Opinion
Case No. 01-32047, Chapter 13
June 26, 2001
MEMORANDUM OPINION AND ORDER
Final hearing was held June 13, 2001, on plaintiff's motion for relief from stay. At conclusion of hearing, the court granted plaintiff's motion for cause, including lack of adequate protection. This order supplements the court's bench ruling.
Facts.
In July 2000, debtor purchased a new Pontiac Sunfire. Plaintiff holds a note secured by a lien on the vehicle. According to the retail installment contract, debtors agreed to pay $16,527.23, less a $2,500.00 down payment, at an interest rate of 19% per year. The first payment was due in August.
Debtor made the first and only payment in August 2000, albeit late. On September 15, 2000, debtor filed a voluntary petition under chapter 13. On February 6, 2001, plaintiff filed a motion for relief from stay, which was granted by order entered March 30, 2001.
The court takes judicial notice of debtor's previous filing history with this court.
Also on February 6, 2001, plaintiff filed an objection to debtor's chapter 13 plan. That objection, along with several others, was sustained and debtor's plan was denied confirmation on March 21, 2001. When debtor failed to comply with LBR 3015-2 by not filing an amended plan by April 2, 2001, an order was entered dismissing the case on April 3, 2001.
Also on March 21, 2001, the United States Trustee certified that debtors failed to attend their § 341 meeting of creditors and asked that their case be dismissed.
Rather than filing an amended plan on April 2, 2001, debtor filed a new chapter 13 case on that date. Then, on April 17, 2001, debtor filed a chapter 13 plan similar to the one that was denied confirmation in the previous case. On May 1, 2001, plaintiff filed this motion for relief from stay.
In debtor's January 26, 2001 plan, he proposed to repay his unsecured creditors 0%; in his April 17, 2001 plan, he proposes to repay his unsecured creditors 0%. In his January plan, debtor valued the Sunfire at $8,000.00 and proposed to pay Regional Acceptance $133.00 per month for sixty months with 0% interest, for a total of $7,980.00 to be paid by the trustee. In his April plan, debtor valued the Sunfire at $8,000.00, and proposed to pay $222.00 per month for thirty-six months with 0% interest, for a total of $7,992.00 to be paid directly by debtor.
Plaintiff has not filed an objection to debtor's plan because plaintiff was not served with a copy of the plan.
Conclusions of Law
Pursuant to 11 U.S.C. § 362(d)(1), "the court shall grant relief from the stay . . . for cause, including the lack of adequate protection of an interest in property of such party in interest." 11 U.S.C. § 362(d)(1) (2001) (emphasis added).
Since the Bankruptcy Code does not define "for cause," the court must make this determination on a case by case basis. In re Robinson, 169 B.R. 356, 359 (E.D.Va. 1994) (citations omitted). In making this determination, the court "must balance potential prejudice to the bankruptcy debtor's estate against the hardships that will be incurred by the person seeking relief from the automatic stay if relief is denied." In re Robbins, 964 F.2d 342, 345 (4th Cir. 1992) (citing In re Peterson, 116 B.R. 247, 249 (D.Colo. 1990)).
Regional Acceptance bears the initial burden of proving that it is a secured creditor and is entitled to relief from stay. See In re Gaines, 243 B.R. 221, 224 (Bankr.N.D.N.Y. 1999). Regional satisfied its burden, which shifted the burden of proof to debtor to refute the existence of cause. See id.; see also 11 U.S.C. § 362(g)(2) (stating that a creditor has the burden of proof on the issue of equity and debtor bears the burden on all other issues). Debtor failed to produce any evidence of adequate protection and failed to refute the existence of cause. Therefore, debtor failed to satisfy his burden of proof. Debtor's failure to meet this burden is grounds for granting relief from stay. See In re Gaines, 243 B.R. at 224.
As stated above, debtor has a previous filing history with this court. Regional successfully argued this same motion for relief from stay in debtor's previous bankruptcy case. Since the filing of this second bankruptcy case, Regional's situation has not improved, nor has debtor provided adequate protection. The vehicle subject to the security agreement was purchased in August 2000, and debtors have made only one payment. Meanwhile, debtors allowed their first bankruptcy case to languish for over six months without a confirmed plan, and then allowed that case to be dismissed rather than file a confirmable plan. Their actions constitute cause for grating relief from the automatic stay pursuant to 11 U.S.C. § 362(d)(1). Furthermore, debtor is currently unemployed. His proposed chapter 13 plan includes income from his wife; however, she has been dismissed from this case for failure to attend the § 341 meeting of creditors. Due to debtor's current employment and financial situation, it is likely that his inability to make payments will continue in the near future.
Debtor Gregory Sykes filed a motion to vacate Valencia Sykes' dismissal.
Debtor's failure to meet his burden of proof, debtor's previous filing history, debtor's current unemployment status, and the fact that debtor made only one payment since purchasing the car in August 2000, constitutes cause for granting plaintiff's motion for relief from stay. Accordingly,
IT IS ORDERED that plaintiff is hereby granted relief from the automatic stay for cause, including lack of adequate protection.
IT IS FURTHER ORDERED that plaintiff is permitted to enforce its state law remedies as to the 2000 Pontiac Sunfire, VIN No. 1G2JB1240Y7289585.