Frank L. Kurtz
So Ordered.
_________________
Bankruptcy Judge
Chapter 11
FINDINGS OF FACT, CONCLUSIONS
OF LAW AND ORDER GRANTING
MOTION FOR RELIEF FROM
AUTOMATIC STAY AND
ABANDONMENT
THIS MATTER having come before the above captioned Court upon the Motion of Charles Robert Payne and Kay Marie Payne (collectively "Payne") (the "Motion"), a secured creditor herein, by and through its counsel Davidson Backman Medeiros PLLC, to grant relief from stay and abandonment as to the real property described as follows, and improvements thereon:
Lots #1, 2, 3, 4, 5, 7, 8, 9, 10, 11, 12 and 13 of Block 1 of LANCELOT SHORES ADDITION TO CAMELOT SHORES,
according to the recorded plat thereof, recorded in Book 4 of Plats, page 12, records of Pend Oreille County, Washington (hereinafter referred to as the "
Property").
The Court having reviewed the records and files herein and having found that good cause exists for the relief requested in Payne's Motion, hereby enters the following Findings of Fact and Conclusions of Law:
FINDINGS OF FACT
1. The Payne's have a claim against the Debtor in the amount of $749,191.75 that is secured by the Property (the "Payne Claim") pursuant to the rulings of the Honorable Allen C. Nielson in Pend Oreille County Superior Court Case Number 09-2-00130-4 as described in the Declaration Of Douglas D. Lambarth In Support Of Motion From Automatic Stay And Abandonment And Notice filed herein on May 10, 2013 [Docket Number 260]and the records and files herein.
2. The Payne Claim is not adequately protected by the value of the Property and the Debtor has not offered other adequate protection.
3. The Property is of inconsequential value and benefit to the Debtor's bankruptcy estate, is burdensome to the estate and is not necessary for the Debtor's reorganization based on the records and files herein and on Debtor's Third Amended Plan filed on March 19, 2013 [Docket Number 224]and Fifth Amended Disclosure Statement filed on March 19, 2013 [Docket Number 223]which indicate that the Debtor intends to abandon the Property and that the Property "is burdensome to the Debtor and is otherwise of inconsequential value."
4. The Debtor filed a pleading entitled Declaration Of Donald Swank Re: Motion For Relief From Stay And Abandonment And Notice Thereof on May 28, 2013 [Docket Number 269]but did not object to the Motion. The only objection to the Motion was the Objection to Motion for Relief from Stay and Abandonment filed by Joanne McKnight filed on May 24, 2013 [Docket Number 263](the "McKnight Objection"), which raised issues that are primarily based on Washington State law and is a dispute between two creditors asserting rights to property that is not necessary for an effective reorganization.
5. The Debtor does not have equity in the Property.
6. The issues raised in the McKnight Objection can and should be resolved by a Washington State court of competent jurisdiction. The authority of this Court to enter an order resolving the Washington State law issues raised by the McKnight Objection could be subject to challenge.
CONCLUSIONS OF LAW
1. The Payne Claim is not adequately protected. Payne is entitled to relief from stay under 11 U.S.C. Section 362(d)(1) for cause based on the findings that the Payne Claim is not adequately protected by the Property and that the Debtor has offered no other adequate protection.
2. Payne is entitled to relief from stay under 11 U.S.C. Section 362(d)(2) based on the findings that the Debtor does not have equity in the Property and that the Property is not necessary for an effective reorganization.
3. Pursuant to 11 U.S.C. Section 554, the Property should be abandoned from the bankruptcy estate because it is burdensome to the estate.
4. Pursuant to 11 U.S.C. Section 554, the Property should be abandoned from the bankruptcy estate because it is of inconsequential value and benefit to the estate.
5. The issues raised in the McKnight Objection are primarily based on Washington State law, which can and should be resolved by a Washington State court of competent jurisdiction. The authority of this Court to enter an order resolving the Washington State law issues raised by the McKnight Objection could be subject to challenge.
WHEREFORE, based upon the foregoing Findings of Fact and Conclusions of Law;
IT IS HEREBY ORDERED that pursuant to 11 U.S.C. Section 362(d)(1) and (2), Payne is entitled to and is granted relief from the automatic stay imposed under 11 U.S.C. Section 362, with respect to the Debtor and the Property in order to exercise all remedies allowed by its agreements with the Debtor, and by law, including, but not limited to entry of a judgment foreclosing their first position security interest in the Property, any and all other actions which may be determined to be necessary to foreclose their security interest in the Property, and to sell their collateral.
IT IS FURTHER ORDERED that the Property is abandoned from the estate pursuant to 11 U.S.C. Section 554.
IT IS FURTHER ORDERED that the fourteen (14) day period for the stay of an order granting relief from the automatic stay, provided for in BR 4001(a)(3) is hereby waived, and this Order is effective upon entry. Presented by: DAVIDSON BACKMAN MEDEIROS PLLC _________________
Bruce K. Medeiros, WSBA No. 16380
Attorney for Charles Robert Payne and Kay
Marie Payne