In re Norris, Bankruptcy No. 82-5789K

• Decision Date: 28 March 1984
• Docket Number: Bankruptcy No. 82-5789K,Civ. A. No. 83-6258.
• Citation: 39 BR 85
• Parties: In re Delores S. NORRIS.
• Court: U.S. District Court — Eastern District of Pennsylvania

39 B.R. 85 (1984)

In re Delores S. NORRIS.

Bankruptcy No. 82-5789K, Civ. A. No. 83-6258.

United States District Court, E.D. Pennsylvania.

March 28, 1984.

David A. Searles, Community Legal Services, Philadelphia, Pa., for appellant.

Lawrence Phelan, Philadelphia, Pa., for appellee Fidelity Bank.

MEMORANDUM AND ORDER

FULLAM, District Judge.

On April 19, 1983, the Bankruptcy Court entered an Order confirming the debtor's amended plan under Chapter 13. The plan contemplated the sale of debtor's residence, valued at $14,600, free and clear of all liens and encumbrances, and use of the proceeds to pay off the mortgage held by Fidelity Bank (approximately $5500) and for a distribution of $600 among unsecured creditors.

In September, the bank filed a petition for relief from automatic stay, on an all-purpose standard from which alleged that the debtor had not made all of the payments she was required to make under the terms of the plan, that the dwelling house property was not needed to carry out the plan (!), and that the bank's security interest in the residence was not adequately protected. A hearing was scheduled, but when the debtor notified the court that she could not obtain transportation to attend the hearing, the hearing was continued. At the continued hearing, the debtor again failed to appear (allegedly, it was later learned that she lacked the funds to obtain public transportation). On the theory that the debtor had failed to prove that the bank's interests were being adequately protected, the Bankruptcy Court entered an Order granting relief from the automatic stay, so as to permit the bank to proceed with a mortgage foreclosure.

In the present appeal from that Order, counsel for the debtor does not challenge the propriety of granting relief from the automatic stay. Rather, the present appeal challenges only certain additional provisions in the Order appealed from. After directing that the automatic stay be modified "with respect to premises 4609 Hedge Street, Philadelphia, PA. 19124 as to allow the petitioner to foreclose on its mortgage . . .", the order adds the following:

"And further

"DECREED that the foregoing Order is determinative of the issues regarding petitioner and the debtor(s) concerning said premises

"AND FURTHER, the filing of any future petitions in bankruptcy shall not affect the instant Order granting relief from the Code Section 362 stay.

"Debtor failed to show adequate protection at trial."

I confess to great difficulty in interpreting the intended effect of the first paragraph thus added, and counsel have been unable to shed much light on its possible meaning. If, as seems probable, it means merely that the Order is intended as a final resolution of all issues raised by the bank's petition for relief from stay, there is no cause for complaint.

The real problem arises from the inclusion of the provision that "the filing of any future petitions in bankruptcy shall not affect the instant Order granting relief from the Code Section 362 stay."

The applicable statute, 11 U.S.C. § 362(d), provides:

"(d) On request of a party in interest and after notice and a hearing, the court shall grant relief from the stay provided under subsection (a) of this section, such as by terminating, annuling, modifying, or conditioning such stay—

"(1) for cause, including the lack of adequate protection of an interest in property of such party in interest; or

"(2) with respect to a stay of an act against property if—

"(A) the debtor does not have an equity in such property; and

"(B) such property is not necessary to an effective reorganization."

The Order in question is undoubtedly an Order "with respect to a stay of an act against property". It should be noted preliminarily that the record seems to establish quite clearly that in fact the debtor did have substantial equity in the property, and that the...