CA1: no implied crediting procedures in bankruptcy plan

Ameriquest Mortgage v. Nosek, 07-2173, 07-2174.  In an adversary proceeding, the bankruptcy court awarded the debtor “In an adversary proceeding, the bankruptcy court awarded appellee Jacalyn S. Nosek ("Nosek") $250,000 in emotional distress damages and $500,000 in punitive damages for appellant Ameriquest Mortgage Company's ("Ameriquest") violations of 11 U.S.C. § 1322(b).”  The underlying issue deals with whether the mortgage company was properly crediting less-than complete payments. 

The First Circuit holds that since the Ameriquest wasn’t really on notice of what it had to do under 11 U.S.C. § 1322(a), and 11 U.S.C. § 1322(a) wasn’t specific as to how to treat payments there was no underlying violations.  Instead, that section is a listing of elements that could be incorporated into a plan.  Instead, the First says that the bankruptcy court should have amended the plan to make clear how to credit the payments.   

The First concludes with some blabber about how they are “sympathetic” to the debtor’s predicament. Why bother?