Martha Shepard

UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF NORTH CAROLINA
NEW BERN DIVISION
IN RE:
MARTHA SHEPARD,
DEBTOR
CHAPTER 13
CASE NO. 12-05482-8-RDD
ORDER DENYING MOTION TO SET ASIDE DISMISSAL
Pending before the Court is the Motion to Set Aside Dismissal (the “Motion”) filed by
Martha Shepard (the “Debtor”) on September 20, 2012; the Trustee’s Response to Debtor’s Motion
to Set Aside Dismissal filed by Richard M. Stearns, the Chapter 13 Trustee, on September 24, 2012;
and the Response to Debtor’s Motion to Set Aside Dismissal filed by Bank of America, N.A. on
October 15, 2012. The Court conducted a hearing on November 6, 2012 in New Bern, North
Carolina to consider the Motion and the objections.
BACKGROUND
I. Previous Bankruptcy Filings
The Debtor filed five voluntary petitions for relief under Chapter 13 of the Bankruptcy Code.1
Four cases, case numbers 11-03019-8-RDD, 11-08948-8-RDD, 12-01096-8-RDD, 12-1
04338-8-RDD, were previously dismissed. The current filing, case number 12-05482-8-RDD
was dismissed on September 11, 2012.
SO ORDERED.
SIGNED this 16 day of November, 2012.
________________________________________
Randy D. Doub
United States Bankruptcy Judge
____________________________________________________________
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From April 2011 to June 2012, the Debtor filed the first four bankruptcy cases, all of which were
dismissed based on the Debtor’s failure to meet filing requirements. The first case was dismissed
for failure to obtain a confirmable plan. The third case was dismissed for failure to provide
documents required by § 521(a) of the Bankruptcy Code. The second and fourth cases were
dismissed for failure to complete a credit counseling course as required by § 109(h) of the
Bankruptcy Code.
II. Procedural History for the Fifth Bankruptcy Filing
The Debtor filed a voluntary petition for relief under Chapter 13 of the Bankruptcy Code on
July 30, 2012. On August 7, 2012, a Notice of Deficiency of Certificate of Credit Counseling was
mailed to the Debtor’s residence informing the Debtor she failed to file the certificate. An Order to
Show Cause was entered on August 16, 2012, requiring the Debtor to appear on September 6, 2012.
The Debtor filed the Certificate of Credit Counseling on August 27, 2012. The Order to Show Cause
was dismissed on September 5, 2012. On August, 13, 2012, Deutsche Bank filed a Motion to
Dismiss Case, a Motion for Relief From Stay, a Motion Confirming Stay Is Not In Effect, and a
Motion For Adequate Protection (hereinafter “Creditor’s Motions”). A hearing was scheduled for
September 6, 2012. The Debtor failed to appear at the hearing and the case was dismissed with
prejudice. The order dismissing the case barred the Debtor from filing another bankruptcy petition
for 360 days.
III. Present Motion to Reopen Debtor’s Chapter 13 Case
In the Motion, the Debtor argues that this case should be reopened because of her desire to
remain in her home and finish paying off the homes associated with the group homes she operates.
The Debtor was present at the hearing with her son, who spoke on her behalf. The Debtor’s son
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explained the Debtor failed to attend the September 6, 2012 hearing due to a misunderstanding. The
Debtor believed the hearing was on the show cause order for failure to file the certificate of credit
counseling. The Debtor filed the certification and the order to show case was dismissed on
September 5, 2012. The Debtor asserts she did not realize the hearings on the Creditor’s Motions
remained calendared and the Debtor failed to attend.
At the hearing for the Motion and objections, the Debtor’s son asked the court for a
continuance in order to obtain legal counsel. The Debtor’s son argued that the Court should reopen
the case because the Debtor previously proceeded pro se and that she made a good faith effort to file
the necessary statements, schedules, and make the necessary payments to the best of her ability. The
Debtor’s son stressed the family’s desire to save the remaining homes related to their family
business.
The Chapter 13 Trustee objected to the motion to set aside dismissal and requested a hearing
on the objection to the Motion. At the hearing, the Trustee objected to a continuance and to the
reopening of the case. Specifically the Trustee objected to continuing the Motion because this was
the fifth bankruptcy case filed by the Debtor, none of the prior cases were successful, and the Debtor
was delinquent four payments as of September 2012.
Bank of America objected to the motion to set aside dismissal as servicer for the Debtor’s
mortgage. In its objection, Bank of America stated that the Debtor owed approximately $29,233.41
in pre-petition arrearages. The objection further stated that the Debtor filed four previous bankruptcy
cases, which were pending within the previous year and these multiple bankruptcy cases were filed
for the purpose of hindering, delaying, and defrauding her creditors the ability to collect the monies
owed.
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DISCUSSION
The Court treats the Motion as one brought pursuant to Federal Rule of Civil Procedure
60(b)(1), incorporated into the Federal Rules of Bankruptcy Procedure by Rule 9024. Rule 60(b)
provides a party may be relieved from a final judgment, order, or proceeding based on mistake,
inadvertence, surprise, excusable neglect, newly discovered evidence, fraud, misrepresentation, or
misconduct, or any other reason that justifies relief. Fed. R. Civ. Pro. 60(b)(1)-(6). The party
seeking relief under Rule 60(b) must show the motion is timely filed, the movant has a meritorious
defense, and the opposing party would not be unfairly prejudiced by granting the proposed relief.
In re Canovali, No. 09-05342-8-RDD, 2011 WL 307374 at *5 (Bankr. E.D.N.C. Jan. 27, 2011)
(citing Park Corp. v. Lexington Ins. Co., 812 F.2d 894, 896 (4th Cir. 1987); Compton v. Alton
Steamship Co., 608 F.2d 96, 102 (4th Cir. 1979)).
Here, the Court finds no sufficient cause exists to reopen the Debtor’s case. The Court finds
the Debtor has alleged no grounds justifying relief under Rule 60(b). The Debtor failed to appear
at the September 6, 2012 hearing and the Court dismissed the case due to the serial filings over the
past two years. The Court must hold the Debtor to the same standard an attorney is held. While the
facts may indicate the existence of excusable neglect, Rule 60(b) also requires showing a meritorious
defense. The Debtor has shown no ability to cure deficiencies or propose a plan. As such, the Court
finds no meritorious defense to Deutsche Bank’s Motion to Dismiss. Therefore, the Motion to Set
Aside Dismissal is DENIED.
SO ORDERED.
END OF DOCUMENT
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