Opinion
23-10684
05-11-2023
In Re ORA JOSEPH DONALDSON JR. Debtor
Chapter 7
ORDER: (I) DENYING REQUEST FOR WAIVER OF CREDIT COUNSELING BRIEFING REQUIREMENT [DOCKET NUMBER 19], AND (II) DISMISSING CASE
BETH A. BUCHANAN, UNITED STATES BANKRUPTCY JUDGE
[Not intended for publication]
This matter is before this Court on the Motion for Waiver of Credit Counseling Requirement [Docket Number 19] (the "Motion") filed by Ora Donaldson, Jr., the debtor in this case.
Mr. Donaldson filed a petition for relief under chapter 7 of the Bankruptcy Code on April 13, 2023. He did not file a certificate of credit counseling with his petition. Reading the record as a whole, it appears the Mr. Donaldson is asserting three alternative grounds for not completing the prepetition credit counseling briefing: (1) he is exempt from the credit counseling briefing because of a physical disability; (2) he qualifies for a temporary waiver of the credit counseling requirement due to exigent circumstances; and, (3) he has completed a financial education course that is equivalent to the credit counseling briefing.
Section 109(h)(1) of the Bankruptcy Code provides that an individual may not be a debtor under any chapter of the Bankruptcy Code unless the individual has received a briefing from an approved credit counseling agency within the 180-day period ending on the petition date. 11 U.S.C. § 109(h)(1).
Section 109(h)(1) provides that:
Subject to paragraphs (2) and (3), and notwithstanding any other provision of this section other than paragraph (4) of this subsection, an individual may not be a debtor under this title unless such individual has, during the 180-day period ending on the date of filing of the petition by such individual, received from an approved nonprofit budget and credit counseling agency described in section 111(a) an individual or group briefing (including a briefing conducted by telephone or on the Internet) that outlined the opportunities for available credit counseling and assisted such individual in performing a related budget analysis.II U.S.C. § 109(h)(1).
A debtor may be exempt from the credit counseling requirement entirely if the debtor is unable to meet the requirement because of "incapacity, disability, or active military duty in a combat zone." 11 U.S.C. § 109(h)(4). The Bankruptcy Code defines "disability" as someone who is "so physically impaired as to be unable, after reasonable effort, to participate in an in person, telephone, or Internet briefing … ." Id.
In lieu of seeking an exemption from the credit counseling requirement, a debtor may request a temporary waiver of the credit counseling requirement. Section 109(h)(3) of the Bankruptcy Code creates a limited exception where a debtor must file a bankruptcy case very quickly to forestall imminent harm. Such a debtor must submit to the court a certification that describes the exigent circumstances that merit a temporary waiver of the requirement and states that the debtor requested credit counseling services from an approved agency but was unable to obtain the services during the seven-day period beginning on the date the debtor made the request. 11 U.S.C. § 109(h)(3)(A). If the debtor satisfies the foregoing requirements to the satisfaction of the court, the debtor still must complete the credit counseling briefing no later than 30 days after the petition, unless the court, for cause, allows the debtor an additional 15 days. 11 U.S.C. § 109(h)(3)(B).
In his original petition [Docket Number 1], Mr. Donaldson checked the box requesting an exemption from the requirement to receive a briefing about credit counseling because of a physical disability that causes him "to be unable to participate in a briefing in person, by phone, or through the internet, even after [he] reasonably tried to do so." While not set forth in his petition, this Court presumes that Mr. Donaldson's disability exemption request relates to his incarceration, as more fully discussed below.
"Though incarceration 'may erect physical barriers' to completing the [credit counseling] requirement, 'it is not a physical impairment in the sense that it is not an injury, defect, or characteristic of this person's physical makeup that prevents him from doing what is necessary to obtain the briefing." In re Heim, 2019 Bankr. LEXIS 141, at *2-3, 2019 WL 236231, at *1 (Bankr.N.D.Ohio Jan. 16, 2019) (quoting In re Larsen, 399 B.R. 634, 637 (Bankr. E.D. Ga. 2009). As such, most courts hold the view that incarceration is not a disability within the meaning of § 109(h)(4), including courts within the Sixth Circuit. Id. (citing In re Anderson, 397 B.R. 363, 366-367 (B.A.P. 6th Cir. 2008)). As such, Mr. Donaldson does not qualify for an exemption from the credit counseling requirement under § 109(h)(4) due to his incarceration.
By his Motion, Mr. Donaldson requests a waiver of the credit counseling requirement because he is incarcerated at the North Central Correctional Complex in Marion, Ohio where he is serving a six to nine year prison sentence. Alternatively, Mr. Donaldson maintains in his Motion that he has completed a course in personal finance through the Ohio Central School System, which he submits is a form of credit counseling, and that he is currently enrolled in a second course in personal finance.
Mr. Donaldson's Motion also fails to meet the criteria for a temporary waiver of the credit counseling requirement. Mr. Donaldson has not explained what efforts he made to obtain the credit counseling briefing before filing his petition, or what serious and imminent harm he was facing from creditors that required the immediate filing of the petition before completing the credit counseling briefing.
As to his completion of a course in personal finance through the Ohio Central School System, this Court commends Mr. Donaldson for continuing his education while incarcerated, however, this Court cannot verify that the personal finance courses through the Ohio Central School System satisfy the requirements of § 109(h).
A list of approved credit counseling agencies can be found on the U.S. Department of Justice website at https://www.justice.gov/ust/list-credit-counseling-agencies-approved-pursuant-11-usc-111. Certain of these agencies provide services at no charge and offer the credit counseling briefing online or by telephone.
If a debtor fails to file a timely credit counseling certificate and has not established exigent circumstances to justify a 30-day extension, the debtor's case must be dismissed. In re Ingram, 460 B.R. 904, 910 (6th Cir. 2011) ("Compliance with § 109(h) is a prerequisite to obtaining relief under the Bankruptcy Code. By definition, an individual may not be a debtor who is eligible for bankruptcy relief unless he has complied with § 109(h). See 11 U.S.C. § 109(h); 11 U.S.C. § 301(a)."). A bankruptcy court does not have the discretion to ignore, modify, or defer the requirements of § 109(h). Id.
Accordingly, the Motion is denied, and this case is hereby dismissed.
SO ORDERED.
Distribution list:
All Creditors and Parties in Interest