588 B.R. 191
Bankr. E.D. Mich.2018Background
- Debtor filed Chapter 7 on March 26, 2013; first §341 meeting was set for May 15, 2013. The debtor never filed the required post‑petition personal financial management course Certificate (Official Form 23).
- The 60‑day deadline to file the Certificate ran on July 15, 2013; the case was closed without a discharge on July 17, 2013 for failure to file the Certificate. Notice of the closure was mailed to the Debtor and counsel.
- No motion to extend the filing deadline was filed while the case remained open, and no Certificate was filed before closure.
- Five years later (July 17, 2018) the Debtor filed two nearly identical motions to reopen the case to file the Certificate and obtain a discharge; one motion was accompanied by the reopening fee. No Certificate or explanation for the delay was attached to either motion.
- The court applied a four‑factor test (reasonable explanation, timeliness, fault of counsel, creditor prejudice) and concluded the debtor failed to show cause to reopen or to grant a retroactive extension of time to file the Certificate.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the case should be reopened under 11 U.S.C. §350(b) to permit filing Official Form 23 | Debtor: reopen to file Certificate taken recently and obtain discharge | Court/creditors: no cause shown; no Certificate attached; five‑year delay unexplained | Denied — no cause to reopen |
| Whether a retroactive extension to file the Certificate should be granted under Fed. R. Bankr. P. 1007(c) | Debtor: seeks discretion to enlarge time to file Certificate | Court: motion lacks cause and required notice; extreme delay undermines Rule 1007(c) relief | Denied — no extension granted |
| Whether counsel’s fault excuses the delay | Debtor: did not allege counsel’s fault | Court: record shows notice to counsel; failure attributable to debtor | Found to weigh against debtor |
| Whether creditors are prejudiced by reopening and late discharge | Debtor: did not argue prejudice is minimal | Court/Cited precedent: long delay harms creditors and defeats statutory purpose | Found prejudice; weighs against reopening |
Key Cases Cited
- Rosinski v. Rosinski (In re Rosinski), 759 F.2d 539 (6th Cir. 1985) (reopening decisions are within bankruptcy court’s discretion)
- In re Lockhart, 582 B.R. 1 (Bankr. E.D. Mich. 2018) (applied four‑factor test; denied reopening after significant delay)
- In re Barrett, 569 B.R. 687 (Bankr. E.D. Mich. 2017) (denied reopening where debtor delayed many years before filing Certificate)
- In re Johnson, 500 B.R. 594 (Bankr. D. Minn. 2013) (denied reopening after multi‑year delay)
- In re Rondeau, 574 B.R. 824 (Bankr. E.D. Mich. 2017) (denial where reopening sought after years of delay)
- In re Wilson, 575 B.R. 783 (Bankr. E.D. Mich. 2017) (applied timeliness and prejudice considerations)
- In re Whitaker, 574 B.R. 819 (Bankr. E.D. Mich. 2017) (denial where debtor waited many months to seek reopening)
- In re Bragg, 577 B.R. 265 (Bankr. E.D. Mich. 2017) (considered delay and creditor prejudice in reopening request)
- In re Garnett, 579 B.R. 818 (Bankr. E.D. Mich. 2018) (denied reopening after long post‑closure delay)