Opinion
Case No. 11-27033-DAR
2012-01-24
In re: JOHN DAWSON KATHLEEN DAWSON Debtors
SO ORDERED
___________________________
U.S. BANKRUPTCY JUDGE
Chapter 7
STIPULATION AND CONSENT ORDER RESOLVING DEBTORS' MOTION TO
COMPEL PAYMENT OF ADMINISTRATIVE EXPENSE AND FOR OTHER RELIEF
BY STIPULATION, it is agreed by the Parties as follows:
1. As set forth on Schedule A—Real Property, as filed with the bankruptcy petition, John Dawson and Kathleen Dawson (the "Debtors") own the real properties located at 8650 Willow Leaf Lane, Odenton, Maryland (the "Willow Leaf Property") and 1544 Fallstone Lane, Crofton Maryland (the "Fallstone Property" and collectively with Willow Leaf, the "Real Properties") as tenants by the entireties.
2. Based on the value of the Fallstone Property and the amount owed to creditors whose debts are secured by the Fallstone Property, there is no equity in the Fallstone Property to benefit the bankruptcy estate and its creditors.
3. As of January _, 2012 , the Fallstone Property is vacant as the tenant that had resided in the property has moved out. Therefore, the Fallstone Property is no longer generating rental income.
4. Based on the value of the Willow Leaf Property and the amount owed to creditors whose debts are secured by the Willow Leaf Property, there is no equity in the Willow Leaf Property to benefit the bankruptcy estate and its creditors.
5. The Willow Leaf Property is currently generating rental income. However, the rental income is not sufficient to pay the monthly installment payments due to the creditors whose debts are secured by the Willow Leaf Property.
6. So long as the Willow Leaf Property generates rental income, it benefits the bankruptcy estate and its creditors.
7. The above notwithstanding, the Willow Leaf Property is leased "month-to-month". Upon termination of the current lease, the Trustee has no intention of seeking a substitute tenant.
8. The Debtors shall make no effort or take no steps to advise, or otherwise encourage, the tenant at the Willow Leaf Property to vacate the property or otherwise terminate the lease.
9. The rental income generated by the Willow Leaf Property is sufficient to pay the post-petition Condominium Fees and insurance on the property, as they come due.
Condominium Fees as used herein shall consist of Front Foot Assessment, Woodland Walk Condominium and Piney Orchard Community Association Fees.
10. The post-petition Condominium Fees and insurance for the Willow Leaf Property are ordinary and necessary expenses to the extent that rental income is sufficient to pay the same.
11. The Debtors retain control of an escrow account for security deposits (the "Escrow Account") paid by the tenant currently residing at the Willow Leaf Property and the former tenant at the Fallstone Property, the Escrow Account is not property of the bankruptcy estate, and the disposition of which is subject to the law of the State of Maryland.
THE COURT, UPON HEARING THIS MATTER and considering the representations of the Debtors and of the Trustee, has determined that these Stipulations of Fact are fair and reasonable.
NOW THEREFORE, Upon the Stipulations of Fact, and having determined that the agreements below are consistent with Law and in the best interests of the Estate, it appearing that the Willow Leaf Property and the Fallstone Property have no equity for the benefit of the bankruptcy estate, it is by the United States Bankruptcy Court for the District of Maryland hereby
ORDERED that the Trustee shall be deemed to have abandoned the Fallstone Property, including any claim for future rental income, and it is further
ORDERED that the Trustee shall pay, as an Administrative Expense any Condominium Fee, Homeowner's Association Fee, Front Foot Fee or insurance which shall have come due from the commencement of this case, with respect to the Willow Leaf Property; PROVIDED HOWEVER, that in no event shall the Trustee's liability for such payments exceed the gross amount of rents collected by the Trustee with respect to the Willow Leaf Property, and it is further
ORDERED that upon receiving notice that the Tenant at the Willow Leaf Property intends to terminate the Lease thereon, the Trustee may, without further Order being required, give notice that the said Willow Leaf Property has been abandoned; and it is further
ORDERED that upon the Trustee's abandonment of the Willow Leaf Property, the Trustee's requirement to pay any Condominium Fee, Homeowner's Association Fee, Front Foot Fee and insurance shall be terminated; and it is further
ORDERED that the Debtor shall, within five (5) days of receipt of same, forward to the Trustee, in care of his undersigned attorney, all bills, invoices or other such notices of payment required for any Condominium Fee, Homeowner's Association Fee, Front Foot Fee or insurance and it is further
ORDERED that the Trustee shall advise the Debtor, through counsel, within five (5) days of receiving notice from the tenant in the Willow Leaf Property the tenant's intent to terminate the lease.
END OF ORDER
CONSENTED TO AS TO FORM AND SUBSTANCE:
___________________________
DAVID W. COHEN, Esquire
Counsel to Debtors
___________________________
REGAN K. LA TESTA, Esquire
Counsel to Richard Kremen,
Trustee
I hereby certify that the terms of the copy of the document submitted to the Court are identical to those set forth in the original document and the signatures represented by /s/ on this copy reference the signatures of consenting parties on the original.
David W. Cohen
cc:
Debtor
Trustee
United States Trustee