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Phillips Esq.
Phillips Esq., Attorney-at-Law
Category: Bankruptcy Law
Satisfied Customers: 16052
Experience:  B.A.; M.B.A.; J.D.
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My wife and I filed for Chapter 11 in California. We postponed

Resolved Question:

My wife and I filed for Chapter 11 in California. We postponed the first hearing and canceled the action at the second hearing. During this period, a bank that was foreclosing on a piece of property I owned filed a motion to have the automatic stay removed from the property and I did not contest the motion.
Is the bank still obligated to notify me prior to the sale of the property?
Submitted: 5 years ago.
Category: Bankruptcy Law
Expert:  Phillips Esq. replied 5 years ago.

Thank you for giving me the opportunity to assist you. I encourage you to ask me for clarification, if you are not clear with my Answer.


Could you clarify?


When you said that you cancelled the action, are you no longer in bankruptcy?

Customer: replied 5 years ago.
We pulled out of the bankruptcy completely and did not move forward. As far as the timeline goes, I am not sure of when the stay would have been removed, when we officially notified them of our withdrawal form the action, and when the sale took place.
I can (and will if necessary) go back and reconstruct the timeline of events, but my question is basically: Is the bank (foreclosing institution) still required to notify me of a pending sale date prior to selling the property, or are they releived from that requirement due to the bankruptcy and the property being held in trust at the point of our filing etc? And if I find out that no auction was held (they simply transferred ownershipv to themselves), is that legal? I want the property back and need to know how to go about voiding the sale if possible. The bank owns it now and paid less than half of the outstanding debt balance.
Expert:  Phillips Esq. replied 5 years ago.


Thank you for the clarification and the additional information.


Regardless of your bankruptcy, the foreclosing lender must still inform you of the date of the sale at least 20 days before the sale. See California Civil Code Section 2924c:


If the lender did not inform you and the property has been sold, you can get a consumer lawyer to file action in the Superior Court to undo the sale. You can find local attorneys here:



Phillips Esq., Attorney-at-Law
Category: Bankruptcy Law
Satisfied Customers: 16052
Experience: B.A.; M.B.A.; J.D.
Phillips Esq. and other Bankruptcy Law Specialists are ready to help you
Customer: replied 5 years ago.
(I hope you don't mind the informal moniker, no "dis'" intnded)
Just to make sure and give you the entire context, I guess the only other circumstances were: we received a sale notice back in December '09. I then filed an action citing a number of issues such as breach of contract, lack of valid consideration, conversion of funds, undue enrichment and petitioned for an ex-parte hearing to get an RO and stop the sale. I initially suceeded.
It was then transferred to another Judge, I was served with another sale date by the bank while waiting for a hearing so I requested another ex-parte and was refused the RO and stay this time on the grounds (the one they use to baffle the rookies every time) of "not stating a claim upon which relief can be granted". At the time I had no idea what that meant or how to resolve it.

(((((As a result of all this I have recently become an avid amateur law student (I have been acting pro per; "acting" being the operative portion of that statement). I have no dough for attorneys; the result of my civil engineering business tanking after the total collapse of the local construction industry and real estate market. If I had enouigh money to pay attorneys I wouldn't be missing loan payments or filing for Bankruptcy. THAT is the MOST cruel irony of this whole sordid mess))))

Back to the story: So to stop the sale again, I immediately filed for Chapter 11, as my wife had been urging me to do anyway. This is the point where the bank filed the motion to remove the automatic stay on the property. After being notified of the motion to remove the stay which I did not contest (because it was part of a verbal deal so the Bank wouldn't try to sell my primary residence too). So I never received notice of a scheduled sale date after the stay was removed. Shortly after I became aware that under Chap. 11 we would lose control of ALL of our assets and we would have no say in how they were dealt with, I talked my wife into stopping the Bankruptcy at our hearing date, Our Bankruptcy attorney withdrew us from the process (about 50 days ago) and I recently contacted the Bank to get a pay-off amount and learned thay had sold the property at some point without ever informing us of the public sale date. Since I had not received any notice of a pending sale date, I assumed the bank had not proceeded with the sale yet.
Is your understanding of the situation (and your answer) still the same?

Were they unquestionably required to tell me of the impending sale date?
Expert:  Phillips Esq. replied 5 years ago.


No, I do not take offense for the informal moniker. And for an "amateur law student" you did well by stopping the first sale using an RO.


Anyway and unfortunately, my answer would not be the same in light of the additional information. Since you already had a sale date before you filed the bankruptcy petition and the automatic stay was lifted, the lender was free to proceed with the scheduled sale date without giving you yet another notice of the sale. For all things concerning foreclosure notices see California Civil Code Sections 2924c, 2924f, and 2924g. I am sorry that the news is not good.


Edited by AttorneyPhillips on 11/9/2010 at 7:54 AM EST
Customer: replied 5 years ago.
Ok, so if we never actually went into bankruptcy, did the trustee actually take possession of our property in order to give the bank permission to sell it? At what point does our property actually become the property of the trustee to dispense with?
Since we never actually proceeded with the bankruptcy, do they have a duty to inform me once the property is sold, and they don't need to let us know the date of the actual sale? What if we wanted to buy it back at that sale?
Expert:  Phillips Esq. replied 5 years ago.

I am tired and ready to sign off.


So, I will opt out and give another Expert the opportunity to further assist you.

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