United States District Court, D. Connecticut
ORDER AFFIRMING DECISION OF BANKRUPTCY COURT
Jeffrey Alker Meyer United States District Judge.
Edward O'Hara co-signed a mortgage with Francis
O'Hara in 2006. Under the terms of the agreement, Edward
O'Hara would not be personally liable in the event of a
default on the loan. When he declared bankruptcy a decade
later, the bank noticed a claim against Edward O'Hara
based solely on the mortgage. The United States Bankruptcy
Court eventually dismissed his case, see Doc. #127
to In re O'Hara, No. 16-51249 (Bankr. D. Conn.
2018) (Manning, C.J.), then denied his subsequent motion to
reopen, see Doc. #146 to id., and then
denied his motion for reconsideration of that denial,
see Doc. #149 to id. O'Hara now appeals
from that final order denying reconsideration of his motion
to reopen. Doc. #1. For the reasons stated herein, I will
affirm the Bankruptcy Court's order.
2006, Edward O'Hara and Francis O'Hara jointly signed
a mortgage for property in Greenwich, Connecticut in 2006.
Doc. #10-2 at 12, 23. The mortgage secured payment for a loan
of nearly $700, 000, id. at 11, and Francis
O'Hara alone signed a separate promissory note pledging
to pay that amount back to the lender, see Id. at 4,
8. The lender and mortgagee was an entity named
“MORTGAGEIT, INC.” Id. at 8, 10. In
relevant part, the mortgage provided that anyone who
co-signed the mortgage but who did not sign the
promissory note agreed “only to mortgage . . . the
co-signer's interest in the property, ” and that a
co-signer was “not personally obligated to pay the sums
secured by” the mortgage. Id. at 19.
years later, Edward O'Hara filed a Chapter 13 bankruptcy
petition in the United States Bankruptcy Court on September
19, 2016. See Doc. #1 to In re O'Hara,
No. 16-51249 (Bankr. D. Conn. 2017). As part of the
bankruptcy proceeding, Ocwen Loan Servicing- purporting to
work on behalf of creditor U.S. Bank National Association, as
Trustee for the Lehman XS Trust Mortgage Pass-Through
Certificates, Series 2006-12N (“Lehman XS”)-filed
a proof of claim for the mortgaged Greenwich property.
See Doc. #10 at 6; Doc. #10-1 at 4-6.
made various challenges to this claim in the Bankruptcy
Court. As one piece of evidence among many, O'Hara filed
with the Bankruptcy Court the affidavit of securities
attorney Martin Mushkin, and with it an attestation from the
Securities and Exchange Commission (SEC). See Doc.
#91 at 45-49 to In re O'Hara, No. 16-51249
(Bankr. D. Conn. 2017). On January 24, 2018, the Bankruptcy
Court dismissed O'Hara's Chapter 13 case, and in the
same ruling, overruled O'Hara's objections to the
Lehman XS claim. The Bankruptcy Court ruled in relevant part:
ORDERED: Pursuant to Fed.R.Bankr.P.
3001(f), “[a] proof of claim executed and filed in
accordance with.. [the Bankruptcy Rules] shall constitute
prima facie evidence of the validity and amount of the
claim.” The burden of persuasion under the bankruptcy
claims procedure always lies with the claimant, who must
comply with Fed.R.Bankr.P. 3001 by alleging facts in the
proof of claim that are sufficient to support the claim. If
the claimant satisfies these requirements, the burden of
going forward with the evidence then shifts to the objecting
party to produce evidence at least equal in probative force
to that offered by the proof of claim and which, if believed,
would refute at least one of the allegations that is
essential to the claim's legal sufficiency. In re
Jorczak, 314 B.R. 474, 481 (Bankr. D. Conn. 2004) (internal
citations omitted). The Creditor satisfied the requirements
of the Bankruptcy Rules and therefore, the burden shifted to
the Debtor to overcome the prima facie validity and amount of
the claim. The Debtor has not put forth sufficient evidence
to rebut the Creditor's claim and therefore Objections to
Claim No. 6 are OVERRULED and Claim No. 6 is deemed to be an
allowed secured claim in accordance with 11 U.S.C. §
Doc. #127 to id.
filed a motion for reconsideration on February 2, 2018. Doc.
#131 to id. The Bankruptcy Court denied this motion
on February 9, 2018. Doc. #133 to id. The Bankruptcy
Court then closed O'Hara's case on February 28, 2018.
months later, O'Hara moved the Bankruptcy Court to reopen
his case on August 30, 2018, Doc. #136 to id., and
amended his motion to reopen three times, see Docs.
##140, 144, 145 to id. The third amended motion to
reopen argued that the proof of claim was fraudulent for
several reasons: (1) because O'Hara had not signed the
promissory note, such that “the mortgagee has no claim
whatsoever” on the debtor, Doc. #145 at 1 to
id.; (2) because new evidence from SEC filings
showed that “at least five (5) other securitized REMIC
trusts are claiming an ownership interest” in the loan,
such that the claim by the “putative creditor”
must be “a forgery and [is] most likely fraudulent,
” id. at 2; (3) because “SEC filings of
ownership” showed that the original mortgagee had not
validly assigned the mortgage, id. at 4; and (4)
because the loan servicing company for the creditor was not
registered or licensed in the State of Connecticut as a
consumer debt collector, such that the documents submitted in
support of the claim by the loan servicing company “are
void and judgments rendered on using them as evidence are
void, ” Doc. #145 id. at 5.
October 15, 2018, the Bankruptcy Court denied the third
amended motion to reopen by means of the following docket
ORDER DENYING THIRD AMENDED MOTION TO REOPEN
DEBTOR'S CHAPTER 13 CASE: On September 19, 2018,
the Debtor filed a Third Amended Motion to Reopen
Debtor's Chapter 13 Case (the “Motion, ” ECF
No. 145) arguing that newly discovered information showed
evidence of fraud. After reviewing the Motion and the record
in the Debtor's case, it is hereby
ORDERED: The Motion is DENIED. No cause has
been shown to grant the relief requested. See, 11 U.S.C.
§ 350(b). (RE: 145). Signed by Chief Judge Julie A.
Manning on October 15, 2018. ...