Justia Bankruptcy Opinion Summaries

Articles Posted in Maryland Court of Appeals
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The Court of Appeals answered a certified question of law by the United States Bankruptcy Court for the District of Maryland by holding that the Maryland Contract Lien Act (MCLA), Md. Code Ann. Real Prop. 14-201 - 206, does not permit liens that secure unpaid damages, costs, charges, and fees that accrue after the recordation of the lien.According to Appellant, if a lien complies with the procedural requirements for creation under the MCLA, the lien can secure unpaid damages arising after the recordation of the lien, and therefore, the MCLA permits continuing liens. Appellee, in turn, argued that continuing liens are prohibited by the plain language of the statute, its legislative history, and due process requirements. Specifically, Appellee argued that the MCLA prohibits any sum from being secured by a statutory lien before the property owner has the opportunity to contest the sum prior to attachment. The Court of Appeals held that the plain text, legislative history, and case law relevant to the MCLA collectively demonstrate the Legislature's intent to prohibit continuing liens. View "In re Walker" on Justia Law

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The Court of Appeals reversed the judgment of the Court of Special Appeals reversing the judgment of the circuit court quashing Respondent's writ of garnishment, holding that Md. Code Ann. Cts. & Jud. Proc. (CJ) 5-102(a)(3) does not operate to toll the statute of limitations on claim against a bankruptcy debtor that does not result in a dismissal of the petition.Petitioner was an insolvent debtor participating in an active bankruptcy case. Respondent was an unsecured creditor of Petitioner who held a claim in Petitioner's bankruptcy case arising from a judgment he obtained against her. Respondent sought to garnish the proceeds of a settlement Petitioner received that the bankruptcy court, but Petitioner argued that Respondent's judgment had expired under Md. Code Ann. Cts. & Jud. Proc. (CJ) 5-102(a)(3) because it had not renewed it. The circuit court quashed the writ of garnishment. The Court of Special Appeals reversed, holding that CJ 5-202 tolled the statute of limitations. The Court of Appeals reversed, holding that under the plain language of section CJ 5-202, the statute does not operate to toll the statute of limitations on a claim against a bankruptcy debtor that does not result in a dismissal of the petition. View "Hoang v. Lowery" on Justia Law

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Almost three years after her involvement in a motor vehicle accident with Petitioner, Respondent brought a personal injury action against Petitioner and his employer (together, Petitioners). Between the time of the accident and the filing of this action, Respondent filed personal bankruptcy and was discharged from her debts. By operation of bankruptcy law, Respondent’s claim became the property of her bankruptcy estate. Issues regarding the claim were litigated in both the circuit court and the bankruptcy court. Eventually, the bankruptcy court granted Respondent’s request to re-open and re-vested her with the claim as of the filing of the bankruptcy petition. Meanwhile, the circuit court awarded summary judgment to Petitioners, ruling that Respondent lacked standing. The court of special appeals reversed, concluding that, because of the bankruptcy court’s ruling, Respondent was an appropriate plaintiff on a timely-filed complaint. The Court of Appeals affirmed, holding (1) summary judgment was inappropriate where the circuit court failed to take into account the legal effect of the bankruptcy court’s decision to re-vest Respondent with her claim against Petitioners; and (2) as a result of the bankruptcy court’s decision, Respondent had standing to prosecute the complaint. View "Morton v. Schlotzhauer" on Justia Law