Background
Robert Norvell, proceeding pro se, appealed a bankruptcy court order finding that the automatic stay under Section thirty-six-two of Title eleven no longer applied to his property. The bankruptcy court determined the property had revested in Norvell under the terms of his confirmed reorganization plan, removing it from the bankruptcy estate. Norvell argued the district court erred in lifting the stay, claiming he did not default on payments, the motion was procedurally deficient, and the ruling violated his due process rights.
The court’s reasoning
The court reviewed legal conclusions de novo and factual conclusions for clear error. Under Title eleven, a bankruptcy filing creates an estate, but upon confirmation of a reorganization plan, property vests in the debtor unless the plan provides otherwise. When property ceases to be part of the bankruptcy estate, the automatic stay immediately terminates. The court noted that Norvell abandoned any challenge to the finding that the property was not part of the estate by failing to develop an argument in his brief. Additionally, the court found the motion for relief from the stay moot because the property had already revested in 2017.
What it means going forward
Creditors may proceed with collection or foreclosure actions against property that has revested in a debtor under a confirmed plan, as the automatic stay protection no longer applies to that property.