt of any notice, formal or otherwise, the creditor foreclosed its mortgage on the debtors' residence by foreclosure sale held on September 15, 1982.
The automatic stay provided by Section 362 of the Bankruptcy Code is effective upon the filing of the petition. Actions taken in violation of the stay are null and void irrespective of whether the creditor has had any notice of the filing of the case and the accompanying stay. The issue of whether the creditor was without notice and acted in good faith is not relevant inasmuch as this is an action to set aside a foreclosure and not in the nature of a contempt proceeding. In re Hawaii Mini Storage Systems, 2 CBC2d ___ (Bkrtcy.D.Haw. 1980); In re Wheeler, 2 CBC2d ___ (Bkrtcy. N.D.Ga.1980); In re Eisenberg, 3 CBC2d 440, 7 B.R. 683 (Bkrtcy.E.D.N.Y.1980); In re Barksdale, 5 CBC2d 1163, 15 B.R. 731 (Bkrtcy.W.D.Va.1981); Collier's on Bankruptcy, 15th Ed. 2:362.03.
The foreclosure sale conducted by Avco on September 15, 1982, was in violation of the automatic stay and is deemed null and void.
It is accordingly ORDERED that the aforesaid foreclosure sale made on September 15, 1982, be and it is hereby set aside and title to the real property of the debtors located at 3306 Santee Drive, Montgomery, Alabama, is restored in and to the debtors.