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So Cal Edison closes Ch 7 debtor's account and demands a deposit
Dear Listmates,
I have a Chapter 7 client who listed a past due debt of $42.50 to Southern California Edison in Schedule F. Sometime after filing Edison sent her a bill for the debt. In response, she called them and told the Edison contact that she had filed for Chapter 7 relief. Edison immediately closed her existing account and opened another account for her, imposing the requirement that she pay a deposit of $325 on the new account.
Leaving aside the fact that she should have simply paid the debt prior to filing, we are now in an awkward position: she does not have the funds to pay the deposit. I plan on calling Edison to see if we can reset things without my client having to pay the deposit. As a negotiating tactic I would like to assert that Edison's retributive move was a stay violation because, even though technically they are not attempting to collect the $42.50, they are insisting that she pay $325 because of her bankruptcy filing - a somewhat roundabout way to collect, not only the $42.50, but also a punitive $282.50.
Are any of you aware of any case law addressing this sort of thing? In particular, are there any cases holding that Edison's behavior constitutes a stay violation?
Thanks in advance for any light you can shed on these questions.
All the best,
Nick
Nicholas Gebelt, Ph.D., J.D.
Board Certified Bankruptcy Specialist
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