IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 07-10764

In The Matter Of: RONALD CHRISTOPHER PERES; DONNA PATRICIA

MEDINA

Debtors

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RONALD CHRISTOPHER PERES; DONNA PATRICIA MEDINA

Appellants

v.

DANIEL J SHERMAN, Trustee; UNITED STATES TRUSTEE

Appellees

Appeal from the United States District Court 

for the Northern District of Texas

Before SMITH, DeMOSS, and STEWART, Circuit Judges.

DeMOSS, Circuit Judge:

Appellants Ronald Christopher Peres and Donna Patricia Medina

(collectively “Debtors”) appealthe district court’s order affirming the bankruptcy

court’s granting of Trustee Daniel J. Sherman’s objections to the Debtors’

exemptions. For the reasons stated below, we affirm the decision of the district

court. 

United States Court of Appeals

Fifth Circuit

F I L E D

June 6, 2008

Charles R. Fulbruge III

Clerk
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2

I.

Debtor Peres and his wife Medina filed for Chapter 7 bankruptcy on June

6, 2005. The Trustee commenced a creditors’ meeting pursuant to 11 U.S.C. §

341(a) on July 20, 2005. The meeting was adjourned and continued on three

occasions. The third § 341(a) creditors’ meeting took place on September 23,

2005, and was continued without a formal announcement as to the date of

continuation. Subsequently, the §341(a) creditors’ meeting was rescheduled for

July 19, 2006. The day before the scheduled meeting the Debtors requested a

continuance to attend to a family matter. Debtors were then notified by

telephone of a § 341(a) creditors’ meeting scheduled for August 24, 2006. Debtor

moved to quash the meeting on the basis that the meeting was untimely, which

the bankruptcy court denied. The §341(a) creditors’ meeting was thus held and

concluded on August 24, 2006. On September 5, 2006, the Trustee filed

objections to the Debtors’ claimed exemptions. The bankruptcy court sustained

the objections on October 25, 2006. The district court entered a final order

affirming the bankruptcy court’s ruling on June 12, 2007. The Debtors timely

filed their notice of appeal. 

On appeal, the Debtors argue that because there was no announcement of

a continuation date at the September 23, 2005 meeting, the meeting was

concluded thirty days later. Debtors argue that this triggered the thirty day

deadline for objections to their exemptions,thus the Trustee’s objections filed on

September 5, 2006, were untimely. The Debtors also argue that the August 23,

2006 meeting was a new § 341(a) creditors’ meeting requiring written notice.

II. 

A bankruptcy court’s findings of fact are reviewed for clear error. See

Wallace v. Rogers (In re Rogers), 513 F.3d 212, 216 (5th Cir. 2008). When the

district court has affirmed the bankruptcy court’s findings, this standard is

strictly applied, and reversal is appropriate only when there is a firm conviction
No. 07-10764

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that error has been committed. See Chiasson v. J. Louis Matherne & Assocs. (In

re Oxford Management, Inc.), 4 F.3d 1329, 1333 (5th Cir. 1993). Conclusions of

law are reviewed de novo. Id. 

Under Federal Rule of Bankruptcy Procedure 4003(b), a party in interest

who disputes an exemption claimed by the debtor must file an objection no later

than 30 days after the meeting of creditors. FED. R. BANKR. P. 4003(b). Section

341 of the Bankruptcy Code provides the statutory basis for holding meetings of

creditors in a bankruptcy case. Section 341(a) provides that following the

commencement of a voluntary Chapter 7 bankruptcy case, “the United States

trustee shall convene and preside at a meeting of creditors.” 11 U.S.C. §§ 301,

341(a). Federal Rule of Bankruptcy Procedure 2003 governs the commencement

and continuance of the meeting. Rule 2003(e) provides that “[t]he meeting may

be adjourned from time to time by announcement at the meeting of the

adjourned date and time without further written notice.” FED. R. BANKR. P.

2003(e). 

The Debtors argue that the § 341(a) creditors’ meeting was deemed

concluded thirty days after the September 23, 2005 meeting, triggering the

thirty day deadline for the Trustee to file objections. The Trustee argues thatthe

§ 341(a) creditors’ meeting was continued and concluded on August 23, 2006. The

district court held that the § 341(a) creditors’ meeting was not concluded until

August 23, 2006. The question presented to this court is, if no formal

announcement of a continuation date is made, when is a § 341(a) creditors’

meeting concluded. This court has not previously ruled on this issue. 

The Debtor urges this courtto apply a “bright-line” approach, holding that

if a trustee does not announce a specific date to which the meeting is being

continued within 30 days of the last meeting held, the meeting will be deemed

to have been concluded on the last date it was convened. Some courts have

adopted this approach. See Smith v. Kennedy (In re Smith), 235 F.3d 472, 476
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(9th Cir. 2000) (holding that an indefinite adjournment of the § 341(a) creditors’

meeting would nullify the thirty-day requirementin Rule 4003(b)); In re Leavitt,

137 B.R. 881, 883 (Bankr. D. Mass. 1992) (holding that “where the trustee fails

to announce an adjourned date and time within thirty days of the date on which

the meeting of creditors was last held, the meeting will be deemed to have

concluded on the last meeting date”); In re Friedlander, 284 B.R. 525, 527

(Bankr. D. Mass. 2002) (same). However, Levitt was likely overruled by the First

Circuit Bankruptcy Appellate Panel in Premier Capital, Inc. v. DeCarolis (In re

DeCarolis), 259 B.R. 467, 470-71 (B.A.P. 1st Cir. 2001) (rejecting Levitt’s brightline approach but declining to adopt a specific alternative approach).

Accordingly, Friedlander is also of doubtful precedence.

A majority of courts reject a bright-line approach, holding that § 341(a)

creditors’ meetings adjourned indefinitely are not concluded, and therefore do

not trigger the thirty day deadline; these courts either adopt a case-by-case

approach or require the trustee or courtto declare the § 341(a) creditors’ meeting

concluded. See In re Cherry, 341 B.R. 581, 587 (Bankr. S.D. Tex. 2006) (“A

case-by-case approach is most appropriate” because it “affords a trustee

discretion in complicated cases yet restrains a trustee’s ability to indefinitely

postpone a meeting of creditors.”); In re Brown, 221 B.R. 902, 906-07 (Bankr.

M.D. Fla. 1998) (finding that a case-by-case method is best because “[t]rustees

should have the discretion to perform their duties; however, some limitation

based on reasonableness should apply); In re James, 260 B.R. 368, 372 (Bankr.

E.D.N.C. 2001) (applying a case-by-case approach); Petit v. Fessenden , 182 B.R.

59, 63 (D. Me. 1995) (same); In re Havanec, 175 B.R. 920, 923 (Bankr. N.D. Ohio

1994); In re Koss, 319 B.R. 317, 321 (Bankr. D. Mass. 2005) (meeting is not

concluded until the trustee so declares or the court so orders); In re Flynn, 200

B.R. 481, 484 (Bankr. D. Mass. 1996) (same); In re DiGregorio, 187 B.R. 273, 276

(Bankr. N.D. Ill. 1995) (same).
No. 07-10764

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This court declines to hold that a meeting of creditors is not concluded

until such time as the trustee so declares or the court so orders. Such a holding

ignores the clearly-established policy of the Bankruptcy Code of encouraging

promptness in the filing of objections to exemptions, because it would permit a

trustee to continue a meeting of creditors indefinitely. Cherry, 341 B.R. at 587.

A strict rule could impede justice in complex cases when a trustee needs further

time and information to fully understand a debtor’s financial affairs, especially

when the debtor agrees to a continuance or refuses to cooperate, and where no

evidence of unjustified delay is present. Accordingly, this Court is persuaded

that a case-by-case approach is most appropriate. Such an approach affords a

trustee discretion yet restrains a trustee’s ability to indefinitely postpone a

meeting of creditors. This Court will determine whether any delay in

reconvening the meeting was reasonable as opposed to enforcing a bright-line

rule.

Thus, we now turn to whether the Trustee in the present matter acted

reasonably in continuing the § 341(a) creditors’ meeting from September 23,

2005, until August 24, 2006. Courts that have adopted the case-by-case approach

have considered at least four factors in determining the reasonableness of a

trustee’s delay in adjourning a meeting of creditors: (1) the length of the delay;

(2) the complexity of the estate; (3) the cooperativeness of the debtor; and (4) the

existence of any ambiguity regarding whether the trustee continued or concluded

the meeting. See, e.g., Cherry, 341 B.R. at 589 (the delay was not unreasonable

when the decision to continue the meeting was “clearly announced”); In re Bace,

364 B.R. 166, 179 (Bankr. S.D.N.Y. 2007) (trustee’s delay appropriate when

debtor did not produce business records); Petit, 182 B.R. at 63 (finding trustee’s

delay appropriate when debtor was “particularly litigious and obstructionist”).

Finding no clear error with the bankruptcy court’s factual findings, we find

that the circumstances in the present matter indicate that the Trustee acted
No. 07-10764

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reasonably and had legitimate reasons for adjourning the § 341(a) creditors’

meeting for eleven months. The bankruptcy court found that of the eleven

month delay, six months worth of the continuances were granted to

accommodate the Debtors. The September 23, 2005 meeting was continued

because the Debtors were still gathering records to support their amended

schedules. The meeting was then continued in July at the Debtors’ request. The

court also held that at no time did the Debtors move to conclude the § 341(a)

creditors’ meeting, as was their right if they believed that a delay was

prejudicial. Finally, the court found that an unprecedented increase in the

number of bankruptcy filings during the relevant time period made the delay in

continuing and concluding the meeting reasonable.

Lastly, we find thatthe August 23, 2006 § 341(a) creditors’ meeting did not

require written notice. Bankruptcy Rule 2002 requires that all parties in interest

must receive written notice ofthe initial creditors’ meeting under 11 U.S.C. §341

at least twenty days in advance. FED. R. BANKR. P. 2002(a)(1). Written notice is

not required if the date of the continuation is set at the original meeting. FED.

R.BANKR.P. 2003(e). Both parties agree thatthe transcript ofthe September 23,

2005 meeting shows that it was continued. The district court found that the

debtors had notice in May 2006 that the Trustee intended to continue the

meeting to July 2006, at which pointthe Debtors requested a continuance rather

than asserting an objection to the meeting. Thus, the Debtors were not

prejudiced by the lack of written notice.

For the foregoing reasons,the decision of the district court is AFFIRMED.