In Re Keiser

204 B.R. 697, 11 Tex.Bankr.Ct.Rep. 91, 1996 Bankr. LEXIS 1764, 1996 WL 780162
CourtUnited States Bankruptcy Court, W.D. Texas
DecidedSeptember 24, 1996
Docket19-10235
StatusPublished
Cited by7 cases

This text of 204 B.R. 697 (In Re Keiser) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, W.D. Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In Re Keiser, 204 B.R. 697, 11 Tex.Bankr.Ct.Rep. 91, 1996 Bankr. LEXIS 1764, 1996 WL 780162 (Tex. 1996).

Opinion

MEMORANDUM OPINION

FRANK R. MONROE, Bankruptcy Judge.

The Court held a hearing on September 10, 1996 upon the Motion of the United States Trustee to Dismiss Annette T. Keiser as a debtor in this case. At the conclusion of the argument made by the U.S. Trustee and counsel for the debtor, the Court stated that it would make its ruling in writing. Accordingly, this Memorandum Opinion shall serve as written Findings of Fact and Conclusions of Law made pursuant to Bankruptcy Rules 7052 and 9013.

As this is a motion to dismiss one of the debtors from this case, it is a contested matter which is a core proceeding under 28 U.S.C. Section 157(b)(2)(A) and (O) and because it is a matter that arises both under Title 11 and in a case under Title 11. Accordingly, this Court has the jurisdiction to enter a final order hereon pursuant to 28 U.S.C. Section 1334(a) and (b), 28 U.S.C. Section 157(a) and (b), 28 U.S.C. Section 151 and the Standing Order of Reference from the United States District Court for the Western District of Texas.

The facts relevant to this controversy appear by a review of the pleadings and the file itself to be largely uncontested.

FACTS

The debtors filed their voluntary petition under Chapter 11 of Title 11 on May 9,1996. The meeting of creditors required by Section 341(a) of the Bankruptcy Code was set for June 3, 1996 at 10:00 a.m. At such meeting, the debtor Ralph D. Keiser and counsel appeared as did Diane L. Graham of the United States Trustee’s Office. The debtor Annette T. Keiser did not appear allegedly 1 due to some undisclosed pressing family business that required her presence in Alabama. No creditor appeared.

The Proceeding Memo of the Section 341 meeting filed by Ms. Graham reflects that the Section 341 meeting was adjourned “pending waiver of appearance by co-debtor wife Annette Keiser”. The Proceeding Memo also reflects that “debtor’s attorney will request waiver of appearance (for co-debtor wife) from Court”. Counsel for the debtor disputes that he made such an agreement. Instead, he avers that he was requested by a different employee of the U.S. Trustee’s Office after the June 3, 1996 Section 341 meeting to file a request with the Court seeking a waiver of the appearance of debtor Annette T. Keiser from the Section 341 meeting. He further states that he has never agreed to do so, either at the Section 341 meeting or afterward. 2 In fact, it was *699 counsel’s unsworn declaration to the Court that Ms. Graham told him that she had no questions for Mrs. Reiser as Mr. Reiser had answered all of her questions to her satisfaction, but that she would have to check with higher authority in the U.S. Trustee’s Office to see what would occur next. Apparently, it was this higher authority who told debtors’ counsel that he would have to either seek a waiver of appearance for the debtor Annette T. Reiser or she would have to appear at a reconvened Section 341 meeting.

Debtors’ attorney refused to seek a waiver of appearance for debtor Annette T. Reiser. In response, the U.S. Trustee sent notice that the previously adjourned Section 341 meeting would be reconvened on July 23, 1996 at 10:30 a.m. for the appearance of the debtor Annette T. Reiser. Neither Mrs. Raiser or her counsel appeared at the reconvened Section 341 meeting. The Section 341 meeting was then concluded as per the Proceeding Memo filed by the U.S. Trustee’s Office.

The U.S. Trustee next filed the instant Motion to Dismiss the case as to debtor Annette T. Reiser alleging that her nonappearance at the Section 341 meeting violated the mandate of Section 343 and that such violation will effectively prevent her from ever confirming a plan because she will not ever be able to show that she had complied with all of the applicable provisions of Title 11 as will be required by Section 1129(a)(2) with regard to any Plan which she proposes.

It is this historic and momentous issue, the result of which will most certainly change the administration of bankruptcy cases as we know it, if not the destiny of the whole of mankind as well, that the United States Trustee’s Office and debtors’ counsel have submitted to this Court for the exercise of its most solemn and judicious discretion.

CONCLUSIONS

One thing is clear. This controversy has absolutely nothing to do with the real administration of justice in this case. It has everything to do with a struggle of wills between the United States Trustee’s Office and debtors’ counsel. The absurdity of the situation could not be more abundantly clear.

Debtor Annette T. Reiser did not appear at the first scheduled Section 341 meeting because she was allegedly in Alabama taking care of some family business. The representative of the United States Trustee’s Office that interrogated the debtor Ralph D. Reiser at that Section 341 meeting told debtors’ counsel that she had no questions for Mrs. Reiser but that she would have to leave it to the higher authorities in the U.S. Trustee’s Office to see whether or not the meeting would have to be reconvened for Mrs. Reiser’s appearance even though she had no questions for her. Later, the higher authority in the U.S. Trustee’s Office informed debtors’ counsel that he would have to get a waiver from this Court for Mrs. Reiser’s appearance. Otherwise, they were duty bound to reconvene the Section 341 meeting so that the co-debtor for whom they had no questions .could appear for examination as required by Section 343. Examination by whom is the logical next question since the U.S. Trustee apparently had no questions and no creditors had appeared the first time. This type of bureaucratic, blind adherence to the statute 3 (without the apparent existence of any ability to exercise discretion in matters such as these) is just the type of activity that has caused the United States Trustee’s Program to be so criticized in the past by those who see too little utility in that program as it now operates on a national scale. Here, however, the attorney in the local U.S. Trustee’s office did exercise the appropriate discretion. He told debtor’s counsel that he would not oppose a motion to excuse Mrs. Reiser’s appearance if he chose to file one. But that if he did not, she would have to appear; whether they had any questions for her or not because that is what the statute required.

Debtors’ counsel is an accomplished bankruptcy practitioner fully knowledgeable of the laws and rules that govern bankruptcy *700 practice in this District. He was given an “out” early by the higher authority at the United States Trustee’s Office. He could simply have filed a motion to excuse Mrs. Reiser’s appearance at the Section 341 meeting which they would not resist and the matter would be done.

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Cite This Page — Counsel Stack

Bluebook (online)
204 B.R. 697, 11 Tex.Bankr.Ct.Rep. 91, 1996 Bankr. LEXIS 1764, 1996 WL 780162, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-keiser-txwb-1996.