Unusual circumstance and need advice...

[despritfreya]

TB,

Just looking at it from different angles. This is the type of stuff that walks in our door and for which we would be hiring "special counsel" to assist if a bk was the way to go.

Des.

[phattysbox]

This is a very complicated issue for which seeking advice off the Internet is not the way to go. I realize you are trying to arm yourself with as much information as possible so that you can assist your father. However as LITR points out, he is under a court order and I am not sure a bk will help him.

1. The Court Order appears to have been issued under the regulatory power of a governmental entity. It is not in the nature of a money judgment. It is in the nature of an injunction requiring him to act.

2. Filing a bk will not stop the governmental unit from implementing its regulatory power. 11 USC 362(b)(4)

3. A discharge talks in terms of a debt, not the enforcement of a regulatory action. I am not sure your father’s “liability” to the government is even something that would be subject to a discharge.

4. I am not sure that a foreclosure of the property will end the problem since the regulatory action was not directed at the lien holder.

I think your father needs to consult with two attorneys who can work together - one that is familiar with zoning regulations and injunctions related to such violations and one that is familiar with the effect of a bankruptcy on such issues. I can tell you that if your dad walked into my office I would not be able to answer such questions without spending time researching these issues. My first call would be to an attny I know who handles zoning matters. It may very well be that he must undo the damage or get the regulatory court order modified in some way.

Des.

Thanks, this helps alot. he is seeing a bk atty this friday but I may push him to see a real estate atty as well.

J

[tobee43]

TB,

Just looking at it from different angles. This is the type of stuff that walks in our door and for which we would be hiring "special counsel" to assist if a bk was the way to go.


Des.

it certainly is to bad your door isn't down OP's street!

although i'm certain many on this site feel that way.

[ddrolia]

No way, no chance of going to jail. One has a chance to explain to a judge about not complied with the court order.

[btbeme]

I read this a few hours ago, and have now come back to it. Here's what is pecking at my brain, whether it is relevant or not...

I read an article last week about zombie mortgages. Those are mortgages and homeowner obligations that get caught in a legal limbo, yet haunt a homeowner in ways they never dreamed. To wit, a homeowner can get a discharge in Ch 7, and assume that the foreclosure sale scheduled for "next week" is going to happen. Homeowner moves out, and... nothing happens. The bank decides to not sell the property in foreclosure and would rather wait for whatever reason (there are several). However, NOBODY is responsible for informing the homeowner that the sale did not happen. Homeowner is still on the deed, and is therefore legally obligated to pay various fees and fines and whatnot because of local ordinance, or HOA, or...

I saw stories of homeowners responsible for huge fines because their abandoned property has been stripped of siding, or for weed control, or sued by the bank for loss of value after transients burn half of it down. Now, maybe, a sharp attorney and a raft of legal maneuvering may help mitigate or even eliminate these fines and suits and penalties, but that costs big money.

I am certainly not a legal expert, but I find that most law follows a pretty good common-sense path of reasoning. My common sense says that the legal woes regarding the status of the house would need to be addressed first, as a BK discharge may shoosh the mortgage payment but not necessarily compel the bank to reassume responsibility for a hugely non-desirable (and possibly unsafe and illegal) property. Meaning that Dad would still be on the hook financially, even as the occupants started to recycle the copper wiring and plumbing. God forbid something tragic happens while Dad is still on the deed.

That's my fear, anyway. I am pretty sure that there is nothing in BK law that compels a lien holder to take back property, especially as-is and with no recourse. I may be 180 degrees wrong here. Don't know. Judging from current news items, it looks more like lien holders are willing to let things sit and rot in some cases.

If it were me I would make damn sure that a BK would be the last and final act I would have to worry about - not the opening salvo.

[keepsmiling]

As we here all know... depending on the individual situation, the banks' failure to move forward is a blessing or a curse.
No good answers except to not move until you absolutely must.
So many folks have come here with this kind of quandary.
I guess the best thing to do is start downsizing and organizing so you can move in a hurry when the axe actually falls. Of course this doesn't help those who must relocate for other reasons.
No ideas about how you can "address the status of the house first." But I'll be curious to see if any others do.