Opinion
Case No. 13-15271
09-03-2014
In Re: Rick J. Boshears Angela D. Boshears Debtor
Chapter 13
ORDER CONFIRMING PLAN
I. Introduction.
In this chapter 13 case, Debtors filed a plan with their petition for relief. Creditor 21Mortgage Corporation ("Creditor") filed an objection to confirmation of the plan. The objection to confirmation came on for a hearing which was held. At the hearing Debtors and Creditor advised the Court that the only issue that has not been resolved between the parties was the appropriate method for valuing the Debtors' manufactured home and the land upon which that home sits. At the request of the Court, the parties submitted briefs as to the appropriate method for determining valuation, and such briefs have been filed as well as responses to those briefs.
II. Jurisdiction.
This court has jurisdiction of this matter pursuant to 28 U.S.C. § 1334(b) and the General Order of Reference entered in this district. This is a core proceeding arising under 28 U.S.C. §157.
III. Facts.
Creditor holds a valid security interest in real property located at 17001 Minnick Road, Mt. Orab, Ohio 45154, as well as in Debtors' manufactured home.
The parties have stipulated that the value of the manufactured home is $15,000.00, and the value of the real property is $9,000.00. If, however, the manufactured home and real property are valued together as one unit, the value is $32,000.00.
IV. Position of the Parties.
A. Creditor
Creditor urges that the Court adopt the one unit valuation. Its position is supported by Debtors' own appraisal which was filed with the Court, and the one unit valuation was the method used by the appraiser.
B. Debtors
Debtors contend that the manufactured home and the real property should be separately valued and the valuation determined by adding the separate values together.
V. Discussion.
There is no dispute amongst the parties that the antimodification provision § 1322(b)(2) does not apply since the Creditor does not have a claim secured only by real property which is the Debtors' personal residence. Pursuant to Ohio law a mobile home only becomes real property if it is affixed to a permanent foundation on land owned by the mobile home owner and the certificate of title for the mobile home has been inactivated by the clerk of the court of common pleas that issued it. Ohio Rev. Code Ann. § 5701.02 (2014); In re Wallingford, 524 F. App'x 205, 207 (6th Cir. 2013). In this case, since the title was never surrendered the Debtors' manufactured home remains personal property separate from the real property. Since the manufactured home is separate from the real property it must be valued separately.
Creditor argues for a different outcome here. The basis for its position is the value contained in the appraisal submitted to the Court by Debtors. The Court finds Creditor's position to be unsound. In his appraisal, the appraiser approached his task as finding the value of the unit land and mobile home combined. It was not for the appraiser to determine the question which is here before the Court. Indeed, the appraiser in his report said, "I have not used comparable sales that were the result of combining a land sale with the contract purchase price of a home that has been built or will be built on the land." Thus, the appraiser understood his task to be to value the land and home as a unit. He did not deal with the question which is now before the Court.
VI. Conclusion.
The Court holds that the manufactured home and the real property should be valued separately, with the manufactured home having a value of $15,000.00 and the real property having a value of $9,000.00. Creditor shall have a secured claim of $24,000.00.
So Ordered.
This document has been electronically entered in the records of the United States Bankruptcy Court for the Southern District of Ohio.
IT IS SO ORDERED.
Dated: September 3, 2014
/s/_________
Burton Perlman
United States Bankruptcy Judge
Copies to: Default List David Demers
PO Box 714
New Albany, Ohio 43054
Counsel for 21 Mortgage Corporation