The specific issue appealed was whether the District Court abused its discretion when it held that the bankruptcy court could reinstate Smith’s Chapter 13 case. Smith then appealed to the Sixth Circuit. The District Court denied the motion but certified for interlocutory appeal the question of whether reinstatement of Smith’s case was contrary to the law. Smith appealed to the District Court and sought a stay of the bankruptcy court’s order reinstating his case. The bankruptcy granted the motion and also lifted the automatic stay in Smith’s case for a period of two years. Bank filed a motion under Federal Rule of Civil Procedure 60(b) (as incorporated by Bankruptcy Rule 9024) requesting that the bankruptcy court vacate its order dismissing the case. On the day the sale was scheduled to take place, Smith filed for bankruptcy, and six days later he filed a motion to dismiss the case, which the bankruptcy court granted. Bank purchased the mortgage for Smith’s home, and a foreclosure sale was scheduled. Smith did the same thing in 2017 when another foreclosure sale of his home was scheduled, and again the bankruptcy court dismissed his case after the foreclosure sale was cancelled. After the sale date passed, Smith filed a motion to dismiss the case, which the bankruptcy court granted. Smith defaulted on the loan, was sued by the mortgage holder and in 2007 a state court scheduled a foreclosure sale.įour days before the sale, Smith filed for bankruptcy, resulting in the automatic stay of the sale. The case involves a Chapter 13 debtor, Ronald Smith, who obtained a loan to purchase a home. In short, the Sixth Circuit held that if a Chapter 13 debtor moves to have his/her case dismissed, and no exception applies, a bankruptcy court must dismiss it. Court of Appeals for the Sixth Circuit, “of whether a court likes the results of that application in a particular case.” That legal maxim guided the Sixth Circuit’s reasoning in a recent decision in a case involving a Chapter 13 debtor’s repeated filings and requests for dismissal of his bankruptcy cases in order to avoid foreclosure of his home. OctoSixth Circuit Upholds Chapter 13 Debtor’s Right to Request and Receive Dismissal of Bankruptcy CaseĪ statute must be interpreted and enforced as written, regardless, according to the U.S.
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