The Bankruptcy Code exempts from discharge those debts arising from willful and malicious injuries caused by the debtor. 11 U.S.C. § 523(a)(6). Because debtors have a habit of filing bankruptcy soon after a judgment for such an injury is entered against them, bankruptcy courts often give a prior (state or federal) judgment issue-preclusive effect when the creditor seeks to have the debt declared non-dischargeable under § 523(a)(6). The extent of issue preclusion depends on the specificity of the prior findings, as recently discussed by the Seventh Circuit in Gerard v. Gerard, No. 14-1496 (Mar. 12, 2015).
The Federal Rules of Civil Procedure allow a nonmovant, when faced with a motion for summary judgment, to ask the court to defer ruling on the motion, to allow it additional time to take discovery. The process is straightforward: a nonmovant must show the court “by affidavit or declaration” the specified reasons that prevent it from presenting facts essential to justify its opposition. See FRCP 56(d) (Wisconsin has a similar requirement, modeled on the federal rule, see Wis. Stat. § 802.08(4)). The “affidavit or declaration” portion of the rule is not merely a suggestion, as failure to submit one justifies a district court’s denying the request to take additional discovery, and ultimately, granting summary judgment in the absence of additional facts. That lesson was recently learned by the plaintiff in Kallal v. CIBA Vision Corp., No. 13-1786 (7th Cir. Feb. 24, 2015). This Seventh Circuit decision should remind practitioners to comply strictly with Rule 56(d) when asking the court to defer ruling on a summary judgment motion.
Last week we discussed the Wisconsin Supreme Court’s decision in Bank of New York v. Carson permitting circuit courts to force a mortgagee to hold a sheriff’s sale. Today we rewind the clock a bit to a decision last December by the Court of Appeals on a different aspect of Wisconsin’s foreclosure regime. In Bank of America, N.A. v. Prissel, 2015 WI App 10 (Dec. 9, 2014), the court held that a mortgagee is not required to publish a notice of sale before the expiration of the six-month redemption period in Wis. Stat. § 846.101. The case presents an interesting juxtaposition to the Carson case because it interprets the same word in a neighboring statute.
Last week the Wisconsin Supreme Court issued its decision in Bank of New York v. Carson, 2015 WI 15, a case we previewed here. The case is significant for its potential lasting effects on mortgage foreclosures in Wisconsin.
The Carson case involves interpretation of Wis. Stat. § 846.102, which applies to foreclosure of “abandoned” properties. In 2007, Shirley Carson granted a mortgage on her home in Milwaukee to secure a loan from Countrywide Home Loans. After Carson defaulted on the loan, Bank of New York (the trustee of the securitized mortgage trust to which Countrywide had transferred the mortgage loan) filed a foreclosure action, and the Milwaukee County Circuit Court entered a default foreclosure judgment in June 2011. Because the property appeared vacant at the time, and the bank did not seek a deficiency judgment against Carson, the judgment provided for a 3-month statutory redemption period under § 846.103(2), but the bank did not sell the property after the redemption period expired.
Most bankruptcy lawyers might think that the dismissal of a bankruptcy proceeding and the revesting of the bankruptcy estate’s assets in the debtor bring an end to the bankruptcy court’s jurisdiction.
Not (necessarily) so, according to the Seventh Circuit in In re Sweports, Ltd., No. 14-2423 (7th Cir. Jan. 9, 2015), a decision written by Judge Posner in which Judges Williams and Tinder joined. There exists a form of “clean-up” jurisdiction (or “ancillary” jurisdiction, as the court acknowledged “it is commonly called”) that allows a bankruptcy court “to take care of minor loose ends,” even after the case has been dismissed.