General Motors Acceptance Corp. v. Gumbleton (In re Gumbleton)

MEMORANDUM OPINION

HAROLD H. BOBIER, Bankruptcy Judge.

I. Introduction

Defendant, a secured creditor, brought an action for relief from stay in order to allow it to proceed directly against its collateral in state court. Prior to trial the parties executed a written settlement agreement allowing plaintiff to recover possession of two vehicles in return for a waiver of its right to the deficiency which was certain to arise upon the subsequent sale of the vehicles. Prior to the formal written execution of the settlement agreement and unbeknownst to the parties, the trustee made a lump-sum payment…