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Exigent Circumstances
In re Otero, 09-71420 TG, 2010 WL 580033 (Bankr. N.D. Cal. Feb. 12, 2010)
same court year later read *In re Romero *differently. The Romeros only
tried to get the counseling 3 days before filing, but code requires 5 days.
So in this case the judge denied the motion and they had to refile.
United States Bankruptcy Court,
N.D. California.
In re T. Donald OTERO, Debtor.
No. 0971420 TG.
Feb. 12, 2010.
Opinion
*MEMORANDUM AND ORDER DISMISSING CASE*
LESLIE TCHAIKOVSKY, Bankruptcy Judge.
*1 The above-captioned chapter 13 case was filed on November 30, 2009. On
the same day, the above-captioned debtor (the Debtor) filed a motion for
a temporary waiver of the pre-petition credit counseling requirement
pursuant to 11 U.S.C. 109(h)(1). In his declaration, the Debtor stated
that he filed his bankruptcy petition on November 30, 2009 to stop the
foreclosure sale of his home which was scheduled to take place that day, at
1:30 p.m. He stated that he contacted a credit counseling agency 45 minutes
before the scheduled foreclosure sale and was advised that the counseling
process would take 45 minutes if done over the Internet. However, he did
not have access to the Internet. He was advised that the process would take
longer if conducted by other means. Under the circumstances, the Debtor
stated, he was forced to file for bankruptcy prior to completing the
counseling in order to save his home. On December 23, 2009, the Debtor
filed a Certificate of Credit Counseling, indicating that he had completed
the counseling process that day.
On January 15, 2010, the chapter 13 trustee (the Trustee) filed an
objection to the Debtor's motion. The objection asserted that 11 U.S.C.
109(h)(3) acknowledges that the pre-petition credit counseling requirement
may be waived due to exigent circumstances. However, according to the
objection, 11 U.S.C. 109(h)(4) delineated the circumstances under which
the requirement may be waived: i.e., incapacity, disability, or active
military duty in a military combat zone. Since the Debtor satisfied none of
these circumstances, the Debtor was not entitled to the requested waiver.
On January 27, 2010, the Debtor filed a reply to the Trustee's objection.
In the reply, the Debtor noted that he was not seeking a permanent waiver
of the credit counseling requirement pursuant to 11 U.S.C. 109(h)(4),
merely a temporary waiver pursuant to 11 U.S.C. 109(h)(3). He contended
that the circumstances that he had described qualified as exigent
circumstances as required by 109(h)(3). In support of this contention,
he cited *In re Romero,* 349 B.R. 616 (Bankr.N.D.Cal.2006). In
*Romero,*the bankruptcy court held that filing to halt an imminent
wage garnishment
qualified as an exigent circumstance. The Debtor contended that, if *
Romero* was correct, the imminent foreclosure of one's home should also
qualify as an exigent circumstance.
Section 109(h)(3) provides that the debtor may obtain credit counseling
post-petition provided he:
... submits to the Court a certification that
(i) describes exigent circumstances that merit a waiver of the
[pre-petition credit counseling] requirements ...;
(ii) states that the debtor requested credit counseling services from an
approved nonprofit budget and credit counseling agency, but was unable to
obtain ... [pre-petition credit counseling] during the 5day period
beginning on the date on which the debtor made that request;
*2 and
(iii) is satisfactory to the court.
11 U.S.C. 109(h)(3). Thus, there are three prongs that a debtor must
satisfy to obtain a temporary waiver of the pre-petition credit counseling
requirement. The Court agrees with the Debtor that the imminent foreclosure
of one's home satisfies the first prong of 109(h)(3). However, the Debtor
is unable to satisfy the second prong.
In *Romero,* the debtors stated that they first contacted a credit
counseling three days before the petition date and were informed that they
could not obtain credit counseling agency for a week. This would have been
too late to stop the wage garnishment. The *Romero* court held that this
satisfied 11 U.S.C. 109(h)(3) and granted them a temporary waiver. Thus,
under the approach taken by the *Romero* court, the Debtor would be
entitled to a temporary waiver of the pre-petition credit counseling
requirement if the credit counseling agency had stated that it could not
provide counseling within five days even though the request was made only
45 days before the petition was filed.
The Court reads 109(h)(3) somewhat differently than the *Romero* court.
The Court reads the statute to require the request to be made at least five
days before the bankruptcy filing. However, even under the *Romero* reading
of the statute, the Debtor would not qualify for a temporary waiver. The
credit counseling agency contacted by the Debtor was willing and able to
provide counseling within five days. Thus, the Debtor is unable to satisfy
the second prong of 109(h)(3).
The Court concludes that the above-captioned case must be dismissed due to
the Debtor's failure to obtain pre-petition credit counseling and his
failure to qualify for a temporary waiver of this requirement pursuant to
11 U.S.C. 109(h)(3). Based on the foregoing, it is
SO ORDERED.
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HOWEVER: Let me say this. You can online get an immediate certificate
from http://www.abacuscc.org/index.php I use this one the most because I
can have my debtor go online pay their fee and as soon as the course is
finished the certificate is generated with a link to download it
immediately. I believe Judge Ahart's son is one of the partners of this
company. So because you can 24 hours a day 7 days a week, I have been told
before I used this service by a Judge in LA that THERE are never exigent
circumstances that would prevent a debtor from obtaining the certificate
prior to filing.
So when the debtor calls at 7pm and I happen to be working late and they
need an emergency filing because the sale is 10am in the morning, I have
them come to the office sit down and on the Client Computer I have across
my desk for clients to use, they take their course while I on the other
side use their tax returns, bank statements and other documentation to prep
the bankruptcy. All in All it can be done in about 3 hours to complete an
emergency BK filing before midnight so that notice can be given to creditor
to stop a sale.
I won't try to file emergency BK after 8am on the date of sale because of
the relation back to sale being completed at 8am on the date of the sale.
It can be done but no guarantees and its very risky..... (fyi to attorneys
here who are new to this).
R. Grace Rodriguez, Esq.
OFF: (818) 734-7223
CEL: (818) 554-9922
HOWEVER: Let me say this. You can online get an immediate certificate from
http://www.abacuscc.org/index.phpI use this one the most because I can have my debtor go online pay their fee and as soon as the course is finished the certificate is generated with a link to download it immediately. I believe Judge Ahart's son is one of the partners of this company. So because you can 24 hours a day 7 days a week, I have been told before I used this service by a Judge in LA that THERE are never exigent circumstances that would prevent a debtor from obtaining the certificate prior to filing.
So when the debtor calls at 7pm and I happen to be working late and they need an emergency filing because the sale is 10am in the morning, I have them come to the office sit down and on the Client Computer I have across my desk for clients to use, they take their course while I on the other side use their tax returns, bank statements and other documentation to prep the bankruptcy. All in All it can be done in about 3 hours to complete an emergency BK filing before midnight so that notice can be given to creditor to stop a sale.
I won't try to file emergency BK after 8am on the date of sale because of the relation back to sale being completed at 8am on the date of the sale. It can be done but no guarantees and its very risky..... (fyi to attorneys here who are new to this).
R. Grace Rodriguez, Esq.OFF: (818) 734-7223CEL: (818) 554-9922
The post was migrated from Yahoo.
Hi Steve:
In re Romero, 349 B.R. 616 (Bankr. N.D. Cal. 2006
*Background:* Would-be Chapter 7 debtors applied for temporary waiver of
credit counseling requirement imposed by the Bankruptcy Abuse Prevention
and Consumer Protection Act (BAPCPA) on eligibility for bankruptcy relief,
and the United States Trustee (UST) objected and moved to dismiss case on
ground that debtors had not demonstrated the requisite exigent
circumstances.
*Holding:* The Bankruptcy Court, Thomas E. Carlson, J., held that would-be
Chapter 7 debtors who, three days before filing for bankruptcy relief, had
requested credit counseling from approved agency but been unable to obtain
it within requisite five-day period specified by statute, and who had need
to file for bankruptcy in order to prevent garnishment of debtor-husband's
wages, sufficiently established requisite exigent circumstances and were
entitled to temporary waiver of credit counseling requirement.
Motion denied.
One line of cases concludes that the exigent circumstances standard is a
high one that is generally not satisfied when the debtor has sufficient
advance knowledge of the threatened creditor action to obtain the credit
counseling before the creditor action takes effect. *See, e.g., **In re
DiPinto,* 336 B.R. 693
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Filed a Chapter 13 in Oakland. Trustee brought a motion to dismiss because counseling certificate was filed within 14 days of original filing but I checked off the box on Exhibit D that indicated it was attached. Judge wants Trustee and I to brief what constitutes exigent circumstances to allow the filing of the cert within 14 days as opposed to at the time of the filing despite the fact I was retained one day before the foreclosure sale. Any case law or code support would be greatly appreciated.
Steven A. Wolvek, Esq.
Law Offices of Steven A. Wolvek
23480 Park Sorrento, Suite 109A
Calabasas, CA 91302
818-227-3379 / FAX 818-227-3383
Email: steve@wolveklaw.com
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