IN RE: Gail Aldridge (2026)

Chapter 7

ORDER DENYING MOTION TO REOPEN BUT ALLOWING DEBTOR TO FILE MOTION FOR VIOLATION OF AUTOMATIC STAY

THIS MATTER is before the Court on the Motion to Reopen Chapter 7 Case (“the Motion to Reopen”) filed by Gail Aldridge (“Debtor”) on July 27, 2026.¹ Debtor seeks the reopening of the case in order to (1) enforce the protections afforded by the automatic stay under 11 U.S.C. § 362 and, in particular, file a motion for sanctions against Gerber Collision and Glass Shop (the “Shop”) for willful violation of the automatic stay pursuant to § 362(k); (2) seek court-ordered turnover of property pursuant to 11 U.S.C. § 542, and (3) obtain such other and further relief as the Court deems just and proper. No objections were filed to the Motion to Reopen. A hearing was held on August 20, 2026, which was attended by Debtor. After the hearing, Debtor filed an Affidavit in Support of Emergency Relief and Motion for Immediate Turnover (the “Affidavit”) and a Declaration in Support of Motion to Reopen Chapter 7 Case and Motion for Turnover of Property (the “Declaration”).² For the reasons set forth below, the Court denies the Motion to Reopen but will allow Debtor an opportunity to file a motion for sanctions pursuant to 11 U.S.C. § 362(k).

FACTUAL BACKGROUND

Debtor filed a voluntary chapter 7 petition, schedules, and statements on November 5, 2024 (the “Petition Date”).³ On Schedule A/B, Debtor listed ownership of a 2016 BMW X1 vehicle (the “Vehicle”). Debtor did not claim an exemption for the Vehicle on Schedule C. As set forth in the Notice of Chapter 7 Bankruptcy Case, Meeting of Creditors & Notice of Appointment of Interim Trustee, the first date set for the § 341 meeting of creditors was December 6, 2024,⁴ but the meeting was later continued to January 6, 2025. Debtor filed a Statement of Intention on December 9, 2024, indicating her intent to retain the Vehicle.⁵

Debtor asserts that in September of 2024, prior to the Petition Date, the Vehicle was damaged in a collision. According to Debtor, on December 17, 2024, Debtor had the Vehicle towed to the Shop at 1515 Broad Street, Augusta, Georgia 30904 for repairs. At the hearing on the Motion to Reopen, Debtor recounted what transpired after the vehicle was towed to the Shop. Debtor stated that, on or about December 20, 2024, she visited the Shop for a “walkaround” of the Vehicle. During that visit, Debtor asserts she initially signed an authorization for the repairs but later revoked the repair authorization and demanded that the Shop wait for her insurance company's adjuster to inspect the Vehicle. Debtor claims that after December 20, 2026, the Shop only communicated with her insurance company, State Farm, regarding repairs and allegedly received permission from its claims adjuster to complete the repairs. Debtor contends that the repairs were unauthorized by her and were not completed to her satisfaction.

Following the meeting of creditors on January 6, 2025, the Chapter 7 Trustee filed a Report of No Distribution, certifying that Debtor's estate had been fully administered and abandoning the assets of the estate.⁶ At the hearing, Debtor stated that she contacted the Shop on January 25, 2025 to request the return of the Vehicle, but the Shop refused and demanded that she pay them the $500.00 deductible for the repairs.⁷ On March 17, 2025, the Court entered an Order Discharging Debtor, Discharging Trustee and Closing Case.⁸

According to Debtor, since January of 2025, she has exchanged emails and letters with the Shop's manager regarding the return of the Vehicle and the manager displayed “bullying, aggressive and hostile behavior” during these communications, refusing to return and threatening to sell the Vehicle.⁹ At the hearing, Debtor stated that she filed a theft by conversion complaint in state court in July of 2025. When the deputy sheriff went to the Shop to investigate, the Shop advised the deputy that it held a lien on the Vehicle, and the deputy sheriff therefore took no further action to recover the Vehicle.

CONCLUSIONS OF LAW

More than a year after the Court closed her bankruptcy case, Debtor seeks to reopen the case to pursue claims against the Shop and recover possession of the Vehicle. The standard governing the reopening of a closed bankruptcy case is set forth in 11 U.S.C. § 350(b), which provides that “[a] case may be reopened in the court in which such case was closed to administer assets, to accord relief to the debtor, or for other cause.” Federal Rule of Bankruptcy Procedure 5010 further provides that “[o]n the debtor's or another party in interest's motion, the court may, under § 350(b), reopen a case ․”

In the Fourth Circuit, “the right to reopen a case depends upon the circumstances of the individual case” and “the decision whether to reopen is committed to the court's broad discretion.” In re Hoffman, 663 B.R. 292, 294 (Bankr. D.S.C. 2024) (quoting Hawkins v. Landmark Fin. Co. (In re Hawkins), 727 F.2d 324, 326 (4th Cir. 1984); In re Boyd, 618 B.R. 133, 165 (Bankr. D.S.C. 2020)). The party seeking the reopening of a bankruptcy case bears the burden of demonstrating that cause exists. Hoffman, 663 B.R. at 294. “Generally, reopening ‘does not afford the parties any substantive relief but rather provides an opportunity to request further relief.’ ” In re Beverley, 659 B.R. 174, 177 (Bankr. M.D.N.C. 2024) (quoting Horizon Aviation of Va., Inc. v. Alexander (In re Alexander), 296 B.R. 380, 382 (E.D. Va. 2003)). As this Court observed in Hoffman, Debtor, as the moving party, is not required to prove her case in the motion to reopen, and the court should avoid ruling on the merits of her claims. Id. (citing In re Kennedy, No. 08-81687, 2016 WL 6649200, at *2 (Bankr. M.D.N.C. Apr. 6, 2016)). Nevertheless, if Debtor's purpose in filing the motion is objectively futile, the case should not be reopened. Id.; see also Beverley, 659 B.R. at 177. The determination of whether to reopen is made on a case-by-case basis considering the totality of the circumstances. Boyd, 618 B.R. at 165.

Debtor's request to reopen the case appears to seek two forms of relief: (1) an order directing the Shop toto turnover the Vehicle pursuant to 11 U.S.C. § 542; and (2) relief for an alleged violation of the automatic stay under 11 U.S.C. § 362, including a determination that any lien arising post petition in violation of the stay is void ab initio and an award of sanctions pursuant to § 362(k).

I. Turnover Pursuant to 11 U.S.C. § 542

Subject to certain exceptions, 11 U.S.C. § 542 generally requires an entity in possession of property that the bankruptcy estate is entitled to use, sell, or lease to deliver that property to the trustee or the entity entitled to it. The party seeking the turnover must demonstrate the following elements to require an entity to turnover property of the estate or its value: “(1) during the case, (2) an entity other than a custodian, (3) was in possession, custody or control of property that a trustee could use, sell, or lease under 11 U.S.C. § 363 or that a debtor may exempt under 11 U.S.C. § 522, and (4) that such property is not of inconsequential value or benefit to the estate.” In re Altman, 647 B.R. 148, 150 (Bankr. D.S.C. 2022) (citing In re Milledge, 639 B.R. 334, 343-44 (Bankr. D.S.C. 2022)). Even if the case were reopened, Debtor cannot demonstrate that § 542 gives her the right to obtain the Vehicle in this case.

First, it is usually the Chapter 7 trustee who has standing to assert a turnover claim in a Chapter 7 case. In re McGhee, 672 B.R. 278, 294 (Bankr. D.S.C. 2025) (citing cases). Second, although the Vehicle was listed in the Schedules, the Chapter 7 Trustee declared the case a no-asset case and abandoned the assets, including the Vehicle, and the case was closed. By this declaration, the Chapter 7 Trustee implicitly found that the assets of the estate had inconsequential value or benefit to the estate. Accordingly, pursuant to 11 U.S.C. § 554(c), the Vehicle was abandoned to Debtor and is no longer property of the estate subject to turnover under § 542. See In re Trujillo, 485 B.R. 238, 245 (Bankr. D. Colo. 2012) (“Property ceases to be property of the estate when: (1) it revests in the debtor at confirmation of a plan of reorganization; (2) it is abandoned by the chapter 7 trustee in compliance with § 554; and/or (3) once the property becomes exempt property.”); see also In re Patriot Coal Corp., 631 B.R. 648, 656 (Bankr. E.D. Mo. 2021) (“Turnover under Section 542 is available only for property that is undeniably estate property”); Stanziale v. Pepper Hamilton, LLP (In re Student Fin. Corp.), 335 B.R. 539, 554 (D. Del. 2005) (To “state a claim for turnover of property under § 542, a plaintiff must allege that transfer of the property has already been avoided or that the property is otherwise the undisputed property of the bankruptcy estate.”).

Reopening the case would not revive the bankruptcy estate or provide a basis for Debtor to seek relief under § 542. The Court finds that reopening this case to pursue a turnover action would be futile. Debtor is not, however, left without any recourse—Debtor retains her rights under state law to pursue any claims she may have against the Shop for recovery of the Vehicle in state court. Accordingly, the Court concludes that the case should not be reopened to allow Debtor to seek relief under § 542.

II. Relief Under 11 U.S.C. § 362

Debtor further seeks to reopen the case to enforce the automatic stay under 11 U.S.C. § 362 and pursue any remedies she may be entitled to under that section, including § 362(k). At the outset, the Court observes that any obligation to the Shop would be a postpetition claim, which would not have been discharged by her chapter 7 bankruptcy case. Debtor appears to argue that the Shop's completion of unauthorized repairs and refusal to return the Vehicle constitutes an act to exercise control over property of the estate under 11 U.S.C. § 362(a)(3). This section provides that the filing of a petition operates as a stay as to “any act to obtain possession of property of the estate or of property from the estate or to exercise control over property of the estate.” 11 U.S.C. § 362(a)(3). Moreover, to recover damages for a willful violation of the automatic stay, a debtor must prove the following elements by a preponderance of the evidence: (1) a bankruptcy petition was filed, (2) the debtor is an ‘individual’ under the automatic stay provision, (3) the creditor received notice of the petition, (4) the creditor's actions in violation of the stay were willful, and (5) the debtor suffered damages.” In re Weathers, 670 B.R. 20, 32 (Bankr. D.S.C. 2025) (citing cases).

Debtor alleges that she revoked authorization to repair the Vehicle on or about December 20, 2024, but the Shop nevertheless completed the repairs. However, the record does not clearly reflect the date when the Shop received notice of Debtor's bankruptcy case and whether the repairs were completed before or after such notice. With respect to Debtor's allegations that the Shop refused to return the Vehicle to her in January of 2025 and afterwards, the Court further observes that the record presently before it is insufficient to establish when the automatic stay terminated in this case or whether the Shop's alleged conduct violated the stay while it remained in effect.

The stay of an act against property of the estate under § 362(a) continues until such property is no longer property of the estate. 11 U.S.C. § 362(c)(1). Pursuant to 11 U.S.C. § 521(a)(2), Debtor was required to file a statement of intention within thirty days after the Petition Date—on or before December 5, 2024. Debtor's statement of intention was filed on December 9, 2024, after that deadline had passed. Debtor is further required to perform her intention within thirty days after the first date set for the meeting of creditors pursuant to 11 U.S.C. § 521(a)(2)(B). Debtor did not redeem or reaffirm the debt prior to January 5, 2025. Section 362(h) provides that the automatic stay:

is terminated with respect to personal property of the estate or of the debtor securing in whole or in part a claim ․ and such personal property shall no longer be property of the estate if the debtor fails within the applicable time set by section 521(a)(2)—(A) to file timely any statement of intention required under section 521(a)(2) or to indicate in such statement that the debtor will either surrender such personal property or retain it and, if retaining such personal property, either redeem such personal property ․ [or] enter into an agreement of the kind specified in § 524(c) ․; and (B) to take timely the action specified in such statement.

11 U.S.C. § 362(h) (emphasis added). Accordingly, it appears that the automatic stay terminated on or about January 5, 2025, pursuant to 11 U.S.C. § 362(h).

Under the facts set forth above, it appears that Debtor may have some high hurdles to surpass to successfully prosecute a § 362(k) action against the Shop, but the Court will allow her the opportunity to do so. Moreover, even if successful, relief under § 362(k) would most likely result only in an award of monetary damages for Debtor. Because the Vehicle is no longer property of the estate and the automatic stay is no longer in effect at this time, the Court does not have jurisdiction to order the Shop to return the Vehicle to Debtor.¹⁰

Nevertheless, it is not necessary for the Court to reopen the case for Debtor to seek relief against the Shop for willful violation of the automatic stay. See In re Ard, 666 B.R. 744 (Bankr. D.S.C. 2025) (denying motion to reopen but allowing debtors the opportunity to file any motions under § 362(k)(1)); In re Coleman, No. 25-17551, 2026 WL 770424, at *1 (Bankr. D. Colo. Mar. 18, 2026) (holding that “a debtor is not required to open an underlying Chapter 7 case before bringing claims for violation of the automatic stay pursuant to 11 U.S.C. § 362(k) (citing cases); In re Ohai, No. 12-65475, 2023 WL 4551481, at *2 (Bankr. N.D. Ga. 2023) (citing Johnson v. Smith (In re Johnson), 575 F.3d 1079, 1084 (10th Cir. 2009) (finding no basis to require plaintiff “to move to reopen the Chapter 13 case to pursue [Section] 362(k)(1) adversary proceeding”); In re Stanwyck, 450 B.R. 181, 193 (Bankr. C.D. Cal. 2011) (rejecting “Defendants’ assertion that [plaintiff] was required to reopen his prior bankruptcy cases to assert [Section] 362(k) claims”)). This court continues to have jurisdiction over stay violation claims even after the closing of the bankruptcy case because those claims are core proceedings. In re Palmetto Interstate Dev. II, Inc., 653 B.R. 230 (Bankr. D.S.C. 2023) (citing Healthcare Real Estate Partners, LLC v. Summit Healthcare Reit, Inc. (In re Healthcare Real Estate Partners, LLC), 941 F.3d 64, 69 (3d Cir. 2019)) (“A court must have the power to compensate victims of violations of the automatic stay and punish the violators, even after the conclusion of the underlying bankruptcy case”); see also Tucker v. JP Morgan Chase Bank, N.A. (In re Tucker), 743 Fed. Appx. 965, 968 (11th Cir. 2018). Therefore, the Court will allow Debtor an opportunity to file a motion seeking relief under § 362(k) within fifteen days.

CONCLUSION

In summary, the Court will not reopen the case to allow Debtor to file a motion for turnover. However, for the reasons set forth above, it is unnecessary to reopen the case to allow Debtor to file a motion seeking relief under 11 U.S.C. § 362(k) or to deem any lien that the Shop may have placed on the Vehicle to be in violation of the automatic stay and thus void ab initio; and Debtor may file such a motion within fifteen days. Therefore, it is hereby

ORDERED that the Motion to Reopen is DENIED; and

IT IS FURTHER ORDERED that Debtor may file any motion seeking relief under 11 U.S.C. § 362(k) on or before September 11, 2026. Debtor must comply with SC LBR 9013-4(b)(2) by serving any motion filed on the parties entitled to notice and filing a certification of such notice with the Court.

AND IT IS SO ORDERED.

FOOTNOTES

1.   ECF No. 55.

2.   ECF Nos. 64 and 65, filed on Aug. 24, 2026. Both the Affidavit and Declaration appear to have been signed on July 27, 2026, prior to the hearing. It is unclear why the documents were not filed prior to the hearing or presented to the Court during the hearing.

3.   ECF No. 1.

4.   ECF No. 5, filed Nov. 6, 2024.

5.   ECF No. 39. Debtor indicated on the Statement of Intention that “Amorization [sic] sch has been requested to reaffirm.”

6.   ECF No. 48.

7.   In the Declaration filed after the hearing, however, Debtor asserts that she requested that the Vehicle be returned to her “on or about the first week of January 2025,” but the manager declined to return the Vehicle, informed her that she could not revoke authorization after signing it, and demanded payment of the $500.00 deductible. ECF No. 65.

8.   ECF No. 50.

9.   ECF No. 65.

10.   The Court may, however, determine that if some act was taken in violation of the automatic stay, it may be void ab initio. In re Fisher, 675 B.R. 486, 491 (Bankr. D.S.C. 2025) (finding that actions taken in violation of the automatic stay are void and without legal effect, even if the creditor was not aware of the bankruptcy filing).

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