Melwood Joel Johnson

UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF COLUMBIA
In re
MELWOOD JOEL JOHNSON,
Debtor.
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Case No. 09-00704
(Chapter 7)
Not for Publication in
West’s Bankruptcy Reporter
MEMORANDUM DECISION AND ORDER STRIKING REAFFIRMATION AGREEMENT
The debtor’s reaffirmation agreement with Sterling, Inc.,
doing business as Kay Jewelers was filed after the deadline set
by Fed. R. Bankr. P. 4008(a) and after the entry of the debtor’s
discharge.
I
The reaffirmation agreement raises a presumption of undue
hardship under 11 U.S.C. § 524(m)(1). 	But the filing of the
reaffirmation agreement after entry of the debtor’s discharge
prevents the court’s exercising its authority under § 524(m)(1),
if appropriate, to disapprove the agreement if the presumption of
undue hardship is not rebutted to the court’s satisfaction. 	That
is because the court cannot comply with the statute’s command
that any hearing to consider disapproval “shall be concluded
The document below is hereby signed.
Signed: December 23, 2009.
_____________________________
S. Martin Teel, Jr.
United States Bankruptcy Judge
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before the entry of the debtor’s discharge.”
I could find only one decision that addresses this
circumstance. 	It holds that the circumstance (that the filing of
the agreement after entry of the discharge prevents the court’s
complying with the statutory requirement that the hearing to
consider disapproving the reaffirmation agreement be concluded
before entry of the debtor’s discharge) warrants striking the
reaffirmation agreement. 	See In re Schmidt, 2009 WL 1587690
(Bankr. N.D. Ohio Apr. 16, 2009). 	In any event, no motion has
been filed to permit the filing of the reaffirmation agreement
out of time, and I will thus strike the reaffirmation agreement.
II
The debtor’s attorney represents that the reaffirmation
agreement halves the debt owed for the jewelry the debtor
purchased. 	Nothing in this order precludes the debtor and
Sterling, Inc. entering into an agreement that so long as the
debtor makes voluntary payments (in the amounts contemplated by
the reaffirmation agreement), Sterling, Inc. will not repossess
the jewelry pursuant to its security interest. 	But the debtor
cannot, without an effective reaffirmation agreement, be held
personally liable for any missed payments. 	In effect, Sterling,
Inc. would be agreeing to redemption in installments, and waiving
its right under 11 U.S.C. § 722 to insist upon the redemption
amount being paid “in full at the time of redemption.”
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III
In light of the foregoing, it is
ORDERED that the debtor’s reaffirmation agreement with
Sterling, Inc., doing business as Kay Jewelers, is STRICKEN, but
the reaffirmation agreement does not preclude the debtor’s making
voluntary payments to Sterling, Inc., doing business as Kay
Jewelers.
[Signed and dated above.]
Copies to: Debtor; Debtor’s attorney; Scott D. Fink; Office of
United States Trustee.
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