In re Andrews
| Decision Date | 21 July 2015 |
| Docket Number | Case No. 14-36384-KRH |
| Court | U.S. Bankruptcy Court — Eastern District of Virginia |
| Parties | IN RE: DONALD WAYNE ANDREWS, JR., Debtor. |
Before the Court is the amended motion of Donald Wayne Andrews, Jr. (the "Debtor") to vacate (the "Amended Motion to Vacate") the Local Rule 2003-1(B) order dismissing this case for the Debtor's failure to appear at his rescheduled § 341 meeting of creditors on April 21, 2015 (the "Order Dismissing Case"). The Court conducted a hearing on the Amended Motion to Vacate on June 24, 2015 (the "Hearing on the Motion to Vacate"). At the conclusion of the Hearing on the Motion to Vacate the Court denied the Debtor's motion. The Debtor filed a notice of appeal on June 26, 2015, and subsequently filed an amended notice of appeal on June 29, 2015. This memorandum opinion supplements the findings of fact and conclusions of law set forth by the Court on the record at the Hearing on the Motion to Vacate in accordance with Rule 7052 of the Federal Rules of Bankruptcy Procedure.1
The Amended Motion to Vacate is a contested matter arising under Rule 9014 of the Federal Rules of Bankruptcy Procedure. Rules 9023 and 9024 of the Federal Rules of Bankruptcy Procedure set forth the framework under which the Court may consider the Debtor's motion. The Court has subject matter jurisdiction over this contested matter pursuant to 28 U.S.C. §§ 157(a) and 1334 and the General Order of Reference from the United States DistrictCourt for the Eastern District of Virginia dated August 15, 1984. The contested matter is a core proceeding under 28 U.S.C. § 157(b)(2)(G). Venue is appropriate in this Court pursuant to 28 U.S.C. § 1409.
Donald Wayne Andrews, Jr. filed a voluntary petition pro se under Chapter 7 of the Bankruptcy Code on November 28, 2014 (the "Petition Date").2 Sherman B. Lubman ("Lubman") was appointed interim trustee in accordance with 11 U.S.C § 701 (the "Trustee").3 The meeting of creditors required by 11 U.S.C § 341 was scheduled for December 23, 2014 (the "§ 341 Meeting of Creditors"). The Office of the Clerk of the Bankruptcy Court (the "Clerk's Office") issued a deficiency notice to the Debtor on December 2, 2014 for his failure to file the schedules, statements, and lists described in Rule 1007 of the Federal Rules of Bankruptcy Procedure as the Debtor was required to do under 11 U.S.C § 521(a) (the "Deficiency Notice"). The Debtor responded to the Deficiency Notice by filing schedules and a statement of financial affairs on December 12, 2014. The Debtor thereafter amended his schedules on December 17, 2014.
The Court entered its standard administrative order on December 4, 2014 which among its provisions required the Debtor to: (i) safely care for, protect, and preserve his property; (ii) preserve all recorded information from which his financial condition might be ascertained and make that information available to the Trustee, (iii) cooperate with the Trustee as necessary for the Trustee to perform the Trustee's duties, (iv) make all reasonable efforts to provide theTrustee any documentation requested by the Trustee, and (v) appear at the initial § 341 Meeting of Creditors as well as any adjourned and subsequently reconvened § 341 Meeting of Creditors.
The Debtor attended the § 341 Meeting of Creditors on December 23, 2014 and submitted to examination as required by 11 U.S.C § 343. The Debtor failed, however, to cooperate with the examination as required by 11 U.S.C. § 521(a)(3), Rule 4002 of the Federal Rules of Bankruptcy Procedure, 4 and the Court's administrative order entered December 4, 2014. The Debtor refused to answer routine questions posed by the Trustee concerning the Debtor's employment and educational background. The Debtor failed to provide the Trustee with a copy of a tax return filed by him for any of the five tax years preceding the Petition Date.5 The Trustee adjourned the § 341 Meeting of Creditors until February 3, 2015 in order to give the Debtor an opportunity to produce the documents and information he had requested. The Office of the United States Trustee (the "U.S. Trustee")6 issued a letter to the Debtor immediately following the § 341 Meeting of Creditors confirming the requests made by the Trustee for ninecategories of documents (the "Document Requests"). The Document Requests included such routine items as bank statements, tax returns, and verification of household income.
Although notified in December of the rescheduled February date for the adjourned § 341 Meeting of Creditors, the Debtor waited until January 26, 2015 to file an Emergency Motion requesting a further adjournment of the § 341 Meeting of Creditors scheduled for February 3, 2015. The Trustee acceded to the Debtor's request for the adjournment and rescheduled the meeting for his next available date on March 17, 2015. On January 28, 2015, just two days after filing his Emergency Motion requesting adjournment, the Debtor responded to the Document Requests issued by the U.S. Trustee. The Debtor's response was wholly inadequate. It failed to comply with the majority of the Document Requests that had been made. Instead of complying, the Debtor filed a Motion for Protective Order. The Debtor asserted that information concerning his educational background was privileged and protected from disclosure under the Family Education and Privacy Act, 20 U.S.C. § 1232g. The Debtor scheduled a hearing on his Motion for Protective Order for February 11, 2015. In the meantime, the Debtor uploaded to YouTube an audio recording and transcript of his December 23, 2014, § 341 Meeting of Creditors along with an "index" providing the Debtor's editorial musings ridiculing the Trustee's performance.7 The U.S. Trustee filed a Response to the Motion for Protective Order on February 6, 2015. The Debtor failed to appear at the February 11, 2015 hearing he had scheduled. By Order entered February 18, 2015, (the "Court's February 18 Order") the Court denied the Debtor's Motion for Protective Order and ordered the Debtor to forthwith fully and timely comply with all requestsmade to him by the Trustee and the Office of the U.S. Trustee for information and documentation. The Court ordered the Debtor to appear at the adjourned § 341 Meeting of Creditors and answer all questions duly propounded by the Trustee and to cooperate with the Trustee and the Office of the U.S. Trustee. No further response to the Document Requests was ever forthcoming from the Debtor. Accordingly, the Office of the U.S. Trustee filed a Motion to Extend Time to Object to Discharge (the "Motion for Extension of Time").8 The Debtor filed an Objection to the U.S. Trustee's Motion for Extension of Time wherein the Debtor complained that the U.S. Trustee was merely attempting to harass the Debtor and had not filed the motion for any justifiable purpose.
In the wake of the Internet posting of the § 341 Meeting of Creditors, Lubman resigned as Trustee on March 16, 2015. Bruce H. Matson ("Matson") was appointed in his stead as successor trustee in accordance with 11 U.S.C § 343 the next day. The § 341 Meeting of Creditors, which had been adjourned to March 17, 2015, at the request of the Debtor, had to be further rescheduled for April 21, 2015 in order to accommodate Matson's next hearing date.
The Court conducted a hearing on April 1, 2015, at which it granted the U.S. Trustee's Motion for an Extension of Time. By order entered April 8, 2015, the last day to file a complaint to object to the Debtor's discharge was extended through and including May 26, 2015. The Debtor, thereafter, refused to produce the documents responsive to the Document Requests as required by the Court's February 18 Order and he failed to appear before Matson at his rescheduled § 341 Meeting of Creditors on April 21, 2015. An order was entered on April 23,2015 pursuant to Local Rule 2003-1(B) dismissing the Debtor's case. The Debtor filed a motion to vacate the Order Dismissing Case on May 1, 2015, but he failed to serve the motion. The Clerk's Office issued a deficiency notice to the Debtor via first class mail on May 6, 2014, alerting him to the fact that he had failed to serve the motion to vacate on any party in interest. The Debtor failed to timely correct the deficiency. The Debtor waited until after the time had expired for objecting to his discharge before he filed his Amended Motion to Vacate. The Amended Motion to Vacate was not filed until June 1, 2015. Although it was properly served on the Trustee, the Debtor's creditors, and all other parties in interest, the Debtor did not notice the hearing on the Amended Motion to Vacate until June 24, 2015.
At the Hearing on the Motion to Vacate, the Court found that no adequate reason had been presented establishing cause for vacating the dismissal of the Debtor's bankruptcy case under either Rule 9023 or Rule 9024 of the Federal Rules of Bankruptcy Procedure. In fact, as of the date of the Hearing on the Motion to Vacate, none of the additional information in the Document Requests had been provided to the Trustee or to the Office of the U.S. Trustee. The Court further found that granting the Amended Motion to Vacate at this juncture of the chapter 7 case, after such a long delay had ensued between the entry of the order of dismissal and the Hearing on the Amended Motion to Vacate, would unduly prejudice the creditors of the bankruptcy estate. The Court concluded that the Debtor had purposely prolonged the case in order to avoid disclosure of the information he had been requested (and subsequently ordered) to produce while taking great care to bypass the date set for objecting to his chapter 7 discharge. Accordingly, the Court entered an order denying Debtor's Amended Motion to Vacate on June 26, 2015.Analysis
In order for the Court to vacate the Order Dismissing Case, it must find that the Debtor has satisfied either Federal...
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