Opinion ID: 6931628
Heading Depth: 2
Heading Rank: 1

Heading: Timeliness Of Motion To Extend Time

Text: The bankruptcy court’s determination that the appellees’ motions to extend the bar date were timely made is a question of law reviewable de novo. Southtrust Bank v. Thomas (In re Thomas), 883 F.2d 991, 994 (11th Cir.1989), cert. denied, 497 U.S. 1007, 110 S.Ct. 3245, 111 L.Ed.2d 756 (1990). The facts underlying this determination are not in dispute. The trustee filed a motion to extend the bar date on July 28,1989, seven days prior to the bar date. Mrs. Coggin filed a similar motion to extend time on August 3, 1989, the day before the bar date. The bankruptcy court granted both motions ex parte, without a hearing of any kind, on the day each motion was filed. In the ease of the trustee’s motion, neither Coggin nor his attorney was ever served with the motion. Coggin admits, however, that after the court granted the motion, he received a copy of the order in the mail. Mrs. Coggin’s motion contains a certificate of service which includes Coggin’s attorney, but not Coggin himself. There is no evidence as to whether the order granting her motion was sent to Coggin. A motion to extend the bar date is a contested matter under the Code. Collier on Bankruptcy states: Broadly speaking, proceedings in bankruptcy cases can be divided into: (1) adversary proceedings, governed by Part VII of the Bankruptcy Rules; (2) administrative matters, in which there is no adversary party (for example, an unopposed motion by a trustee to sell property of the estate); and (3) contested matters, which do not qualify as adversary proceedings because they are not defined as such by Rule 7001 but which, nevertheless, resemble adversary proceedings in that there are two parties who are opposing each other with respect to relief sought by one of them. 9 Collier on Bankruptcy ¶ 9014.03 (15th ed. 1994) (footnote omitted). A motion to extend time best fits in the third category, as it is opposed by the debtor, but is not an adversary proceeding enumerated in Rule 7001. As a result, Rule 9014 applies to this motion. 4 Rule 9014 provides in pertinent part: In a contested matter in a case under the Code not otherwise governed by these rules, relief shall be requested by motion, and reasonable notice and opportunity for hearing shall be afforded the party against whom relief is sought. No response is required under this rule unless the court orders an answer to a motion. The motion shall be served in the manner provided for service of a summons and complaint by Rule 700k- • • • Fed.R.Bankr.P. 9014 (emphasis added). In the case of a motion under Rule 4004(b), the rule provides that the matter will be initiated by motion and specifically requires notice and hearing. Rule 4004 does not, however, provide how service shall be accomplished on a motion for extension of the bar date. As a result, the requirement of Rule 9014, applicable by default to contested matters, applies. It provides that service will be in the manner provided in Rule 7004 for a summons and complaint. 5 Under Rule 7004(b)(9), if a movant is conducting service by mail, such service must be made on both the debtor and his attorney. There is no question here that neither the trustee nor Mrs. Coggin executed service on Coggin himself. Under Rule 4004(b), a motion to extend the time for filing a complaint objecting to the discharge of a debtor must “be made before such time [for filing a complaint] has expired.” Fed. R.Bankr.P. 4004(b) (emphasis added). According to Coggin, a motion for extension of the bar date is “made” when it is served. Since the appellees failed to serve Coggin as required under Rule 7004(b)(9), Coggin contends that the motion was not timely made. Further, he argues that under the current rules the failure of a party to properly make a motion under Rule 4004(b) deprives the bankruptcy court of jurisdiction and, consequently, of any discretion to extend the bar date. In support of his position, Coggin cites several cases that hold that a motion is “made” when it is served. The majority of these cases, however, can be distinguished. Coggin cites a line of cases in which courts have held that a motion to amend findings, or to make additional findings and amend the judgment, is made when it is served, not when it is filed. Sonoma v. Sells (In re Sonoma V), 703 F.2d 429 (9th Cir.1983) (per curiam); Keohane v. Swarco, Inc., 320 F.2d 429 (6th Cir.1963); In re Sonoma V, 21 B.R. 21 (9th Cir. BAP 1982) (mem.). All three of these cases, however, make reference to a motion under Federal Rule of Civil Procedure (“FRCP”) 52(b). The two In re Sono-ma V cases were decided under the old Federal Rule of Bankruptcy Procedure 752, but, as noted by the bankruptcy court, “[t]his language tracks the language of Fed.R.Civ.P. 52(b).” In re Sonoma V, 21 B.R. at 21. Keohane was decided under FRCP 52(b) itself. In all three cases, the court relied on the following language from Moore’s Federal Practice: Although Rule 52(b) refers to a motion of a party “made,” while Rule 59(b) and (d) refer to a motion “served,” there is no. difference in effect, since a motion is “made” by causing it to be served. 5A Moore’s Federal Practice ¶ 52.11[1] n. 8. In support of this proposition, Moore’s currently cites Keohane itself. It does so, however, with the following parenthetical explanation: “[T]he court reasoned that if a Rule 52(b) motion had to be filed as well as served within the ten day period, there would be little reason for Rule 5(d), granting a reasonable time after service to file the motion.” Id. This explanation shows that these cases are not authoritative relative to a motion under Rule 4004(b). FRCP 5(d) provides that “[a]ll papers after the complaint required to be served upon a party, together with a certificate of service, shall be filed with the court within a reasonable time after service.” Fed.R.Civ.P. 5(d). A motion under FRCP 52(b), of course, would be just such a post-complaint motion to which FRCP 5(d) would apply. A motion under Rule 4004(b), however, is not the same as a motion under FRCP 52(b). Under Rule 9014, a contested-matter motion such as one under Rule 4004(b) is to be treated and served just as a summons and complaint. As such, under Rule 7004(a), service of a motion under Rule 4004(b) is governed by FRCP. 4(j). 6 FRCP 4(j) provides that a summons and complaint must be served within 120 days of filing with the court. Fed.R.Civ.P. 4(j). Thus, if the logic of this trio of eases is that it makes no sense for FRCP 5(d) to allow for a reasonable time after service to file a motion if a motion must be filed to be “made,” then likewise we are drawn to the conclusion that it makes no sense for Rule 7004(a), by way of FRCP 4(j), to allow 120 days for service after filing a motion under Rule 4004(b) if a motion must be served to be “made.” The logic of Moore’s statement that a motion is “made” when it is served, therefore, is limited to the particular Federal Rule of Civil Procedure to which it was referring. Likewise, the three cited cases are limited to FRCP 52(d) and old Bankruptcy Rule 752(b). Two bankruptcy court decisions, however, have explicitly held that under Rule 4004(b), a motion to extend the bar date is not “made” until and unless it is served. In re Friscia, 123 B.R. 9 (Bankr.E.D.N.Y.1991); In re Mancini, No. 85-30168, 1986 WL 28905 (Bankr.S.D.N.Y. Mar. 26,1986). These cases are indistinguishable from the present case. Nevertheless, we disagree with their holdings and hold that a motion to extend the bar date under Rule 4004(b) is “made” when filed. Prior decisions of the bankruptcy court support our position. Although we have found no other case that directly addresses the issue of whether a motion under Rule 4004(b) is “made” when it is filed or when it is served, many cases have mentioned the section in passing. These cases universally use the term “file” when referring to the time limitation imposed on making a motion under Rule 4004(b). 7 None of these cases specifically deals with the issue of whether a motion filed but not served prior to the expiration of the original bar date is timely. Rather, most deal with a motion that was neither filed nor served prior to the original bar date and conclude that the bankruptcy court is without discretion under the current rules to enlarge the time for filing a complaint under Rule 4004(a) when the movant fails to file the motion before the expiration of the bar date. Our position is supported by Collier on Bankruptcy, which states: “Current Bankruptcy Rule 4004(b) permits an extension of the deadline only on motion of a party in interest, only for cause, determined at a hearing on notice, and only if the motion is filed before the original deadline expires.” 8 Collier on Bankruptcy ¶ 4004.02[1] (emphasis added). It further states that “[t]he motion [under Rule 4004(b) ] must be filed within the original time period for complaints objecting to discharge.” Id. ¶4004.04[1] (emphasis added). Common sense also supports our conclusion that a motion under section 4004(b) is “made” when it is filed, rather than when it is served. Rule 4004(c) provides: “In a Chapter 7 case, on expiration of the time fixed for filing a complaint objecting to discharge and the time fixed for filing a motion to dismiss the case pursuant to Rule 1017(e), the court shall forthwith grant the discharge _” Fed.R.Bankr.P. 4004(c). Black’s Law Dictionary defines “forthwith” as: Immediately; without delay; directly; within a reasonable time under the circumstances of the case; promptly and with reasonable dispatch. Within such time as to permit that which is to be done, to be done lawfully and according to the practical and ordinary course of things to be performed or accomplished. The first opportunity offered. Black’s Law Dictionary 654 (6th ed. 1990) (citation omitted). Under Rule 4004(c), therefore, the bankruptcy court is obligated, as soon as practicable after the passage of the bar date, to enter a discharge for the debtor, assuming no complaints objecting to such discharge have been filed. If service on the debtor and his attorney is adequate for a motion to be “made” under Rule 4004(b), but filing is not required to be achieved prior to the bar date, then the court could be left in the position of entering a discharge when there is a validly “made” motion for an extension of time outstanding. Common sense tells us that it is imperative for the court to know, prior to the expiration of the bar date, whether any motions for extension of the bar date have been “made.” The court will be so informed if a motion is “made” when filed. Having ruled that a motion under Rule 4004(b) is “made” when it is filed, we determine the effect of that holding on this case. It is true that “[e]very written motion other than one which may be considered ex parte must be served by the moving party on the trustee or debtor in possession and on those entities specified by the Bankruptcy Rules.” 9 Am.Jur.2d § 74. As discussed above, Rule 9014 applies Rule 7004 to a motion under Rule 4004(b). Rule 7004(a), incorporating FRCP 4(j), requires service within 120 days of the filing of a complaint or, in this case, a motion. When serving a motion by mail, Rule 7004(b)(9) requires service on both the debtor and his attorney. It is undisputed that neither the trustee nor Mrs. Coggin served Coggin. The issue of the exact timing of acceptable service of a motion to extend the bar date, therefore, is not before us in this case, as it is undisputed that service was never properly completed. 8 As a corollary to our holding that a motion is “made” when filed, we also hold that failure to serve the debtor or his attorney or both prior to the expiration of the bar date does not constitute failure to “make” a motion within the prescribed time. It is well-settled that under the new Bankruptcy Rules, the bankruptcy court has no discretion to grant an extension of the bar date when a motion to do so is not “made” prior to the expiration of the bar date. See In re Lane, 37 B.R. at 412-13. We hold that if a motion is filed but not served prior to the bar date, the jurisdictional requirement of rule 4004(b) is met, and the bankruptcy court retains jurisdiction to extend the bar date if service is proper, or to employ its equitable powers if service is not perfected properly. We are called upon here to determine whether the bankruptcy court erred as a matter of law in allowing the appellees additional time to file a complaint objecting to Coggin’s discharge. The facts of this case indicate that the court had this power and did not abuse its discretion in doing so. Thinking that it had the power to give the appellees an extension ex parte, the court granted their motions as soon as they were submitted, with no notice and no opportunity for Coggin to be heard. This decision, of course, was erroneous, as it was contrary to the plain language of Rule 4004(b), which provides that such a motion may only be granted “after hearing on notice.” Fed. R.Bankr.P. 4004(b). The error, however, was that of the court and not of the appel-lees. The appellees had time to serve Cog-gin after they filed their motions, but because of the court’s immediate granting of the motions and the fact that notice of the extension was given to Coggin, the pleading itself had already been rendered moot. Hence, while the appellees erred in never serving Coggin and his attorney, the actions of the court in granting the motions ex parte created a situation where such error was excusable. 9 Having decided that the motions of the appellees to extend the bar date were properly “made” when filed, and that their failure to serve Coggin in this case was excusable due to the error of the court, we must determine whether the court properly granted those motions. We are not addressing the merits of such a decision, but rather whether the process followed by the court was proper. Upon determining that it had erred in granting the motions ex parte, the court set aside its earlier order pursuant to section 105(a) and afforded Coggin a hearing and an opportunity to dispute the appellees’ motions for extension of the bar date. After the hearing, the court found that there were sufficient facts to justify the grant of the extension and that Coggin was not prejudiced by the extension. Section 105(a) provides that a bankruptcy court “may issue any order, process, or judgment that is necessary or appropriate to carry out the provisions of this title.” 11 U.S.C. § 105(a). The bankruptcy court has the equitable power to correct, modify, or vacate its own interlocutory orders. See A & A Sign Co. v. Maughan, 419 F.2d 1152, 1155 (9th Cir.1969); Dore & Assocs. Contracting, Inc. v. American Druggists’ Ins. Co., 54 B.R. 353, 360 (Bankr.W.D.Wis.1985). Coggin argues that such modification here is beyond the equitable power of the court because the failure of the appellees to serve him prior to the expiration of the bar date amounts to a failure to meet the requirements of Rule 4004(b) and therefore amounts to a jurisdictional bar. Since we have held, however, that only failure to file a motion for extension of the bar date raises a jurisdictional bar under Rule 4004(b), the court retained equitable power in this case. We find no error in the court correcting its own mistake of granting the appellees’ motions ex parte. In addition, service by the appellees after the court had granted the motions and sent the orders to Coggin would have been fruitless. As a result, the failure of the appellees to serve Coggin here was excusable. Moreover, Cog-gin received notice and a hearing, which is the purpose of service. We hold, therefore, that the appellees satisfied the jurisdictional bar of Rule 4004(b) when they filed their motions prior to the expiration of the bar date, that appellees’ failure to serve Coggin himself was excusable in light of the court’s error in granting their motions ex parte, and that the court had the equitable power to correct its earlier mistake and grant the motions after affording Coggin notice and a hearing. The extension of the bar date here was valid.