Opinion
Case No. 8:16-bk-06911-RCT
12-15-2016
In re Baseemah Nura Salat, Debtor(s).
Chapter 13 ORDER GRANTING RELIEF FROM THE STAY UNDER 11 U.S.C. § 362(d)(4) AND IMPOSING TWO-YEAR BAR IN-REM REGARDING PROPERTY LOCATED AT 5717 PINEY LANE DR. , TAMPA, FLORIDA, 33625
This case was considered at trial on the Motion filed by Mayan Mainstreet Investors, I, LLC ("Mayan") to Dismiss Case, or Alternatively, for Relief from Stay, for Injunctive Relief and Objection to Confirmation of Plan (Doc. 12) (the "Motion"), and Mayan's Motion for Preliminary Injunction filed in a related adversary (Adv. Proc. 8:16-ap-00759-RCT, Doc. 2). Debtor is one of the four defendants in the adversary proceeding that Mayan seeks to enjoin; Debtor's co-defendants are Nadine Houston ("Houston"), Della Khadijah Hatch-Abdullah ("Hatch-Abdullah"), and Michael Taalibuddin Abdullah ("Abdullah") (collectively with Debtor, the "Abdullah Parties").
At trial, the court received into evidence, without objection, a sizeable volume of documents, including various deeds, mortgage documents, and state court filings and records (Doc. 38), and the proffered testimony of Mayan's corporate representative, Bradley Weiss (Doc. 40). Debtor presented no evidence. Except for the Debtor, who appeared through counsel, the Abdullah Parties did not appear.
Mr. Weiss was present at trial. Debtor declined to cross examine Mr. Weiss. Accordingly, the court treats Mr. Weiss's proffered testimony as uncontested.
Debtor is represented in the main case only. Mr. Borden has not appeared in the adversary proceeding.
Mayan argues that the Abdullah Parties, working in concert, have interfered unjustifiably with its lawful right to foreclose on the property located at 5717 Piney Lane Dr., Tampa, FL 33625 ("Property"), for a period of almost ten years. During that time, while making no payments under the mortgage, the Abdullah Parties allegedly engaged in a complex scheme that included (i) bad-faith filing of multiple bankruptcy cases, (ii) fraudulently transferring the Property among themselves, and (iii) fraudulently obtaining a reverse mortgage against the Property by creating sham business entities and falsifying estoppel letters that purported to be payoff requests from Mayan. (Docs. 12, 38, 40). This case was filed the day before a scheduled foreclosure sale of the Property.
As to this filing, Mayan argues that Debtor's chapter 13 is in bad faith based upon this concerted conduct as well as certain discrepancies or false statements in her petition and schedules. (Docs. 12, 38, 40). According to Mayan, of particular note among the false statements is the fact that, as of the petition date, Debtor was not the record title owner of the Property, Houston was.
Debtor concedes that she was not the record owner of the Property as of the filing; however, she claims title to the Property under an unrecorded quit-claim deed executed by Houston shortly before the filing. Debtor stated that she does not object to Mayan obtaining relief from the stay—even prospective relief. However, she contests that her case was filed in bad-faith and therefore asks that the court deny the motion to dismiss. Debtor indicated that she might convert her case to a case under chapter 7.
At trial as well as at a prior hearing on the Motion, Debtor's counsel represented that Debtor held such a deed. --------
After hearing from the parties and reviewing the evidence presented, the court finds that Mayan is entitled to relief from the stay under 11 U.S.C. § 362(d)(4) and that a two-year in-rem bar as to the Property is warranted. Cf. In re Wilke, 429 B.R. 916, 923 (Bankr. N.D. Ill. 2010) (ordering relief under § 362(d)(4) where debtor and a non-debtor engaged in a scheme involving multiple bankruptcy filings, fraudulent transfers of the real property including a transfer on the eve of the filing, and fraudulent procurement of mortgages); see generally First Yorkshire Holdings, Inc. v. Pacifica L 22, LLC (In re First Yorkshire Holdings, Inc.), 470 B.R. 864, 870-71 (B.A.P. 9th Cir. 2012) (discussing the requirements of § 362(d)(4) relief). The court makes the following findings:
1. The Abdullah Parties have filed the following bankruptcy cases, which have affected the Property: (a) Debtor's instant case; (b) In re Taalibuddin Abdullah, aka Michael T. Abdullah, Case No. 8:08-bk-08879-MGW, M.D. Fla. (Doc. 38, Ex. 34); In re Taalibuddin Abdullah, aka Michael T. Abdullah, Case No. 8:08-bk-14253-MGW, M.D. Fla. (Doc. 38, Ex. 35) (the "Bankruptcy Filings").
2. The Abdullah Parties have transferred the Property among themselves, including the representation that Debtor accepted a quit-claim deed for the Property from Houston shortly before the filing of the petition, without either Mayan's consent or the approval of a court of proper jurisdiction. (Doc. 38, Exs.8, 19; Doc. 40) (the "Transfers").
3. The Bankruptcy Filings and Transfers were part of a scheme perpetuated by the Abdullah Parties with the intent to hinder, delay and/or defraud Mayan in the exercise of its lawful rights against the Property. This scheme also included (i) the fraudulent procurement of a reverse mortgage against the Property by, among other means, generating false documents that purported to be payoff/estoppel letters from Mayan (Doc. 38, Exs. 13, 14, 15, 17, 18; Doc. 40); and (ii) either the non-appearance at a scheduled deposition (Houston), or evasive, combative behavior at depositions in the state court foreclosure matter (Debtor, Hatch-Abdullah, and Abdullah) (Doc. 38, Exs. 27-30).
The court will reserve ruling on the Motion to the extent that it seeks dismissal of the case for bad faith. The court also reserves ruling on the motion for a preliminary injunction insofar as the relief granted in this order includes broader and more tailored relief, which will be addressed by separate order entered in the adversary proceeding.
Accordingly, it is ORDERED:
1. The Motion is GRANTED, in part. The automatic stay is annulled and modified as provided below.
2. If this Order is recorded in compliance with applicable state law governing the notice of interests or liens in real property, the automatic stay arising under 11 U.S.C. § 362(a) shall not arise in any case filed under Title 11 of the United States Code that purports to affect the real property identified below, which is filed within two years from the date of entry of this Order.
3. The real property that is subject of this Order is located at 5717 Piney Lane Dr., Tampa, Florida, 33625, and is more particularly described as:
Lot 12, Block 1, Woodmont Subdivision, Phase 1, according to the plat thereof, recorded in Plat Book 65, Page 16, of the Public Records of Hillsborough County, Florida.
4. The 14-day stay of this Order imposed by Fed. R. Bankr. P. 4001(a)(3) is waived.
5. The court reserves ruling on the Motion to the extent it seeks dismissal of the case.
ORDERED. Dated: December 15, 2016
/s/_________
Roberta A. Colton
United States Bankruptcy Judge Attorney Robert A. Stok is directed to serve a copy of this order on interested parties and file a proof of service within 3 days of entry of the order.