On August 15th, Judge Kay Woods held a town hall meeting for all attorneys who practice in the Youngstown, Ohio Bankruptcy Court. The following are the key issues and items which were discussed:
1. The Bankruptcy Court for the Northern District of Ohio-Youngstown will be putting into place a Model Chapter 13 Plan. The Plan will be put together by the Chapter 13 Trustee, Michael Gallo, and the Court. No Committee will be formed. Attorneys are to submit issues or suggestions to Mr. Gallo’s office by hard copy. Once the plan is in place there will be a two week comment period. The court mentioned two issues to be addressed:
a. 11 USC Sec. 524(i) issues
b. A separate provision in the plan to solely deal with real estate issues
2. Proofs of Claim: Proofs of claim in Youngstown will still control. The Chapter 13 Plan will not. The Court is looking at setting time limits on the amendment of claims after the sale of property. The Court is concerned at plan feasibility once a deficiency claim is filed. The court is considering allowing estimated claims.
3. Conduit Plans: The court is not contemplating conduit plans on Mortgage Claims. The Court will consider them on a case by case basis.
4. The Court continued to raise a concern on Affidavits. The Court’s position is that the Creditor must set out and support the relationship between the underlying Creditor and the individual and entity providing the Affidavit. The Court indicated that it wanted the servicing agreement to support the relationship. In addition, a Power of Attorney would be necessary. Furthermore, the Court indicated that the holder of the note must be identified and supported in any Motion. If there has been a merger between entities, the Court is still requiring the merger document. The Court will not take Judicial Notice of any merger, even local mergers.
5. Rulings on Motions for Relief: Judge Woods indicated that if a Debtor brings an account current in the amount set forth in the original Motion for Relief she will deny the Motion despite the fact that the Debtor may be past due for the next contractual payment. She will not allow an Amended Motion for the new past due amount. She did indicate that if a new Motion for Relief has to be filed and the Debtor once again brings the past due amount current but is contractually due for the next payment at the hearing, she will take that into consideration in issuing a ruling.
6. Agreed Orders: The issue of timely filing Agreed Orders was raised. The Court will typically allow two weeks for Agreed Orders to be submitted to the Court. She recommended that if the Creditor’s attorney does not have the order, to reset the Motion for hearing.
7. Loss Mitigation: The Court supports loss mitigation opportunities. The Court indicated that all such agreements be put in writing, signed off by the Trustee and filed with the Court.
Mr. Hochheiser is the managing partner of Bankruptcy with the Real Estate Default Group at Weltman, Weinberg & Reis Co., L.P.A. in Brooklyn Heights, Ohio. Mr. Hochheiser can be reached at (216) 739-5649 or via e-mail at ahochheiser@weltman.com.
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