Opinion
Bankruptcy Case No. 02-93330
November 18, 2002
OPINION
This matter having come before the Court on a Motion to Compel Compliance with the Automatic Stay filed by the Debtor on November 1, 2002; the Court, having heard arguments of Debtor's counsel and being otherwise fully advised in the premises, makes the following findings of fact and conclusions of law pursuant to Rule 7052 of the Federal Rules of Bankruptcy Procedure.
Findings of Fact
The material facts in this matter are not in dispute, and are, in pertinent part, as follows:
1. Debtor filed for relief under Chapter 7 of the Bankruptcy Code on October 28, 2002.
2. On Schedule F of the Debtor's bankruptcy petition, the Debtor scheduled Creditor, State Farm Insurance Auto Claims Department, as an unsecured creditor having a judgment in the amount of $5,822.84, arising from an automobile accident. The Debtor also indicated on his schedules that the Creditor, State Farm Insurance Auto Claims Department, was represented by Swaim Swaim, Ltd., of Kankakee, Illinois. Both State Farm Insurance Auto Claims Department and Swaim Swaim, Ltd. were listed on Debtor's mailing matrix and notice of the Debtor's Chapter 7 bankruptcy filing was sent to all creditors on October 28, 2002.
3. A bench warrant has been issued against the Debtor by State Farm Insurance Auto Claims Department through its attorneys, Swaim Swaim, Ltd., in the State Court proceeding, wherein judgment was entered in June 2001, in the approximate amount of $5,822.84.
4. In addition to notices sent by the Court, Debtor's attorney has notified Swaim Swaim, Ltd. of the Debtor's bankruptcy proceeding, and has requested that the bench warrant be quashed.
5. Despite notice of the Debtor's Chapter 7 bankruptcy proceeding from the Court and Debtor's counsel, it appears that the bench warrant remains in effect.
6. Hearing was held on the Debtor's Motion to Compel Compliance with the Automatic Stay on November 14, 2002, in Kankakee, Illinois, at which time neither Creditor, State Farm Insurance Auto Claims Department nor its counsel, Swaim Swaim, Ltd., appeared.
Conclusions of Law
Having heard arguments of Debtor's counsel in connection with the Debtor's Motion to Compel Compliance with the Automatic Stay and having reviewed the applicable law, the Court finds that the Motion to Compel Compliance with the Automatic Stay should be allowed. The case law concerning the matter presently before the Court clearly holds that once a Chapter 7 bankruptcy petition is filed, a creditor has an affirmative duty to see that any bench warrants issued in underlying State Court proceedings are withdrawn or quashed.
See: In re Woodside, 161 B.R. 969 (Bankr.S.D.Ill. 1994); In re Atkins, 176 B.R. 998 (Bankr.D.Minn. 1994); and In re Halas, 249 B.R. 182 (Bankr.N.D.Ill. 2000).
Under the circumstances of the instant case, the Court finds that, not only is it appropriate that the Motion to Compel Compliance with the Automatic Stay be allowed, but that the creditor be required to show proof to the Court that the bench warrants at issue have, in fact, been quashed, and that no further collection actions will be pursued on the State Court judgment.
For the reasons set forth in an Opinion entered on the ___ day of November 2002;
IT IS HEREBY ORDERED that:
A. Motion to Compel Compliance with the Automatic Stay filed by the Debtor on November 1, 2002, is ALLOWED;
B. Creditor, State Farm Insurance Auto Claims Department, through its attorneys, Swaim Swaim, Ltd., are directed to quash any bench warrants in the underlying State Court proceeding against Debtor, Timothy Alan Norder, within 5 days of the date of this Order;
C. Creditor, State Farm Insurance Auto Claims Department, through its attorneys, Swaim Swaim, Ltd., is to provide proof to this Court that the bench warrants at issue have been quashed; and,
D. Failure to comply with the terms of this Order may result in sanctions being entered in favor of the Debtor and against Creditor and its counsel.