Wells Fargo Bank, N.A v. Griffin
Opinion of the Court
On September 23, 2008, the Debtors-Appellees (the “Hunts”) converted their underlying bankruptcy case from a proceeding under Chapter 13 to one under Chapter 7, in part because their 2005 Ford Freestar was totaled in an accident. The Hunts now have filed a motion to dismiss the appeal as moot. We conclude that the case is indeed moot due to the Hunts’ conversion of their case to a different bankruptcy code chapter. See In re J.B. Lovell Corp., 876 F.2d 96, 99 (11th Cir. 1989) (“Lovell voluntarily elected to pursue remedies under Chapter 11 rather than continue litigation in the original Chapter 7 proceedings. This election to convert the proceedings prevented Lovell from further pursuing Chapter 7 issues on appeal.”); cf. In Re Roller, 999 F.2d 346, 347 (8th Cir. 1993) (‘While the appeal was pending, the bankruptcy court converted the case from Chapter 12 to Chapter 7, and the Chapter 7 trustee distributed the Rollers’ assets among creditors.... [T]he Chapter 12 petition [i]s moot.”).
Wells Fargo argues that this appeal falls under an exception to the mootness doctrine, in that it presents a question
Wells Fargo’s arguments primarily focus on the first condition, stressing the allegedly large number of cases currently pending in the Kansas bankruptcy court involving the negative-equity issue of 11 U.S.C. § 1325(a) that is presented in this appeal.
. Put most simply, that issue is whether the incorporation of negative equity into certain pre-bankruptcy debtor motor vehicle financing transactions vitiates the purchase money security interest nature of those transactions for purposes of application of the creditor protection provisions of the so-called hanging paragraph of 11 U.S.C. § 1325(a). See, e.g., GMAC v. Peaslee, 373 B.R. 252, 255 (W.D.N.Y. 2007) ("The specific question ... involves the extent to which a creditor holds a purchase money security interest ... in connection with a motor vehicle sale in which the seller allows the buyer to roll in the negative equity on a trade-in vehicle, i.e., the difference between the vehicle’s outstanding loan balance and its market value, as part of the purchase price of the new vehicle.” (internal quotation marks omitted)).
Reference
- Full Case Name
- In re Bobbi J. HUNT, a/k/a Bobbi J. Rupp David A. Hunt, Jr., Debtors. Wells Fargo Bank, N.A., doing business as Wells Fargo Auto Finance v. William H. Griffin Bobbi J. Hunt, aka Bobbi J. Rupp David A. Hunt, Jr., American Financial Services Association National Automobile Dealers Association Kansas Bankers Association Ford Motor Credit Company, LLC Ingrid M. Hillinger Michael Hillinger Adam J. Sevitin Michaela M. White Jean Braucher, Amici Curiae
- Cited By
- 2 cases
- Status
- Published