Betina G Koloch

UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF NEW YORK
----------------------------------------------------------X
In Re 	Case No. 8-07-73919-dem
BETINA G. KOLOCH
a/k/a/ BETINA SWIATKOWSKI, 	Chapter 13
Debtor.
----------------------------------------------------------X
DECISION AND ORDER ON OBJECTION
DENNIS E. MILTON
United States Bankruptcy Judge
The matter comes before the Court on the objection of Lidia Swiatkowski
(“Swiatkowski”), a party in interest and co-obligor, to Proof of Claim No. 2 filed by
Swiatkowski seeks an Order pursuant to Section 530 of the Bankruptcy Code reopening the case1
and thereafter holding the creditor CitiMortgage, Inc. (“CitiMortgage”) and their legal associates
responsible for criminal activity. Objection dated October 26, 2009 at 4. As set forth below, the
Objection is overruled and the Court adherers to its prior decision and order dated September
20, 2009 reducing CitiMortgage's Proof of Claim to $444,389.02. 	.
JURISDICTION
This Court has jurisdiction over this proceeding pursuant to 28 U.S.C. §§1334(b)
and 157(b)(2) and the Eastern District of New York standing Order of reference dated August
28, 1986. This decision constitutes the Court’s findings of fact and conclusions of law to the
extent Fed. R.Bank. P. 7052 requires.
1 Although the case had been dismissed, as of October 27, 2009, the filing date of this Motion, the case had not been
closed. On January 12, 2010, the Court issued an Order closing the case.
Case 8-07-73919-dem Doc 60 Filed 03/31/10 Entered 03/31/10 16:45:04

INTRODUCTION
As noted in prior Decisions, this case is the seventh case in this Court involving
the debtor and co-obligors and CitiMortgage, Inc. and its predecessor in interest regarding the
note and mortgage dated September 18, 1990 between the debtor, co-obligors and Citibank, N
.A. regarding the real property located at 7 Park Lane Place, Massapequa, New York 11758 (the
“Massapequa Property”). 	There has been additional litigation involving the parties in the
Supreme Court, Nassau County and the United States District Court for the Eastern District of
New York. A brief recitation of the underlying facts of these cases follows.
A. 	Background
On or about September 18, 1990, Citibank, N.A. financed the Massapequa
Property with debtor Betina G. Koloch a/k/a Betina Swiatkowski, Michael Swiatkowski a./k/a
Michal Swiatkowski and Lidia Swiatkowski. The debtor and the co-obligors executed a
mortgage note in the principal amount of $264,000.00 and delivered a mortgage against the
Massapequa Property.
On or about June 1, 1998, the debtor and co-obligors defaulted under the note and
mortgage. Citibank’s successor in interest commenced a foreclosure action in the Supreme
Court, Nassau County, and obtained a judgment of foreclosure on or about April 20, 1999.
On or about September 1, 1999, Michal and Lidia Swiatkowski filed a voluntary
joint petition for relief under Chapter 13 of the Bankruptcy Code (the “First Case”). On or about
July 20, 2000, the First Case was dismissed upon the application of the debtors. On or about
October 2, 2000, the First Case was closed.
2
Case 8-07-73919-dem Doc 60 Filed 03/31/10 Entered 03/31/10 16:45:04

On or about October 25, 2000, Michal Swiatkowski filed a voluntary petition for
relief under Chapter 13 of the Bankruptcy Code (the “Second Case”). This filing stayed the
scheduled foreclosure sale of the Massapequa Property. 	On or about January 16, 2001, the
Second Case was dismissed on the application of the Chapter 13 case trustee due to the debtor’s
default in making payments. On February 16, 2001, the Second Case was closed.
On March 7, 2001, Lidia Swiatkowski filed a voluntary petition for relief under
Chapter 13 of the Bankruptcy Code (the “Third Case”). This filing stayed a scheduled
foreclosure sale of the Massapequa Property. On or about November 6, 2001, the case was
dismissed with prejudice on the motion of the Chapter 13 case trustee. On December 12, 2001,
the Third Case was closed.
While the Third Case was pending, the debtor and co-obligors requested a
workout arrangement with CitiMortgage. However, they refused to sign a stipulation of
settlement which was part of the forbearance agreement process. According to CitiMortgage,
the loan representative working with the Swiatkowskis authorized the acceptance of funds
without an executed stipulation. CitiMortgage accepted payment of $101,230.49 without a
written settlement agreement. The forbearance agreement was calculated at the monthly
payment amount of $3,231.00. However, according to CitiMortgage, the annual taxes and
insurance at the time of reinstatement were $12,553.41, and the $3,231.00 monthly payment was
insufficient to reinstate the escrow deficit.
CitiMortgage’s documentation reflected considerable confusion at CitiMortgage
concerning the amount of the monthly mortgage payment. It appears from its own records that
the mortgagors may not have been in default under the mortgage in May 2002. 	By letter dated
3
Case 8-07-73919-dem Doc 60 Filed 03/31/10 Entered 03/31/10 16:45:04

June 25, 2002, CitiMortgage informed the mortgagors that they were current through May 1,
2002 and were due for the June 1, 2002 payment. The payment history further reflects that in
May 2002, a time when CitiMortgage allegedly notified the mortgagors that they were current
with their mortgage payments, CitiMortgage referred the file to its attorneys for foreclosure.
On or about April 24, 2002, CitiMortgage issued a notice to the debtor and co-
obligors that the monthly payment had adjusted upward to $4,703.00 per month; CitiMortgage
claimed that the debtor and co-obligors were given notice of this adjusted mortgage payment on
or about May 1, 2002. On or about June 19, 2002, the debtor and co-obligors received a letter
from CitiMortgage informing them that the amounts remitted in the June 2002 payment were not
sufficient to cover the monthly amount due of $4,753.28. On June 20, 2002, CitiMortgage
informed the mortgagors that their payment was late and imposed late payment charge of $50.28.
On or about July 11, 2002, CitiMortgage according to the payment history, reversed the
payments in the amount of $3231.00 for the months of May and June 2002 and returned the
payments to the co-obligor Lidia Swiatkowski.
In May 2002 CitiMortgage referred the file to its attorneys for foreclosure
proceedings. On or about September 30, 2005, Judgment of Foreclosure and Sale was entered in
the pending foreclosure action. On or about November 4, 2005, Michal Swiatkowski filed a
voluntary petition for relief under Chapter 13 of the Bankruptcy Code (the “Fourth Case”). On
November 16, 2006, the Fourth Case was dismissed on the motion of the Chapter 13 case trustee.
In or about November 2006, the debtor tendered two payments in the amount of $6,000.00 and
$19,200.00. On January 19, 2007, the Fourth Case was closed.
On or about December 12, 2006, Lidia Swiatkowski filed a voluntary petition for
4
Case 8-07-73919-dem Doc 60 Filed 03/31/10 Entered 03/31/10 16:45:04

relief under Chapter 13 of the Bankruptcy Code (the “Fifth Case”). On or about April 17, 2007,
the Fifth Case was dismissed with prejudice on the debtor’s motion. On June 19, 2007, the Fifth
Case was closed.
On April 2, 2007, Michal Swiatkowski filed a voluntary petition for relief under
chapter 13 of the Bankruptcy Code (the “Sixth Case”). On August 8, 2007, the Sixth Case was
dismissed with prejudice on the motion of the Chapter 13 case trustee.
PROCEDURAL HISTORY OF THIS CASE
On October 4, 2007, Betina G. Koloch (the “debtor”) filed a voluntary petition
for relief under Chapter 13 of the Bankruptcy Code. On November 7, 2007, CitiMortgage filed
Proof of Claim No. 2. On or about January 11, 2008, counsel for Lidia Swiatkowski filed an
Objection to Proof of Claim No. 2. On March 4, 2008, counsel for CitiMortgage filed an
Affirmation in Opposition to the Objection. On March 6, 2008, counsel for Swiatkowski filed a
reply to the affidavit in opposition and counsel for CitiMortgage filed a supplemental affidavit in
opposition to the Objection. On March 28, 2008, counsel for Swiatkowski filed a Memorandum
of Law. On April 17, 2008, counsel for CitiMortgage filed a reply affirmation and cross-
application for fees and costs. On May 9, 2008, the Court conducted a hearing on the Objection.
At a continued hearing on October 17, 2008, the Court directed counsel for CitiMortgage to file
a post hearing submission on the issue of calculation of interest and the placing of forced
insurance. On October 24, 2008, counsel for CitiMortgage submitted a supplemental affidavit
and the Court took the matter under submission. By Decision and Order dated September 30,
2009, this Court found that Citibank had failed to meet its burden of proof, upheld Swiatkoski's
Objection and reduced CitiMortgage's Proof of Claim.
5
Case 8-07-73919-dem Doc 60 Filed 03/31/10 Entered 03/31/10 16:45:04

On October 3, 2009, following a hearing, the Court denied Confirmation. On
October 19, 2009, the Court entered an Order denying confirmation and dismissing the case
without prejudice. On January 12, 2010, the Court entered an Order closing the case.
Neither debtor's counsel nor creditor's counsel has submitted any papers in
opposition or other response to Swiatkowkis's Objection.
THE SWIATKOWSKI OBJECTION
On October 27, 2009, Swiatkowski filed a document entitled “OBJECTION TO
ORDER DENYING CONFIRMATION OF CHAPTER 13 AND DISMISSING THE CASE
WITHOUT PREJUDICE” (the “Objection”). In the Objection, Swiatkowski alleges that
creditors committed bankruptcy fraud through deficiencies of service of process, and offers only
speculation as to the conduct of creditors which she alleges may have constituted said fraud.
Objection at 1-4. Swiatkowski seeks the reopening of the case in order to
have responsible parties for criminal activity held responsible.
This includes dismissing claims of the creditor for its 12
years of constant vicious attacks on their homestead which
were based on liable [sic], frivolous and criminal claims
that led the mortgators [sic] to sustain severe physical and
mental anguish throughout this ordeal.
Id. at 4. As set forth below, the Objection is overruled.
DISCUSSION
The Application to Reopen the Case Should be Denied.
Section 350 of the Bankruptcy Code governs the application for an order
reopening a Chapter 7 case. The statute provides that “[a] case may be reopened in the court in
which such case was closed to administer assets, to accord relief to the debtor, or for other
cause.” 11 U.S.C. § 350(b). The statute is phrased in permissive language and therefore leaves
6
Case 8-07-73919-dem Doc 60 Filed 03/31/10 Entered 03/31/10 16:45:04

the decision to reopen a bankruptcy case at the discretion of the court. See Apex Oil Co. v.
Sparks (In re Apex Oil Co.), 406 F. 3d 538, 541-42 (8th Cir. 2005); State Bank of India v.
Chalsani (In re Chalsani), 92 F. 3d 1300, 1307 (2d Cir. 192); Rosinki v. Boyd (In re Rosinski),
759 F.2d 539, 540-541 (6th Cir. 1985); Hawkins v. Landmark Finance Co. (In re Hawkins), 727
F. 2d. 324, 326 (4th Cir. 1984).
Although styled as an Objection, Swiatkowski's moving papers in essence seeks
the Court's reconsideration of matters previously brought before the Court. As the history of
this proceeding makes clear, this Court has painstakingly reviewed and analyzed the claims of
the debtors in the seven cases which they have brought. There are no additional assets to
administer and no additional relief available to the debtor in this case. In short, there is no
reason or cause to reopen the case. The application to reopen the case is therefore denied.
To the extent that Swiatkowski seeks reconsideration of the Court's prior decision
in this case, that application is also denied. An application for such relief is addressed to the
court's discretion, but because such relief erodes the principle of finality, the application is rarely
granted, as “'a motion for reconsideration ... does not provide a forum for the non-prevailing
party to reargue issues that the Court has already decided. '” In re Taub, 421 B.R. 93, 108-109
(Bankr. E.D.N.Y. 2009)(quotation and citation omitted).
CONCLUSION
Swiatkowski's Objection is overruled. The application to reopen the case, and/or
the application for reconsideration of the Court's decision dated October 19, 2009 denying
Confirmation and granting the trustee's motion to dismiss the case is in all respects denied.
IT IS SO ORDERED.
7
Case 8-07-73919-dem Doc 60 Filed 03/31/10 Entered 03/31/10 16:45:04

Dated: Brooklyn, New York
March 31, 2010
S/ Dennis E. Milton
DENNIS E. MILTON
United States Bankruptcy Judge
8
Case 8-07-73919-dem Doc 60 Filed 03/31/10 Entered 03/31/10 16:45:04