Rodrigo Celedio and Catherine Celedio

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
-1-
UNITED STATES BANKRUPTCY COURT
FOR THE NORTHERN DISTRICT OF CALIFORNIA
In re
RODRIGO CELEDIO and
CATHERINE CELEDIO,
Debtors.
)
)
)
)
)
)
)
)
)
)
)
Case No. 07-31389 TEC
Chapter 7
MEMORANDUM RE U.S. TRUSTEE’S MOTION TO DISMISS CASE
The United States Trustee moves to dismiss Debtors’ bankruptcy
case under section 707(b) on the basis that (1) a presumption of
abuse arises, and (2) the totality of circumstances demonstrate
abuse. 	For the reasons stated below, the motion is denied.
A presumption of abuse arises if a debtor’s “current monthly
income” less permitted expenses and multiplied by 60 is $10,950 or
more. 	11 U.S.C. § 707(b)(2)(A)(i)(II). 	“Current monthly income”
is
the average monthly income from all sources that the
debtor receives (or in a joint case the debtor and the
debtor’s spouse receive) without regard to whether such
income is taxable income, derived during the 6-month
Signed and Filed: June 23, 2008
________________________________________
THOMAS E. CARLSON
U.S. Bankruptcy Judge
________________________________________
Entered on Docket
June 23, 2008
GLORIA L. FRANKLIN, CLERK
U.S BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
Case: 07-31389 Doc# 40 Filed: 06/23/08 Entered: 06/23/08 12:50:45 Page 1 of 3

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
1 The United States Trustee calculated Debtors’ monthly
expenses as $12,586. 	On the record at the hearing, counsel for the
United States Trustee acknowledged that this sum does not include
the $53 per month Debtors pay for insurance required by their
mortgage. 	(See Official Form 22A, ¶ 42).
-2-
period ending on . . . the last day of the calendar month
immediately preceding the [petition] date. . . .
11 U.S.C. § 101(10A). 	I construe this to mean pay received for
work performed in the six-month period ending on the last day of
the month before the bankruptcy is filed. 	So construed, the
couple’s average gross monthly income is $12,788. 	The United
States Trustee acknowledges that Debtors’ monthly expenses total
$12,639. 1 	Thus, Debtors’ gross monthly income less expenses is
$149. 	This amount multiplied by 60 is $8,940, which is less than
the $10,950 necessary to create a presumption of abuse.
The court also determines that this case is not abusive under
the totality of the circumstances. 11 U.S.C. § 707(b)(3)(B); In re
Price, 353 F.3d 1145 (9th Cir. 2004). 	While Debtors have steady
jobs, they have only a small net monthly surplus on a budget the
United States Trustee admits is not extravagant. 	(Memo of Points &
Authorities, at p.7: 11-12). 	Debtors may no longer be working
overtime, but the court can find no published decision finding such
a choice to constitute substantial abuse. 	Nor did Debtors engage
in any other inappropriate behavior. 	There is no evidence that
Debtors obtained cash advances or purchased consumer goods on
credit exceeding their ability to repay, or that Debtors engaged in
eve-of-bankruptcy purchases.
**END OF MEMORANDUM**
Case: 07-31389 Doc# 40 Filed: 06/23/08 Entered: 06/23/08 12:50:45 Page 2 of 3

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
-3-
Court Service List
James F. Beiden, Esq.
Law Offices of James F. Beiden
840 Hinckley Road, Suite 245
Burlingame, CA 94010
Patricia A. Cutler, Esq.
Office of the U.S. Trustee
235 Pine Street, Suite 700
San Francisco, CA 94104
Case: 07-31389 Doc# 40 Filed: 06/23/08 Entered: 06/23/08 12:50:45 Page 3 of 3