Whitehead v. Whitehead (In re Holyfield)
| Decision Date | 16 July 2015 |
| Docket Number | CASE NO. 08-10735-JDW,ADV. PROC. NO. 09-01177-NPO |
| Court | U.S. Bankruptcy Court — Northern District of Mississippi |
| Parties | IN RE: WILLIAM HOLYFIELD, DEBTOR. JOYCE WHITEHEAD AND L.V. WHITEHEAD PLAINTIFFS v. WILLIAM HOLYFIELD DEFENDANT |
This matter came before the Court1 on the Order on Appeal issued by the U.S. District Court for the Northern District of Mississippi, Oxford Division (the "District Court"), in William Holyfield v. L.V. Whitehead and Joyce Whitehead, No. 3:13-cv-00227-DMB, 2014 WL 7739345 (N.D. Miss. Sept. 5, 2014) (the "Remand Order"), remanding the Adversary for furtherproceedings. The District Court held:
Although the parties raised multiple issues during the Adversary, the Remand Order requires the Court to address only the following two (2) issues: the amount of rent that Joyce Whitehead owes Holyfield and the ownership of the insurance proceeds. Having considered the pleadings, exhibits, and evidence, the Court finds as follows:4
Jurisdiction
The Court has jurisdiction over the parties to and the subject matter of this proceeding pursuant to 28 U.S.C. § 1334. This is a core proceeding under 28 U.S.C. § 157(b)(2)(A), (B), and (O). The Court exercises continued jurisdiction over the Adversary notwithstanding the dismissal of Holyfield's Bankruptcy Case for the reasons set forth in the Order Retaining Jurisdiction entered on June 18, 2015.
The Court finds it unnecessary to reopen the record on remand. On the issues before the Court, hearings were held on April 16-17, 2012 and September 17, 2012, and status conferences were held on May 14, 2012 and May 25, 2012. The record is already voluminous.5
1. On August 10, 1995, William B. Wallace ("Wallace") executed a warranty deed(the "Warranty Deed") (J.W. Ex. 1; H. Ex. 1)6 conveying 1.5 acres of real property located at 15082 Old Panola Road, Como, Mississippi (the "Land") to Joyce Whitehead. To finance the purchase price, she obtained a loan from Wallace and signed a deed of trust (the "DOT") (J.W. Ex. 2) in favor of Wallace on August 9, 1995 as security for repayment of the loan. The DOT was recorded in the Land Assessment Roll of Panola County (the "Land Roll") in the Chancery Clerk's office.
2. On April 15, 1997, Joyce Whitehead and her daughter, Lisa Oliver ("Oliver"), purchased the Mobile Home from Holloway Homes, Inc. ("Holloway Homes") for $54,995.00. Holloway Homes financed the purchase of the Mobile Home and delivered and affixed the Mobile Home to the Land on April 23, 1997. (J.W. Ex. 46; H. Ex. 2).
3. At the office of the Panola County Tax Assessor, Joyce Whitehead and Oliver registered the Mobile Home as part of the Land for tax purposes.7 A Certificate of Mobile Home as Real Estate (the "Certificate") (J.W. Ex. 3; H. Ex. 4) was issued and recorded in the Land Roll. Shortly thereafter, Holloway Homes informed Joyce Whitehead that Oliver had failed to qualify as a co-signer on the loan and cancelled their agreement.
4. On June 18, 1997, Joyce Whitehead and her then husband, L.V. Whitehead, executed a new Installment Note, Security Agreement, and Disclosure Statement (the "MobileHome Security Agreement") (J.W. Ex. 4) for the purchase of the Mobile Home.8 The Mobile Home Security Agreement required the Whiteheads to pay $472.66 per month for 360 months beginning July 1, 1997. Holloway Homes contemporaneously assigned the Mobile Home Security Agreement to SouthTrust. On July 1, 1997, SouthTrust filed Uniform Commercial Code (UCC) Financing Statements (J.W. Exs. 5-6) reflecting the sale and related financing of the Mobile Home in the personal property lien records of the Chancery Clerk and the Mississippi Secretary of State. The UCC Financing Statements were not filed in the Land Roll. Moreover, the Certificate designating the Mobile Home as part of the Land for tax purposes remained in the names of Joyce Whitehead and Oliver and was never changed to substitute L.V. Whitehead for Oliver.
5. Joyce Whitehead did not pay her 2001 ad valorem taxes, and the Panola County Tax Collector sold the Land for taxes to S&S Properties, LLC ("S&S") for $452.91 on August 26, 2002. (J.W. Ex. 26; H. Ex. 9); see MISS. CODE ANN. § 27-41-15, § 27-53-17(a).9 The Chancery Clerk provided proper notice10 of the tax sale and expiration of the two (2)-year redemption period11 to Joyce Whitehead, but she failed to pay the taxes due before the expirationof the redemption period on August 26, 2004. (J.W. Ex. 8); see MISS. CODE ANN. § 27-43-1, § 27-43-2.
6. The Chancery Clerk did not notify SouthTrust of the tax sale or the two (2)-year redemption period because SouthTrust's security interest in the Mobile Home was not listed in the Land Roll but only in the UCC Financing Statements filed in the personal property lien records.12
7. On December 23, 2004, Joyce Whitehead filed a voluntary petition for relief under chapter 13 of the Bankruptcy Code. (Case No. 04-18158-DWH, Dkt. 1).13 She listed the Mobile Home as an asset of her bankruptcy estate in "Schedule A. Real Property" (Id. at 5) and identified SouthTrust as her only creditor (Id. at 10). In her chapter 13 plan, Joyce Whitehead proposed to retain the Mobile Home and pay SouthTrust $99.26 per month toward an arrearage of $5,955.71 that accrued from March 2004 through February 2005 and $472.66 per month on the ongoing payments, beginning in March 2005. (J.W. Ex. 12).
8. On February 28, 2005, Wachovia Bank, N.A., the then successor-in-interest to SouthTrust, granted power of attorney to Vanderbilt to enforce and maintain the Mobile Home Security Agreement. (J.W. Ex. 10).
9. S&S wrote Joyce Whitehead a letter dated June 2, 2005 inviting her to engage in negotiations to repurchase the Land. (J.W. Ex. 34). S&S wrote Joyce Whitehead again but in its second letter informed her that she would be evicted from the Mobile Home unless she paid S&S$1,211.96 in unpaid rent and taxes. (J.W. Ex. 35). Joyce Whitehead testified that she did not recall entering into an agreement with S&S to rent or repurchase the Mobile Home, and no copy of such a written agreement was submitted in the record.
10. At S&S's request, the Chancery Clerk on November 15, 2005 executed a tax deed conveying the unredeemed Land to S&S. (J.W. Ex. 26; H. Ex. 10); see MISS. CODE ANN. § 27-45-23.14 Approximately two (2) months later, on January 22, 2006, S&S signed a quitclaim deed (the "Quitclaim Deed") (J.W. Ex. 25; H. Ex. 12) conveying its interest in the Land to Holyfield for a purchase price of $2,000.00.
11. In a letter dated February 15, 2007, Holyfield's attorney informed Joyce Whitehead that Holyfield had purchased both the Land and Mobile Home from S&S, and she could either lease the Mobile Home or vacate the premises. (J.W. Ex. 15). Joyce Whitehead protested to Holyfield that she was making payments to Vanderbilt through her chapter 13 bankruptcy plan, but Holyfield insisted that her bankruptcy case did not protect her interest in the Mobile Home. On March 9, 2007, Joyce Whitehead signed a Rental Agreement (the "Rental Agreement") (H. Ex. 14), in which she agreed to pay Holyfield $550.00 per month under a month-to-month tenancy. She further agreed to pay a $50.00 late charge for any rent paid more than ten (10) days after the date due. Therefore, in order to continue living in the Mobile Home, Joyce Whitehead had agreed to pay $571.92 per month to Vanderbilt through her confirmed plan and $550.00 per month to Holyfield under the Rental Agreement.
12. Joyce Whitehead became delinquent in her payments under the Rental Agreement, and Holyfield sent her an eviction notice (J.W. Ex. 60) dated May 9, 2007demanding that she either vacate the Mobile Home or pay him $1,800.00. On May 21, 2007, he filed an action against her in the Justice Court of Panola County, Mississippi ("Justice Court") seeking her eviction and $1,800.00 in unpaid rent (the "First Justice Court Action"). (J.W. Ex. 16). Holyfield did not obtain relief from the automatic stay provided under 11 U.S.C. § 362(a) before initiating the First Justice Court Action.15 Joyce Whitehead paid the past due rent, and the First Justice Court Action was dismissed.
13. Joyce Whitehead again became delinquent in her payments under the Rental Agreement, and Holyfield filed a second eviction and collection action in Justice Court on November 13, 2007 seeking $1,200.00 in unpaid rent. (the "Second Justice Court Action"). (J.W. Ex. 17). Again, Holyfield did not seek permission from the Bankruptcy Court before bringing suit against Joyce Whitehead. The Justice Court entered a judgment evicting Joyce Whitehead and awarding Holyfield...
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