Craig H. Hatch v. Cameron Hatch

Summary

The United States Bankruptcy Court for the Eastern District of Michigan granted the Chapter 13 trustee’s motion for summary judgment in an adversary proceeding concerning a quitclaim deed transferring the debtor’s property to his son. The court held that the unauthorized post-petition transfer was avoidable under 11 U.S.C. § 549(a) or the confirmed Chapter 13 plan, regardless of whether the transfer occurred before or after plan confirmation. The court voided the deed, ordered recovery of the property, and directed the debtor to seek authority to sell the property and pay off the plan.

Holdings

1. A post-petition transfer of estate property made outside the ordinary course of business without the notice, hearing, and court authorization required by 11 U.S.C. § 363(b) is voidable, not void ab initio.
2. The transfer must be avoided and the deed voided because it was made without court authorization, violated the confirmed chapter 13 plan, and was detrimental to the interests of the debtor's creditors, regardless of whether the transfer was completed before or after plan confirmation.
3. Summary judgment was proper because the material facts assumed for purposes of the motion did not create an evidentiary dispute and the remaining issue was one of law.

Questions Presented

1. Whether an unauthorized post-petition transfer of property in a chapter 13 case that violates 11 U.S.C. § 363(b) is void ab initio or merely voidable under 11 U.S.C. § 549.
2. Whether the quitclaim deed should be avoided and voided when the debtor transferred the property without court authorization in violation of the confirmed chapter 13 plan, regardless of whether the transfer occurred before or after plan confirmation.
3. Whether summary judgment was appropriate where the dispositive issue was legal and the court assumed the defendant's version of the transfer facts.

Disposition

other