Odoms Harris v. Fremont Investment & Loan et al

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Case 08-01258 Doc36 Filed 05/21/09 Entered 05/21/09 11:34:30 Desc Main
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UNITED STATES BANKRUPTCY COURT
DISTRICT OF MASSACHUSETTS
EASTERN DIVISION

In re
Chapter 13
MARY ODOMS-HARRIS, Case No. 06-11300-FJB
Debtor
MARY ODOMS-HARRIS,
Plaintiff

Adversary Proceeding

No. 08-1258
Vv.

FREMONT INVESTMENT & LOAN,
MORTGAGE ELECTRONIC
REGISTRATION SYSTEMS, INC., and
WELLS FARGO BANK, N.A.

Defendants

MEMORANDUM OF DECISION AND ORDER
AS TO CORE JURISDICTION AND ABSTENTION

The claims asserted by the debtor against defendants MERS and Fremont Investment
and Loan—prepetition claims for damages—are related to this bankruptcy case but not core
proceedings. Therefore, and because these defendants have not consented to the bankruptcy
court's entering final judgment as to these claims, the court may at best enter only proposed
findings and conclusions, subject to de novo review in the U.S. District Court. 28 U.S.C. §
157(c)(1). This procedure is inherently inefficient and, for that reason, cause for abstention,
especially where the claims may be adjudicated in another forum with full jurisdiction over them.

With respect to the third defendant, Wells Fargo. as successor in interest to JP Morgan,
the claims are core proceedings because JP Morgan (through its servicer, Saxon Mortgage

Corporation) filed a proof of claim in this case and because, at least as to some of the claims

AUTHENTICATED
U.S. GOVERNMENT
INFORMATION
GPO

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against this defendant, the claims concern (i) a determination of the validity of a mortgage of
which this defendant is presently the holder and (ii) adjudication of claims against the
bankruptcy estate. Core proceedings include the allowance and disallowance of claims against
the estate, proceedings to determine the validity of a lien, and counterclaims by the estate
against persons filing claims against the estate. 28 U.S.C. § 157(b)(2)(C) & (K). These being
core matters, the Court has authority to enter final judgment against this defendant despite its
lack of consent. 28 U.S.C. § 157(b)(1). Insofar as these matters involve claims against the
estate and a lien against estate assets, the prompt adjudication of these claims is integral and
essential to the advancement of this chapter 13 case, and therefore the court will not abstain as
to the counts against Wells Fargo.

Nonetheless the debtor may prefer to litigate her claims against the three defendants in
a single proceeding. She may do so by withdrawal of this proceeding to the U.S. District Court
(provided a party so moves and the District Court grants a motion for that relief) or by refiling

the same claims in another court of competent jurisdiction.

ORDER

Accordingly, the Court hereby ORDERS that the court will (1) retain jurisdiction as to
Wells Fargo and (2) enter an order abstaining as to MERS and Fremont Investment and Loan
unless, on or before June 1, 2009, the debtor either moves to dismiss this proceeding (in order
to refile it elsewhere) or files a motion under 28 U.S.C. § 157(d) and Fed. R. Bankr. P. 5011(a)

for withdrawal of the reference as to this adversary proceeding and that motion is (in due

course) granted by the District Court.

Date: May 21, 2009 | ]
/ rf

Frank J. Bailey
United States Bankruptcy Judge