A debt collection agency sought to recover $1,526.56 in Citibank credit card debt from RRW, who represented himself in court.
Apparently, RWW had filed for bankruptcy on August 8, 2019, but his bankruptcy petition was dismissed on December 2, 2019. During the pendency of the bankruptcy case, Citibank transferred the debt to the collection agency and, in 2022, a lawsuit was filed by the latter entity with the Kings County Civil Court to collect the debt.
RWW argued that the transfer of the debt during his bankruptcy violated the automatic stay provisions of the Bankruptcy Code, which protect debtors from collection actions while their bankruptcy case is pending. He claimed that this made the transfer illegal and ineffective, and thus, the complaint should be dismissed.
Both the Civil Court and the Appellate Term, Second Department, found that Citibank's transfer of the debt did not constitute an action against RWW nor was it an attempt to collect the debt from him. Instead, the transfer was considered an asset transaction of Citibank, not involving RWW’s estate, and thus did not violate the automatic stay provisions.
As a result, the denial of RWW’s motion to dismiss the complaint was ultimately left undisturbed.
Got to give the guy credit there.
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DECISION