Law360, New York ( August 7, 2015, 5:01 PM EDT) -- Many courts have clung to the archaic "lien rides through" principle espoused in the U.S. Supreme Court's Dewsnup v. Timm Chapter 7 case. This principle permits a lien to "ride through" a bankruptcy case if the creditor did not "participate" in the case. Of course, Dewsnup, as a Chapter 7 case, did not involve the effect of discharge. Instead, Dewsnup focused strictly on the interpretation and application of Section 506(d) of the Bankruptcy Code. Moreover, in deciding Dewsnup, the Supreme Court overlooked that the "lien rides through" principle harkens back to an era when the discharge only affected debts that could be "proved," and secured debts could only be "proved" at that time for the amount of a deficiency claim....
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