In re: Ana Emilia Ortiz Jimenez

CourtUnited States Bankruptcy Court, D. Puerto Rico
DecidedJune 3, 2019
Docket18-04070
StatusUnknown

This text of In re: Ana Emilia Ortiz Jimenez (In re: Ana Emilia Ortiz Jimenez) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, D. Puerto Rico primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re: Ana Emilia Ortiz Jimenez, (prb 2019).

Opinion

1 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF PUERTO RICO 2 IN RE: CASE NO. 18-04070 (ESL) 3 ANA EMILIA ORTIZ JIMENEZ CHAPTER 11 4

5 Debtor 6

7 OPINION AND ORDER 8

9 This case is before the court upon the Motion Requesting Judgment be Entered for 10 Dismissal with Prejudice and Prohibition to Refile for 24 Months (Docket No. 103) filed by RL 11 Capital International LLC (“RL”); the Opposition to Motion Requesting Judgment be Entered for 12 Dismissal with Prejudice and Prohibition to Refile for 24 Months filed by the Debtor, Ana Emilia 13 Ortiz Jimenez (“Debtor”) (Docket No. 109); and the Reply to Opposition to Motion Requesting 14 Judgment be Entered for Dismissal with Prejudice and Prohibition to Refile for 24 Months filed 15 by RL (Docket No. 116). 16 RL argues that, following the court’s determination that cause for dismissal existed 17 pursuant to §1112(b)(4)(c) and that the petition was filed in bad faith as no special circumstances 18 were demonstrated, the dismissal order should be with prejudice with a bar to refile for twenty- 19 four (24) months. The Creditor argues that, “due to the strong evidence of bad faith on the part of 20 Debtor Ana Emilia Ortiz Jimenez, the Court should find Debtor’s behavior deserving of a 21 dismissal with prejudice under §105(a), §109(g) and §349(a)…” 22 In its Opposition, the Debtor contends that this is the first time RL submits to the court a 23 request for a bar to refile and has failed to sustain the allegations and submit evidence in support 24 of the request. The Debtor additionally states that “…none of Debtor’s circumstances justify or 25 merit a bar to refile: she has appeared at all her hearings and complied with all the Court’s request; 26 she has obtained the permit to operate her business, and she explained [to] the Court the 27 circumstances that resulted in several filings”. 1 RL filed a Reply to the Opposition arguing that in the Joint Trial Report “RL clearly argued 2 not only the reasons to warrant not only the dismissal of the case but also to enjoin future filings”; 3 and that the Debtor’s number of cases dismissed constitutes a pattern of abuse (this is the Debtor’s 4 fifth petition). The Creditor also alleged that the Debtor was not candid during the 341 meeting 5 and in her answer to Motion for Lift of Stay. 6 7 Legal Analysis and Discussion 8 9 Dismissal Pursuant to 11 U.S.C. §1112 and Bar to Refile 10 Pursuant to 11 U.S.C. §1112(b) on request of a “party in interest” a bankruptcy court may 11 dismiss a chapter 11 case for “cause”. Section 1112(b)(4) provides a non-exhaustive list of 12 “causes” that constitute grounds for dismissal. Casse v. Key Bank Nat’l Ass’n (In Re Casse), 198 13 F.3d 327, 335 (2nd Cir. 1999). On November 7, 2018, the court, after notice and a hearing, 14 determined the following: 15 “The facts o[f] this case show that the debtor has not made any payment to the secured creditor since 2010, foreclosure has been stalled 16 since the filing of the first petition on December 8, 2010, irrespective of whether or not the debtor expressly authorized the filing of the other three 17 petitions prior to the present one. The filing of this petition was on the eve of the public sale. The debtor has not shown reasonable likelihood of 18 rehabilitation within a reasonable period of time. The combination of these 19 factors do establish that the petition was filed in bad faith, that is, to continue forestalling execution.” Docket No. 102, page 14. 20 The court also found that the debtor had failed to show evidence of insurance as of the 21 date of the hearing, which is a cause for dismissal pursuant to 1112(b)(4)(C) and that the debtor 22 failed to show unusual circumstances. 23 Nonetheless, although 1112(b)(4) provides the substantive criteria for dismissal, the effect 24 of such dismissal is governed by §349(a). See Gonzalez Ruiz v. Doral Fin. Corp. (In Re Gonzalez- 25 Ruiz) 341 B.R. 371 (B.A.P. 1st Cir. 2006). “Generally, dismissals are ordered without prejudice 26 to carry out the remedial purpose of the Bankruptcy Code and to restore property rights, insofar 27 1 as is practicable, to the same positions as when the case was first filed, but without affecting the 2 disposition of debts.” Leavitt v. Soto (In re Leavitt), 171 F.3d 1219, 1223 (9th Cir. 1999) citing In 3 re Tomlin, 105 F.3d 933, 936-37 (4th Cir. 1997); See also In re Lawson, 156 B.R. 43, 45 (9th Cir. 4 BAP 1993). 5 Section 349(a) states: 6 “[u]nless the court, for cause, orders otherwise, the dismissal of a case under this title does not bar the discharge, in a later case under this title, 7 of debts that were dischargeable in the case dismissed; nor does the dismissal of a case under this title prejudice the debtor with regard to the 8 filing of a subsequent petition under this title, except as provided in section 109(g) of this title.” 9

10 Section 349(a) refers to section 109(g), which provides temporal and circumstantial 11 restrictions on debtor filing subsequent petitions within one hundred and eighty (180) days after 12 a case is dismissed in certain circumstances, namely, where the debtor willfully failed to abide by 13 orders of the court, or to appear before the court in proper prosecution of the case, or if a debtor 14 voluntarily dismissed a case after the filing of a request for relief from the automatic stay. Id. 15 “Nor does the dismissal, in and of itself, constitute a bar to the filing of a subsequent petition by 16 the same debtor, unless section 109(g) is applicable.” Alan N. Resnick & Henry J. Sommer eds., 17 3 Collier on Bankruptcy ¶ [349.02] (16th ed. 2017) However, the prong of section 109(g) is 18 applicable only when an earlier case is dismissed. “The issue of whether a bankruptcy filing is 19 barred by section 109(g) arises only if a second petition is filed within 180 days of an earlier 20 dismissal. Alan N. Resnick & Henry J. Sommer eds., 1 Collier on Bankruptcy ¶ [109.08] (16th ed. 21 2017). The issue of a bar pursuant to section 109(g) is typically raised by a motion to dismiss in 22 a subsequent case and the moving party has the burden of proof. Id. When confronted with an 23 allegation grounded upon the debtor’s failure to obey a court’s order pursuant to section 109(g)(1), 24 the debtor must establish that the failure was not willful. In re Jones, 2005 Bankr. LEXIS 303, 25 *3, 2005 WL 486758 (Bankr. W.D. Mo. 2005). “§109(g) of the Bankruptcy Code was ‘added to 26 the Bankruptcy Code in 1984 to address…the filing of meritless petitions in rapid succession to 27 improperly obtain the benefit of the Bankruptcy Code’s automatic stay provisions as a means of 1 avoiding foreclosure under a mortgage or other security instrument.’” In Re Cline, 2012 Bankr. 2 LEXIS 2456, 2012 WL 1957935 (B.A.P. 6th Cir. 2012), citing In Re Price, 304 B.R. 769, 772 3 (Bankr. N.D. Ohio 2004). 4 A motion requesting voluntary dismissal that does not relate to a request for relief of stay 5 does not activate the filing restrictions of §109(g)(2). As stated by Collier on Bankruptcy, the 6 restriction included in §109 is inapplicable “…if the Debtor successfully defended against or 7 resolved the motion for relief from the stay or paid in full the creditor who moved for relief. 8 Further, when the dismissal of the first case is remote in time from the motion for stay relief – 9 perhaps years after it was filed- section 109(g) should not be automatically applied.” Collier on 10 Bankruptcy at 349.02. (foot notes omitted).

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In re: Ana Emilia Ortiz Jimenez, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-ana-emilia-ortiz-jimenez-prb-2019.