In re Burrier

Brandon and Denon Burrier (plaintiffs) executed a deed of trust and note with NBank, N.A. (NBank) and received a loan in return. NBank then transferred the deed of trust and note to Wells Fargo Bank, N.A. (Wells Fargo). Thereafter, the Burriers filed for bankruptcy under Chapter 13 of the United States Bankruptcy Code. In bankruptcy court, the Burriers filed a repayment plan to make regular payments to Wells Fargo. Wells Fargo moved for relief from automatic stay, alleging that the Burriers had failed to make the agreed-upon payments. The Burriers denied Wells Fargo’s assertion. The parties then entered into a stipulation agreement, which provided that Wells Fargo would credit the Burriers’ account if they could produce cancelled checks indicating that they had made the payments in question. However, the Burriers were unable to obtain the cancelled checks. Pursuant to the Check Clearing for the 21st Century Act (Act), Wells Fargo processed customer checks via check truncation. As a result, the Burriers’ checks would have been converted into an electronic image upon being processed, and the cancelled checks would not have been returned to them. At an evidentiary hearing on Wells Fargo’s motion, the Burriers submitted their bank statements, which reflected that payments had been made to Wells Fargo. The Burriers also produced carbon copies of checks made out to Wells Fargo as evidence that they had made the payments in question.