Promised Land Development, LLC

1Also pending before the Court is the Motion to Dismiss or Convert Debtor’s Chapter 11
Case; Motion to Lift the Automatic Stay or for Adequate Protection filed by the Hines Family
Corporation on December 9, 2009 (the “Hines Family Corporation Motion”) and the response
filed on January 4, 2010 by the Debtor. The Hines Family Corporation Motion is moot based on
the Court’s dismissal of the case on the grounds set forth by the Bankruptcy Administrator.
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF NORTH CAROLINA
WILMINGTON DIVISION
IN RE:
PROMISE LAND DEVELOPMENT, LLC,
DEBTOR
CHAPTER 11
CASE NO. 09-06550-8-RDD
ORDER DISMISSING CASE
Pending before the Court is the Motion to Convert, or in the Alternative, Dismiss Case filed
by the Bankruptcy Administrator on November 12, 2009 (the “Motion”) and the Response to
Bankruptcy Administrator’s Motion to Convert or Dismiss filed by Promise Land Development,
LLC (the “Debtor”) on December 7, 2009 (the “Response”).1 On January 12, 2010, the Court
conducted a hearing in Wilson, North Carolina to consider the Motion and the Response.
Pursuant to the Motion, the Bankruptcy Administrator requests dismissal or conversion of
this case pursuant to Section 1112(b)(4) based on the Debtor’s unexcused failure to timely satisfy
any filing or reporting requirements established by Title 11 of the Bankruptcy Code or any rule
SO ORDERED.
SIGNED this 02 day of February, 2010.
________________________________________
Randy D. Doub
United States Bankruptcy Judge
____________________________________________________________
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applicable to a case under Chapter 11. As of the filing of the Motion, the Debtor had failed to pay
the quarterly fees, as required by Local Bankruptcy Rule 4002-1(b), for the period ending September
30, 2009.
The Debtor does not dispute that it has failed to timely pay the quarterly fees. 	In its
Response, the Debtor states that it currently has no income as its tenant, First Fruit Enterprises, Inc.
(“First Fruit”), ceased operation of Zora’s Seafood Market in late September or early October 2009.
Since that time, the Debtor has not received any rental income from First Fruit. The Debtor stated
at the hearing and in the Response that it is exploring options to lease or sell the principal asset, the
building located at 1411 Castle Street, Wilmington, North Carolina. However, neither contracts for
sale nor contracts for lease are in existence. No offers are presently pending from any party.
At the hearing, Hakeem Brantley, a principal of the Debtor, testified that he has attempted
to locate a purchaser or a new tenant for the building. At the present time, he was in negotiations
with a potential tenant but the proposed rent would not be sufficient to cover the monthly payment
due to the secured creditor. Mr. Brantley stated that he was aware that the Debtor was in arrears for
the quarterly fees due in connection with this case and that the Debtor currently had no funds
available to pay such fees.
Section 1112(b)(1) of Title 11 of the United States Code (the “Bankruptcy Code”) provides
that if a party in interest establishes cause, absent an unusual circumstance specifically identified
by the court that conversion or dismissal is not in the best interest of creditors and the estate, a court
must convert or dismiss a case. emphasis added.
Section 1112(b)(4) enumerates a non-exhaustive list of examples of cause. For example,
cause is established if a party in interest can show that there is a substantial or continuing loss to the
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2 28 U.S.C. § 1930(a)(6) requires that a quarterly fee be paid to the United States
Trustee for deposit in the Treasury, in each case under chapter 11 of the Bankruptcy Code for
each quarter until the case is converted or dismissed. Paragraph (7) provides that in districts that
are not part of the United States Trustee region, the Judicial Conference may require the debtor
to pay fees equal to those imposed by paragraph (6), as is the case in North Carolina.
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estate and with the absence of a reasonable likelihood of reorganization or if the Debtor fails to pay
any fees or charges required under chapter 123 of title 28 of the United States Code, including the
quarterly fees.2
The Debtor has admitted that it does not have any funds to pay the quarterly fees and that
it has no income at the present time. It has been unable to obtain any contracts to lease the property
and generate any future income. These facts establish that cause exists to convert or dismiss this
case pursuant to 11 U.S.C. § 1112. There is no evidence in the record and based on the testimony
of Mr. Brantley, there does not appear to be any unusual circumstances in this case that would allow
this Court to deny dismissal or conversion of this case. Furthermore, the Hines Family Corporation,
the secured creditor in this case supports dismissal.
Therefore, based on the Debtor’s inability to pay its quarterly fees, the Debtor’s lack of
income, and only a speculative prospective tenant whose proposed rent would not service the
monthly debt due to the secured creditor, and the Debtor having failed to present any unusual
circumstances that would warrant the Debtor remaining in a chapter 11 proceeding, the Motion to
Convert, or in the Alternative, Dismiss Case is GRANTED and the case is DISMISSED.
SO ORDERED.
END OF DOCUMENT
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