621 B.R. 260
Bankr. D.N.M.2020Background
- Debtors (Sandra McGrath and Dale Rogers) filed a Chapter 13 on July 29, 2020 after a prior Chapter 13 (filed Oct. 28, 2019) was dismissed June 15, 2020 for failure to comply with a court order.
- On the new petition date Debtors moved to extend the automatic stay; mortgage creditor InBank objected and had a pending foreclosure action.
- Debtors requested a hearing; the hearing occurred 50 days after filing, and the court denied the motion to extend the stay as untimely under 11 U.S.C. § 362(c)(3)(B).
- Parties disputed whether § 362(c)(3)(A) ends the automatic stay entirely or only “with respect to the debtor.”
- The court held that the automatic stay terminated with respect to the Debtors personally but remains in effect as to efforts to obtain estate property; InBank must file a § 362(d) motion for relief from stay to pursue foreclosure.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Scope of § 362(c)(3)(A): whether the automatic stay terminates entirely after 30 days or only "with respect to the debtor" | The phrase "with respect to the debtor" limits termination to actions against the debtor; stay continues to protect estate property | The statute is ambiguous and should be read to terminate the entire stay after 30 days to deter serial filings | Court adopted the majority/plain-meaning view: stay terminates only as to the debtor; estate property remains protected |
| Precedential weight of BAP decision In re Holcomb | Holcomb (10th Cir. BAP) supports Debtors’ interpretation and should be followed | Holcomb is not binding precedent on this court | Court: BAP opinions are persuasive but not binding; Holcomb is persuasive and the court follows its analysis |
Key Cases Cited
- In re Holcomb, 380 B.R. 813 (10th Cir. BAP 2008) (BAP decision construing § 362(c)(3)(A) to terminate stay only with respect to the debtor)
- In re Smith, 910 F.3d 576 (1st Cir. 2018) (First Circuit interpreted § 362(c)(3)(A) to terminate the entire automatic stay)
- Rose v. Select Portfolio Servicing, Inc., 945 F.3d 226 (5th Cir. 2019) (Fifth Circuit adopted Holcomb approach; stay terminates only with respect to the debtor)
- In re Silverman, 616 F.3d 1001 (9th Cir. 2010) (discusses precedential effect of BAP opinions and treats them as persuasive)
- Bank of Maui v. Estate Analysis, Inc., 904 F.2d 470 (9th Cir. 1990) (explains limits on BAP decisions binding district courts)
- BFP v. Resolution Trust Corp., 511 U.S. 531 (1994) (Supreme Court decision cited for general bankruptcy policy on maximizing equitable distributions to creditors)