In re Brown
| Decision Date | 14 February 2020 |
| Docket Number | CASE NO. 19-65022-JWC |
| Parties | IN RE: CHADRUS LEQUARDRA BROWN, Debtor. |
| Court | United States Bankruptcy Courts. Eleventh Circuit. U.S. Bankruptcy Court — Northern District of Georgia |
IT IS ORDERED as set forth below:
THIS MATTER is before the Court on the Request for Dismissal (the "Request for Dismissal") (Doc. No. 23) filed by S. Gregory Hays in his capacity as Chapter 7 Trustee ("Trustee"), Debtor's Application for Waiver of Chapter 7 Filing Fee (the "Fee Waiver Application") (Doc. No. 3), and Debtor's Motion to Extend Time to File Schedules (the "Application to Extend") (Doc. No. 10). For the reasons stated below, the Request for Dismissal is granted, and the Fee Waiver Application and Application to Extend are denied.
Debtor initiated this chapter 7 case on September 20, 2019 by filing a voluntary petition for non-individuals filing for bankruptcy (Doc. No. 1). In the petition, Debtor identified itself as a trust. The same day, Debtor filed the Fee Waiver Application seeking waiver of the chapter 7 filing fee and stating that Debtor was incarcerated and had no income. The Court entered an order on September 27, 2019 requiring Debtor to supplement the petition with the schedules and documents necessary to evaluate the Fee Waiver Application (Doc. No. 6). Debtor filed the Application to Extend on October 7, 2019.
The Court held a hearing on the Application to Extend and the Fee Waiver Application on December 18, 2019 (the "Hearing"), primarily to determine whether Debtor was eligible for a waiver of the chapter 7 filing fee. Chadrus Brown appeared telephonically at the Hearing, and there was no appearance by the Trustee or any other party in interest. Chadrus Brown indicated at the Hearing that his motive in filing this case was for this Court to remove him from prison. A bankruptcy court, however, has "no conceivable interest" in enjoining enforcement of criminal statutes and related prison sentences resulting therefrom. See Barnette v. Evans, 673 F.2d 1250, 1253 (11th Cir. 1982). Thus, this Court has no power to release Chadrus Brown from his imprisonment. Unable to grant the primary relief sought in this case, the Court finds sufficient grounds to dismiss this bankruptcy case based on the record before it and Chadrus Brown's representations to the Court at the Hearing.
The Trustee requests dismissal of this case as a result of Debtor's failure to attend three separately scheduled 341 meetings. A chapter 7 case may be dismissed for cause, including "unreasonable delay by the debtor that is prejudicial to creditors[.]" 11 U.S.C. § 707(a). Courts have found that failure to attend a duly noticed and scheduled meeting of creditors pursuant to 11 U.S.C. § 341 is cause for dismissal.1 See, e.g., In re Rust, 1 B.R. 656 (Bankr. M.D. Tenn. 1979) (); In re Bresler, 119 B.R. 400 (Bankr. E.D.N.Y. 1990) (). Furthermore, pursuant to this Court's General Order 2-2005, a debtor's failure to appear at a duly noticed and scheduled 341 meeting is grounds for dismissal of a chapter 7 case. The record reflects that Debtor failed to appear at three consecutive duly noticed and scheduled 341 meetings.
Debtor's first meeting of creditors was scheduled for October 29, 2019. Pursuant to the Certificate of Service filed on September 27, 2019, notice of Debtor's first 341 meeting was served on Debtor at Debtor's address of record via first class mail (Doc. No. 7). Debtor failed to appear at his first scheduled 341 meeting, and the meeting was rescheduled for November 19, 2019, with notice thereof sent to Debtor's address of record via first class mail (Doc. No. 12). The Trustee requested dismissal of Debtor's case after Debtor failed to appear at the rescheduled 341 meeting. Debtor's case was dismissed in error on November 21, 2019 but reinstated the same day (Doc. Nos. 16 and 17). The United States Trustee rescheduled Debtor's 341 meeting for December 17, 2019, with notice thereof sent to Debtor's address of record via first class mail (Doc. Nos. 19 and 20). Debtor failed to appear at this third 341 meeting, and the Trustee again requested dismissal of this case for Debtor's failure to appear.
A debtor petitioning this Court for relief under the Bankruptcy Code must comply with certain duties, such as "filing appropriate statements and schedules, appearing at the meeting of creditors, and cooperating with the case trustee and the United States Trustee regarding the administration of the bankruptcy estate." In re Michael, 285 B.R. 553, 556 (Bankr. S.D. Ga. 2002). Section 343(a) of the Bankruptcy Code provides that a "debtor shall appear and submit to examination under oath at the meeting of creditors under section 341(a) of this title." 11 U.S.C. § 343(a) (emphasis added). Bankruptcy Rule 2003(a) provides that "[t]he [341] meeting may be held at a regular place for holding court or at any other place designated by the United States trustee within the district convenient for the parties in interest." Fed. R. Bankr. P. 2003(a). Neither § 343 nor Bankruptcy Rule 2003 specifically provide the United States Trustee or the bankruptcy court the authority to waive the requirement that a debtor appear and submit to examination under oath at the 341 meeting. In re Michael, 285 B.R. at 556 (citing In re Sochia, 231 B.R. 158, 161 (Bankr. W.D.N.Y. 1999)). As a result, some courts disallow any exceptions to a debtor's mandatory attendance at 341 meetings. See In re Chandler, 66 B.R. 334, 335-36 (N.D. Ga. 1986) (citing In re Import Toy Sales, 41 B.R. 784, 785 (Bankr.S.D.Fla.1984); In re Martin, 12 B.R. 319, 320 (Bankr.S.D.Ala.1981)).
Other courts have found limited exceptions for a debtor's personal appearance at a 341 meeting in certain circumstances when requested by the debtor. See In re Chandler, 66 B.R. at 335-36 (); see also In re Carstarphen, No. 02-43450, 2003 WL 26119291, at *1 (Bankr. S.D. Ga. June 16, 2003) (same); In re Vilt, 56 B.R. 723 (Bankr. N.D. Ill. 1986) (). Examples of scenarios meriting waiver of the 341 attendance requirement include a debtor confined by physical illness or a debtor stationed outside of the country on military or religious duty. In re Vilt, 56 B.R. 723 (citing In re Sullivan, 30 B.R. 781 (Bankr. E.D. Pa. 1983); In re Stewart, 14 B.R. 959 (Bankr. N.D. Ohio 1981)). Previous courts, however, have declined to waive a debtor's attendance at a 341 meeting simply because of a debtor's incarceration. See, e.g., In re Michael, 285 B.R. 553 (). The record in this case does not show that Debtor requested relief to be excused from a personal appearance at any of the three scheduled 341 meetings. Because Debtor failed to request relief from the attendance requirement or establish any special circumstances beyond his confinement meriting a waiver, the Court declines to waive Debtor's required attendance, and Debtor's failure to attend the 341 meetings constitutes grounds for dismissal of this case.
Even if Debtor were to request relief to attend the 341 meeting telephonically, the Court would be unlikely to grant such relief because Debtor, as a purported trust, is ineligible to be a debtor in this Court and because Chadrus Brown, a non-attorney, cannot represent a purported trust in federal court. Chadrus Brown represented to the Court at the Hearing that Debtor is a trust, and he serves as its trustee. This presents two problems. First, under the Bankruptcy Code, a trust is not an eligible debtor in bankruptcy. "[O]nly a person that resides or has a domicile, a place of business, or property in the United States, or a municipality, may be a debtor under this title." 11 U.S.C. § 109(a). A "person" is defined to include an individual, partnership, or corporation, 11 U.S.C. § 101(41), and does not include a trust other than a business trust. See In re Darren Buckner Living Tr., No. 12-70036-MHM, 2012 Bankr. LEXIS 5050, at *1-2 (Bankr. N.D. Ga. Oct. 5, 2012) (); see also Shawmut Bank Conn. v. First Fidelity Bank (In re Secured Equip. Trust of Eastern Airlines), 38 F.3d 86, 32 C.B.C.2d 1069 (2d Cir. 1994) (); Hunt v. TRC Properties (In re Hunt), 30 C.B.C.2d 139, 160 B.R. 131 (B.A.P. 9th Cir. 1993); In re Pace Trustee of Pace Irrevocable Trust, 376 B.R. 334 (Bankr. M.D. Fla 2007). Chadrus Brown provided no argument or evidence establishing that Debtor is a business trust under any existing law.
The second problem arising from Debtor's status as a purported trust is that a trust must be represented in federal court by an attorney. Hays v. Hamblen Family Irrevocable Tr. (In re Hamblen), 360 B.R. 362, 365 (Bankr. N.D. Ga. 2006). See also Michel v. United States, 519 F.3d 1267, 1271 (11th Cir. 2008) (); C.E. Pope Equity Tr. v. United States, 818 F.2d 696, 697 (9th Cir. 1987) (). Chadrus Brown stated at the Hearing that (i) he is not an attorney, and (ii) he was...
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