Opinion
CASE NO. 16-20740 (JJT) ADV. PRO. No.: 16-02053
03-31-2017
IN RE: DIANE M. HOUCHINS, DEBTOR. DIANE M. HOUCHINS, PLAINTIFF v. CITY OF NORWICH, DEFENDANT.
APPEARANCES David F. Falvey, Esq. Action Advocacy Law Office, P.C. 1 Crouch St. Groton, CT 06340 Attorney for the Plaintiff Aimee L. Wickless, Esq. Brown Jacobson, P.C. 22 Courthouses Square P.O. Box 391 Norwich, CT 06360 Attorney for the Defendant
CHAPTER 13
RE: ECF No. 5
APPEARANCES David F. Falvey, Esq.
Action Advocacy Law Office, P.C.
1 Crouch St.
Groton, CT 06340 Attorney for the Plaintiff Aimee L. Wickless, Esq.
Brown Jacobson, P.C.
22 Courthouses Square
P.O. Box 391
Norwich, CT 06360 Attorney for the Defendant MEMORANDUM OF DECISION AND ORDER GRANTING THE DEFENDANT'S MOTION TO DISMISS
Before the Court is the City of Norwich's (the "City") Motion to Dismiss Adversary Complaint Pursuant to Fed. R. Bankr. P. 7012(b)(6) (ECF No. 5, the "Motion"), in response to the Debtor-Plaintiff Diane M. Houchins' (the "Debtor") Adversary Complaint seeking to avoid as a fraudulent conveyance an involuntary transfer of the Debtor's real property by the Tax Collector Sales Procedure set forth in Conn. Gen. Stat. § 12-155 et seq.. The City contends that the Complaint must be dismissed for failure state a claim upon which relief can be granted, as the price obtained by a tax sale conducted in accordance with Conn. Gen. Stat. § 12-155 et seq. "is entitled to a conclusive presumption of 'reasonably equivalent value' within the meaning of Bankruptcy Code § 548(a)(1)(B)(i)." In re Jacobson, 523 B.R. 13, 24 (Bankr. D. Conn. 2014) (extending the Supreme Court's rationale in BFP v. Resolution Trust Corp., 511 U.S. 531, 114 S.Ct. 1757, 128 L.Ed.2d 556 (1994) to tax foreclosure sales conducted in accordance with Conn. Gen. Stat. § 12-155 et seq.). The Court agrees. Accordingly, the Motion is hereby GRANTED. IT IS SO ORDERED at Hartford, Connecticut this 31st day of March 2017.
While the Debtor has moved to hold the City in contempt for transferring title to the property following the filing of the instant Chapter 13 petition (ECF 46, the "Motion For Contempt And Nullification of Transfer"), it makes no difference, for purposes of the Motion to Dismiss, that the City's post-petition transfer of title may have violated the automatic stay. If the Motion For Contempt And Nullification of Transfer succeeds, the post-petition transfer will be voided as a nullity ab initio, and therefore no transfer, fraudulent or otherwise, will have occurred. Thus, any violation of the automatic stay would result in the nullification of the transfer, and potentially an award of appropriate damages, but would not sustain the Debtor's fraudulent conveyance action. --------
James J. Tancredi
United States Bankruptcy Judge
District of Connecticut