IN RE: Michael Antonio Addison (2025)

Chapter 13

ORDER DENYING MOTION TO RECONSIDER DISMISSAL

THIS MATTER is before the Court on the Motion to Reconsider Dismissal (“Motion”) filed by Michael Antonio Addison (“Debtor”) on February 3, 2025.¹ This case was dismissed without prejudice on January 22, 2025,² following a hearing on a Rule to Show Cause,³ which was issued by the Court due to Debtor's failure to timely file schedules, statements, Chapter 13 plan, and other documents (the “Documents”) and attend the § 341 Meeting of Creditors in this case.⁴

The Motion seeks relief pursuant to Fed. R. Bankr. P. 9024, which incorporates Fed. R. Civ. P. 60(b). However, the Fourth Circuit has held that a post-judgment motion seeking to correct the judgment that is filed within the 14-day period following the entry of judgment should be treated as a motion to alter or amend judgment under Fed. R. Civ. P. 59(e). In re Peugh, 662 B.R. 261, 268 (Bankr. D.S.C. 2024) (citing Dove v. CODESCO, 569 F.2d 807, 809 (4th Cir. 1978)). Since the Motion was filed within 14 days of the order dismissing the case, the correct standard to apply to determine the Motion is Rule 59(e). There are three recognized grounds for amendment of an earlier judgment under Rule 59(e): “(1) to accommodate an intervening change in the controlling law; (2) to account for new evidence not available at trial; or (3) to correct a clear error of law or prevent manifest injustice.” Id. (quoting In re Auto Money North LLC, 649 B.R. 704, 706 (Bankr. D.S.C. 2023)). Debtor asserts that relief from the dismissal is appropriate due to excusable neglect, arguing that his failure to file schedules and other required documents was caused by his inability to secure legal representation, being “locked away from [his] records”, and the complexity of his financial affairs. Debtor further asserts that the Court's electronic filing system was not functioning properly and was down from January 16, 2025 to January 22, 2025, so he was unable to submit documents. The Court is unaware of any issue with the Electronic Document Submission System (EDSS)⁵ during that time period and notes that Debtor successfully submitted a “Letter to Trustee Hardesty” using the EDSS system on the morning of January 21, 2025 without issue. Moreover, the Columbia courthouse location was open to accept in-person filings on January 16-17, 2025 as well as on January 21-22, 2025.⁶ Based on the arguments in the Motion, the Court is unable to discern any intervening change in the controlling law, new evidence, or clear error of law or manifest injustice which supports relief under Rule 59(e).

Debtor also has failed to identify any basis for reconsideration of dismissal under Fed. R. Civ. P. 60(b). Prior to considering the grounds for relief from an order of dismissal, the Court must first make a threshold determination of “timeliness, a meritorious defense, a lack of unfair prejudice to the opposing party, and exceptional circumstances.” In re Ard, No. 24-03611-JD, 2025 WL 80440, at *4 (Bankr. D.S.C. Jan. 10, 2025) (quoting Huennekens v. Reczek, 43 Fed. Appx. 562, 567 (4th Cir. 2002)) (internal quotations omitted). If the Court determines that Debtor has met these threshold requirements, the Court may then proceed to determine whether Fed. R. Civ. P. 60(b) mandates relief from the dismissal order—including whether there was excusable neglect. Id.

Debtor has failed to meet the initial threshold requirement of demonstrating a meritorious defense to the dismissal of his case. Debtor's case was dismissed for failure to meet the requirements of 11 U.S.C. § 521(i) due to Debtor's failure to timely file the Documents and his failure to attend the § 341 meeting of creditors. The Documents were originally required to be filed by November 27, 2024. Debtor filed a motion seeking a 20-day extension of time—until December 20, 2024—to file the required Documents. The Court entered an order granting an extension until December 11, 2024.⁷ Debtor then filed a second motion on December 12, 2024—the day after the Documents were due—requesting a further extension until January 31, 2025. The Court granted a second limited extension until January 17, 2025—65 days after the case commenced (the “Petition Date”).⁸ The order further extending the time to file the required Documents also indicated that “[f]ailure to file these documents by the new deadline may result in the dismissal of the case without further notice or hearing.”

Despite having more than two months to prepare and submit the required Documents, Debtor failed to file them by the extended deadline granted and failed to request a further extension before the deadline passed. Section 521(i)(3) of the Bankruptcy Code authorizes the Court to extend the 45-day deadline provided in § 521(i)(1) for up to 45 additional days, but the request must be made before the deadline expires, otherwise the dismissal is automatic. See 11 U.S.C. § 521(i)(1), (3). “[S]ection 521 does not provide the Court discretion as to whether to dismiss a case if the debtor fails to file the documents required by section 521(a)(1) within 45 days of filing the petition, nor does it provide the Court discretion to reconsider its dismissal of the case pursuant to section 521(i).” Ard, No. 24-03611-JD, 2025 WL 80440, at *3 (quoting In re Bundrick, 653 B.R. 809, 814 (Bankr. D.S.C. 2023)). The 90-day total extension allowed under the Bankruptcy Code has passed. Debtor asserts that his failure to timely complete and file the Documents was due to the complexity of the case and his inability to access the information he needed to complete the Documents because he was locked out of his storage unit and his home/office was damaged in a hurricane.⁹ However, “[s]ection 521(i) is a component of a strict statutory regimen ․ [A] dismissal [under section 521(i)] is statutory in nature and is not subject to being vacated or avoided based upon a party's mistake, inadvertence or excusable neglect.” Id.

The Court further notes that Debtor is ineligible to be a debtor under § 109(h)(1) of the Bankruptcy Code because the certificate of credit counseling he filed on November 27, 2024 indicates that he took the required credit counseling course on November 25, 2024—12 days after filing the bankruptcy case.¹⁰ With limited exceptions that do not apply to the facts of this case, § 109(h)(1) of the Bankruptcy Code requires an individual to obtain credit counseling within the 180 days prior to filing a bankruptcy petition and file a certificate to that effect to qualify as a debtor in a bankruptcy case. The failure to satisfy the requirements of § 109(h) renders an individual ineligible to be a debtor in a bankruptcy case. See Haynes v. Stephenson, No. 3:14-cv-352-MGL, 2015 WL 687133 (D.S.C. Feb. 18, 2015) (“[C]ourts have held that the proper remedy for failure to comply with Section 109(h) is dismissal of the debtor's case, as one who is not a debtor cannot obtain relief under the Bankruptcy Code.”) (quoting In re Mitrano, 409 B.R. 812, 819 (Bankr. E.D. Va. 2009)).

For the foregoing reasons, it is hereby

ORDERED that Debtor's Motion to Reconsider Dismissal is DENIED.

AND IT IS SO ORDERED.

FOOTNOTES

1.   ECF No. 37.

2.   ECF No. 35.

3.   ECF No. 25, filed Jan. 7, 2025.

4.   The Court incorporates by reference the factual background of this case as set forth in the Order Denying Motion to Stay Pending Appeal, which is being entered simultaneously herewith.

5.   The Court's CM/ECF program experienced a nationwide disruption to the delivery of Notices of Electronic Filings (NEFs) from Monday, January 20, 2025 to Wednesday, January 22, 2025, which affected bankruptcy, district, and appellate courts and included NEFs setting hearings and deadlines. During this time, not all NEFs were successfully delivered to all intended recipients. However, this issue was resolved and the disruption did not impact parties’ ability to file documents on CM/ECF.

6.   The courthouse was closed from January 18-20, 2025 for the weekend and Martin Luther King, Jr. federal holiday on January 20, 2025.

7.   ECF No. 19.

8.   ECF No. 24, filed Jan. 7, 2025.

9.   See ECF No. 56 (Debtor's Motion for Stay Pending Appeal, which details more of the circumstances that Debtor alleges prevented him from timely preparing the Documents).

10.   ECF No. 16.

Elisabetta G. M. Gasparini US Bankruptcy Judge District of South Carolina