Deanne M. Wayt

UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF COLUMBIA
In re
DEANNE M. WAYT,
Debtor.
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Case No. 05-01133
(Chapter 7)
[Not for Publication in
West’s Bankruptcy Reporter]
MEMORANDUM DECISION RE MOTION TO EXPUNGE CASE FROM PUBLIC RECORD
The debtor has filed a motion seeking to expunge her
bankruptcy case from the public record in order to facilitate her
obtaining a loan in order to pay off credit card debt (Docket
Entry (“DE”) No. 17, filed March 5, 2008). 	She obtained a
voluntary dismissal of this case on December 1, 2005, after
reaching a settlement with the only creditor scheduled in the
case, American University, under which American University agreed
to extinguish its claim in exchange for a reduced payment of its
claim from funds provided by the debtor's parents (DE No. 15,
entered December 1, 2005).
The debtor continued her education after the dismissal of
the case, and had to incur credit card debt in order to pay her
The Memorandum Decision below is hereby signed.
Dated: March 13, 2008.
_____________________________
S. Martin Teel, Jr.
United States Bankruptcy Judge
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expenses in her second year of graduate school. 	She states that
she "would like to take out a private loan to pay off credit card
debt in order to obtain a lower rate but is unable to obtain
approval" because the bankruptcy case, even though it was
dismissed prior to discharge, causes lenders to decline to
approve her for a loan.
Cases addressing whether a bankruptcy court has the
authority to expunge, nullify, or void a bankruptcy case are
scarce. 	At least one court has declined to find that a
bankruptcy court has the authority to expunge, nullify, or void a
bankruptcy case because there is no “statutory anchor” for such
authority in the Bankruptcy Code. 	In re Woods, No. 05-32207,
2007 WL 130634427, *1 (Bankr. W.D. Mo. May 1, 2007).
Other courts have found the authority to expunge bankruptcy
cases in 11 U.S.C. § 105 but only in extraordinary circumstances.
In re Storay, 364 B.R. 194, 196 (Bankr. D.S.C. 2006)(holding that
cause exists to expunge a case pursuant to 11 U.S.C. § 105 where
the debtor did not authorize the filing of the petition); In re
Buppelmann, 269 B.R. 341 (Bankr. M.D. Pa. 2001)(denying the
debtors’ motion to expunge but stating that “the expungement of
bankruptcy cases appears to be a rare event exercised with the
greatest of prudence by bankruptcy judges under the equitable
powers implied under 11 U.S.C. § 105").
The court does not believe that it has authority under 11
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U.S.C. § 105 to enter an order expunging the debtor's bankruptcy
case. 	Lenders are entitled to inquire whether the debtor ever
filed a prior bankruptcy case if they fear that is a sign that
the debtor is a poor credit risk. 	Nothing in the Bankruptcy Code
suggests that the court should expunge a bankruptcy filing so
that lenders are deprived of that information (unless the filing
was a fraudulent filing, one not authorized by the debtor). 	The
debtor knowingly commenced this case, and, unfortunately, despite
the court's sympathy for her plight, must suffer the consequence
of a poor credit record arising from the filing.
An order follows.
[Signed and dated above.]
Copies to: Debtor; Debtor’s attorney; Chapter 7 Trustee, U.S.
Trustee
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