Opinion
ORDER DENYING TRUSTEE'S EX PARTE MOTION TO DISMISS CASE AND REQUIRING DEBTOR TO COMPLY WITH CONVERSION ORDER
James W. Meyers, judge United States Bankruptcy Court
The Trustee filed an Ex Parte Motion to dismiss this case because the Debtor failed to appear and testify at the § 341(a) Meeting of Creditors, which was scheduled for July 15, 2009. After reviewing the docket in this case, the Court has determined that dismissal is not appropriate at this time, and the motion is denied.
The Debtor filed a Chapter 11 petition on October 9, 2008, without the assistance of counsel. The Debtor apparently had difficulty preparing the necessary documents and hired attorney Thomas C. Nelson to represent him in this case. Mr. Nelson filed the certification to disclose compensation he received as attorney for the Debtor on January 7, 2009, but there is no indication on the docket that he ever submitted an application to be appointed as counsel for the Debtor in Possession.
Over the next few months, a number of creditors were granted relief from the automatic stay to foreclose on collateral, but nothing was filed in the case to effectuate a reorganization. The Debtor did not file a disclosure statement or plan of reorganization, or any-monthly operating reports as required by Bankruptcy Rule 2015. The United States Trustee filed a motion to convert or dismiss the case on April 23, 2009, which was joined by the Internal Revenue Service. The motion was set for hearing on June 10, 2009, and the case converted to one under Chapter 7 at that hearing.
The Order Converting Chapter 11 to Chapter 7 was entered on June 12, 2009. ("Conversion Order"). The Conversion Order is attached hereto as "Exhibit A", and includes provisions which require the Debtor to turnover records and property of the estate to the Chapter 7 trustee, and to file the schedules and reports required by Bankruptcy Rules 1019 and 1007 within 15 days. The Court Certificate of Notice shows that the Conversion Order was sent to the Debtor at 2025 Oceanview Road in Oceanside, Ca., and to Mr. Nelson at an address on Raytheon Road in San Diego. The docket also contains an order sent to the Debtor at the Oceanview address and returned as undeliverable on February 3, 2009. On June 18, 2009, the Debtor filed a Notice of Change of Address to 1200 Harbor Drive North in Oceanside. The only documents filed by Mr. Nelson list his address as 550 West C Street, Suite 1850 in San Diego. These facts raise a question as to whether the Debtor and Mr. Nelson actually received the Conversion Order.
Given this background, the Court will not dismiss the case at this time. The Debtor must comply with the terms of the Conversion Order and cooperate with the Chapter 7 trustee before this case can proceed or be dismissed. Without any operating reports, the Court cannot determine whether the Debtor remitted the fees due under 2 8 U.S.C. § 1930. The Debtor voluntarily filed a Chapter 11 petition to invoke the protections afforded by the automatic stay. He may not extricate himself from the bankruptcy process without fulfilling his obligations as a Debtor under Title 11.
Therefore, IT IS ORDERED that:
1)The Trustee's Ex Parte Motion to Dismiss this case is DENIED; and
2) The Debtor is ordered to comply with the terms of the Conversion Order within 14 days of entry of this Order, and is further ordered to attend the continued § 341(a) meeting of creditors to be scheduled by the Trustee. If the Debtor fails to comply with this Order, the Trustee or other interested party may file a motion under Rule 2005(a) for the issuance of an order to the Marshall to bring the Debtor before the Court to allow examination of the Debtor and to obtain his compliance with the orders of this Court.
ORDER CONVERTING CHAPTER 11 CASE TO CHAPTER 7
IT IS ORDERED THAT the relief sought as set forth on the continuation pages attached and numbered two (2 through_2 with exhibits, if any, for a total of_2 pages, is granted. Motion/Application Docket Entry No. _69
This matter came before the Court on the United States Trustee's Motion to Dismiss or Convert Case to Chapter 7 ("Motion"), on June 10,2009, at 11:00 a.m., in Department One of the United States Bankruptcy Court for the Southern District of California, the Honorable James W. Meyers, Bankruptcy Judge, presiding. Jules Elliot Briskin appeared in pro per, David A. Ortiz, Esq., appeared on behalf of the United States Trustee. Sylvia L. Shaughnessy, Esq., appearon behalf of the Internal Revenue Service, who joined in the Motion. All other appearances were as noted on the record.
Based upon the Motion, the lack of opposition filed thereto, argument of counsel, and for cause; IT IS HEREBY ORDERED that:
1. This chapter 11 case is converted to a case under chapter 7.
2. The debtor in possession shall:
a. forthwith turn over to the chapter 7 trustee all records and property of the estate under its custody or control as required by Federal Rule of Bankruptcy Procedure 1019(4);
b. within 15 days of the date of this order, file a schedule of all unpaid debts incurred after the commencement of the chapter 11 case including the name and address of each creditor, as required by Federal Rule of Bankruptcy Procedure 1019(5)(A); and
c. within 30 days of the date of this order, file and transmit to the United States Trustee a final report and account, as required by Federal Rule of Bankruptcy Procedure 1019(5)(B).
3. The debtor within 15 days of the date of this order shall file the statements and schedules required by Federal Rules of Bankruptcy Procedure 1019(1)(A) & 1007(b), if such documents have not already been filed.
IT IS FURTHER ORDERED that this Order may be submitted without lodgement or signatures of counsel, after same having been waived by the parties in open court.