tag:blogger.com,1999:blog-18043488.post115256074504190933..comments2007-02-19T12:05:39.023-05:00David L. Rosendorfhttp://www.blogger.com/profile/02528850177354056032noreply@blogger.comBlogger3125tag:blogger.com,1999:blog-18043488.post-1152805266220992372006-07-13T10:41:00.000-05:002006-07-13T10:41:00.000-05:00Creditors, listen up. There is a serious argument to be mounted against the opinions of In re Harris, 342 B.R. 274, In re Jones, 339 B.R. 360, and In re Moon, 339 B.R. 668. <BR/><BR/>These cases all hinge on the ambiguous phrase "with respect to the debtor." 11 U.S.C. s. 362(c)(3)(A). Now to what exactly does this phrase refer?<BR/><BR/>These courts would have us believe that Congress, in making these elaborate "disappearing stay" provisions, meant only that creditors could attach property of the debtor, and NOT property of the estate. But see s. 541(a)(stating that practically all assets belongs to the estate as of the petition date).<BR/><BR/>In other words, the whole issue is practically moot. Why even bother filing motions to extend the stay?<BR/><BR/>While I would not go so far as to say that these opinions are wrong, per se, there is an obvious argument against them. To wit:<BR/><BR/>The phrase "with respect to the debtor" is a reference not to the "property of the debtor" but specifically to the debtor described in s. 362(c)(3) (main paragraph) who "is an individual" who had 1 or more cases dismissed in the prior year, etc.<BR/><BR/>Here is the problem Congress was wrestling with: Say you have two debtors, H & W. All by his lonesome, H filed a case that was dismissed 6 months ago. Now he and his wife (W) are filing a new joint case. "[W]ith respect to the debtor" refers not to property of the debtor, but to the specific language of the main paragraph.<BR/><BR/>In other words, it refers to H. And it excludes W. So W gets an (enduring) automatic stay. But H has to beg for it. If he does not, then the stay will be void as to property which H alone has title. After 30 days pass, rapacious creditors can drag him back into state court... first come, first serve.<BR/><BR/>Not pretty, but I think this is what Congress intended.<BR/><BR/>This interpretation explains the elaborate hemming and hawwing at the beginning of s. 362(c) that In re Paschal and other courts find so tedious. ("[I]f a single or joint case is filed by or against debtor who is individual... [etc.]")<BR/><BR/>Congress was trying to draft language that would protect W, while isolating H as a bad actor. Hence the phrase "with respect to the debtor."<BR/><BR/>That, I would argue, is how s.362(c) ought to be interpretted.<BR/><BR/>Courts are understandably trying to minimize the impact of this statute. Bankruptcy without the protection of the stay is about as pointless as... say... pre-petition credit counseling (ha).<BR/><BR/>But these opinions just don't consider the ambiguity of the phrase in question. When that ambiguity is brought to light, I think the arguments favor creditors. Congress didn't write this lengthy new section for nothing.<BR/><BR/>NOTE: Nothing in this comment is intended to be legal advice. The author renounces any and all liability for others' reliance on the comments contained herein.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-18043488.post-1152709385861825922006-07-12T08:03:00.000-05:002006-07-12T08:03:00.000-05:00Regarding the used of 362(c)(4) by a debtor who has had one prior case dismissed, you'll want to keep an eye out for a Minnesota case, In re Novack, on appeal from the Bky. Court to the District Court. The pro se debtor in this case attempted to used 362(c)(4) to argue that the Bky. court could still consider his motion for continuation of the automatic stay, even though he'd had only one prior case dismissed within the previous year and he filed his motion late. The Bky. court (Judge Dreher) denied the motion on procedural grounds & the debtor has appealled to the District Court (Judge Montgomery), where the appeal is still in the briefing stage. The District Court case no. is 0:06-cv-02204, Novack v. Wurst, et al.Thomas E. Johnson, Chapter 13 staff attorney (MN)noreply@blogger.comtag:blogger.com,1999:blog-18043488.post-1152639175900871222006-07-11T12:32:00.000-05:002006-07-11T12:32:00.000-05:00Welcome Back. I missed your submissionsSkillyhttp://www.blogger.com/profile/11257848268996647497noreply@blogger.com