591 B.R. 680
Bankr. E.D. Mich.2018Background
- Debtor filed chapter 7 petition on June 16, 2017; first meeting set for July 26, 2017.
- Rule requires debtor to file a Financial Management Course Certificate (Official Form 423) within 60 days after the §341 date (deadline Sept. 25, 2017).
- Debtor failed to file the Certificate by the deadline and did not request an extension.
- Case was closed without a discharge on Sept. 26, 2017; notice of closure mailed to debtor Sept. 28, 2017.
- Debtor completed the course and moved to reopen for entry of discharge on Aug. 3, 2018 (over 10 months after closure).
Issues
| Issue | Debtor's Argument | Court/Opposing Argument | Held |
|---|---|---|---|
| Whether cause exists to reopen the closed chapter 7 case to allow filing of the Certificate | Debtor: completed the course (Aug. 2, 2018) and requests reopening so discharge may be entered | Court: Debtor offered no explanation for failure to timely complete/course or for 10‑month delay; reopening is discretionary and requires cause | Denied — no cause shown to reopen |
| Whether court should grant retroactive extension to file Certificate | Debtor: completion of course justifies reopening and discharge | Court: Rule 1007(c)/9006(b)(3) allow extensions only for cause on motion and notice; no cause shown | Denied — no retroactive extension granted |
| Whether counsel’s fault excuses delay | Debtor: did not allege counsel error | Court: record shows notice was received by counsel; delay appears debtor’s fault | Debtor’s neglect, not counsel’s, weighs against reopening |
| Whether creditors would be prejudiced by reopening and retroactive discharge | Debtor: reopening prevents future collection activity against debtor | Court: long delay frustrates statutory purpose and harms creditor fairness; prejudice increases with delay | Denied — prejudice to creditors favors refusal |
Key Cases Cited
- Rosinski v. Rosinski, 759 F.2d 539 (6th Cir. 1985) (reopening decisions committed to bankruptcy court discretion)
- In re Lockhart, 582 B.R. 1 (Bankr. E.D. Mich. 2018) (denying motion to reopen to file certificate after lengthy delay)
- In re Barrett, 569 B.R. 687 (Bankr. E.D. Mich. 2017) (denying reopening where debtor sought certificate many years after closure)
- In re Kessler, 588 B.R. 191 (Bankr. E.D. Mich. 2018) (applying the four‑factor test to deny reopening)