Opinion
Case No. 8:16-bk-05222-RCT
08-29-2016
In re Amada Maria Cuellar, Debtor.
Chapter 13 ORDER WAIVING PREPETION CREDIT COUNSELING , GRANTING THE APPOINTMENT OF A "NEXT FRIEND," AND DIRECTING THE FILING OF A SUPPLEMENTAL AFFIDAVIT BY DAINELI PEREZ, THE PROPOSED "NEXT FRIEND" FOR DEBTOR
Before the Court are Debtor's motion, pursuant to Fed. R. Bankr. P. 1004.1, for an order confirming and/or appointing Daineli Perez as Debtor's "next friend" with authority to file the instant bankruptcy petition and to take all other actions required by Debtor throughout the pendency of the case, [Doc. No. 12], and motion for a waiver of the prepetition credit counseling requirement pursuant to 11 U.S.C. § 109(h)(4), [Doc. No. 5] (together, "the Motions"). A hearing on the Motions was held on July 11, 2016. After hearing from Debtor's counsel and the Chapter 13 trustee, the Court issued an oral ruling, abating all activity in the case, pending submission of documents by Debtor's counsel and further briefing by the parties. An order setting forth that ruling was entered July 19, 2016 (the "Order"). [Doc. No. 28].
As directed, Debtor's counsel filed declarations of (i) Hiram A. Cuevas, M.D., Debtor's primary care physician, (ii) Carmen Junquera, Paralegal at Bay Area Legal Services, Inc. ("BALS"), and (iii) Daineli Perez, Debtor's granddaughter and proposed "next friend." [Doc. Nos. 24, 25, 26]. Debtor's counsel, Sue-Helen Motley, Esq. of BALS, filed a memorandum of law in support of the Motions. [Doc. No. 30]. The Chapter 13 trustee filed a response to Ms. Motley's memorandum. [Doc. No. 31].
In most cases, the appointment of a guardian ad litem for an infant or incompetent individual is best determined in a Florida Circuit Court. See In re Petrano, No. 13-10052-KKS, 2013 WL 6503672 (Bankr. N.D. Fla. Apr. 16, 2013). However, the Court finds that this is an extreme case far more similar to In re Myers, 350 B.R. 760 (Bankr. N.D. Ohio 2006), than Petrano, 2013 WL 6503672.
The declarations filed by Debtor's counsel are unrebutted. Dr. Cuevas stated that Debtor has been under his care for treatment of Alzheimer's disease since her diagnosis in November 2011. Dr. Cuevas opined that due to her condition, Debtor cannot understand her financial affairs, nor make rational decisions about her finances. [Doc. No. 23]. Ms. Junquera, who conducted Debtor's intake interview for BALS, stated that Debtor was unable to provide basic information about herself, e.g. her birthdate, or her finances, referring Ms. Junquera's questions to Ms. Perez. Based upon her observations and experience, Ms. Junquera opined that Debtor would not be competent to represent herself or direct an attorney to represent her. [Doc. No. 25]. Further, the Court had the opportunity to observe Debtor at the hearing on the Motions, and my observations are consistent with the opinions of Dr. Cuevas and Ms. Junquara.
Debtor has no resources, except her social security and the assistance her family provides. She is represented, pro bono, by BALS, and they have done a masterful job in representing her. Per the schedules, Debtor owns no non-exempt property, and, other than the holder of the reverse mortgage on her homestead, has no significant creditors. Ms. Perez, Debtor's primary caregiver, has filed a sensible and appropriate Chapter 13 plan, which cures insurance and tax arrears on the reverse mortgage. Indeed, because Debtor did not comprehend how a reverse mortgage worked, she defaulted by failing to pay for taxes and insurance. A foreclosure was filed against her home, prompting this Chapter 13 petition.
Debtor is a 90 year-old widow, with one daughter and five adult grandchildren. When it became clear to Debtor's family that she required regular care, the family selected Ms. Perez to oversee that care. --------
The Court has reviewed the schedules, the proposed plan, in addition to the declarations and memoranda filed with the Court. The Court also has reviewed the available case law as well as examined other bankruptcy courts' local rules relative to motions under Fed. R. Bankr. P. ("Rule(s)") 1004.1. The Court finds that Local Rule 1004.1-1 of the U.S. Bankruptcy Court for the District of Oregon particularly well-suited for guiding a court's determination of a Rule 1004.1 motion. Therefore, upon due consideration, it is
ORDERED:
1. Debtor's Motion for Waiver of Credit Counseling Due to Incapacity is GRANTED.
2. Debtor is incapacitated as defined in 11 U.S.C. § 109(h)(4) and, therefore, is exempt from the requirement to complete prepetition credit counseling.
3. Debtor's motion brought pursuant to Rule 1004.1 is GRANTED, subject to the following terms.
4. Within ten days of entry of this order, Daineli Perez shall file a supplemental affidavit that contains the information required by the Oregon Bankruptcy Court's Local Rule 1004.1-1(b)(1), a copy of which is attached to this Order.
5. Absent the failure to file a sufficient supplemental affidavit, Daineli Perez, by subsequent order, shall be appointed "next friend" of Debtor nunc pro tunc to the petition date with authority to file the instant bankruptcy petition and take all other actions required by Debtor during the pendency of the case. In the event Ms. Perez is so appointed, her appointment shall be for purposes of this case only and shall have no effect outside of this bankruptcy case or any related adversary proceedings.
ORDERED. Dated: August 29, 2016
/s/_________
Roberta A. Colton
United States Bankruptcy Judge Attorney Sue-Helen Motley is directed to serve a copy of this order on interested parties and file proof of service within 3 days of entry of this order.