Dennis Tiner and Brenda Tiner

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1All statutory references are to Title 11 of the United States
Code (the “Bankruptcy Code”) unless otherwise specified.
UNITED STATES BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
In re 	No. 08-42070 TM
Chapter 7
DENNIS TINER, BRENDA TINER,
Debtors.
___________________________/
MEMORANDUM OF DECISION
Sara L. Kistler, Acting United States Trustee, (the “UST”) moves
to 	dismiss 	the 	above-captioned 	case 	pursuant 	to 	11 	U.S.C. 	§ 	707(a)
and 11 U.S.C. § 349 1. 	Dennis and Brenda Tiner (the “Debtors”), the
above-captioned debtors, oppose the motion. 	For the reasons stated
below, the motion will be GRANTED.
BACKGROUND
The Debtors filed a voluntary petition seeking relief under
chapter 7 of the Bankruptcy Code on April 28, 2008. 	In the past
twenty years, the Debtors have filed for bankruptcy eight times.
The instant case was the Debtors’ fourth chapter 7 filing since
Signed: July 01, 2008
________________________________________
LESLIE TCHAIKOVSKY
U.S. Bankruptcy Judge
________________________________________
Entered on Docket
July 03, 2008
GLORIA L. FRANKLIN, CLERK
U.S BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
Case: 08-42070 Doc# 22 Filed: 07/01/08 Entered: 07/03/08 16:12:00 Page 1 of
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November of 2006. 	Each of their three most recent filings was
dismissed.
The Debtors filed a chapter 7 petition on November 20, 2006.
The Debtors applied for and were denied in forma pauperis status,
but they did not pay their filing fee. 	The Debtors did not appear
at the first meeting of creditors. 	The Debtors also failed to file
their statistical summary of certain liabilities, schedules,
statement of financial affairs, and their means test form. 	The
Debtors’ case was dismissed on January 24, 2007 on a motion of the
UST based on their failure to obtain credit counseling. 	On March
15, 2007, US Bank obtained ownership of the Debtors’ home via a
foreclosure sale.
The Debtors filed their next chapter 7 petition on May 9,
2007. 	Their petition did not disclose the previous bankruptcy
case. 	This time, Brenda Tiner submitted a certificate of credit
counseling. 	Dennis Tiner, who is blind, claimed an exemption to
the credit counseling due to disability. 	No motion was filed for a
determination of his right to such an exemption. 	The Debtors again
applied for and were denied in forma pauperis status, but were
allowed to pay the filing fee in installments. 	The court received
no payments. 	The Debtors failed to appear at the continued meeting
of creditors. 	They did not file the means test or the voluntary
petition form. 	Their case was dismissed on July 24, 2007 for
failure to file these forms.
The Debtors filed their next chapter 7 petition on January 4,
2008. 	The Debtors failed to disclose the previous two cases in
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their petition. 	The Debtors applied for and were denied in forma
pauperis status. 	They were again allowed to pay the filing fee in
installments and again failed to make any payments. 	The Debtors
did not submit their federal income taxes to the Chapter 7 Trustee.
Mrs. Tiner submitted the same credit counseling certificate she had
used in the previous case even though it was more than a year old
by that time. 	Mr. Tiner again claimed an exemption from the credit
counseling requirement for disability, but no motion was filed for
a determination of his right to such an exemption. 	US Bank was
granted relief from the automatic stay so that it could repossess
the Debtors’ home. 	The sheriff’s lockout was authorized to occur
on or before February 8, 2008. 	The Debtors’ case was dismissed on
February 27, 2008 when they did not appear at either the first or
second meeting of creditors.
The instant case was filed on April 28, 2008. 	The Debtors
failed to disclose the previous three cases in their petition.
Mrs. Tiner submitted the same certificate of credit counseling,
dated December 12, 2006, that she submitted in the previous two
cases. 	Mr. Tiner again claimed a disability exemption but did not
file a motion for determination of his right to an exemption. 	The
Court denied Debtors’ application for in forma pauperis status.
In an order dated May 1, 2008, the Debtors were ordered to pay
the current filing fee in full plus the back filing fees owed to
the Court by May 12, 2008, or their case would be dismissed. 	The
Debtors did not make any payments.
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On May 7, 2008, the UST moved under §§ 707(a) and 349 to
dismiss the case with prejudice and to bar future filings for two
years with sanctions of $5,000 if violated. 	A hearing was held on
June 4, 2008. 	Mr. Tiner appeared and stated that he had not
received notice of the hearing and had only heard about it at that
morning’s meeting of creditors. 	He claimed that he had filed a
change of address form with the court, which had been lost. 	The
address he listed on his petition was the address of the house that
had been foreclosed on in March of 2007. 	He also listed that house
as a secured asset in his schedule D. 	At the hearing, Mr. Tiner
claimed that he had not filed in bad faith and simply had not
understood the forms or procedures. 	He asserted that at this point
he simply wanted to discharge his substantial unsecured debts.
The Court took the matter under submission in order to review
the docket.
DISCUSSION
The UST argues that this case should be dismissed for bad
faith pursuant to § 707(a).
Section 707(a) provides that a court may dismiss a case for
cause, including:
(1) 	unreasonable 	delay 	by 	the 	debtor 	that 	is
prejudicial to creditors;
(2) nonpayment of any fees or charges required under
chapter 123 of title 28; and
(3) failure of the debtor in a voluntary case to file,
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within 	fifteen 	days 	or 	such 	additional 	time 	as 	the
court 	may 	allow 	after 	the 	filing 	of 	the 	petition
commencing 	such 	case, 	the 	information 	required 	by
paragraph (1) of § 521 . . .
11 U.S.C. § 707(a).
Bad faith does not constitute cause under § 707(a)
The UST cites In re Mitchell for the proposition that bad
faith may be cause to dismiss a Chapter 7 petition under § 707(a).
However, the court in that case considered how to determine whether
debtors have filed a petition in bad faith under § 707(b)(3). 	It
held that a finding of bad faith under § 707(b)(3) would constitute
“cause” for the purposes of dismissal with prejudice under § 349.
Mitchell, 357 B.R. 142, 157 (Bankr. C.D. Cal. 2006). 	The court did
not address whether bad faith constitutes cause under § 707(a).
In fact, the Ninth Circuit has ruled explicitly that bad faith
does not constitute cause under § 707(a), reasoning that § 707(b)
would not be necessary if “cause” under § 707(a) were meant to
include bad faith. 	In re Padilla, 222 F.3d 1184, 1194 (9th Cir.
1999). 	Although it is possible that the Debtors’ conduct
constitutes bad faith under § 707(b)(3), the UST moved under §
707(a). 	This case should not be dismissed for bad faith pursuant
to § 707(a).
Conduct that constitutes cause under § 707(a)
The UST states that the Debtors’ serial filings were
prejudicial to their creditors. 	The Debtors’ creditors have been
prejudiced because of the Debtors’ omission of their previous
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bankruptcies in their petition. 	This omission could have led
creditors to believe that the automatic stay was in place, even
though it was not due to the Debtors’ previous filing. 	However,
the Debtors do not presently have any secured debt. 	The Chapter 7
Trustee has certified that there are no assets to administer for
the benefit of the creditors of the estate. 	So, although there is
some evidence of prejudice to the Debtors’ creditors, these
creditors are no worse off due to the Debtors’ serial filings.
The Debtors have failed to comply with the pre-petition credit
counseling requirement mandated by § 109(h). 	Brenda Tiner’s credit
counseling certificate was more than one year old when the Debtors
filed the instant case. 	She has not alleged any exemption from the
credit counseling requirement. 	This Court has waived the
requirement if there is evidence that the debtor is using the
credit counseling requirement offensively in order get a case
dismissed after receiving the benefit of the automatic stay. 	In re
Withers, 2007 Bankr. LEXIS 663 (Bankr. N.D. Cal. 2007). 	Other
courts have ruled that the credit counseling requirement may be
waived when it was complied with in spirit. 	In re Bricksin, 346
B.R. 497 (Bankr. N.D. Cal. 2006) (finding that participation in a
debt repayment plan constitutes ongoing credit counseling).
Neither of these exceptions apply to Mrs. Tiner. 	She has not
offered any reason why she should be exempt from the requirements
of § 109(h).
Mr. Tiner has claimed an exemption from the credit counseling
requirement due to disability. 	Section 109(h) defines disability
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as “so physically impaired as to be unable, after reasonable
effort, to participate in an in person, telephone, or Internet
briefing.” 	Mr. Tiner is blind. 	While this may be a disability
according to the general definition of disability, it does not meet
the high burden established by § 109(h). 	For instance, Mr. Tiner
has not explained how his blindness prevents him from receiving
credit counseling over the telephone. 	Mr. Tiner has not satisfied
the exemption for credit counseling due to disability.
Section 707(a)(3) allows dismissal for failing to file any of
the information required under § 521(a)(1). 	The requirement to
file a credit counseling certificate is not listed under §
521(a)(1) but is instead listed under § 521(b)(1). 	However, the
Ninth Circuit has ruled that the factors listed in § 707(a) are
“illustrative and not exhaustive” and has described the grounds for
dismissal under this subsection as “technical and procedural” in
nature. 	In re Padilla, 222 F.3d 1184, 1191-92. 	The credit
counseling requirement is both technical and procedural. 	Thus,
although not expressly noted in § 521, the Court concludes that the
Debtors’ failure to obtain pre-petition credit counseling is
sufficient grounds for dismissal under § 707(a).
The Debtors’ failure to pay filing fees falls clearly within §
707(a). 	Filing fees must be paid to commence a bankruptcy case.
28 U.S.C. § 1930. 	Thus, the Debtors’ failure to pay filing fees
serves as a independent ground for dismissal of their case pursuant
to § 707(a).
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Dismissal with prejudice pursuant to § 349.
Section 349(a) authorizes the dismissal of bankruptcy cases
with and without prejudice. 	In re Leavitt, 171 F.3d 1219, 1223
(9th Cir. 1999). 	Section 349 provides:
Unless the court, for cause, orders otherwise,
the 	dismissal 	of 	a 	case 	under 	this 	title 	does
not 	bar 	the 	discharge, 	in 	a 	later 	case 	under
this title, of debts that were dischargeable in
the 	case 	dismissed; 	nor 	does 	the 	dismissal 	of
a 	case 	under 	this 	title 	prejudice 	the 	debtor
with 	regard 	to 	the 	filing 	of 	a 	subsequent
petition 	under 	this 	title, 	except 	as 	provided
in section 109(g) of this title.
11 U.S.C. § 349(a)
“A dismissal with prejudice bars further bankruptcy
proceedings between the parties and is a complete adjudication of
the issues.” 	In re Leavitt,171 F.3d at 1223-24. 	The Bankruptcy
Code does not define “cause” for dismissal under § 349. 	Id. at
1224. 	The Fourth Circuit held that dismissal with prejudice is
only appropriate if a debtor has “engage[d] in egregious behavior
that demonstrates bad faith and prejudices creditors . . . .” 	In
re Tomlin, 105 F.3d 933, 937 (4th Cir. 1997). 	The Ninth Circuit
cited to Tomlin when it held that “bad faith is ‘cause’ for
dismissal of a Chapter 13 case with prejudice under § 349(a).” In
re Leavitt, 171 F.3d at 1224. 	The Ninth Circuit requires only a
finding of bad faith, and does not specify that creditors must be
prejudiced. 	The court found that there are four factors that
bankruptcy courts should consider in determining whether there has
been bad faith:
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1. whether the debtor misrepresented facts in his petition or
plan, unfairly manipulated the Bankruptcy Code, or otherwise
filed his chapter 13 petition or plan in an inequitable
manner
2. The debtor’s history of filings and dismissals
3. Whether the debtor only intended to defeat state court
litigation.
4. Whether egregious behavior is present
Id. at 1224.
The standards for a finding of bad faith in chapter 7 should be
the same as the standards in a chapter 13 case. 	In re Mitchell,
357 B.R. 142, 154. 	The harm to creditors and to the court that
results from a bad faith filing are the same regardless of the
chapter under which the debtor files. 	Multiple standards are
confusing and may encourage chapter shopping in order to receive
the most favorable treatment. 	In addition, the bad faith tests in
Chapters 11 and 13 are essentially the same, and there is no reason
to deviate from this standard in Chapter 7. 	Id.
Applying the Leavitt factors to the instant case yields a
finding of bad faith. 	The first factor--that debtors have
misrepresented facts in his petition--applies to the Tiners. 	They
have repeatedly failed to disclose their previous bankruptcies.
They listed a house as one of their assets despite the fact that
the house was deeded to US Bank at a foreclosure sale on March 15,
2007. 	They listed that house as their address in their current
petition even though US Bank was granted a relief from stay to
evict them from the property on or after February 8, 2008. 	Because
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of this inaccuracy, the Debtors did not receive notices issued by
the court.
The second Leavitt factor--the debtor’s history of filings and
dismissals--also supports a finding of bad faith in the case at
bar. 	The Debtors have filed for bankruptcy a total of eight times.
Each of the Tiners received a discharge in 1988, but every
subsequent case has been dismissed.
The third Leavitt factor does not apply to the Debtors because
there is no indication that the Debtors filed in order to defeat
state court litigation.
The fourth Leavitt factor--whether egregious behavior is
present--applies to the Debtors. 	The Debtors have established a
pattern of misconduct. 	They have made misrepresentations in three
of the last four petitions. 	The Debtors have repeatedly failed to
comply with the credit counseling requirement. 	The Debtors have
consistently failed to pay their filing fees. 	The repeated failure
to prosecute their case makes their behavior rise to an egregious
level. 	Although a single misrepresentation may be an innocent
mistake, the Debtors have repeated the same mistakes under oath
several times in a row. 	The Debtors’ explanation is that they did
not intend to make misrepresentations, but “[a] finding of bad
faith does not require fraudulent intent by the debtor.” 	Leavitt
at 1225.
All four factors do not need to be satisfied because the test
for bad faith is a totality of the circumstances test. 	In re
Cortez, 349 B.R. 608, 616 (Bankr. N.D. Cal. 2006). 	Because the
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2The Bankruptcy Appellate Panel opinion explicitly required a
finding of both bad faith and prejudice to creditors in order to
dismiss with prejudice under § 349. In re Leavitt, 209 B.R. 935,
939, aff’d, 171 F.3d 1219 (9 th Cir. 1999)(quoting In re Tomlin, 105
F.3d 933, 937).
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Debtors have satisfied three of the four factors, the totality of
the circumstances test demonstrates that the Debtors have acted in
bad faith.
Although the Ninth Circuit in Leavitt is silent as to whether
there must be a finding of prejudice to creditors in order to
dismiss with prejudice, there was substantial evidence of prejudice
to creditors in that case. 	The debtor failed to disclose all of
his assets, inflated his expenses, and offered nothing to his
largest unsecured creditor. 	When his second case was dismissed
with prejudice, the debtor filed with a different social security
number. 	171 F.3d 1219, 1225. 2
Even if prejudice to creditors is required, it has been
established in the instant case. 	The Debtors’ omission of their
prior bankruptcies would have led creditors to believe a stay was
in place even though it was not.
Whether the case should be dismissed with a bar on future filings.
A refiling bar is particularly in the interests of secured
creditors. 	In re Craighead, 377 B.R. 648 (Bankr. N.D. Cal. 2007).
Here, there are no secured creditors to protect with a refiling
bar.
However, a number of dismissals for failure to prosecute
suggests that the Debtors are vexatious litigants. 	In re Walker,
231 B.R. 343, 350 (N.D. Cal.1999). 	The court should consider six
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factors in deciding whether to restrict vexatious litigants from
access to the court:
1. The litigant’s history of litigation and
in particular whether it entailed vexatious,
harassing or duplicative lawsuits.
2. The litigant’s motive in pursuing the
litigation
3. Whether the litigant is represented by
counsel
4. Whether the litigant has caused needless
expense to other parties or has posed an
unnecessary burden on the courts and their
personnel
5. Whether other sanctions would be adequate
to protect the courts and other parties
6. Whether a litigant who has a history of
vexatious litigation is likely to continue to
abuse the judicial process.
Id. (Quoting Safir v. United States Lines, Inc., et al., 792
F.2d 19, 23 (2nd Cir. 1986).
Although this is a close case, applying the above factors
leads to the conclusion that the Debtors’ access to the bankruptcy
court should be restricted. 	Factors one, four, five, and six weigh
against the Debtors. 	The Debtors’ petitions have been duplicative
because the Debtors have repeatedly filed the same petition in
order to avoid the same creditors. 	Although there is no stay in
place, the Debtors’ omission of their previous cases could have led
creditors to believe there was a stay, causing needless expense to
creditors. 	The Debtors have burdened this Court by their repeated
failure to pay filing fees, obtain credit counseling, appear at
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meetings of creditors, and submit all the necessary documents to
successfully prosecute their cases. 	The Debtors’ failure to pay
filing fees indicates that other types of sanctions would not
protect the Court and other parties. 	Although the Debtors have
shown small improvements with each filing, they continue to make
significant mistakes that warrant dismissal. 	This pattern strongly
suggests that future petitions will also have flaws that merit
dismissal.
The factors that weigh in favor of the Debtors are that their
stated motive is to obtain a fresh start and the fact that they are
not represented by counsel. 	These two factors alone are not
sufficient to overcome the conclusion that the Debtors should be
restricted from access to the Court.
The bankruptcy court has the discretion to enjoin future
filings to prevent abuse of the bankruptcy process. 	11 U.S.C. §
105(a). 	The bankruptcy court can bar debtors from filing for as
short as 180 days to as long as a permanent bar. 	In this case, the
Debtors have failed to abide by orders of the Court. 	Their
repeated dismissals suggest that they are vexatious litigants. 	The
Court concludes that, given the facts recited above, a refiling bar
of 180 days would be too lenient and a permanent bar would be too
harsh. 	Consequently, the Debtors will be barred from future
filings for two years.
CONCLUSION
For the above reasons, the Debtors’ case will be dismissed
with prejudice pursuant to §§ 707(a) and 349 so that they are
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barred from refiling for bankruptcy under any chapter for a period
of two years from the date of entry of the order dismissing the
case. 	Appropriate sanctions will be imposed if they violate the
bar.
END OF DOCUMENT
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COURT SERVICE LIST
Dennis Tiner
Brenda Tiner
120 Village Square, #83
Orinda, CA 94563
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