Bankruptcy – Motion to reinstate Chapter 7 petition previously dismissed by court is denied

Where the debtor failed to file documents required by his Chapter 7 petition, even after the court extended his deadline to do so, his motion seeking relief from the court’s dismissal order was denied.

Background

The question is whether the debtor, Christopher Lynn Andrews, has shown grounds under Federal Rule of Civil Procedure 60(b), to vacate this court’s order dismissing his Chapter 7 case for failure to file certain required documents.

Rule 60(b)(1)

Rule 60(b)(1) permits relief from a judgment or order based on excusable neglect. Whether neglect is excusable depends on the totality of circumstances, including (1) the danger of prejudice [to the non-moving party], (2) the length of delay and its potential impact on judicial proceedings, (3) the reason for the delay, including whether it was within the reasonable control of the movant and (4) whether the movant acted in good faith.

The danger of prejudice and the length of delay on balance weigh against the debtor. The length of delay between dismissal and the filing of the balance of schedules was two days. The motion to vacate was filed promptly, and the case had been pending for less than three weeks at the time of dismissal.

On the other hand, vacating the order of dismissal will not change the petition date, the date initially set for the meeting of creditors under § 341 or the deadlines under Bankruptcy Rules 4004(a)(1) or 1017(e)(2). Creditors’ deadline to object to discharge or determine the dischargeability of their debt will remain the same upon vacating the order, to their detriment.

The deadline to dismiss the case under § 707(b) likewise will remain the same to the prejudice of creditors, the trustee and the United States Trustee. More importantly, creditors have been operating with knowledge that the case has been dismissed since April 8, 2026; vacating the dismissal order obviously will affect actions they may have taken because the automatic stay had terminated.

Entering an order vacating the dismissal order may place creditors at risk for relying upon the dismissal order. Counsel for the debtor never sought a stay of this dismissal order, so it is still in effect. While creditors are relying upon an order that may be invalidated, the debtor has not filed a new petition despite the opportunity to do so (the dismissal order is without restriction or condition).

Counsel acknowledged that he filed the petition intentionally without most of the documents required by Bankruptcy Code § 521(a)(1) and Rule 1007(b). Counsel further acknowledged that the deficiency order was received by his office. He failed to file them not because of an external event or circumstances beyond his control but because he did not track the deadline to file the required documents by the deadline that counsel knew or should have known would attach to the case from the moment of filing.

Whether the movant acted in good faith, weighs in favor of the debtor. Nothing in the record suggests bad faith on the part of the debtor or counsel. Counsel filed the motion to vacate and the missing documents promptly after the dismissal. Based on the totality of these circumstances, the debtor has not established excusable neglect under Rule 60(b)(1).

Rule 60(b)(4)

Rule 60(b)(4) provides for relief from a void judgment [or order] when the entering court lacked jurisdiction or the order violated due process. Counsel claims the dismissal order does not comply with §707(a) because the order was not entered after notice and a hearing. However the Code expressly contemplates dismissal without an actual hearing if notice has been given and the debtor has declined to request a hearing.

Counsel next argues that the dismissal order should be void because it lacked due process. However he acknowledged that the order was received by his office, and that

order expressly invited him to request a hearing on the asserted deficiencies, which he did not. He was thus provided notice sufficient to apprise him of the consequences of not complying with the court’s order.

Rule 60(b)(6)

Rule 60(b)(6) is reserved for extraordinary circumstances when a party is faultless in the delay. The “manifest injustice” that counsel identifies are the same circumstances under which the court denied relief under Rule 60(b)(1) and (b)(4). Hence, the motion does not pass Rule 60(b)(6) requirements.

Debtor’s motion to vacate denied.

In re: Christopher Lynn Andrews, Case No. 26-50158, May 22, 2026 WDVA Bankr. at Roanoke (Connelly). VLW No. 024-4-034. 14 pp.

Full-Text Opinion
VLW No. 024-4-034