Before the foreclosure sale, notice of the pending sale was posted in the Harris County, Texas courthouse. Tex. Prop. Code Ann. 51.002(b); cf In re Burns, 183 B.R. 670, 671 (Bankr.D.R.I. 1995). After the foreclosure sale, no posted or filed records were required.
On July 6, 1995, the Bankruptcy Court issued a Decision and Order, denying Freddie Mac's motion and declaring the mortgagee's deed to be void. See In re Burns, 183 B.R. 670 (Bankr. D.R.I. 1995). Approximately eight months later, on March 13, 1996, the Decision and Order was recorded in the land evidence records in the town of Cumberland.
We have dealt with this same fact scenario at least twice, but in cases that were commenced prior to October 22, 1994, the effective date of Section 1322(c)(1). See In re Burns, 183 B.R. 670 (Bankr.D.R.I.1995), and In re Glenwood Associates, 134 B.R. 1012 (Bankr.D.R.I.1991). In those cases, when Section 544(a)(3) of the Bankruptcy Code was the law, we ruled that "the filing of the bankruptcy petition prior to the recording of the mortgagee's deed subordinates the status of the foreclosure sale purchaser to the rights of the trustee, or the debtor standing in the trustee's shoes."
The Debtors argue that the Hazleton decision should not control this case because the analysis in Hazleton only considered the property rights of debtors under state and federal law, but not the rights of a trustee as a hypothetical bona fide purchaser of real property ("BFP") under 11 U.S.C. § 544(a)(3). The Debtors point to the decision in In re Burns, 183 B.R. 670 (Bankr.D.R.I. 1995). In Burns, the Chapter 13 debtors filed their petition after the foreclosure auction, but before the foreclosure deed was recorded.