Opinion
Case No. 11-49277.
April 28, 2011
OPINION AND ORDER DENYING MOTION FOR RECONSIDERATION
This case is before the Court on "Debtors' Ex Parte Motion To Vacate Order Allowing The Lift Of The Automatic Stay As To Creditor TCF National Bank Pursuant To Bankruptcy Rule 9024, Federal Rule of Civil Procedure 60(b) And Applicable Decisional Law," filed on April 27, 2011 (Docket # 42, the "Motion"), which this Court construes as a motion for reconsideration of, and for relief from, the April 27, 2011 Order granting TCF National Bank's motion to lift the automatic stay (Docket #41).
The Court finds that the Motion fails to demonstrate a palpable defect by which the Court and the parties have been misled, and that a different disposition of the case must result from a correction thereof. See L.B.R. 9024-1(a)(3) (E.D. Mich.).
The Court also finds that the allegations in the Motion do not establish excusable neglect under Fed.R.Civ.P. 60(b)(1), FedR.Bankr.P. 9024, or any other valid ground for relief from the order granting TCF National Bank's motion to lift the automatic stay.
In addition, the Court notes the following. The Motion alleges, in ¶ 11, that "[d]ue to mistake/error, Debtor's counsel failed to file a response to Creditor's Motion for Relief." First, any neglect or mistake by Debtors' counsel is attributable to the Debtors, for purposes of determining whether such neglect or mistake was excusable within the meaning of Fed.R.Civ.P. 60(b)(1). See, e.g., Pioneer Investment Services Co. v. Brunswick Associates Limited Partnership, 507 U.S. 380, 396-97 (1993) (in determining whether "excusable neglect" is shown, "the proper focus is upon whether the neglect of [the movants] and their counsel was excusable" (italics in original)). In the Pioneer Investment case, the Supreme Court reasoned:
"Petitioner voluntarily chose this attorney as his representative in the action, and he cannot now avoid the consequences of the acts or omissions of this freely selected agent. Any other notion would be wholly inconsistent with our system of representative litigation, in which each party is deemed bound by the acts of his lawyeragent and is considered to have `notice of all facts, notice of which can be charged upon the attorney.'" . . .
This principle applies with equal force here and requires that respondents be held accountable for the acts and omissions of their chosen counsel.
507 U.S. at 397 (quoting, in part, Link v. Wabash Railroad. Co., 370 U.S. 626, 633-34 (1962)). Debtors not only chose their current counsel in this case, but they also chose the same counsel to represent them in their most recent prior Chapter 13 case (Case No. 10-73936), which was dismissed due to an error by this same attorney, as discussed below.
Second, the Motion does not allege anything that would permit the Court to find that Debtor counsel's neglect or mistake here is excusable. And the Court notes that this is not the first "mistake/error" by Debtors' counsel in representing these Debtors in this Court. For example, the Debtors' most recent prior Chapter 13 case, Case No. 10-73936, was dismissed due to an admitted error by Debtors' counsel. (See Docket # 11 in this case at ¶ 2; Docket ## 34, 36 in Case No. 10-73936).
Third, Debtors' failure to file a timely response to TCF National Bank's stay relief motion cannot be excused or justified by any of the proceedings related to Debtors' motion to impose the stay under § 362(c)(4), or the Court's April 7, 2011 order granting that motion. Indeed, the stayrelief motion filed by TCF National Bank was filed on April 8, 2011, a day after the Court entered its order granting Debtors' motion to impose the stay. The stay-relief motion was clearly a distinct matter from the Debtors' motion to impose the stay. And the Debtors' Motion (at ¶ 11) admits that it was a "mistake/error" for Debtors' counsel not to file a response to the stay relief motion.
Fourth, the alleged failure by counsel for TCF National Bank to seek concurrence from Debtors' counsel before filing the stay-relief motion, (see Motion at ¶ 8), cannot excuse or justify Debtors' failure to file a timely response to the stay-relief motion. At most, it might have been a defense to the stay-relief motion, if Debtors had timely filed a response to that motion.
Fifth, Debtors' Motion invokes Civil Rule 60(b)(6), in addition to Rule 60(b)(1). But under Rule 60(b)(6), relief is appropriate "only in exceptional or extraordinary circumstances which are not addressed by the first five numbered clauses of the Rule." In re Cassidy, 273 B.R. 531, 537 (Bankr., N.D. Ohio 2002) ( citing Blue Diamond Coal Co. v Trustees of the UMWA Combined Benefit Fund, 249 F. 3d 519, 524 (6th Cir. 2001)); see also Fuller v. Quire, 916 F.2d 358, 360 (6th Cir. 1990) (same). "This is because `almost every conceivable ground for relief is covered' under the other subsections of Rule 60(b)." Cassidy, 273 B.R. at 537 (citing Olle v Henry Wright Corp., 910 F. 2d 357, 365 (6th Cir. 1990).
This case does not present such "exceptional or extraordinary circumstances." The circumstances here — a stay relief order entered by default due to the alleged "mistake/error" by Debtors' counsel in failing to timely respond to the motion — are addressed by Rule 60(b)(1), particularly the "excusable neglect" provision of Rule 60(b)(1), and the facts and arguments in Debtors' Motion do not make a showing of such "excusable neglect" under that rule.
For these reasons,
IT IS ORDERED that the Motion (Docket # 42) should be, and is, DENIED.