You are here

In re Julia Bowens

21 B 13626
Court allowed Debtor to reopen her bankruptcy case in order to seek sanctions for violation of the discharge injunction and the automatic stay, as well as a renewed motion to avoid judicial lien, all against the same judgment creditor.   HELD: All three motions would be denied.  Prepetition, Debtor executed a warranty deed while the creditor’s foreclosure action was pending.  Although Debtor directed the grantee not to record the transaction, delivering the deed effected a transfer.  Therefore, when Debtor filed for relief under the Bankruptcy Code, she did not own the real property in question and could not claim an exemption in it.  Consequently, Debtor could not assert that the creditor’s lien impaired an exemption.  Nor could she prevail on her motion for sanctions for violation of the automatic stay.  As for the discharge violation motion, the creditor asserted that by continuing its foreclosure action, it sought only to enforce its in rem rights.  The creditor had neglected to revive its judgment within seven years, however, so there was a question regarding its ability to pursue the foreclosure action.  But, since there is a split in the Illinois courts, there was an objectively reasonable basis for concluding that the creditor’s conduct might be lawful.  Therefore, under the standard set forth in Taggart v. Lorenzen, 139 S. Ct. 1795 (2019), sanctions for violation of the discharge injunction were not warranted.

Monday, February 5, 2024