Zito et al

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28 	1
IN THE UNITED STATES BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
IN RE: JOHN MICHAEL ZITO, and
LETICIA QUINTANA ZITO,
Debtors.
CASE NO. 09-13886-AJ-13
CHAPTER 13
JOHN MICHAEL ZITO, and
LETICIA QUINTANA ZITO,
Plaintiffs,
v.
BANK OF AMERICA, N.A., Defendant.
A.P. No. 09-1187
Memorandum re Default Judgment
__________
The debtors filed a Chapter 7 petition in 2008 and were discharged in 2009. They then
commenced the above Chapter 13 case and brought this adversary proceeding to stip off the lien
of Bank of America and disallow the Bank’s unsecured claim. The Bank’s default has been
entered.
There is serious doubt that a debtor can strip off a lien in cases like this were the debtor is
not entitled to a Chapter 13 discharge due to a recent Chapter 7 discharge. In re Jarvis, 390 B.R.
600 (Bkrtcy.C.D.Ill.2008); In re Blosser, 2009 WL 1064455 (Bkrtcy.E.D.WI 2009). However,
since there are no binding appellate cases on this issue and since the Bank has not chosen to
contest the complaint, the court will allow the strip of the lien notwithstanding these cases.
However, the court declines to void the Bank’s unsecured claim; the debtors cannot have
their cake and eat it, too. An unsecured claim is generally allowable where a lien is avoided in
Chapter 13 even when there has been a recent Chapter 7 discharge. In re Gounder, 266 B.R.
879 (Bkrtcy.E.D.Cal.2001); In re Akam, 259 B.R. 371 (Bkrtcy.C.D.Cal.2001).
For the foregoing reasons, the court will enter a judgment stripping the lien but declines
to declare that the Bank has no unsecured claim. Final adjudication of that issue will be rendered
Entered on Docket
February 24, 2010
GLORIA L. FRANKLIN, CLERK
U.S BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
Case: 09-01187 Doc# 11 Filed: 02/23/10 Entered: 02/24/10 08:44:55 Page 1 of 2

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28 	2
only after a hearing on the debtors’ objection to a proof of claim.
Dated: February 23, 2010
SAlan Jaroslovsky
U.S. Bankruptcy Judge
Case: 09-01187 Doc# 11 Filed: 02/23/10 Entered: 02/24/10 08:44:55 Page 2 of 2