United States District Court, D. Connecticut
IN RE FRANCES ANN BARRETTA, Debtor.
WELLS FARGO BANK, N.A., Appellee. FRANCIS ANN BARRETTA, Appellant, Bky. Petition No. 15-30751 (JAM)
RULING ON BANKRUPTCY APPEAL
W. THOMPSON, UNITED STATES DISTRICT JUDGE
Frances Ann Barretta (“Barretta”) appeals from an
order entered in her Chapter 7 bankruptcy proceeding granting
a motion filed by appellee Wells Fargo Bank, Inc., N.A.
(“Wells Fargo”) from relief from the automatic
stay pursuant to 11 U.S.C. §§ 362(d)(1) and 363
bankruptcy court's decision on a motion to lift the
automatic stay is reviewable only for an abuse of
discretion." Mazzeo v. Lenhart (In re Mazzeo),
167 F.3d 139, 142 (2d Cir. 1999). This court reviews the
Bankruptcy Court's “conclusions of law de
novo, and findings of fact under a clearly erroneous
standard.” In re Ionosphere Clubs, Inc., 922 F.2d 984,
988 (2d Cir. 1990). "This [clearly erroneous] standard
precludes this Court from reversing the Bankruptcy
Court's decision if its account of the evidence is
plausible, even if this Court is convinced that it would have
weighed the evidence differently." In re B. Cohen &
Sons Caterers, Inc., 108 B.R. 482, 484 (E.D. Pa. 1989)
(citation omitted). A finding is clearly erroneous when
“the reviewing court on the entire evidence is left
with the definite and firm conviction that a mistake has been
committed." Dist. Lodge 26, Int'l Ass'n of
Machinists & Aerospace Workers, AFL-CIO v. United
Techs. Corp., 610 F.3d 44, 51 (2d Cir. 2010) (citation
and internal quotation marks omitted).
November 2012, Wells Fargo commenced a foreclosure action
against Barretta in Connecticut Superior Court with respect
to property located at 73 Lori Lane, Meriden, Connecticut
(the “Property”). In September 2014, Wells Fargo
moved for summary judgment. Barretta did not oppose the
motion, and summary judgment entered in favor of Wells Fargo.
In December 2014, Wells Fargo filed a Motion for Judgment -
Strict Foreclosure, which was accompanied by an appraisal.
Barretta did not oppose the motion, and it was granted on
December 22, 2014. The state court entered a Judgment of
Strict Foreclosure in favor of Wells Fargo in the amount of
$270, 014.60 and at that time determined that the fair market
value of the Property was $255, 000.00, i.e. less than the
amount of the judgment. Barretta did not timely appeal the
judgment or file a motion to open the judgment.
7, 2015, Barretta filed a petition for relief pursuant to
Chapter 13 of the Bankruptcy Code. In that petition she
listed her monthly income and expenses, and her monthly
expenses were $1, 985 greater than her monthly income. In a
schedule filed with her petition, Barretta listed the value
of the Property as $255, 000, and in another schedule she
listed Wells Fargo as a secured creditor with an undisputed
debt in the amount of $270, 014.60. Barretta filed amended
schedules on May 18, 2015, but did not amend the valuation of
the Property or the amount of Wells Fargo's secured debt.
Barretta filed a proposed Chapter 13 plan on July 7, 2015. In
that plan Barretta again represented that Wells Fargo was
owed a debt of $270, 014.60 secured by the Property, and she
again placed a value on the Property of $255, 000. Barretta
was unable to confirm the Chapter 13 plan and her case was
converted to a Chapter 7 proceeding in August 2015.
October 2015, Wells Fargo filed a motion for relief from the
automatic stay. Wells Fargo argued to the Bankruptcy Court
that Barretta lacked equity in the Property, pointing to the
valuation in the debtor's schedule filed with her
petition. It argued further that payments were not being made
to protect Wells Fargo's interest in the Property, that
the Property was not necessary to an effective
reorganization, and that cause otherwise existed for relief
from the automatic stay.
filed an objection to the motion, arguing that the town had
valued the Property at $278, 100 in 2014 and 2015, that a
statement she had received indicated that her unpaid
principal balance as of the date she had defaulted was $204,
108.45, and that it was not plausible that the total amount
due had grown to $270, 014.60, i.e. the number reflected in
the state court judgment.
on the record here, this court cannot conclude that the
appellant has met the standard of demonstrating the
Bankruptcy Court's decision was clearly erroneous. This
court does not have a definite and firm conviction that a
mistake has been committed. Rather it appears to this court
that the Bankruptcy Court's analysis and conclusion were
Bankruptcy Court's decision is supported by the repeated
statements the appellant made prior to Wells Fargo filing its
motion for relief from the automatic stay, which reflected
that she owed a debt to Wells Fargo, that the debt was
secured by the Property, and that the amount of the debt
exceeded the value of the Property. This fact, together with
the fact that Barretta was unable to confirm her Chapter 13
plan, supports the Bankruptcy Court's conclusion that the
requirements of Section 362(d)(2) had been satisfied.
Section 362(d)(1), which provides that the stay can be lifted
“for cause, including the lack of adequate protection
of an interest in property of such party in interest”,
the focus of the argument before the Bankruptcy Court was
adequate protection. See Debtor's Objection to
Wells Fargo Bank, N.A.'s Motion for Relief from Automatic
Stay (Real Property) (Doc. No. 15-1) at 45-47 of 71. Thus,
the appellant's argument that the Bankruptcy Court erred
because its order did not explicitly address the Sonnax
factors (see In re Sonnax Industries, Inc., 907 F.2d
1280, 1286 (2d Cir. 1990)) is unavailing. See
Appellant's Opening Brief (Doc. No. 15) at 20-23 of 31.
Section 362(d)(1) explicitly provides that lack of adequate
protection is “cause”, and the facts that support
the Bankruptcy Court's conclusion with respect to Section
362(d)(2), together with Barretta's statements in her
petition with respect to her monthly income and expenses,
supports the Bankruptcy Court's decision with respect to
on the foregoing, the court concludes that the Bankruptcy
Court's decision to grant relief from the automatic stay
was not an abuse of discretion under either Section 362(d)(2)
the order of the Bankruptcy Court is hereby AFFIRMED.
Clerk shall ...