§5175. Order of discharge in bankruptcy; effect

A. A judgment debtor in whose favor a United States Bankruptcy Court has entered an order of discharge, or any person whose rights are or may be affected by the order, may bring an action in accordance with the provisions of R.S. 44:114, against the recorder of mortgages of a parish in which the judgment is recorded to declare the judicial mortgage created by its recordation extinguished and order the recordation of the judgment cancelled from the records of the parish and any other parish in which the judgment is recorded.

B.(1) Upon proof of the order of discharge, and that the judgment is for a claim that has been discharged, the court shall declare extinguished the judicial mortgage evidenced by the recordation of the judgment and order the recordation of the judgment cancelled unless the judgment creditor, or any other party to the action whose rights are or may be adversely affected by the cancellation, proves that the judgment creditor or such other person possesses equity in property as a result of the judicial mortgage over and above superior liens, in which case the order of cancellation shall expressly exclude its effect as to that property.

(2) If a bankruptcy court order authorizing the sale of property free and clear of all judgments, mortgages, and privileges does not specify the discharged judgments, mortgages, or privileges to be cancelled, the trustee or former trustee in the proceedings, or his attorney of record, may specify by affidavit which discharged judgments, mortgages, or privileges are to be partially cancelled as to the particular property subject to the order. The affidavit and a Request to Cancel shall be filed with the bankruptcy court order. The affidavit shall contain all of the following information:

(a) A statement that the debtor filed a petition under the United States Bankruptcy Code.

(b) The name of the court where the bankruptcy proceeding was filed.

(c) The date on which the petition was filed.

(d) A statement that the debt or debts upon which the judgment, mortgage, or privilege is based were listed in the bankruptcy proceeding.

(e) A description of the particular property to be released and a statement that the property is free and clear of all judgments, mortgages, or privileges.

(f) A listing of the judgments, mortgages, or privileges, including the clerk's office identification by instrument number, book, or folio.

(g) A certified copy of the bankruptcy court order.

C.(1) A judgment debtor may obtain a partial cancellation of the inscription of a judgment as it affects property not owned by the judgment debtor on the date of his filing a petition under Chapter 7 or Chapter 13 of the United States Bankruptcy Code upon the filing of an affidavit in accordance with this Subsection.

(2) The affidavit shall contain all of the following:

(a) A statement that the judgment debtor filed a petition under Chapter 7 or Chapter 13 of the United States Bankruptcy Code.

(b) The name of the court where the bankruptcy proceeding was filed.

(c) The date on which the petition was filed.

(d) A statement that the debt or debts upon which the judgment is based were listed in the bankruptcy proceeding and that the debtor was subsequently released from personal liability on the debt or debts by virtue of a discharge in bankruptcy.

(e) A description of any particular property to be partially released and a statement that the property was not owned by the debtor at the time of filing the bankruptcy proceeding.

(f) A copy of the schedule or schedules listing the debt.

(g) A copy of the discharge order.

(3) Upon the filing of an affidavit in compliance with this Subsection, the recorder shall partially cancel the judgment insofar as it affects the property described in the affidavit and any property that may have been acquired after the date stated in Subparagraph (2)(c) of this Subsection that the debtor filed his petition for bankruptcy.

(4) For purposes of this Subsection, a debtor is deemed to own inherited property as of the date of death of the decedent from whom he inherited the property.

Acts 2005, No. 169, §6, eff. July 1, 2006; Acts 2005, 1st Ex. Sess., No. 13, §1, eff. Nov. 29, 2005; Redesignated from R.S. 44:111 by Acts 2010, No. 284, §1, eff. Jan. 1, 2011; Acts 2012, No. 179, §1; Acts 2016, No. 88, §1.