DEBTOR CASE NO. 91-00338






This matter is before the Court on the debtor's Motion to Turn Over Property to Debtor filed herein on January 2, 1992. The Motion is in regard to an automobile which was repossessed by Star Bank of Ironton, Ohio, a creditor of the debtor, before the debtor's Chapter 13 petition was filed. Star Bank has filed a response to the Motion. This Court has jurisdiction of this matter pursuant to 28 U.S.C. '1334(b); it is a core proceeding pursuant to 28 U.S.C. '157(b)(2)(E).

The record in this case indicates that the debtor filed his Chapter 13 petition in this Court on July 19, 1991. His Chapter 13 plan, filed on September 5, 1991, provided for the debtor's secured debt of $9700.00 to Star Bank for a 1988 Pontiac Grand Am automobile, Manufacturer's Serial #1G2FW21E9JL251036, by the payment of five arrearages of $381.00 each within the plan and remaining payments outside the plan. According to the debtor's Motion, Star Bank repossessed the automobile on June 3, 1991. According to Star Bank, it repossessed the automobile on June 4, 1991, and had the automobile transferred to its name on July 12, 1991, pursuant to Ohio Revised Code '4505.10.

The issue to be resolved in this matter is whether the issuance of title showing Star Bank as the owner extinguished the debtor's rights in the vehicle. That question was resolved in favor of the debtor in In re Wallace, 102 B.R. 114 (Bkrtcy.S.D.Ohio 1989), a case in which, as here, a secured creditor repossessed an automobile before the debtor filed his Chapter 13 petition, but before any sale occurred, and obtained a "repossession" title. Therein, Judge Sellers held that

...the provisions of '1309.49 of the Ohio Revised Code (U.C.C. '9-506) give the plaintiff the right to redeem the Vehicle after repossession until the secured party has disposed of it or entered into a contract for its disposition. ...

It is clear that mere transfer of a title to GMAC to enable it to sell the Vehicle does not end the plaintiff's right to redeem under the provisions of the Uniform Commercial Code, as enacted in Ohio. Ohio Revised Code '1309.01 et seq.. Rather, the plaintiff continues to have an equitable right to cure his default and redeem his property.

At 116. Judge Sellers made a similar finding in In re Karr, 129 B.R. 503 (Bkrtcy.S.D.Ohio 1991), and went on to hold that the subject automobile was property of the estate.

In conclusion, it is apparent that case law supports the debtor's position in this matter and it is therefore the opinion of this Court that the debtor's Motion to Turn Over Property to Debtor should be sustained. An order in conformity with this opinion will be entered separately.


By the Court -





Copies to:

Paul Snyder, Esq.

James E. Armstrong, Esq.

Sidney White, Esq., Trustee