In re Jumpp, BAP No. 06-031.

• Citation: 356 B.R. 789
• Decision Date: 28 December 2006
• Docket Number: Bankruptcy No. 06-40677-JBR.,BAP No. 06-031.
• Parties: In re Veronica T. JUMPP, Debtor. Veronica T. Jumpp, Appellant, v. Chase Home Finance, LLC, Appellee.
• Court: Bankruptcy Appellate Panels. U.S. Bankruptcy Appellate Panel, First Circuit

Page 789

356 B.R. 789

In re Veronica T. JUMPP, Debtor Veronica T. Jumpp, Appellant, v. Chase Home Finance, LLC, Appellee.

BAP No. 06-031.

Bankruptcy No. 06-40677-JBR.

United States Bankruptcy Appellate Panel of the First Circuit.

December 28, 2006.

Craig T. Ornell, Worcester, MA, Lawson Williams, on brief for Appellant.

Andrew S. Harmon, Newton Highlands, MA, on brief for Appellee.

Before DE JESÚS, VAUGHN and DEASY, United States Bankruptcy Appellate Panel Judges.

PER CURIAM.

Veronica T. Jumpp (the "Debtor") appeals from the bankruptcy court's June 23, 2006, order denying the Debtor's Motion for Determination and Declaratory Judgment as to Continuation and Existence of the Automatic Stay ("Motion for Determination") and Motion to Reimpose the Automatic Stay, which had the effect of lifting the automatic stay in favor of Chase Home Finance, LLC ("Chase"). The bankruptcy court held that section 362(c)(3)(A)¹ terminates the automatic stay in its entirety, i.e., with regard to the debtor, property of the debtor, and property of the estate. The Debtor argues that section 362(c)(3)(A) does not terminate the stay with regard to property of the estate. For the reasons set forth below, the bankruptcy court's order is vacated.

BACKGROUND

The Debtor filed a Chapter 13 petition on May 1, 2006. She had previously been a debtor in a Chapter 13 case, that was dismissed upon the Chapter 13 trustee's motion on February 6, 2006. Chase holds a mortgage on the Debtor's residence in which the Debtor claims approximately $86,000 in equity exempt under Mass. Gen. Laws, Ch. 188, § 1.

In her current bankruptcy case, the Debtor filed a Motion to Extend the Automatic Stay on May 30, 2006, twenty-nine days post-petition. See 11 U.S.C. § 362(c)(3)(B) (requiring, before the court may grant a motion to extend the automatic stay, that both the motion be filed and the hearing be held "before the expiration of the 30-day period"). The Debtor did not seek an expedited hearing on her motion, and a hearing was held on June 6, 2006. Chase objected to the motion to extend the stay on the ground that the stay could not be extended because the hearing was not held within thirty days. The bankruptcy court denied the Debtor's Motion to Extend the Automatic Stay. The Debtor then filed a Motion to Reconsider in light of In re Johnson, which had been recently decided. See In re Johnson, 335 B.R. 805 (Bankr.W.D.Tenn.2006) (holding that under section 362(c)(3)(A) the automatic stay terminates with respect to the debtor and property of the debtor, but not with respect to property of the estate). The Debtor's Motion to. Reconsider was denied "because it failed to allege any newly discovered evidence, any manifest error of law, or any significant change in the law that would affect the prior outcome." In re Jumpp, 344 B.R. 21, 23 (Bankr.D.Mass.2006). The Debtor did not appeal the denial of her Motion to Reconsider.

The Debtor next filed the Motion for Determination wherein she argued the position she currently argues on appeal, that section 362(c)(3)(A) does not terminate the stay with regard to property of the estate. The Debtor also filed a Motion to Reimpose the Automatic Stay, arguing that the court, could use section 105(a) to reimpose the stay.

The bankruptcy court denied both the Motion for Determination and the Motion to Reimpose the Automatic Stay, holding that section 362(c)(3)(A) terminates the automatic stay in its entirety, i.e., with regard to the debtor, the debtor's property, and property of the estate. The court also concluded that it could not reimpose the automatic stay under section 105(a).²

JURISDICTION

The bankruptcy appellate panel's jurisdiction includes appeals "from final judgments, orders, and decrees." 28 U.S.C. § 158(a)(1) and (b). Fleet Data Processing Corp. v. Branch (In re Bank of New England Corp.), 218, B.R. 643, 645 (1st Cir. BAP 1998). "A decision is final if it `ends the litigation on the merits and leaves nothing for the court to do but execute the judgment.'" Id. at 646 (quoting Catlin v. United States, 324 U.S. 229, 233, 65 S.Ct. 631, 89 L.Ed. 911 (1945)). The bankruptcy court's order denying the Debtor's motions is final because it had the effect of lifting the automatic stay with respect to the Debtor's residence, permitting Chase to proceed against the Debtor's residence outside of bankruptcy. See Tringali v. Hathaway Machinery Co., Inc., 796 F.2d 553, 558 (1st Cir.1986) (an order denying relief from the automatic stay is, a final order).

STANDARD OF REVIEW

Generally, a bankruptcy court's factual findings are reviewed under the clearly erroneous standard and conclusions of law are reviewed de novo. See TI Fed. Credit Union v. DelBonis, 72 F.3d 921, 928 (1st Cir.1995); Western Auto Supply Co. v. Savage Arms, Inc. (In re Savage Indus., Inc.), 43 F.3d 714, 719-20 n. 8 (1st Cir. 1994). The extent to which the automatic stay terminates pursuant to section 362(c)(3)(A) is a question of law that the Panel herein reviews de novo.

DISCUSSION

The question presented on appeal is whether section 362(c)(3)(A) terminates the automatic stay with regard to the debtor, property of the debtor, and property of the estate, or only with regard to the debtor and property of the debtor. The majority of courts that have considered the issue have concluded that the automatic stay does not terminate with respect to property of the estate.³ The court below and In re Jupiter, 344 B.R. 754 (Bankr. D.S.C.2006), have held otherwise, concluding that the automatic stay terminates in its entirety.

Section 362(c)(3) terminates the automatic stay after thirty days for individual debtors who have had a previous bankruptcy case pending within the preceding year:

(3) if a single or joint case is filed by or against debtor who is an individual in a case under chapter 7, 11, or 13, and if a single or joint case of the debtor was pending within the preceding 1-year period but was dismissed, other than a case refiled under a chapter other than chapter 7 after dismissal under section 707(b) —

(A) the stay under subsection (a) with respect to any action taken with respect to a debt or property securing such debt or with respect to any lease shall terminate with respect to the debtor on the 30th day after the filing of the later case;

(B) on the motion of a party in interest for continuation of the automatic stay and upon notice and a hearing, the court may extend the stay in particular cases as to any or all creditors (subject to such conditions or limitations as the court may then impose) after notice and a hearing completed before the expiration of the 30-day period only if the party in interest demonstrates that the filing of the later case is in good faith as to the creditors to be stayed; and

(C) for purposes of subparagraph (B), a case is presumptively filed not in good faith (but such presumption may be rebutted by clear and convincing evidence to the contrary) —

(i) as to all creditors, if —

(I) more than 1 previous case under any of chapters 7, 11, and 13 in which the individual was a debtor was pending within the preceding 1-year period;

(II) a previous case under any of chapters 7, 11, and 13 in which the individual was a debtor was dismissed within such 1-year period, after the debtor failed to —

(aa) file or amend the petition or other documents as required by this title or the court without substantial excuse (but mere inadvertence or negligence shall not be a substantial excuse unless the dismissal was caused by the negligence of the debtor's attorney);

(bb) provide adequate protection as ordered by the court; or

(cc) perform the terms of a plan confirmed by the court; or

(III) there has not been a substantial change in the financial or personal affairs of the debtor since the dismissal of the next most previous case under chapter 7, 11, or 13 or any other reason to conclude that the later case will be concluded —

(aa) if a case under chapter 7, with a discharge; or

(bb) if a case under chapter 11 or 13, with a confirmed plan that will be fully performed; and

(ii) as to any creditor that commenced an action under subsection (d) in a

previous case in which the individual was a debtor if, as of the date of dismissal of such, case, that action was still pending or had been resolved by terminating, conditioning, or limiting the stay as to actions of such creditor[.]

11 U.S.C. § 362(c)(3) (emphasis added). Whereas section 362(c)(3) applies to individual debtors who had one prior case pending in the previous year, section 362(c)(4)(A)(i) applies to individual debtors who had two or more cases pending within the previous year:

(4)(a)(i) if a single or joint case is filed by or against a debtor who is an individual under this title, and if 2 or more single or joint cases of the debtor were pending within the previous year but were dismissed, other than a case reified under section 707(b), the stay under subsection (a) shall not go into effect upon the filing of the later case[.]

11 U.S.C. § 362(c)(4)(A)(i) (emphasis added).

I.

We begin by considering whether section 362(c)(3)(A) is ambiguous. If a Bankruptcy Code provision is unambiguous, the plain language, controls, so long as a literal application of the provision does not produce an absurd result or one that is "demonstrably at odds with the intentions of its drafters." United States v. Ron Pair. Enters., Inc., 489 U.S. 235, 241, 242, 109 S.Ct. 1026, 103 L.Ed.2d 290 (1989) (quoting Griffin v. Oceanic Contractors, Inc., 458 U.S. 564; 571, 102 S.Ct. 3245, 73 L.Ed.2d 973 (1982)); Lamie v. United States Trustee, 540 U.S. 526, 534, 124 S.Ct. 1023, 157 L.Ed.2d 1024 (2004). In our search for ambiguity, we consider "the language itself, the specific context in which that language is used, and the broader context of the statute as a whole." Robinson v. Shell Oil Co., 519 U.S. 337, 341, 117 S.Ct. 843, 136 L.Ed.2d 808 (1997).

The Jupiter court, found the language of ...