Hill v. Green Tree Servicing, Inc., A06–0530, 2006 Ga. App. LEXIS 771 (Ga. App June 26, 2006) – Prior to this action,  Borrower, the owner of a residential mobile home, had asserted a claim against Conseco Financial Services in Conseco’s Chapter 11 bankruptcy case.  The Borrower ultimately settled the proceeding, agreeing on a general unsecured claim of $88,113.60 and releasing all other claims against Conseco.  The Borrower ultimately received $24,671.81 under Conseco’s Plan of Reorganization.

Fast forward… Borrower still owes Green Tree, which purchased some of Conseco’s assets including Borrower’s loan, and the loan is in default.  Green Tree seeks a writ of possession in state court and Borrower defends that he is entitled to a recoupment of the amount left unpaid by Conseco, because Green Tree stood in the shoes of Conseco.

The court disagreed.  Noting that Borrower’s claim was more in the nature of set-off, the Court found that the Borrower had expressly released all claims against Conseco in the bankruptcy settlement.  Thus, they gave up their right to assert the amount of their unpaid settlement as a set-off or recoupment.