Williams et al
Filing
10
OPINION and ORDER Affirming United States Bankruptcy Court Order Dated November 16, 2015, (1) Denying Debtors' Motion to Determine Lease Assumption Agreement Invalid and Unenforceable; and (2) Determining the Lease Assumption Agreement is Valid. Signed by District Judge Matthew F. Leitman. (HMon)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
JANE MARIE WILLIAMS et al.,
Case No. 15-cv-14201
Hon. Matthew F. Leitman
Debtor-Appellants,
v.
FORD MOTOR CREDIT COMPANY, LLC,
Creditor-Appellee.
____________________________________/
OPINION AND ORDER AFFIRMING UNITED STATES BANKRUPTCY
COURT ORDER DATED NOVEMBER 16, 2015, (1) DENYING DEBTORS’
MOTION TO DETERMINE LEASE ASSUMPTION AGREEMENT INVALID
AND UNENFORCEABLE; AND (2) DETERMINING THE LEASE
ASSUMPTION AGREEMENT IS VALID
When a bankruptcy court issues a discharge in favor an individual debtor,
the discharge generally relieves the debtor of his or her pre-petition debts. But two
provisions of the United States Bankruptcy Code allow a debtor to agree to remain
liable for such debts after a discharge under certain circumstances. The first
provision, 11 U.S.C. § 365(p) (“Section 365(p)”), allows a debtor to enter into an
agreement to assume a pre-petition personal property lease. Section 365(p) does
not require a bankruptcy court to review or approve such an agreement. The
second provision, 11 U.S.C. § 524(c) (“Section 524(c)”), more broadly allows a
debtor to enter into an agreement with any creditor to reaffirm the debtor’s pre1
petition obligation to that creditor and to carry that debt forward after the
discharge. A reaffirmation agreement under Section 524(c) requires, among other
things, careful review by, and approval from, a bankruptcy court.
The primary question presented in this appeal is whether a lease assumption
agreement entered into under Section 365(p) must also satisfy the reaffirmation
requirements of Section 524(c).
Stated another way: Is a lease assumption
agreement entered into pursuant to Section 365(p) enforceable following discharge
if the debtor did not also reaffirm the lease’s underlying debt (with bankruptcy
court approval) under Section 524(c)?
In this case, the United States Bankruptcy Court for the Eastern District of
Michigan (the “Bankruptcy Court”) answered that question in the affirmative. In a
written order dated November 16, 2015 (the “Bankruptcy Court Order”), the
Bankruptcy Court held that a lease assumption agreement under Section 365(p)
between Debtor-Appellants Jane Marie Williams and Anthony DeMark Williams
(together, “Appellants”) and Creditor-Appellee Ford Motor Credit Company, LLC
(“Ford”) was enforceable after discharge even though Appellants did not reaffirm
the debt underlying the lease pursuant to Section 524(c). (See ECF #1 at 4, Pg. ID
4.) The Court agrees. The Court therefore AFFIRMS the Bankruptcy Court
Order.
2
RELEVANT FACTUAL BACKGROUND AND PROCEDURAL HISTORY
On June 8, 2015, Appellants filed a joint voluntary bankruptcy petition
under Chapter 7, Title 11 of the United States Bankruptcy Code with the
Bankruptcy Court (the “Petition”). (See ECF #4 at 142, Pg. ID 151.) They
included with the Petition a form titled “Schedule B – Personal Property.” (See id.
at 84, Pg. ID 93.)
The Schedule B form instructed Appellants to list any
“[a]utomobiles, trucks, trailers, and other vehicles and accessories” they claimed as
personal property. (Id.) Appellants listed two vehicles: a 2006 Ford Explorer and
a 2015 Ford Fusion1 (the “Fusion”). Appellants also included the following note
next to the Fusion: “leased – is being assumed.”
(Id.)
Appellants further
supplemented the note by filing a “Statement of Intention” with the Petition. In the
“Statement of Intention,” Appellants said that they intended to assume the Fusion
lease pursuant to 11 U.S.C. § 365(p)(2). (See id. at 117, Pg. ID 126.)
On June 15, 2015, counsel for Ford informed Appellants via email that the
company would permit Appellants to assume the lease. (See id. at 37, Pg. ID 46.)
Ford’s counsel attached to the email a “Proposed Lease Assumption Agreement”
and a “Proposed Stipulation for Assumption of the Lease Agreement.” (See id.)
Ford’s counsel requested that Appellants return the documents fully executed so
1
The personal property at issue in this appeal – the 2015 Ford Fusion lease – was
in Jane Marie Williams’ name. For ease of reference, however, the Court will refer
to “Appellants” throughout this Opinion and Order.
3
that they could be filed with the Bankruptcy Court.
The Proposed Lease
Assumption Agreement provided, in pertinent part, that Appellants agreed to
assume the lease without undertaking the reaffirmation procedures set forth in 11
U.S.C. § 524:
[Appellants] agree to assume the Lease Agreement
(“Lease”), described below . . . with Ford Motor Credit
Company LLC, (“Creditor”) pursuant to 11 U.S.C. §
365(p) and agree to make the monthly payments, listed
below . . . required under the Lease, which is hereby
incorporated by reference. We further agree to be bound
by all the terms and conditions of the Lease including but
not limited to any and all liability for excess mileage,
excess wear and tear, and any other amounts required by
the lease. We agree that any protections under 11 U.S.C.
§ 524(a) do not apply to this Lease.”
(Id. at 5, Pg. ID 14; emphasis added.)
On July 16, 2015, Appellants and their counsel signed the Proposed Lease
Assumption Agreement and the Stipulation for Assumption of Lease Agreement.
(See id.; see also id. at 125-26, Pg. ID 134-35.) They then sent the executed
documents to Ford. (See id.) Ford filed a “Stipulation for Assumption of the
Lease Agreement” with the Bankruptcy Court on July 28, 2015, and submitted to
that court the fully-executed lease assumption agreement (the “Agreement”). (See
id. at 126, Pg. ID 135.)
Appellants then had a change of heart. On August 4, 2015, Appellants filed
with the Bankruptcy Court a notice titled “Rescission of Lease Assumption
4
Agreement” in which they sought to rescind the Agreement (the “Rescission
Notice”). (See id. at 127, Pg. ID 136.) On September 11, 2015, Ford’s counsel
sent a letter to Appellants’ counsel challenging the Rescission Notice. (See id. at
132, Pg. ID 141.) Ford’s counsel said that there is “nothing in the Bankruptcy
Code or case law that permits rescission of a lease after it has been assumed.” (Id.)
Ford’s counsel then said that “Ford Credit will proceed as if the lease has been
assumed unless [counsel] provide[d] [him] with the legal basis that [Appellants]
can subsequently rescind.” (Id.)
On September 15, 2015, the Bankruptcy Court entered an Order of
Discharge, which released Appellants from their pre-petition debts. (See id. at 119,
Pg. ID 128.) It then issued a “Final Decree” closing the case three days later. (See
id. at 122, Pg. ID 131.) The Bankruptcy Court did not address the Rescission
Notice at that time.
On September 22, 2015, Appellants filed a motion to reopen the bankruptcy
to contest the validity of the Agreement. (See id. at 185, Pg. ID 194.) Appellants
argued that the Agreement was invalid because they did not reaffirm the
obligations in the Fusion lease under 11 U.S.C. § 524(c). Ford countered that 11
U.S.C. § 365(p) governs lease assumption agreements. It argued that when a
debtor assumes a lease under that provision, the assumption is valid and
5
enforceable following discharge even if the debtor did not also reaffirm the lease
obligation under 11 U.S.C. § 524(c).
The Bankruptcy Court agreed with Ford and held in the November 16, 2015,
Bankruptcy Court Order that the Agreement was “valid and cannot be rescinded.”
(ECF #1 at 4, Pg. ID 4; See also ECF #4 at 67, Pg. ID 76.) The Bankruptcy Court
concluded “that [Section] 524 doesn’t apply to lease assumptions which are
governed by [Section] 365” and that “pursuant to Section 365, [the Agreement]
cannot be rescinded because there is no provision in 365 which allows for the
[rescission] . . . .” (Id. at 67-68, Pg. ID 76-77.)
On December 1, 2015, Appellants appealed the Bankruptcy Court Order in
this Court. (See ECF #1 at 3, Pg. ID 3.)
STANDARD OF REVIEW
The Court reviews the Bankruptcy Court’s legal conclusions de novo and its
findings of fact for clear error. See In re Dilworth, 560 F.3d 562, 563 (6th Cir.
2009). The parties agree that there are no factual disputes at issue in this appeal.
(See Appellants’ Br., ECF #6 at 3, Pg. ID 209; Ford’s Br., ECF #8 at 5, Pg. ID
282.) Accordingly, the Court reviews the Bankruptcy Court’s legal conclusions
only.
6
ANALYSIS
A.
The Relevant Statutes
This appeal turns on the interplay between Section 365(p) and Section
524(c). Accordingly, the Court begins with the plain language and operation of
those statutes.
1.
11 U.S.C. § 365(p)
Section 365(p) specifically addresses the assumption of a personal property
lease by a debtor. It provides as follows:
(1)
If a lease of personal property is rejected or not timely
assumed by the trustee under subsection (d), the leased
property is no longer property of the estate and the stay
under section 362(a) is automatically terminated.
(2)
(A)
If the debtor in a case under chapter 7 is an individual,
the debtor may notify the creditor in writing that the
debtor desires to assume the lease. Upon being so
notified, the creditor may, at its option, notify the
debtor that it is willing to have the lease assumed by
the debtor and may condition such assumption on cure
of any outstanding default on terms set by the
contract.
(B)
If, not later than 30 days after notice is provided under
subparagraph (A), the debtor notifies the lessor in
writing that the lease is assumed, the liability under
the lease will be assumed by the debtor and not by the
estate.
7
(C)
The stay under section 362 and the injunction under
section 524(a)(2) shall not be violated by notification
of the debtor and negotiation of cure under this
subsection.
A lease assumption under Section 365(p) proceeds in several steps:
[T]he debtor offers to assume the lease obligation, and the
lessor decides whether to accept the debtor’s offer. . . . If the
lessor determines that it is willing to allow the debtor to assume
the lease, it will then notify the debtor of this decision, and may
condition such assumption on cure of any outstanding defaults
on terms set by the contract, however, the lessor is not under
any obligation to accept the debtor’s offer. Upon being notified
of intent to assume an unexpired lease under 11 U.S.C. §
365(p)(2)(A), the lessor is granted safe harbor to contact the
debtor with an acceptance and if necessary, negotiate a cure
without violating the automatic stay or the discharge injunction.
. . . If the parties come to an agreement, the third and final step
required by the statute is that a writing between the lessor and
the debtor be signed to memorialize the terms of the lease
assumption.
In re Perlman, 468 B.R. 437, 439 (Bankr. S.D. Fla. 2012) (quotations and citations
omitted). Importantly, Section 365(p)’s text does not require a bankruptcy court to
review or approve a lease assumption agreement. See In Re Ebbrecht, 451 B.R.
241, 245 (Bankr. E.D.N.Y. 2011).
2.
11 U.S.C. § 524(c)
Section 524(c) provides a general framework under which a debtor may
agree to remain personally liable for a debt obligation following entry of discharge.
It provides:
8
(c)
An agreement between a holder of a claim and the
debtor, the consideration for which, in whole or in part, is
based on a debt that is dischargeable in a case under this
title is enforceable only to any extent enforceable under
applicable non-bankruptcy law, whether or not discharge
of such debt is waived, only if –
(1)
such agreement was made before the granting of the
discharge . . .
(2)
the debtor received the disclosures described in
subsection (k) at or before the time at which the
debtor signed the agreement;
(3)
such agreement has been filed with the court . . .
(4)
the debtor has not rescinded such agreement . . . [and]
(5)
the provisions of subsection (d)2 of this section have
been complied with.
“Because reaffirmation agreements are contrary to the stated goal of a debtor
receiving a fresh start,” they may be “subject to intense judicial scrutiny and must
comply with all statutory requirements.” Ebbrecht, 451 B.R. at 243-44. As a
federal bankruptcy treatise explains, the strict requirements of Section 524(c)
impose
2
11 U.S.C. § 524(d) mandates that a debtor who is not represented by counsel and
who wishes to enter into a reaffirmation agreement under Section 524(c) shall
appear at a hearing before a bankruptcy court. At the hearing, the bankruptcy court
must, among other things, inform the debtor that reaffirmation agreements are not
required by the Bankruptcy Code, and must explain the legal consequences of
entering into such an agreement.
9
important restrictions on [the use of reaffirmation agreements]
and provide substantial protections to the debtor in an attempt
to prevent some perceived abuses of reaffirmation. . . . [T]he
reaffirmation agreement must be made before the granting of
the discharge [of the petitioner’s debt] . . . . [T]he reaffirmation
agreement must contain the disclosures described in section
524(k). Within a cooling-off period (i.e., before discharge or 60
days after the agreement is filed with the court, whichever is
later), the debtor by notice to the holder of the claim may
rescind the reaffirmation agreement.
[T]he agreement must be filed with the court and, if the debtor
was represented by an attorney during the course of negotiating
the reaffirmation agreement, the agreement must be
accompanied by the attorney’s declaration or affidavit stating
that the agreement represents a fully informed and voluntary
agreement by the debtor and does not impose an undue
hardship on the debtor or a dependent of the debtor, and that the
attorney fully advised the debtor of the legal effect and
consequences of reaffirmation. Assuming the appropriate
attorney declaration or affidavit is filed with the agreement, the
court is not required to conduct a hearing to approve the
agreement, but the court may conduct such a hearing if it
chooses or if the requirements of section 524(d) are not met. If
the debtor was not represented by an attorney during the
negotiation of the reaffirmation agreement, the court must
approve the agreement and determine that it does not impose an
undue hardship on the debtor or a dependent of the debtor and
is in the best interest of the debtor.
2 The Law of Debtors and Creditors § 15:51 – Reaffirmation, Westlaw (database
updated November 2015) (quotations and citations omitted); see also Thompson v.
Credit Union Fin. Grp., 453 B.R. 823, 828 (W.D. Mich. 2011).
10
B.
The Interplay Between Section 365(p) and Section 524(c)
The question of whether a lease assumption agreement under Section 365(p)
is enforceable following discharge even if the agreement has not been reaffirmed
under Section 524(c) is a difficult one that has deeply divided federal courts.
Compare Perlman, 468 B.R. at 441 (holding that a lease assumption agreement
made pursuant to Section 365(p) is valid even though the underlying debt was not
reaffirmed under Section 524(c)), with Thompson, 453 B.R. at 830 (holding that a
lease assumption agreement made pursuant to Section 365(p) is enforceable only
where the debt underlying the lease is also reaffirmed under Section 524(c)). This
division stems in part from the fact that Section 365(p) “is not a model of clarity.”
In re Garaux, 2012 WL 5193779, at *2 (Bankr. N.D. Ohio, Oct. 19, 2012).
The courts that have required debtors entering into lease assumption
agreements under Section 365(p) to additionally reaffirm the debt under Section
524(c) frequently cite the Bankruptcy Code’s policy favoring debtor protection.
These courts explain that bankruptcy is a mechanism for providing debtors with a
“fresh start.”
See Thompson, 453 B.R. at 828.
But by entering into lease
assumption agreements under Section 365(p), debtors are compromising that fresh
start by “releasing substantial and consequential rights, protections and benefits.”
Garaux, 2012 WL 5193779, at *4. Requiring a debtor who has entered into a lease
assumption agreement under Section 365(p) to also reaffirm the underlying
11
obligation under Section 524(c) ensures that debtors do not relinquish their “fresh
start” without court oversight. As the court in Thompson explained:
It would be inconsistent for a Chapter 7 debtor to be able to
bypass judicial approval of an assumption while such approval
is required in the contexts of other types of bankruptcies.
[] [T]he Bankruptcy Code elsewhere explicitly requires judicial
approval of a debtor’s agreement to except an otherwise
dischargeable debt from discharge. 11 U.S.C. § 524(c).
Section 524(c) strictly limits the enforceability of an agreement
between a holder of a claim and the debtor, the consideration
for which, in whole or in part, is based on a debt that is
dischargeable in a case under the Code whether or not discharge
of such debt is waived. Such an agreement is enforceable only
if the agreement was made before the granting of discharge; the
debtor received certain disclosures described in section 524(k);
the agreement has been filed with the court; the debtor has not
rescinded the agreement at any time before the later of the
discharge or sixty days after the date the agreement is filed with
the court; in the case of an individual debtor not represented in
the course of entering an agreement, a court hearing in which
the court approves the agreement as not imposing an undue
hardship on either the debtor or a dependent of the debtor, and
in the best interest of the debtor. Section 524(c) thus
establishes not just one but a series of safeguards, a web of
protections for debtors, in keeping with the policy of giving
debtors a fresh start. . . .
[T]he “fresh start” policy of the Code would be in jeopardy if
Chapter 7 debtors could unwittingly bind themselves to section
365(p) lease assumptions that leave them not only without their
leased car but also with all the liability they would have had
absent the bankruptcy filing.
Thompson, 453 B.R. at 828, 829 (quotations and citations omitted).
12
These courts also assert that the plain language of Section 365(p) supports
the conclusion that the debt underlying a lease assumption agreement must be
further reaffirmed under Section 524(c): “Section 365(p)(2) uses the language of
assumption, but the assumption is not self-executing . . . . Rather, [Section] 365(p)
says that, after certain conditions are satisfied, the liability under the lease will be
assumed, suggesting that more is needed for assumption of liability.” Id. at 827-28
(emphasis added).
That “something more,” these courts conclude, is full
compliance with the requirements of Section 524(c).
See id.; see also In re
Creighton, 427 B.R. 24, 28 (Bankr. D. Mass. 2007).
In contrast, other courts have offered three main reasons for concluding that
a lease assumption agreement under Section 365(p) may be enforced following
discharge even if the underlying debt is not reaffirmed under Section 524(c). First,
these courts highlight that Section 365(p) says nothing about the reaffirmation
process under Section 524(c). They reason that “had Congress intended for leases
to be both assumed under Section 365(p) and reaffirmed under Section 524, it
would have said so,” but it “has not.” Ebbrecht, 451 B.R. at 247; see also In re
Bailly, 522 B.R. 711, 716-17 (Bankr. M.D. Fla. 2014).
Second, these courts also assert that requiring reaffirmation under Section
524(c) would render Section 365(p) superfluous:
Why create § 365(p)(2) at all if Congress intended to require a
separate reaffirmation agreements [sic] to assume a lease? Why
13
not just require the debtor to reaffirm a lease after the Chapter 7
trustee does not timely assume it? ‘A statute should be
construed to give effect to all its provisions, so that no part will
be inoperative or superfluous, void or insignificant.’ [Corley v.
United States, 556 U.S. 303, 304 (2009)]. Distinguishing
between lease assumption and reaffirming a debt allows debtors
to do exactly what § 365(p)(2) allows – to decide whether or
not to assume the lease, thus initiating the back-and-forth
negotiating process. Requiring compliance with reaffirmation
procedures renders Congress’s choice to add § 365(p)(2)
effectively meaningless – a debtor simply could submit a
reaffirmation agreement and forego the § 365(p)(2) process
entirely.
Bailly, 522 B.R. at 716.
Third (and finally), these courts highlight that requiring reaffirmation under
Section 524(c) after a debtor has entered into a lease assumption agreement under
Section 365(p) could produce anomalous results:
[A]ssumption of a lease under Section 365(p) binds the debtor
to the lease terms and the discharge has no effect on the
debtor’s assumed obligation. Under the logic of [requiring
reaffirmation], a lessor would have no ability to enforce a lease
agreement assumed by the debtor in the event of a subsequent
default. This interpretation would render section 365(p) a
nullity and would create an absurd result.
In re Mortensen, 444 B.R. 225, 230 (Bankr. E.D.N.Y. 2011).
Indeed, “[i]f
reaffirmation agreements must accompany lease assumptions, a lessor could face
the unenviable position of being bound by a lease assumption – which does not
require judicial approval – but having its reaffirmation denied by the court.”
Bailly, 522 B.R. at 716.
14
This Court agrees with those courts that have enforced lease assumption
agreements under Section 365(p) even without reaffirmation under Section 524(c).
Section 365(p) specifically addresses lease assumption agreements and does not
expressly require that the underlying debt be reaffirmed under Section 524(c).
Requiring such reaffirmation would be adding a step that Congress chose not to
include; would strip Section 365(p) of its independent significance; and would
create anomalous results. For all of these reasons, the Court concludes that a lease
assumption agreement that complies with Section 365(p) is enforceable following
discharge even if the debt that is the subject of the agreement was not reaffirmed
under Section 524(c). Thus, in this appeal, the Agreement is valid even without
reaffirmation under Section 524(c) if it complies with Section 365(p). The Court
now turns to that question.
C.
The Agreement Complies with Section 365(p)
Appellants have asserted that the Agreement does not comply with Section
365(p) – and is therefore invalid – for two reasons. First, Appellants argue that
they entered into the Agreement during a time when the Trustee had the exclusive
authority to make decisions concerning a possible continuation of the Fusion lease.
(See Appellants’ Br., ECF #6 at 16, Pg. ID 218.) In support of this argument,
Appellants cite 11 U.S.C. § 365(p)(1). That statute provides that “[i]f a lease of
personal property is rejected or not timely assumed by the trustee [within 60 days
15
of the petition’s filing], the leased property is no longer property of the estate and
the stay under section 362(a) is automatically terminated.” Appellants contend that
under this statute, “the right to assume a lease belongs exclusively to the Chapter 7
Trustee for the first 60 days after the order for relief, unless the Trustee rejects the
lease or the lease is deemed rejected.” (Id.) Appellants insist that their assumption
of the Fusion lease was invalid because the assumption occurred (1) during the
Trustee’s exclusive 60-day window to assume the lease, and (2) in the absence of a
rejection of the lease by the Trustee.
At least one bankruptcy court in this District has accepted a similar
argument – albeit in an order that does not contain analysis (which that court may
have offered on the record, but which has not been provided to this Court). See In
re Robert Arthur Houvener, No. 09-42209-TJT (Bankr. E.D. Mich. Mar. 18, 2009)
(holding that a debtor’s lease assumption agreement was “invalid and
unenforceable[] because the Debtor and [the creditor] . . . entered into such
agreement before the Chapter 7 trustee rejected the lease or the lease was deemed
rejected under 11 U.S.C. § 365(d)(1).”)
However, another bankruptcy court has rejected the argument that Section
365(p) grants the trustee the exclusive authority to assume or reject a lease for
personal property within the first sixty days after a petition is filed:
[Section] 365(p) doesn’t specifically state when a debtor may
pursue a lease assumption. Clearly, a trustee has the initial
16
authority to assume or reject. The trustee’s authority, however,
does not appear to limit a debtor’s ability to simultaneously
pursue assumption of a lease. If the debtor is successful, §
365(p)(2)(B) makes it clear that the debtor, not the estate, is
assuming the lease. If the debtor is not undertaking any
obligation on behalf of the estate, the court finds no reason that
a debtor must wait until after the trustee’s sixty day period
expires.
If the debtor is required to wait until after the trustee’s period
expires, a redundancy is created in § 365(p)(2)(C). That
provision states that no violation of the automatic stay occurs
by a debtor’s attempt to negotiate a lease assumption, yet [] §
365(p)(1) already makes clear that the stay terminates when the
trustee rejects or does not timely assume the lease. If a debtor
must wait until after the trustee’s assumption period expires,
there is no stay to violate.
Garaux, 2012 WL 5193779, at *2 (emphasis added). The Court agrees with the
reasoning in Garaux and therefore rejects Appellants’ argument that the
Agreement violates Section 365(p) because Appellants entered into it during the
first sixty days after they filed the Petition.
Second, Appellants argue that the Agreement did not comply with Section
365(p) because they did not timely inform Ford that the Fusion lease was assumed.
In support of this argument, Appellants rely on 11 U.S.C. § 365(p)(2)(B). That
statute provides that the debtor must notify the lessor in writing “that the lease is
assumed” no later than 30 days after the lessor “notif[ies] the debtor that it is
willing to have the lease assumed.”
See 11 U.S.C. §§ 365(p)(2)(A)-(B).
Appellants proffer that they did not inform Ford that they (Appellants) had
17
assumed the lease until after the 30-day notice period had elapsed. Appellants
contend that this delay renders the Agreement invalid. (See Appellants’ Br., ECF
#6 at 19, Pg. ID 221.)
The Court also rejects this argument. Under 11 U.S.C. § 365(p)(2)(B), it
was Appellants’ burden to notify Ford within 30 days of receiving the Proposed
Lease Assumption Agreement whether they had assumed the Fusion lease. When
Appellants executed the Agreement after the 30-day notice period, Ford – and not
Appellants – had the right to reject the executed Agreement. But Ford accepted the
Agreement without objection; Ford therefore chose to waive any right it may have
had to reject the Agreement for Appellants’ noncompliance with 11 U.S.C. §
365(p)(2)(B).
Thus, Appellants cannot escape their obligations under the
Agreement on the ground that they provided tardy notice of acceptance.
CONCLUSION
For the reasons stated above, IT IS HEREBY ORDERED that the
November 16, 2015, Bankruptcy Court Order (1) Denying Debtors’ Motion to
Determine Lease Assumption Agreement Invalid and Unenforceable; and (2)
Determining the Lease Assumption Agreement Is Valid is AFFIRMED.
s/Matthew F. Leitman
MATTHEW F. LEITMAN
UNITED STATES DISTRICT JUDGE
Dated: May 11, 2016
18
I hereby certify that a copy of the foregoing document was served upon the
parties and/or counsel of record on May 11, 2016, by electronic means and/or
ordinary mail.
s/Holly A. Monda
Case Manager
(313) 234-5113
19
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?