Estate of Marilyn E. Roberts by Executor Marilyn D

1 printed pages contain little extracted OCR body text; searchable legal-body completeness has not been established for those pages.

OCR transcription for search; preserved printed pages are authoritative

Entered: August 16, 2005 Case 05-26653 Doc7 Filed 08/16/05 Pageiof5
Signed: August 15, 2005

SO ORDERED
Sofie
E. STEPHEN DERBY
U. S. BANKRUPTCY JUDGE
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF MARYLAND
at Baltimore
In Re: *
Estate of Marilyn E. Roberts * Case No. 05-26653 ESD
* Chapter 13
*
Debtor *

MEMORANDUM AND ORDER DISMISSING, SUA SPONTE,
CASE FILED BY A DECEDENIT'S ESTATE

OnJuly 25, 2005, a Chapter 13 petition was filed on behalf of the Estate of Manlyn E. Roberts,
by Marilyn Dorsey as the "Executor of the Estate of Marilyn E. Roberts." The petition was signed by
Marilyn Dorsey in her capacity as executor of the Estate of Manlyn E. Roberts. The petition was not
filed by Ms. Dorsey personally, but ratherin herrepresentative capacity on behalf of the probate estate
of Manilyn E. Roberts.

The court will, sua sponte, dismiss this case. A decedent's estate, even when represented by
aindividual fiduciary, is not a person that may be a debtor under the Bankruptcy Code. Only a person
may bea debtor. 11 U.S.C. § 109(a). A person includes individuals, partnerships and corporations.
Id. at§ 101(41). Thedefinition of a person does not include a decedent's estate. See Id. at §§101(41),
101(9). Estate is included in the definition of entity. Id. at § 101(15). If Congress had intended to
include estates in the definition of person, and thereby to allow estates to file a bankruptcy petition,

estates would not have been specifically included only within the separate definition of entity. In re

1

2
Walters, 113 B.R. 602, 604 (Bankr.D.S.D. 1990), citing In re Estate of Whiteside by Whiteside, 64 B.R.
99, 100-01 (Bankr.E.D.Cal. 1986). 	Other courts addressing the question of whether an insolvent
decedent’s estate is a person and therefore eligible for relief under the Bankruptcy Code have uniformly
found that the definition of debtor excludes insolvent decedents’ estates. See, e.g., In re Goerg, 844 F.2d
1562, 1566 (11th Cir. 1988), cert. denied,488 U.S. 1034 (1989)(dicta), and the cases cited therein. See
also In re Bunch, 249 B.R. 667, 671 (Bkrtcy.D.Md. 2000)(distinguishing between eligibility of individual
heir to file a bankruptcy petition from prohibited filing by decedent's estate).
Congress expressly recognized that “[t]he definition [of person] does not include an estate or a
trust, which are included only in the definition of ‘entity’ . . . . ” H.R.Rep. No. 595, 95th Cong., 1st Sess.
313 (1977), reprinted in 1978 U.S. Code Cong. & Admin.News 5963, 6270; S.Rep. No. 989, 95th Cong.,
2d Sess. 25 (1978), reprinted in 1978 U.S.Code Cong. & Admin.News 5787, 5811). See In re Goerg,
844 F.2d at 1566; In re Walters, 113 B.R. at 604. The definition of person states that it “includes
individual, partnership, and corporation.” 11 U.S.C. § 101(41). The term “includes” is not limiting. Id.
at §102(3). 	Nevertheless, courts have long concluded Congress left no doubt that an estate was not
included in the definition of person. 	In the Matter of 299 Jack-Hemp Associates, 20 B.R. 412, 413
(Bankr.S.D.N.Y. 1982); In re Brown's Estate, 16 B.R. 128 (Bankr.D.D.C. 1981).
There are other reasons why the probate estate of a decedent should be ineligible to initiate a
request for relief under the Bankruptcy Code. While an authorized representative of a probate estate may
be an individual, he or she is not a debtor seeking a fresh start. Because the represented principal here
is a probate estate, there is no fresh start available. Further, this case was filed under Chapter 13. Only
an individual may be discharged in Chapter 13, because only an individual may be a debtor under
Chapter 13. 11 U.S.C. §§ 109(e), 1328. “Whereas the policy of the Bankruptcy Code is to provide
debtors with a ‘fresh start’, this policy is not met by the Bankruptcy Court’s administration of the estate
of a deceased individual.” Matter of Jarrett, 19 B.R. 413, 414 (Bankr.M.D.N.C. 1982).
Case 05-26653 Doc 7 Filed 08/16/05 Page 2 of 5

3
The bankruptcy court should 	not assume control of the administration of a probate estate.
Probate administration is specialized and greatly detailed within state law. See, e.g., Md. Estates &
Trusts Code Ann. (2001 Repl. Vol. and 2004 Supp.). 	No overriding bankruptcy policy or concern is
furthered when a bankruptcy court enters this complicated arena. 	“The main reason cited by these
[bankruptcy] courts in denying an insolvent probate estate access to bankruptcy is that Congress, through
the Bankruptcy Code, elected not to extend bankruptcy to insolvent decedents’ estates since probate
systems developed by the individual states are a comprehensive and specialized machinery to administer
such estates.” In re Walters, 113 B.R. at 604. Cf., In the Matter of 299 Jack-Hemp Associates, 20 B.R.
at 413; Matter of Jarrett, 19 B.R. at 414; In re Brown's Estate, 16 B.R. at 128. The bankruptcy court has
no power or jurisdiction pursuant to the Bankruptcy Code to administer probate estates, and a probate
estate must find recourse in the appropriate state court. In re Brown's Estate, supra.
The public purposes of probate administration and of bankruptcy administration are quite
different. The laws of probate are designed to carry out the wishes of a testator expressed in a will or
trust or in intestate statutes with respect to the distribution of property to survivors. Bankruptcy laws
reallocate insufficient assets among present creditors. Where there are insufficient assets for creditors,
the priority of distribution is different. Compare, e.g., Md. Estates & Trusts Code Ann. § 8-105 (2001
Repl. Vol.) and 11 U.S.C. §§ 507, 727.
The court does not find that if an individual debtor had filed for bankruptcy before his or her
death, the bankruptcy could not be completed and the debtor discharged. In that scenario the debtor’s
intention is ultimately carried out, because the bankruptcy petition would have been filed by the debtor
before his death. 	“It is possible that the estate of an individual who files for bankruptcy and
subsequently dies could be administered in a Chapter 7 or 11 case, depending on the circumstances. A
decedent’s estate, however, may not file bankruptcy or convert to a different chapter under the
Case 05-26653 Doc 7 Filed 08/16/05 Page 3 of 5

4
Bankruptcy Code.” 	In re Burner, 109 B.R. 216, 222 n. 3 (Bankr.W.D.Tex. 1989). 	Federal Rule of
Bankruptcy Procedure 1016 specifically provides:
Death or incompetency of the debtor shall not abate a liquidation case under chapter 7 of
the Code. In such event the estate shall be administered and the case concluded in the
same manner, so far as possible, as thought the death or incompetency had not occurred.
If a reorganization, family farmer's debt adjustment, or individual's debt adjustment case
is pending under Chapter 11, 12, or 13, 	the case may be dismissed; or if further
administration is possible and in the best interests of the parties, the case may proceed
and be concluded in the same manner, so far as possible, as though the death or
incompetency had not occurred.
In the instant case the decedent, when alive, did not file for bankruptcy. Consequently, the court does
not have authority pursuant to Federal Rule of Bankruptcy Rule 1016 to administer the decedent’s estate.
In conclusion, this probate estate is not a person or an individual. Therefore, the purported debtor
is not eligible for relief. The administration of probate estates is specialized and greatly detailed within
the laws of individual states, and this court will not disrupt those laws.
For the foregoing reasons, it is, by the United States Bankruptcy Court for the District of
Maryland,
ORDERED, that the bankruptcy case of the Estate of Marilyn E. Roberts, Case No. 05-26653
ESD is dismissed, sua sponte.
cc: 	Marilyn Dorsey, Executor of the Estate of Marilyn E. Roberts
1426 Division Street
Baltimore, MD 21217
Gerard R. Vetter, Esq.
Chapter 13 Trustee
7310 Ritchie Highway
Suite 715
Glen Burnie, MD 21061-3293
U.S. Trustee
All Creditors
End of Order
Case 05-26653 Doc 7 Filed 08/16/05 Page 4 of 5

Case 05-26653 Doc 7 Filed 08/16/05 Page 5 of 5
5