CRUZ RENTAS et al v. SALLIE MAE SERVICING CORPORATION et al

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Casd05-00053-BKT Doc#:45 Filed:07/14/06 Entered:07/14/06 07:45:20 Desc: Main

AUTHENTICATED
US. GOVERNMENT 4
INFORMATION

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IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF PUERTO RICO

IN THE MATTER OF

CASE NO. 04-09937 (SEK)
LEIDA CRUZ RENTAS :
DEBTOR CHAPTER 13

LETDA CRUZ RENTAS
MARTA RENTAS ALVAREZ

PLAINTIFFS "apy. ‘PRoc. NO. 05-053
FILED & ENTERED

Vv.

SALLIE MAE SERVICING CORP. ;
GREAT LAKES HIGHER EDUCATICHE t 42006

DEFENDANTS , ’
____ DEFENDANTS yg, sana ty oper

OPINION AND ORDER

Before the Court is plaintiff's request for summary judgment
and defendants’ cross motion concerning a complaint against Sallie
Mae Servicing Corp. (“Sallie Mae”) and Great Lakes Higher Education
(“Great Lakes”) for willful violation of the automatic stay. We
deny both motions because there are material facts in controversy.

To grant a motion for summary judgment, the moving party must
Show that there are no material facts in controversy.? In dealing
with a complaint for violation of the automatic stay, the First
Circuit has clearly stated that:

A willful violation does not require a specific intent to

violate the stay. The standard for willful violation of

the automatic stay under §362(h) is met if there is
knowledge of the stay and the defendant intended the

* “Summary judgment is warranted where the record, viewed
most favorably to non-moving party, reveals that there is no
genuine dispute as to any material fact and’ moving party is
entitled to judgment as a matter of law.” Blanchard v. Peerless,
958 F.2d 483, 485 (18 Cir. 1992),

y

Casq

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actions which constituted the violation. In cases where
the creditor received actual notice of the automatic
stay, courts must presume that the violation was
deliberate. The debtor has the burden of providing the
creditor with actual notice. Once the creditor received
actual notice, the burden shifts to the creditor to
prevent violations of the automatic stay.

Fleet Mortgage Group, Inc. v. Kaneb, 196 F.3d 265, 269 (1% Cir.

1999) (citations omitted)

To prevail, plaintiffs must meet their initial burden of
showing defendants were actually notified of the bankruptcy filing
and the automatic stay injunction. Debtor, co-plaintiff, included
her debt with Sallie Mae in the schedules and listed its address as
P.O. Box 11569, Killeen, TX 76547-1569. The Clerk mailed the notice
of the automatic stay to this address. Defendants argue Sallie Mae
never received this notice, because it was sent to the wrong
addxess.

We do not know if the automatic stay was properly notified to
Sallie Mae. Sallie Mae provides two different addresses of record.?
The Clerk did not notify the automatic stay to any of these.

Defendants also argue Great Lakes was not scheduled nor
notified of these proceedings. However, defendants’ opposition
details facts concerning a phone call Great Lakes received from
debtor indicating she filed this bankruptcy. This contradiction
creates an actual material factual controversy impeding the entry

of summary judgment.

* Sallie Mae states the correct address for purposes of
notification is Sallie Mae, Inc., c/o Robert Lavet, Vice
President and General Counsel, 12061 Bluemont Way, Reston,
Virginia 20190. However, the proof of claim filed by Sallie Mae,
Inc. provides the address of 220 Lasley Ave., Wilkes-Barre, PA
18706 for notification purposes.

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WHEREFORE, plaintiffs’ motion for summary judgment and
defendants’ motion to dismiss the case summarily are denied. The
pretrial hearing continues as scheduled on August 17, 2006 at 11:00

AM.

SO ORDERED, in San Juan, Puerto Rico, on July 13, 2006.

el
end A Re
SARA DE JESUS
U.S. Bankruptcy Judge