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In re Smith (Case No. 23-70619) 1/18/24

In this case, the City of Roanoke scheduled and held a judicial tax sale on real property. Unknown to the City at the time, the sale was held just a few minutes after the Debtor filed for bankruptcy. The City asserted that pursuant to Virginia Code Section 58.1-3974 the Debtor lost her equitable right of redemption on the day prior to the scheduled judicial sale, therefore the Debtor had no legal or equitable interest in the property at the time of the bankruptcy filing. The Court distinguished this case from an earlier opinion, In re Whitlow, a case where the debtor filed her petition days after the sale had taken place. The Court held that the property still belonged to the Debtor legally and equitably at the time her case was filed as the sale had not begun by the time the Debtor filed her petition. Therefore, the sale was conducted in violation of the automatic stay.

Date: 
Thursday, January 18, 2024
Category: 
Automatic Stay
Property of the Estate
Relief from Stay
Chapter: 
13