In Re Clary
MEMORANDUM OPINION
THIS CASE was before the court on April 13, 2010, on the former chapter 7 trustee’s motion to reopen the case.
The debtor and her former husband are co-owners of a parcel of real property located in Clifton, Virginia. During the course of the administration of the case, the chapter 7 trustee investigated the value of the property and the liens encumbering it. While the debtor’s former husband expressed an interest in purchasing the property, the trustee concluded that a purchase was not feasible. The trustee filed a no distribution report on August 10, 2009 and the case was closed on January 8, 2010.
Recently, the debtor’s former husband provided the trustee with a title report which shows that there are now no liens on the property. As a result, the former husband made an offer to the trustee to acquire the property. The trustee seeks to reopen the case to accept the offer.
The basis for reopening a case is well established. The District Court stated:
Section 350 of the Bankruptcy Code allows a bankruptcy court to reopen a closed ease to administer assets, to accord relief to the debtor, or for other cause.11 U.S.C. § 350(b) . Merely granting a motion to reopen does not afford the parties any substantive relief, but rather provides the opportunity to request further relief. Ordinarily, for a court to grant a motion to reopen, the moving party must demonstrate that there is a compelling cause. Reid v. Richardson,304 F.2d 351 , 355 (4th Cir.1962).
Horizon Aviation of Virginia, Inc. v. Alexander (In re Alexander),
Reopening this case would be a futile act because the property in question ceased to be property of the estate on January 8, 2010, when the case was closed. Section 554(c) of the Bankruptcy Code provides:
Unless the court orders otherwise, any property scheduled under § 521(1) of this title not otherwise administered at the closing of the case is abandoned to the debtor and administered for purposes of § 350 of this title.