Source: http://supreme.justia.com/cases/federal/us/540/02-819/opinion.html
Timestamp: 2014-03-12 12:14:34
Document Index: 311391250

Matched Legal Cases: ['§727', '§727', '§727', '§523', '§727', '§727', '§157', '§727', '§727', '§727']

Kontrick v. Ryan - 02-819 (2004) :: Justia US Supreme Court Center
Sign In	Justia > US Law > US Case Law > US Supreme Court > Volume 540 > Kontrick v. Ryan - 02-819 > Opinion (Justice Ginsburg)	NEW - Receive Justia's FREE Daily Newsletters of Opinion Summaries for the US Supreme Court, all US Federal Appellate Courts & the 50 US State Supreme Courts and Weekly Practice Area Opinion Summaries Newsletters. Subscribe Now
Opinion	(Justice Ginsburg)	OPINION OF THE COURT
This case concerns the duration of a right to object to a pleading on the ground that it was filed out of time. Under the Bankruptcy Rules governing Chapter 7 liquidation proceedings, a creditor has “60 days after the first date set for the meeting of creditors” to file a complaint objecting to the debtor’s discharge. Fed. Rule Bkrtcy. Proc. 4004(a). That period may be extended “for cause” on motion “filed before the time has expired.” Fed. Rule Bkrtcy. Proc. 4004(b). In the matter before us a creditor, in an untimely pleading, objected to the debtor’s discharge. The debtor, however, did not promptly move to dismiss the creditor’s plea as impermissibly late. Only after the Bankruptcy Court decided, on the merits, that the discharge should be refused did the debtor, in a motion for reconsideration, urge the untimeliness of the creditor’s plea.
Bankruptcy Rule 4004’s time prescription, the debtor maintains, is “jurisdictional,” i.e., dispositive whenever raised in the proceedings. Rejecting the debtor’s “jurisdictional” characterization, the courts below held that Rule 4004’s time prescription could not be invoked to upset an adjudication on the merits. We agree that Rule 4004 is not “jurisdictional.” Affirming the judgment of the Court of Appeals for the Seventh Circuit, we hold that a debtor forfeits the right to rely on Rule 4004 if the debtor does not raise the Rule’s time limitation before the bankruptcy court reaches the merits of the creditor’s objection to discharge.
A debtor in a Chapter 7 liquidation case qualifies for an order discharging his debts if he satisfies the conditions stated in §727(a) of the Bankruptcy Code. 11 U. S. C. §727(a).[Footnote 1] A discharge granted under §727(a) frees the debtor from all debts existing at the commencement of the bankruptcy proceeding other than obligations §523 of the Code excepts from discharge. §727(b).[Footnote 2]
A debtor’s discharge may be opposed by the trustee, the United States trustee, or any creditor. §727(c)(1). Adjudication of “objections to discharg[e],” Congress provided, is a “[c]ore proceedin[g]” within the jurisdiction of the bankruptcy courts. 28 U. S. C. §157(b)(2)(J). No statute, however, specifies a time limit for filing a complaint objecting to the debtor’s discharge. Instead, the controlling time prescriptions are contained in the Federal Rules of Bankruptcy Procedure, specifically, Rules 4004(a) and (b) and 9006(b)(3).
In relevant part, Bankruptcy Rule 4004(a) states: “[A] complaint objecting to the debtor’s discharge under §727(a) of the Code shall be filed no later than 60 days after the first date set for the meeting of creditors.” Rule 4004(b), governing extensions of the Rule 4004(a) filing deadline, provides: “[T]he court may for cause extend the time [Rule 4004(a) allows] to file a complaint objecting to discharge” if the motion is “filed before the time has expired.” Reinforcing Rule 4004(b)’s restriction on extension of the Rule 4004(a) deadline, Rule 9006(b)(3) allows enlargement of “the time for taking action” under Rule 4004(a) “only to the extent and under the conditions stated in [that rule],” i.e., only as permitted by Rule 4004(b).[Footnote 3]
On April 4, 1997, petitioner, Dr. Andrew J. Kontrick, filed a Chapter 7 bankruptcy petition. Respondent, Dr. Robert A. Ryan, a major creditor and Kontrick’s former associate in a cosmetic and plastic surgery practice, opposed Kontrick’s discharge. After gaining three successive time extensions from the Bankruptcy Court, Ryan filed an original complaint on January 13, 1998, in which he objected to the discharge of any of Kontrick’s debts. Ryan alleged that Kontrick had transferred property, within one year of filing the bankruptcy petition, with intent to defraud creditors, and therefore did not qualify for a discharge under 11 U. S. C. §§727(a)(2)–(5). App. to Pet. for Cert. 40.
Ryan filed an amended complaint on May 6, 1998, with leave of court, ibid., but without seeking or gaining a court-approved time extension. The amended complaint particularized for the first time the debtor’s violation of §727(a)(2)(A) in this regard: Debtor Kontrick, creditor Ryan alleged, had fraudulently transferred money t