Timothy S. Grissinger

UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF NORTH CAROLINA
WILMINGTON DIVISION
IN RE:
TIMOTHY S. GRISSINGER,
DEBTOR.
CASE NO. 10-01024-8-JRL
Chapter 13
ORDER
This matter came before the court on the debtor’s motion to turnover property held by the
North Carolina Department of Revenue (“NCDOR”). A hearing was held on December 14,
2010, in Wilmington, North Carolina.
The debtor filed the instant motion to turnover certain property seized by the NCDOR to
satisfy tax liabilities the debtor claims are not owed. The NCDOR argues the motion was
improperly served and should be dismissed on procedural grounds. The NCDOR asserts the
motion should have been brought as an adversary proceeding, which would require a summons
and proper service of the complaint.
The debtor properly brought the motion for turnover. Pursuant to 11 U.S.C. §542(a):
an entity, other than a custodian in possession, custody, or control, during the
case, of property that the trustee may use, sell, or lease under section 363 of this
title, or that the debtor may exempt under section 522 of this title, shall deliver to
the trustee, and account for, such property or the value of such property, unless
such property is of inconsequential value or benefit to the estate.
SO ORDERED.
SIGNED this 22 day of December, 2010.
________________________________________
J. Rich Leonard
United States Bankruptcy Judge
____________________________________________________________
Case 10-01024-8-JRL Doc 84 Filed 12/22/10 Entered 12/22/10 13:26:26 Page 1 of 2

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While this provision does not explicitly grant a chapter 13 debtor the right to demand turnover, it
does provide for turnover to the trustee of property “that the trustee may use, sell, or lease under
section 363.” In re Williams, 316 B.R. 534, 540 (Bankr. E.D. Ark. 2004). Additionally, a
chapter 13 debtor is granted the rights and powers a trustee would have under §§363(b), 363(d),
363(e), 363(f), and 363(l). 11 U.S.C. §1303. Courts have held that this relationship between
§§363, 542(a), and 1303 gives chapter 13 debtors the right to demand turnover. Williams, 316
B.R. at 540; See also In re Sharon, 234 B.R. 676, 687 (B.A.P. 6th Cir. 1999) (finding that to the
extent a chapter 13 debtor can use property of the estate under §363, the debtor can compel
turnover under §542); In re Radden, 35 B.R. 821, 826 (Bankr. E.D. Va. 1983)(allowing a chapter
13 debtor to seek turnover of property that the debtor may use in the ordinary course of
business).
Here, the debtor demands that property of the estate, specifically a boat allegedly used in
the debtor’s construction business to haul materials and employees to and from Bald Head
Island, be returned. In doing so, the debtor is acting under his §1303 powers as a trustee to
demand turnover of property to the estate. Therefore, the debtor is a proper party to bring the
motion. Furthermore, the debtor does not need to raise the issue as an adversary proceeding, but
rather properly asserted it as a motion as a trustee would under §542(a).
The NCDOR’s procedural objection to the debtor’s motion for turnover is
OVERRULED.
END OF DOCUMENT
Case 10-01024-8-JRL Doc 84 Filed 12/22/10 Entered 12/22/10 13:26:26 Page 2 of 2