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Flynn v. Bankowski (In re Flynn), 402 B.R. 437, 443-45 (B.A.P. 1st Cir. 2009) (Carlo, Deasy, Kornreich) (Citing In re Szostek, 886 F.2d 1405 (3d Cir. 1989), failure of lienholder to object to balloon payment could be acceptance of plan under § 1325(a)(5)(A) notwithstanding equal payment requirement in § 1325(a)(5)(B)(iii)(I); remand necessary because appellate record not sufficient to determine whether notice
was adequate to support acceptance by silence. “The Bankruptcy Code, the Bankruptcy Rules, and the Local Rules .. . are silent as to what constitutes a secured claim holder’s acceptance of a chapter 13 plan for purposes of § 1325(a)(5)(A). However, the courts that have considered the question have overwhelmingly concluded that
a secured creditor’s lack of objection may constitute acceptance of the plan for purposes of § 1325(a)(5)(A). . . . We adopt the Third Circuit’s view that acceptance may occur upon a secured creditor’s failure to file a timely objection to a chapter 13 plan. . . . Implied consent requires, however, that the secured claim holder has received both proper and adequate notice and proper and adequate service…. At a minimum, due process requires that a proper and adequate notice contain a clear, open, and explicit statement of a secured creditor’s treatment in a chapter 13 plan before the creditor’s failure to object will be deemed implied acceptance. . . . If the Mortgagee failed to timely object to confirmation after receiving adequate and proper notice and adequate and proper service, then it is deemed to have impliedly acceptance the chapter 13 plan for purposes of § 1325(a)(5)(A), and the failure to comply with the provisions of § 1325(a)(5)(B) would not be grounds to deny confirmation.”).
See Also:  Bankruptcy Lawyers Boston

General Motors Corp. announced further production cuts yesterday as well as sweeping new incentives on many 2008 models — a reversal of recent strategy and a fresh sign of how badly rising gasoline prices are hurting auto makers, the Wall Street Journal reported today. GM, Ford Motor Co. and Chrysler LLC have been trying for over two years to back away from heavy incentives, which eat into profit margins and tarnish brands in the eyes of some consumers. But a worsening of the slump in car and light-truck sales this month is forcing the Detroit companies to take difficult steps to halt sales declines. Through the first half of June, normally a strong period, U.S. auto sales were running at an annualized rate of about 12.5 million vehicles, according to J.D. Power & Associates. It was the lowest level for June in decades and a huge drop from the year-ago rate of 16.3 million vehicles.

Hundreds of banks that are accused of playing a role in the collapse of Adelphia Communications Corp. have prevailed in their efforts to strike more than $4 billion in claims in a lawsuit brought by the company’s creditors, Bankruptcy Law360 reported yesterday. The cable company’s creditors, represented by the Adelphia Recovery Trust, are accusing 380 commercial and investment banks - including Citigroup Inc., Deutsche Bank and Bank of America Corp. - of looking the other way while Adelphia’s founding family looted the company of over $2 billion. Their 537-page amended complaint, filed last October, asserted 57 claims against the defendants, including claims to recover billions of dollars in loan obligations owed the banks by Adelphia’s subsidiaries.

Bondholders in Pacific Lumber Co.’s bankruptcy case said that they want to investigate possible fraud in a settlement that calls for the company to abandon its reorganization plan and support a rival proposal, the Wall Street Journal reported today. Bank of New York Mellon Corp., which represents the bondholders, said that it wants to probe several aspects of the agreement. The bank wants to look into whether the deal, a key development in the 15-month-old chapter 11 proceeding, is “the product of fraud or collusion and was forced on” Pacific Lumber, according to documents filed last Thursday with the U.S. Bankruptcy Court in Corpus Christi, Texas. Bankruptcy Court Judge Richard Schmidt will consider approving the agreement at a hearing Thursday.