In Re Larry Michael Barnes and Janice Kay Barnes, Husband and Wife, Debtors. Larry Michael Barnes and Janice Kay Barnes, Husband and Wife v. Knutson Mortgage Corporation, 5 F.3d 545, 10th Cir. (1993)
Uploaded by
Scribd Government DocsIn Re Larry Michael Barnes and Janice Kay Barnes, Husband and Wife, Debtors. Larry Michael Barnes and Janice Kay Barnes, Husband and Wife v. Knutson Mortgage Corporation, 5 F.3d 545, 10th Cir. (1993)
Uploaded by
Scribd Government Docs5 F.
3d 545
NOTICE: Although citation of unpublished opinions remains unfavored,
unpublished opinions may now be cited if the opinion has persuasive value on a
material issue, and a copy is attached to the citing document or, if cited in oral
argument, copies are furnished to the Court and all parties. See General Order of
November 29, 1993, suspending 10th Cir. Rule 36.3 until December 31, 1995, or
further order.
In re Larry Michael Barnes and Janice Kay Barnes, husband
and wife, Debtors.
Larry Michael BARNES and Janice Kay Barnes, husband and
wife, Appellees,
v.
KNUTSON MORTGAGE CORPORATION, Appellant.
No. 93-6108.
United States Court of Appeals,
Tenth Circuit.
Sept. 29, 1993.
Before ANDERSON, BARRETT, and TACHA, Circuit Judges.
ORDER AND JUDGMENT1
1
After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist the determination
of this appeal. See Fed. R.App. P. 34(a); 10th Cir. R. 34.1.9. The cause is
therefore ordered submitted without oral argument.
Appellees Larry and Janice Barnes ("debtors") filed a Chapter 13 Bankruptcy
Petition on June 9, 1992. In their Proposed Plan, debtors sought to bifurcate the
claim of Appellant Knutson Mortgage Corporation ("Knutson"), the holder of a
note secured by a mortgage on the debtors' principal residence, into a secured
claim equal to the stipulated fair market value of the residence and an
unsecured claim equal to the balance remaining under the note.
Knutson objected to the Proposed Plan, and the Bankruptcy Court for the
Knutson objected to the Proposed Plan, and the Bankruptcy Court for the
Western District of Oklahoma denied confirmation of the Plan, following the
reasoning of the Fifth Circuit in Nobelman v. American Savings Bank, 968
F.2d 483 (5th Cir.1992), aff'd, 113 S.Ct. 2106 (1993), and concluding that
bifurcation is not permitted. The debtors appealed to the district court, which
reversed the ruling of the bankruptcy court, holding that Eastland Mortgage Co.
v. Hart (In re Hart), 923 F.2d 1410 (10th Cir.1991) (per curiam), permitted such
bifurcation. Knutson timely appealed.
We abated this appeal pending the Supreme Court's decision in Nobelman v.
American Savings Bank, 113 S.Ct. 2106 (1993), involving the same issue--i.e.
the permissibility of bifurcating an undersecured mortgage under sections
506(a) and 1322(b)(2) of the Bankruptcy Code into a secured claim equal to
the fair market value of the residence and an unsecured claim equal to the
balance owing to the mortgagee. A unanimous court in Nobelman held that 11
U.S.C. 1322(b)(2) "prohibits a Chapter 13 debtor from relying on section
506(a) to reduce an undersecured homestead mortgage to the fair market value
of the mortgaged residence." Id. at 2108.
The parties have filed briefs stating their views with respect to the holding in
Nobelman. As we have held in Independence One Mortgage Corp. v. Wicks (In
re Wicks), No. 92-6134, --- F.2d --- (10th Cir., Sept. 28, 1993), Nobelman
applies to cases pending on appeal at the time of its issuance and therefore
applies to this case. Nobelman effectively forecloses the debtors' bifurcation
argument, as the debtors have conceded in their supplemental brief.
For the foregoing reasons, the order of the district court is REVERSED and the
case is REMANDED for proceedings consistent herewith.
This order and judgment has no precedential value and shall not be cited, or
used by any court within the Tenth Circuit, except for purposes of establishing
the doctrines of the law of the case, res judicata, or collateral estoppel. 10th Cir.
R. 36.3
