In a recent 5th Circuit Court of Appeals decision, a proof of claim filed by mortgage creditor in the Homeowner’s prior Chapter 13 case did not judicially estop the same mortgage creditor from amending their claim in the Homeowner’s current case:
The 5th Court of Appeals held that a mortgage company’s failure to include the Homeowner’s full arrearage amounts in the amended proofs of claim the creditor had filed in the Homeowner’s prior Chapter 13 bankruptcy case did not judicially estop the Mortgage company from including the omitted arrearages in the proof of claim the creditor filed in the Homeowner’s current Chapter 13 case.
The Court found no statute or judicial precedent that imposed a legal responsibility on the Mortgage company to seek the full amount to which it was entitled in each amended claim, and the court found no basis for the lower courts’ “novel theory.” Moreover, application of judicial estoppel under these circumstances ran counter to the Fifth Circuit’s expressed reluctance to apply judicial estoppel in situations where a party’s alleged change of position was “merely implied rather than clear and express.” Finally, judicial estoppel requires the court to have adopted the estopped party’s prior inconsistent position and the Homeowner’s prior case was dismissed without the debtor receiving a discharge, the court’s acceptance of the Mortgage company’s prior position (in approving Chapter 13 plans based on the arrearage amounts shown in the creditor’s proofs of claim) was revoked when the case was dismissed.
In re Oparaji, 698 F.3d 231 (5th Cir., Oct. 5, 2012), reh’g en banc denied (Nov. 15, 2012)