Louis Spencer

UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF NORTH CAROLINA
WILSON DIVISION
IN RE:
Louis Spencer,
Debtor. Case No. 04-06344-8-JRL
ORDER
This case came before the court upon the debtor’s motion to avoid the judicial lien of Carlton
Thornton (“Thornton”). The motion asserts that Thornton holds a judicial lien which impairs the
debtor’s homestead exemption and prays that such judicial lien be avoided pursuant to § 522(f)(1)(A)
of the Bankruptcy Code. According to the motion, the real estate which the debtor exempted as his
homestead is owned by the debtor and his wife as tenants by the entirety. However, the judgment
referred to in the motion was entered against the male debtor alone. Under North Carolina law, the
individual creditors of either the husband or wife cannot reach entireties property in order to satisfy a
judgment against only one of the spouses. See North Carolina Nat’l Bank v. Corbett, 271 N.C. 444,
447, 156 S.E.2d 835, 837 (1967); In re Crouch, 33 B.R. 271, 273 (Bankr. E.D.N.C. 1983); In re
Banks, 22 B.R. 891, 892 (Bankr. W.D.N.C. 1982); In re Woolard, 13 B.R. 105, 107 (Bankr.
E.D.N.C. 1967); Winchester-Simmons Co. v. Cutler, 199 N.C. 709, 155 S.E. 611, 612-13 (1930);
Johnson v. Leavitt, 188 N.C. 682, 125 S.E. 490, 492 (1924). Therefore, a judgment against one
spouse is not a lien against property held as tenants by the entirety. See In re Foreclosure of Deed of
Trust, 303 N.C. 514, 519, 279 S.E.2d 566, 569 (1981)(“A lien of judgment . . . effective against only
one spouse does not attach to real property held by husband and wife by the entireties.”); Grabenhofer
v. Garrett, 260 N.C. 118, 120, 131 S.E.2d 675, 677 (1963); Martin v. Lewis, 187 N.C. 473, 122
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1Even though the Debtor is not entitled to relief under § 522(f)(1)(A), he does receive relief
under § 524(a)(1) which protects his homestead exemption from the judgment in question. Under §
524(a)(1) a discharge “voids any judgment at any time obtained, to the extent that such judgment is a
determination of the personal liability of the debtor with respect to any debt discharged under section
727, 944, 1141, 1228, or 1328 of this title, whether or not discharge of such debt is waived . . . .”
Thus, assuming that the debtor receives a discharge in this case and the debt underlying the judgment
thereby is discharged, such discharge will void the judgment. Once the judgment is voided under §
524, it cannot thereafter affix to or become a lien against real property acquired by the debtor. See In
re Ogburn, 212 B.R. 984 (Bankr. M.D. Ala. 1995)(holding that under § 524(a)(1), an unattached
judgment was voided by the debtor’s discharge and thus no lien attached to debtor’s after-acquired
property); In re Norvell, 198 B.R. 697, 699 (Bankr. W.D. Ky. 1996)(holding that pre-petition
judgment against debtor was void pursuant to § 524(a)(1) and observing that no judgment lien would
attach to real estate acquired by the debtor after the filing of a Chapter 7 bankruptcy proceeding in
which the debtor received a discharge).
S.E. 180, 181 (1924); Bruce v. Sugg, 109 N.C. 202, 13 S.E. 790, 791 (1891); Union Grove Milling
and Mfg. Co. v. Faw, 103 N.C. App. 166, 168, 404 S.E.2d 508, 509 (1991). It follows that the
judgment referred to in the motion does not constitute a judicial lien against the debtor’s homestead
since such homestead is owned by them as tenants by the entirety and the judgment is against the
debtor alone. Hence, there is no judicial lien to avoid and no grounds for relief under § 522(f)(1)(A).
See In re Hamilton, 286 B.R. 291, 293 (Bankr. D.N.J. 2002)(“Where a judgment has not become a
lien on any of the debtor’s property at the filing of the bankruptcy petition, Section 522(f) cannot
apply.”). Accordingly, the debtor’s motion pursuant to 522(f)(1)(A) must be denied.1
So Ordered.
Dated: August 24, 2005
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