Last-minute adversary proceeding

[researchnerd]

Today is our Ch7 bar date. I checked PACER a couple of hours ago...no changes. Checked it again a few minutes ago, and found an "adversary proceeding" from one of my creditors that was filed this afternoon. Other than vehicles, this is our only secured debt - it's for some furniture we bought from Havertys. It made no sense to reaffirm, so I haven't.

Essentially they are requesting that their part of the debt be declared non-dischargeable. They want payment in full, and if they don't receive it within ten days of judgment they want legal and court fees too. This is the part that bothers me:

"Defendant has failed to reaffirm on the obligation to Plaintiff and refuses to surrender the Collateral to Plaintiff. As a result of Defendant’s actions, which actions amount to wilful and malicious injury to the property of Plaintiff, Plaintiff has thereby sustained a loss in the amount of $2,671."

I have not been asked to surrender the collateral - how could I possibly have refused? They are welcome to come get the furniture if they want it.

Wilful and malicious injury? Really? Or is that just overly-dramatic legalese?

I've emailed my attorney, but they are not good about responding to my questions. Anyone know what happens next? Will this prevent or delay our discharge, or is it a minor thing?

[DebtEnder]

Wow, a "secured" debt wanting their debt to be non-discharged? Just come get the stuff. It's the same with a car repo, if they want it they can come get it. They are going to sustain a loss regardless, the BK court is unconcerned with that. This is their attempt to get their money back without saying their stuff is junk and now worthless, thereby, unsecured.

In the end they have to prove thier case, which I don't see happening, in the end it's simple matter they say they are secured, as such their rights extend to claiming the secured property, which they don't want, nor made any claim too. All they want is cash, hence the AP.

[backtoschool]

Actually this is a common scare tactic for furniture and electronics creditors. Best Buy does this all the time as well. They are trying to scare you into paying them something (which is illegal). Call their bluff and let them schedule the adversary proceeding. Or, if you are worried that that is going to cost you too much extra money, then have your attorney write them a letter telling them to come pick up the furniture. They will not pick up used furniture that they cannot sell.

When did you buy the furniture? Was it soon before filing? Is the furniture relatively new?

[tobee43]

Actually this is a common scare tactic for furniture and electronics creditors. Best Buy does this all the time as well. They are trying to scare you into paying them something (which is illegal). Call their bluff and let them schedule the adversary proceeding. Or, if you are worried that that is going to cost you too much extra money, then have your attorney write them a letter telling them to come pick up the furniture. They will not pick up used furniture that they cannot sell.

When did you buy the furniture? Was it soon before filing? Is the furniture relatively new?

absolutely right...

however, if it's a couch ....make certain you let you baby on it with no diaper...have a party and spill some wine...or at least tell them that...

really now...like i tell everyone honestly....when you went into Havertys or best buy....did you happen to see a sign saying "USED REPOSSESSED ITEMS FOR SALE SECTION".....right...NOT...that's because i understand they both have this crazy NON enforceable credit agreement...but seriously...where's all the used stuff turned into these companies??? in YOUR HOUSES!!

i hate these people...can't they find better things to do with their money then spend it on atty's filing these ap's that are losers. i know someone that had best buy want back her 3 tvs from 4 years ago....NO WAY it would happen....they lost...as they will with your case. really.

just sorry to see you have to go through this.

[researchnerd]

Thanks all. DH and I talked about this and concluded that Havertys did not offer us the opportunity to surrender the furniture because they don't want it back. Maybe they were hoping we didn't notice that they lied outright about that, and that we'd panic and pay them?

We are fine with giving up the furniture, even though it is fairly new and still in very good condition. We bought it in Jan of this year, thinking we'd pay it off immediately with our tax refund. By the time the refund arrived, we needed the $$ to move, so we made a few payments on the furniture before filing in May. If they want to be nasty about this (and I consider an AP based on a lie to be nasty), they can have it back and we'll go buy some newer stuff with CASH.

Questions:
- Can't they get in some kind of trouble for claiming we refused to surrender when we didn't?
- Does this have to be settled before we can get our discharge?
- I noticed on PACER that there's an answer date of 11/23. Should my attorney file an answer, or just send them a letter about coming to get the furniture?

[backtoschool]

Thanks all. DH and I talked about this and concluded that Havertys did not offer us the opportunity to surrender the furniture because they don't want it back. Maybe they were hoping we didn't notice that they lied outright about that, and that we'd panic and pay them?

We are fine with giving up the furniture, even though it is fairly new and still in very good condition. We bought it in Jan of this year, thinking we'd pay it off immediately with our tax refund. But by the time the refund arrived, we needed the $$ to move. If they want to be nasty about this (and I consider an AP based on a lie to be nasty), they can have it back and we'll go buy some newer stuff with CASH.

Questions:
- Can't they get in some kind of trouble for claiming we refused to surrender when we didn't?
- Does this have to be settled before we can get our discharge?
- I noticed on PACER that there's an answer date of 11/23. Should my attorney file an answer, or just send them a letter about coming to get the furniture?

AP's are separate from your petition, but may affect the dischargability of just that debt if they were to show up at the AP, and win. In order to win, they would have to show that you charged the furniture in the 90 days before filing and didn't pay anything on it and that your intent was to never pay for it. Since none of that is true, they would lose the AP.

I don't think they are going for an AP anyway. I think they are trying to scare you into paying like we all said. They cannot get in trouble for what they said, as it is a "he said she said" scenario and they can always claim the letter was "lost in the mail".

Your attorney should answer them, telling them to come get the furniture. My guess is that it will go away after that.

[tcreegan]

Hi researchnerd,

and that we'd panic and pay them? yup, that is exactly what they are hoping for...

Questions:
- Can't they get in some kind of trouble for claiming we refused to surrender when we didn't?

Probably not, unless you have an ironclad letter telling them you surrendered the property, and even then they can claim, "oops, my bad"

- Does this have to be settled before we can get our discharge? usually

- I noticed on PACER that there's an answer date of 11/23. Should my attorney file an answer, or just send them a letter about coming to get the furniture?

Have your attorney file the answer stating that you surrendered the collateral to the BK estate and the creditor has taken no action to recover it. Specifically ask why the creditor has not filed a claim or motion for relief from stay, suggest this AP is frivolous and a waste of the courts time.

Go for it, like others posters have said, they want cash only, not used furniture....

Tom in Colo

[researchnerd]

Tom, you made an excellent point. The furniture is part of the BK estate until discharge...could we have legally surrendered it, even if they'd offered? I don't think so, without relief from the stay. Asshats.