Opinion
Case No. 8:10-bk-24705-CPM
06-27-2017
In re: Martin Northrop and Andrea Northrop, Debtors.
Chapter 11 ORDER ON ORDER TO SHOW CAUSE TO BANK OF AMERICA
THIS CASE came on for hearing on March 28, 2017, for consideration on the Court Order to Show Cause (Doc. 219) directing Bank of America to appear and show cause why the Court should not compel Bank of America to comply with the Debtors' confirmed plan of reorganization (the "Plan") and impose appropriate sanctions for failure to comply, including an award of attorney's fee against Bank of America for fees incurred by the Debtors in pursuant of compliance with the Plan. Based on statements made at the hearing by counsel and by Bank of America representative Charisse Jones, and for the reasons stated orally and recorded in open court that shall constitute the decision of the Court, it is
ORDERED:
1. To address the specific types of problems that occurred in this case, Bank of America is directed to hire a law firm to design or redesign comprehensive step-by-step procedures for handling bank loans involving clients who have filed for bankruptcy relief, which procedures shall include, without limitation:
1) measures designed to minimize the possibility of human error in the entry of data when changes to a bank loan are required due to court approval (confirmation) of a plan under chapters 11, 12, or 13, or a mortgage modification under any chapter, or any other action occurring in the client's bankruptcy case that causes a change in interest rate, maturity date, or some other aspect of the loan;
2) measures designed to correct any human error in data entry concerning the account of a client known to have filed for bankruptcy, including, without limitation, making an appropriate inquiry into the situation when a client begins making regular payments in an amount that differs from the original contract installment amount; and
3) measures designed to ensure the bank provides a bankruptcy client with notice of intent to reject future payments which the bank perceives as insufficient (e.g., short or late) after having previously accepted similar payments and the reason for the intended rejection, so that the client may address the alleged insufficiency.
2. Bank of America is directed to file a copy of these new procedures with the Court within 90 days of entry of this order.
3. Bank of American is further directed to pay Debtor's attorney's fees incurred in connection with the Debtor's Motion to Enforce Confirmed Plan (Doc. 201) and this Order to Show Cause. If the parties are unable to agree upon an appropriate fee amount, Debtor's counsel is directed to file a fee statement for the Court's review.
ORDERED.
Dated: June 27, 2017
/s/_________
Catherine Peek McEwen
United States Bankruptcy Judge Service by CM/ECF only.