In Re Grand Builders, Inc.

122 B.R. 673, 1990 Bankr. LEXIS 2729, 1990 WL 252804
CourtUnited States Bankruptcy Court, W.D. Pennsylvania
DecidedDecember 17, 1990
Docket19-10189
StatusPublished
Cited by10 cases

This text of 122 B.R. 673 (In Re Grand Builders, Inc.) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, W.D. Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In Re Grand Builders, Inc., 122 B.R. 673, 1990 Bankr. LEXIS 2729, 1990 WL 252804 (Pa. 1990).

Opinion

MEMORANDUM OPINION

BERNARD MARKOVITZ, Bankruptcy Judge.

Before the Court is a document titled “Motion' For Reconsideration Of Claim Of Jeffrey Mondell Which Was Denied Without Notice and Hearing” in which claimant seeks to have vacated an order subordinating his priority claim for unpaid wages to the claims of other unsecured creditors. Mondell contends that his right to procedural due process was violated in that his claim was subordinated without prior notice and opportunity to be heard. He also maintains that the order should be vacated because the factual basis upon which his claim was subordinated is incorrect.

Basically, Mondell acknowledges that the District Attorney for Allegheny County, Pennsylvania, was prepared to indict him. In an effort to avoid prosecution he agreed to return deposits to the various creditors in exchange for the District Attorney’s agreement not to pursue the criminal action and the satisfaction of that class of debt. Accordingly, Mondell argues this objecting creditor has been paid and has no standing to provide this information to the Court.

The motion for reconsideration will be denied for reasons set forth below.

I

FACTS

Grand Builders, Inc. (“debtor”) filed a voluntary Chapter 7 petition on August 15, 1983. The petition, which identifies Jeffrey Mondell as the sole principal of debtor, was signed by him in his capacity as President of debtor.

The schedules appended to debtor’s bankruptcy petition list a total debt of $154,-411.33, of which $129,426.00 was owed to general unsecured creditors. Schedule A-l lists Mondell as having a priority claim for *675 unpaid wages in the amount of $2,000.00 and lists Mary Boyd-Morin as having a priority claim of $800.00 for remodeling work which was never done. In addition to Boyd-Morin, seventeen (17) others are listed with similar claims between $200.00 and $900.00.

A trustee was appointed on September 7, 1983. Little or nothing was done by the trustee for almost six (6) years until May 7, 1990, when the Court ruled him to file final documentation by June 6, 1990. On June 6, 1990, the trustee submitted a proposed distribution to creditors. The total amount available for distribution is $6,946.04. Of that amount, $1,958.73 is allocated to administrative expenses, $4,945.56 to priority prepetition wages, and $41.75 to consumer deposits. No distribution to general unsecured creditors is contemplated by the trustee. Of the amount to be distributed for prepetition wages, $2,000.00 is to be distributed to Mondell, which approximates thirty percent (30%) of the total available to all creditors. In addition, the trustee proposed distributing $5.75 to Boyd-Morin as her pro rata share of the distribution to consumer deposit creditors.

The summary sheet appended to the proposed distribution specifically stated that the amounts to be paid are subject to change and were contingent upon the court’s disposition of any objections to distribution filed by creditors.

On September 19,1990, Boyd-Morin filed a timely pro se objection to the trustee’s proposed distribution of $2,000.00 to Mon-dell. She alleged that Mondell, an insider of debtor, had withdrawn $30,000.00 from debtor in the year prior to debtor’s bankruptcy filing. Boyd-Morin argued that any further distribution to Mondell would be inequitable to other creditors and asked that Mondell’s claim be disallowed or subordinated to all other priority claims. Although Boyd-Morin filed her objection with the court, no notice of the objection was sent to Mondell.

A hearing on the trustee’s proposed distribution was held on September 25, 1990. Boyd-Morin argued that the proposed distribution to Mondell should be disallowed or subordinated to the claims of all consumer depositors who, shortly before the filing of the bankruptcy petition, had deposited money with debtor for home remodeling which was never done. Neither Mondell nor his attorney was present at the hearing.

On September 28, 1990, an Order of Court was issued which subordinated and/or disallowed Mondell’s priority wage claim to the claims of other unsecured creditors pursuant to 11 U.S.C. §§ 502 and 510. The court held that it would be inequitable to allow Mondell’s claim to be paid when the claims of other unsecured creditors were not being paid.

The September 28,1990 order specifically directed the trustee to distribute the $2,000.00 on a pro rata basis to creditors having unsecured claims, and advised that reconsideration should not be requested as it would not be granted. The Court was obviously weary of the constant stream of motions for reconsideration filed by non-attending litigants. Mondell neither sought a stay of nor appealed the order of September 28, 1990. Rather, on October 5, 1990, he filed the motion for reconsideration now before the court. For reasons known only to the trustee, said trustee considered counsel’s motion comparable to a court-ordered stay. No distribution has been made to any creditor.

A hearing was held on the motion for reconsideration on December 6, 1990. Mondell’s counsel appeared and was given a second opportunity to argue the matter and to present any evidence he deemed appropriate. Counsel offered legal argument; no testimony or other evidence was offered.

II

ANALYSIS

Motion For Reconsideration

A motion for reconsideration is not a vehicle for raising issues or citing authorities a party could or should have presented prior to the court’s ruling. It is not a vehicle for rehashing arguments pre *676 viously made or for refuting the court’s prior ruling. Lelsz v. Kavanagh, 112 F.R.D. 367, 371 (N.D.Tex.1986). A motion to reconsider is appropriate where the court has clearly misunderstood a party, has made a decision outside the issues presented by the parties, has made an error not of reasoning but apprehension, or where there has been a significant change in the law or the facts since the court’s prior ruling. Above The Belt, Inc. v. Bohannon Roofing, Inc., 99 FRD 99, 101 (E.D.Va.1983).

Mondell’s first argument for reconsideration is that his right to procedural due process was violated in that he was not given notice and reasonable opportunity to be heard prior to the court’s ruling on September 28, 1990. Specifically, he contends that Boyd-Morin’s objection to his claim was sustained by the court without prior notice or a hearing. This contention is without merit.

Procedural due process imposes constraints on governmental decisions which deprive a person of “liberty” or “property” within the meaning of the Due Process Clause of the Fifth and Fourteenth Amendments. Mathews v. Eldridge, 424 U.S. 319, 332, 96 S.Ct. 893, 901, 47 L.Ed.2d 18 (1976). The fundamental requirement of due process is an opportunity to be heard “at a meaningful time and in a meaningful manner”. Armstrong v. Manzo,

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Cite This Page — Counsel Stack

Bluebook (online)
122 B.R. 673, 1990 Bankr. LEXIS 2729, 1990 WL 252804, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-grand-builders-inc-pawb-1990.