Court Opinion

ID: 4103510
Source: CourtListenerOpinion
Date Created: 2016-11-30 22:01:34.353986+00
Date Added: 2024-06-11T14:34:24.422962
License: Public Domain

FILED
                                                                             U.S. Bankruptcy Appellate Panel
                                                                                   of the Tenth Circuit
                               NOT FOR PUBLICATION 1
                                                                               November 30, 2016
             UNITED STATES BANKRUPTCY APPELLATE PANEL
                                                                                 Blaine F. Bates
                              OF THE TENTH CIRCUIT                                   Clerk
                          _________________________________

IN RE CHUCK ODIFU EGBUNE,                                 BAP No. CO-16-006

          Debtor.
__________________________________

CHUCK ODIFU EGBUNE,                                       Bankr. No. 11-38127
                                                              Chapter 13
             Appellant,

v.
                                                                OPINION
DOUGLAS B. KIEL, Chapter 13 Trustee
and ALWAYS ENTERPRISES, INC.,
d/b/a A-1 BAIL BONDS,

             Appellees.
                          _________________________________

                    Appeal from the United States Bankruptcy Court
                              for the District of Colorado
                       _________________________________

Before NUGENT, SOMERS, and HALL, Bankruptcy Judges.
                  _________________________________

HALL, Bankruptcy Judge.
                    _________________________________

       Appellant Chuck Odifu Egbune (the “Debtor”) appeals an order of the bankruptcy

court overruling his post-confirmation objection to the claim of secured creditor Always

       1
        This unpublished opinion may be cited for its persuasive value, but is not
precedential, except under the doctrines of law of the case, claim preclusion, and issue
preclusion. 10th Cir. BAP L.R. 8018-6.
Enterprises, Inc. d/b/a/ A-1 Bail Bonds (“A-1”) and denying the Debtor’s related request

to convert the objection to a motion to reclassify A-1’s proof of claim.

       I.       BACKGROUND

       On October 5, 2009, A-1 provided a bail bond for Velma Gilbert. The Debtor and

others guaranteed the bond and the bond premium for Ms. Gilbert by signing a

promissory note (the “Note”). The Debtor secured the bond and the bond premium with a

deed of trust (the “Deed of Trust”) on his primary residence at 4694 Briarglen Lane,

Highlands Ranch, Colorado (the “Residence”). 2 The Residence had been previously

encumbered by a first mortgage held by Bank of America, N.A. and a second mortgage

held by Green Tree Servicing LLC (“Green Tree”). 3

       On December 2, 2011, the Debtor filed a Chapter 13 bankruptcy in the District of

Colorado. 4 The Debtor is a licensed attorney in the state of Colorado, who, among other

things, assists individuals in filing bankruptcy petitions. The Debtor did not list A-1 as a

creditor on his statements or schedules but did include A-1 on his creditor-mailing

matrix. 5 On December 5, 2011, the Debtor filed his Motion to Determine Secured Status

       2
           The Deed of Trust provides that it secures $35,000 as described in the Note.
       3
         On August 31, 2015, Green Tree Servicing LLC combined with Ditech Mortgage
Corp to form “ditech, a Walter Company.” For purposes of this opinion, ditech will be
referred to as Green Tree.
       4
        This was the Debtor’s second Chapter 13 petition after having a previous
Chapter 13 case filed in the District of Wyoming dismissed on May 20, 2011.
       5
         In fact, the Debtor did not schedule A-1 as a creditor until November 23, 2015,
almost four years post-petition notwithstanding active participation by A-1 as a creditor
in the bankruptcy case.
                                                  2
Pursuant to 11 U.S.C. 506 (the “506 Motion”) seeking to strip off Green Tree’s second

mortgage lien against the Residence. The 506 Motion did not include a request to strip off

A-1’s lien. While Green Tree did not file a response to the 506 Motion, A-1 objected on

the ground that there was sufficient equity in the Residence to secure Green Tree’s

mortgage and A-1’s lien. 6 On January 5, 2012, A-1 filed Proof of Claim 7-1 (the “A-1

Claim”) asserting a secured claim in the amount of $22,398 (including costs and

attorneys’ fees) with interest accruing annually at 18%. 7 The Debtor did not object to the

A-1 Claim at any time prior to confirmation of his Chapter 13 plan. 8

       The Debtor filed numerous Chapter 13 plans to which A-1 objected on the basis

that the plans did not provide for payment of the A-1 Claim. A-1 was “very active” in

objecting to these plans to ensure that its claim was recognized and treated as a secured

claim. 9 On July 10, 2012, the Debtor filed his sixth plan (the “Plan”). 10 Section V(A) of

the Plan provided for the A-1 Claim, requiring direct payments of $25.00 per month for

       6
         D. Colo. L.B.R. 3012-1(7) provides that an objection to the valuation of
collateral will be considered in conjunction with the hearing on plan confirmation.
Accordingly, the bankruptcy court delayed ruling on the 506 Motion until it ruled on plan
confirmation.
       7
           Appellant’s App. at 22.
       8
       The Debtor did object to numerous other claims in 2012 and 2013. Tr. of Mar. 3,
2016 Hearing at 20, in Appellant’s App. at 196.
       9
           Tr. of Mar. 3, 2016 Hearing at 20, in Appellant’s App. at 196.
       10
         Amended Chapter 13 Plan Including Valuation of Collateral in Classification of
Claims in Appellant’s App. at 26.

                                                  3
360 months to A-1 and listing the Residence as A-1’s collateral. 11 Section IV(C)(1) of the

Plan provided for the treatment of claims subject to 11 U.S.C. § 506. 12 Under this section,

the Plan listed all claims that were subject to a § 506 motion valuing the collateral

securing the applicable claim at zero ($0), leaving such a creditor unsecured. Green

Tree’s claim was the only claim listed in this section of the Plan.

       As a result of the provision in the Plan providing for payments to A-1 and listing

the Residence as A-1’s collateral, A-1 withdrew its objection to the 506 Motion, stating

that the Debtor had “confirmed that [A-1’s] secured status will not be impaired by his

Motion to Determine Secured Status.” 13 On August 21, 2012, the bankruptcy court

entered the Order Confirming Debtor’s/Debtors’ Amended Chapter 13 Plan (the

“Confirmation Order”). 14 The bankruptcy court also entered its Order Determining

Secured Status of Lien and Avoiding Lien Pursuant to 11 U.S.C. § 506 (the “506 Order”),

in which it stated that the “mortgage lien held by Green Tree Servicing . . . is valued at

       11
          Id. at 5, in Appellant’s App. at 30. This amount was insufficient to pay A-1’s
claim in full.
       12
          All future references to “Code,” “Section,” and “§” are to the Bankruptcy Code,
Title 11 of the United States Code, unless otherwise indicated. All references to
“Bankruptcy Rule” or “Bankruptcy Rules” are to the Federal Rules of Bankruptcy
Procedure, unless otherwise indicated.
       13
         Withdrawal of Objection to Debtor’s Motion to Determine Secured Status
Pursuant to 11 U.S.C. 506 at 1, in Appellant’s App. at 32; Tr. of Mar. 3, 2016 Hearing at
13, in Appellant’s App. at 189 (“A-1’s objection [to the 506 Motion] was holding up
confirmation” of a plan). Green Tree did not file an objection to the 506 Motion.
       14
            Appellant’s App. at 34.

                                                 4
zero ($0) and is entirely unsecured for the purposes of the debtor’s plan.” 15 Neither A-1

nor A-1’s lien was mentioned in the Confirmation Order or the 506 Order.

        On January 19, 2015, the Debtor filed his Motion for Order Extinguishing Green

Tree Servicing Mortgage’s Second Mortgage Lien. 16 The bankruptcy court then entered

its Order Extinguishing Green Tree Servicing’s Second Mortgage Lien on 4694

Briarglenn Ln, Highlands Ranch CO 80130 (the “Green Tree Order”) on February 13,

2015. 17 Neither A-1 nor the A-1 lien was mentioned in the Green Tree Order. Thereafter,

on October 21, 2015, the Debtor received a Chapter 13 discharge upon completion of the

Plan.

        After the entry of discharge but prior to closing of the case, A-1 commenced a

foreclosure proceeding against the Residence. On November 23, 2015, the Debtor filed

his Objection to Proof of Claim # 7-1 filed by [A-1] Pursuant to 11 U.S.C. § 502 and

Rule 3001 and 3002.1 of the Bankruptcy Code (the “Claim Objection”). 18 Consequently,

on December 22, 2015, A-1 filed its Response and Motion to Strike Objection to Proof of

Claim 7-1. 19

        15
             506 Order at 1, in Appellant’s App. at 36.
        16
             Bankr. ECF No. 124.
        17
             Appellant’s App. at 37.
        18
             Appellant’s App. at 38.
        19
             Appellant’s App. at 52.

                                                   5
       The Debtor filed the Debtor’s Amended Supplement to Objection [to] His

Previous Objection to Proof of Claim Number 7-1 20 on February 1, 2016, and his

Amended Debtor’s Supplement to [sic] His Previous Objection To Proof of Claim #7-1

Filed By [A-1] and A Request To Convert the Objection To A Motion To Reclassify Claim

7-1 As Unsecured Pursuant to 11 U.S.C. 502(j) and Rule 3001 and 3008 of the

Bankruptcy Code (the “Motion to Reclassify”) on February 2, 2016. 21 Then the Debtor

filed a Motion for Determination of Termination or Absence of the Automatic Stay (the

“Automatic Stay Motion”) on February 25, 2016. 22

       On March 3, 2016, the bankruptcy court issued an oral ruling (the “Oral Ruling”)

that set forth five orders of the bankruptcy court, addressing six separate pleadings before

the bankruptcy court. The bankruptcy court overruled the Claim Objection and denied the

related Motion to Reclassify because the Debtor failed to show “cause” sufficient for the

bankruptcy court to accept and consider the late filed objection. The bankruptcy court

pointed out that the Debtor never disputed A-1 when it said it was withdrawing its

objection to the Plan because it had been assured the 506 Motion would not affect or

impair its lien. Additionally, the Debtor’s only explanation for his delay in objecting to

the A-1 Claim was stress he experienced in 2012, which the bankruptcy court accepted as

       20
            Bankr. ECF. No. 202.
       21
            Appellant’s App. at 60.
       22
         The Automatic Stay Motion is not in the record on appeal but is referenced by
the bankruptcy court in its Oral Ruling. Tr. of Feb. 25, 2016 Hearing at 64-65, in
Appellant’s App. at 170-71.

                                                 6
explaining a short delay but not the four-year delay since the A-1 Claim had been filed.

The bankruptcy court also looked at the type of objections raised by the Debtor and noted

they all related to alleged misconduct that occurred in 2009 when the Note was signed or

when the A-1 Claim was filed in January 2012. The bankruptcy court found the

unexplained delay prejudiced A-1 and interfered with efficient court administration and,

therefore, denied the Debtor’s objection to the A-1 Claim. Consistent with its Oral

Ruling, the bankruptcy court entered orders on the Claim Objection and the Motion to

Reclassify (herein referred to collectively as the “Claim Objection Pleadings”), as well as

three other pleadings not at issue in this appeal. Furthermore, the bankruptcy court denied

the Automatic Stay Motion finding the “stay terminated on October 21, 2015, the date

that the discharge entered” and that “no violation of the automatic stay is possible after

the entry of the Order of Discharge.” 23

       On March 22, 2016, the Debtor filed a Notice of Appeal, appealing any

“Judgment/Order in favor of [A-1] and the [Trustee]” made in the Oral Ruling. 24 This

Court determined that, of the bankruptcy court’s orders, the orders on the Claim

Objection Pleadings and the Automatic Stay Motion satisfied this condition. 25 The Court

ultimately dismissed the appeal of the order on the Automatic Stay Motion as

       23
            Minutes of Proceeding/Minute Order at 2, in Appellant’s App. at 82.
       24
        BAP ECF No. 1. The Debtor amended the Notice of Appeal, filing Debtor’s
Amended Notice of Appeal and Statement of Election on April 4, 2016. Appellant’s App.
at 101.
       25
        BAP Case No. CO-16-008, Dkt. Entry No. 12, Order Construing Notice of
Appeal as Two Notices of Appeal and Directing Payment of Fees.

                                                 7
interlocutory. 26 Therefore, the appeal of the Oral Ruling, as it relates to the Claim

Objection Pleadings, is the sole subject of our review.

       II.      JURISDICTION AND STANDARD OF REVIEW

       An order on an objection to a claim is a final order over which this Court has

jurisdiction. 27 Review of whether a confirmed plan supersedes an allowed claim is a legal

issue, which we review de novo. 28 We review a request for reconsideration of a claim for

an abuse of discretion. 29 Under the abuse of discretion standard, a trial court’s decision

will not be overturned “unless the appellate court has a definite and firm conviction that

the lower court made a clear error of judgment or exceeded the bounds of permissible

       26
            BAP Case No. CO-16-008, Dkt. Entry 22, Order Dismissing Interlocutory
Appeal.
       27
         28 U.S.C. 158(a)(1); Wilson v. Broadband Wireless Int’l Corp., 295 B.R. 140,
143 (10th Cir. BAP 2003); In re Russell, 386 B.R. 229, 230 (8th Cir. BAP 2008).
       28
          Alderete v. Educ. Mgmt. Corp. (In re Alderete), 412 F.3d 1200, 1204 (10th Cir.
2005) (“[A] conclusion of law regarding the legal effect of the bankruptcy court’s
findings . . . [is] reviewed de novo.”).
       29
          In re Rafter Seven Ranches LP, 362 B.R. 25, 28 (10th Cir. BAP 2007) (The
bankruptcy court’s denial of a motion to reconsider is subject to the abuse of discretion
standard of review); In re Jones, No. BAP WY–98–015, 1998 WL 870341, at *2 (10th
Cir. BAP Dec. 15, 1998) (denial of motion to reconsider an order denying objection to
claim reviewed for abuse of discretion); In re Frontier Airlines, Inc., 137 B.R. 808, 810
(D. Colo. 1992) (if reconsideration of claim sought after time to appeal passed, courts
view as motion to reconsider under Rule 60(b), which is reviewed for abuse of
discretion); In re Kirwan, 164 F.3d 1175, 1177 (8th Cir. 1999) (decision under § 502(j)
reviewed for abuse of discretion); In re Colley, 814 F.2d 1008, 1010 (5th Cir. 1987)
(bankruptcy court’s reconsideration of a claim is “virtually plenary”); S.G. Wilson Co. v.
Cleanmaster Indus. (In re Cleanmaster Indus.), 106 B.R. 628, 630 (9th Cir. BAP 1989);
In re Mathiason, 16 F.3d 234, 239 (8th Cir. 1994).

                                                  8
choice in the circumstances.” 30 The trial court abuses its discretion when its “decision is

‘arbitrary, capricious or whimsical,’ or results in a ‘manifestly unreasonable

judgment.’” 31

       III.      DISCUSSION

       A. The terms of the Plan do not supersede the allowed A-1 Claim.

       The Debtor argues that the bankruptcy court erred in holding that the A-1 Claim

superseded the provisions of the Plan and further argues that the Plan and the 506 Motion

stripped A-1’s lien, leaving the A-1 Claim unsecured. Despite filing a motion and

receiving two orders stripping Green Tree’s lien, the Debtor argues that a determination

of secured status under § 506(a) may be accomplished through plan confirmation in lieu

of filing a separate motion or adversary proceeding. The Debtor concludes that the Plan

superseded the A-1 Claim and that A-1’s lien was extinguished because it was not

recognized in the Plan.

       In contrast, A-1 argues that, in confirming the Plan, the bankruptcy court did not

strip A-1’s lien, but rather the Plan treated A-1 as a secured creditor retaining its lien on

the Residence. In support, A-1 asserts its lien was not the subject of the 506 Motion or

any other proceeding to strip its lien and that the lien was not extinguished by the Plan.

       30
        Moothart v. Bell, 21 F.3d 1499, 1504 (10th Cir. 1994) (quoting McEwen v. City
of Norman, 926 F.2d 1539, 1553-54 (10th Cir. 1991) (quoting United States v. Ortiz, 804
F.2d 1161, 1164 n. 2 (10th Cir.1986)).
       31
            Id. (quoting United States v. Wright, 826 F.2d 938, 943 (10th Cir. 1987)).

                                                  9
Further, A-1 argues the Debtor’s interpretation of the Plan is “wholly unorthodox” and

the Debtor failed to timely object to the A-1 Claim. 32

       The bankruptcy court found the Plan did not extinguish or strip off or down 33

A-1’s lien. Supporting this finding, the only language in the Plan addressing the claim of

A-1 states:

       V. OTHER PROVISIONS

       A. Payment will be made directly to the creditor by the Debtor(s) on the
       following claims: 34

                                                 Monthly Payment         No. Of Months
        Creditor          Collateral, if any     Amount                  to Payoff
        A-1 Bail          Homestead @ 4694       25                      360
        Bonds d/b/a       Bria[r]glen Ln
        Always
        Enterprises

No other provision of the Plan even mentions A-1 much less (i) discusses the value of

A-1's lien, (ii) purports to extinguish or strip off A-1's lien on the Residence or

(iii) determines, pursuant to § 506, the extent of A-1's secured and unsecured claims. 35

       32
            Appellee’s R. Br. 4.
       33
          “[T]here is subtle distinction drawn between ‘stripping off’ and ‘stripping down’
a lien. If the entire lien is removed, then it is considered ‘stripping off.’ If the lien is only
partially secured, then it is considered ‘stripping down.’” Griffey v. U.S. Bank (In re
Griffey), 335 B.R. 166, 168 n.1 (10th Cir. BAP 2005) (citing Lam v. Investors Thrift (In
re Lam), 211 B.R. 36, 37, n.2 (9th Cir. BAP 1997)).
       34
            Appellant’s App. at 26-31.
       35
            Appellant’s App. at 31.

                                                  10
        After the Plan was filed and in recognition of the treatment of the A-1 Claim as

secured, A-1 withdrew its objection to the 506 Motion in reliance on the Debtor’s

confirmation that A-1’s secured claim would not be impaired by the 506 Motion. 36 The

Debtor never disputed this.

        The Debtor benefitted directly from the withdrawal of A-1’s objection to the 506

Motion as it was holding up confirmation of the Plan. With A-1’s objection withdrawn,

the 506 Order was entered. The 506 Order, likewise, never references A-1 or its secured

claim, instead addressing only Green Tree and its lien. Additionally, the Plan was

confirmed on the same date, and the Confirmation Order contains no provision

extinguishing or stripping off the lien of A-1 on the Residence. As confirmed, the Plan

expressly provides that the A-1 Claim remains secured by the Residence. Given these

simple facts, it is clear that the bankruptcy court did not conclude that the A-1 Claim

superseded the Plan but, instead, concluded the Plan simply did not affect or alter A-1’s

lien.

        Moreover, the bankruptcy court’s conclusion is consistent with § 1327(a), which

provides that confirmation of a Chapter 13 plan is binding on not only the debtor, but also

every creditor whether or not the plan treats their claims or whether the creditor has

objected or accepted the plan. 37 The secured status of a creditor is an issue intrinsic to

        36
         Appellant’s App. at 32. Similarly, 2 ½ years later, the Green Tree Order was
entered, which again addressed only the mortgage lien of Green Tree, making no
reference to A-1 or its lien. Appellant’s App. at 37.
        37
Will. v. M. Bruenger & Co. (In re Brannan), 532 B.R. 834, 838 n.19 (Bankr.
D.Kan. 2015) (citing 11 U.S.C. § 1327(a) and In re Talbot, 124 F.3d 1201 (10th Cir.
                                                  11
confirmation of a Chapter 13 plan. 38 Thus, any action taken post-confirmation to avoid or

otherwise alter secured status provided by a confirmed plan is barred by the res judicata

effect of § 1327(a). 39

       Thus, the Debtor is incorrect that the bankruptcy court ruled that the A-1 Claim

superseded the Plan. The bankruptcy court merely found that the A-1 Claim was filed as

a secured claim, the Debtor conceded at various times that A-1 was secured, and the Plan

contained no language extinguishing or stripping off A-1’s lien on the Residence. These

findings of the Court are not arbitrary, capricious or whimsical and did not result in a

manifestly unreasonable judgment, but one entirely consistent with relevant law.

1997)); In re Rutt, 457 B.R. 97, 101 (Bankr. D.Colo. 2010) (“Section 1327 binds the
Debtor, and the secured creditor to the treatment provided for in the confirmed plan.
What Debtor now proposes does not fall within the narrow circumstances permitting
modification of a confirmed plan under section 1329(a). Debtor is not merely seeking to
‘increase or reduce the amount of payments on claims of a particular class provided for
by the plan;’ or ‘to extend or reduce the time for such payments.’ Debtor is seeking to
strip off the lien of a creditor treated as secured by the confirmed plan and to reclassify it
as a general unsecured creditor.”).
       38
          Brannan, 532 B.R. at 840; Atkins v. Bank of America, N.A. (In re Atkins), 497
B.R. 568, 570-71(Bankr. D.Minn. 2013) (“[T]he provisions of a confirmed plan bind a
debtor and a creditor as confirmation is, essentially, an adjudication of the issues of
classification and treatment of claims provided for in the plan.”).
       39
         Brannan, 532 B.R. at 840; Atkins, 497 B.R. at 570-71; In re Berrouet, 469 B.R.
393, 397 (Bankr. N.D.Ga. 2012) (citing In re Cruz, 253 B.R. 638, 641 (Bankr. D.N.J.
2000) (motion to determine secured status filed six months after plan confirmation;
because debtor could have raised the value of his home and proposed treatment to strip
the second priority lien at confirmation, the confirmation order is res judicata as to the
value of debtor’s home and the treatment of creditor’s second priority lien claim.); In re
McCarter, No. G08-23720-REB, 2014 WL 2086691, at *2 (Bankr. N.D.Ga. Mar. 6,
2014) (“[U]pon confirmation, the value of a secured claim is fixed. The plan as
confirmed is accorded the effect of res judicata, barring litigation over any matters that
were or could have been asserted before confirmation.”)

                                                 12
       B. The Plan contains no language stripping off A-1’s lien on the Residence.

       The Debtor’s arguments that the various provisions of Chapter 13 (§§ 1321;

1322(b)(2) & (c)(2); 1324; 1325(a)(5)(B)(i) & (ii); 1327(c); and 1328(a)) require that

A-1’s lien be extinguished all rest on facts that are simply not available in this case. The

Debtor did not seek to strip A-1’s lien through the 506 Motion, and the language in the

Plan did not adequately put A-1 on notice that its lien would be stripped upon completion

of all payments and entry of discharge. It is a fundamental principle of bankruptcy law

that, unless a debtor objects to a claim secured by a lien against real property, the lien

passes through bankruptcy unaffected. 40 “[A] bankruptcy discharge extinguishes only one

mode of enforcing a claim—namely, an action against the debtor in personam—while

leaving intact another-namely, an action against the debtor in rem.” 41

       The Debtor’s argument that United Student Aid Funds, Inc. v. Espinosa 42 renders

the terms of the Plan binding as to A-1 is misplaced as the Plan recognized the A-1 Claim

and expressly provided it remains secured by a lien on the Residence. As the bankruptcy

court noted, A-1 did not slumber on its rights, but objected until the Plan treatment no

longer altered its secured claim. 43 The Debtor’s argument that the Plan stripped A-1’s

       40
            Dewsnup v. Timm, 502 U.S. 410, 418 (1992).
       41
            Johnson v. Home State Bank, 501 U.S. 78, 84 (1991).
       42
            559 U.S. 260 (2010).
       43
        Tr. of Feb. 25, 2016 Hearing at 44, in Appellant’s App. at 150; Tr. of Mar. 3,
2016 Hearing at 25, in Appellant’s App. at 201.

                                                 13
lien is, therefore, unfounded. Accordingly, the bankruptcy court’s findings and

conclusions were not an abuse of its discretion.

       C. The bankruptcy court did not abuse its discretion in overruling the
       Debtor’s post-confirmation objection to the A-1 Claim and denying the
       Motion to Reclassify.

       The Debtor argues that the A-1 Claim is deficient because: (1) it does not comply

with § 502 or Rules 2016, 3001, and 3002.1 in itemizing interest, costs, attorneys’ fees

and expenses; (2) A-1 cannot charge default interest under C.R.S. 5-3-302; (3) the Deed

of Trust and Note are inconsistent; (4) A-1 did not comply with various disclosure

requirements at the time the Note and Deed of Trust were signed; and (5) the debt was

fully paid prepetition. Accordingly, the Debtor concludes the bankruptcy court erred in

overruling the Claim Objection and denying the Motion to Reclassify.

       A-1 argues that the statutory mandate of § 502(j) provides that late objections to

claims are allowed only for “cause,” placing the allowance of such objections within the

bankruptcy court’s discretion and that the Debtor bears the burden to demonstrate

“cause” sufficient for the bankruptcy court to accept and consider a late filed objection.

A-1 further contends that the bankruptcy court correctly weighed the extent and

reasonableness of any delay, prejudice to any party in interest, the effect on efficient

court administration, and the moving party’s good faith and correctly concluded that the

Debtor did not met his burden to show “cause” to sustain the objection to the A-1 Claim.

                                                   14
       The bankruptcy court has the authority to reconsider the allowance or

disallowance of claims for cause pursuant to § 502(j). 44 Any claim filed “is deemed

allowed, unless a party in interest . . . objects.” 45 As the advisory committee for Rule

3008 noted, the bankruptcy court’s discretion in deciding whether to reconsider a claim is

virtually absolute, as the court may decline to reconsider an order of allowance or

disallowance without a hearing or notice to the parties involved. 46 Section 502(j) provides

in pertinent part, that “[a] reconsidered claim may be allowed or disallowed according to

the equities of the case.” 47 Bankruptcy courts have interpreted reconsideration under

§ 502(j) to be a two-step process. 48 First, the bankruptcy court must decide whether

“cause” has been shown. Next, the bankruptcy court must determine whether the

“equities of the case” dictate allowance or disallowance. 49

       44
          Amtech Lighting Services Co. v. Payless Cashways (In re Payless Cashways,
Inc.), 230 B.R. 120, 137 (8th Cir. BAP 1999) (reconsideration can be requested at any
time, even after expiration of the time to appeal); In re Gomez, 250 B.R. 397 (Bankr.
M.D. Fla. 1999) (confirmation of plan does not preclude reconsideration of claim);
Brannan, 532 B.R. at 841; In re Jones, No. BAP WY-98-015, 1998 WL 870341, at *2
(10th Cir. BAP Dec. 15, 1998).
       45
            11 U.S.C. § 502(a).
       46
            Fed. R. Bankr. P. 3008 advisory committee’s note to 1986 amendment.
       47
            11 U.S.C. § 502(j).
       48
         In re Gonzalez, 490 B.R. 642, 651 (1st Cir. BAP 2013); In re Tri-State Ethanol
Co., No. 03-10194, 2009 WL 1079776, at *7 (Bankr. D.S.D. Apr. 21, 2009); In re
Rayborn, 307 B.R. 710, 720 (Bankr. S.D.Ala. 2002); In re Jones, No. 99-13086C-13G,
2000 WL 33673759, at *2 (Bankr. M.D.N.C. Aug. 28, 2000).
       49
            In re Rayborn, 307 B.R. 710, 720 (Bankr. S.D.Ala. 2002).

                                                 15
       Neither the Bankruptcy Code nor the Bankruptcy Rules, however, defines “cause”

as used in § 502(j). Courts regularly consider whether “[c]ause may exist when relief

would be justified under [Federal Rule of Civil Procedure] 60(b).” 50 Federal Rule of Civil

Procedure 60(b) (“Rule 60(b)”) sets forth the standards for reconsideration of claims in

general and offers an applicable definition of “cause” providing that there may be relief

from a judgment or order for:

              (1) Mistake, inadvertence, surprise, or excusable neglect; (2) newly
       discovered evidence, that with reasonable diligence could not have been
       discovered in time to move for a new trial under Rule 59(b); (3) fraud
       (whether heretofore denominated intrinsic or extrinsic) misrepresentation,
       or other misconduct of an adverse party; (4) the judgment is void; (5) the
       judgment has been satisfied, released, or discharged, or a prior judgment
       upon which it is based has been reversed or otherwise vacated, or it is no
       longer equitable that the judgment should have prospective application; or
       (6) any other reason justifying relief from the operation of the judgment. 51

       The bankruptcy court applied step one—whether there was cause to reconsider the

claim—and noted that § 502(j)’s requirement that “cause” must be shown to reconsider

an allowed claim suggests “that late objections are not freely allowed.” 52 The transcript

of the hearing on the Motion to Reclassify evidences the bankruptcy court’s consideration

       50
         Gonzalez, 490 B.R. at 651; In re Willoughby, 324 B.R. 66, 72 (Bankr. S.D.Ind.
2005); In re Colley, 814 F.2d 1008, 1010–1011 (5th Cir. 1987); cert. denied, 484 U.S.
898 (1987); In re W.F. Hurley, Inc., 612 F.2d 392, 396 n. 4 (8th Cir. 1980); In re Payless
Cashways, 230 B.R. 120, 137 (8th Cir. BAP 1999); In re Southwest Florida Telecomm.,
234 B.R. 137, 142 (Bankr. M.D.Fla. 1998); In re Orsini Santos, 349 B.R. 762, 769 (1st
Cir. BAP 2006).
       51
            Fed. R. Civ. P. 60(b).
       52
            Tr. of Mar. 3, 2016 Hearing at 19, in Appellant’s App. at 195.

                                                  16
of whether there was cause pursuant to Rule 60(b) to reconsider the allowed claim. 53 In

determining that there was not sufficient cause to reconsider the allowance of the A-1

Claim, the bankruptcy court relied heavily on the fact that the Debtor objected to

“numerous, numerous other claims in 2012 and 2013,” and “filed motions to strip junior

liens, but [] never did so for A-1.” 54

       Similarly, the Debtor’s other objections to the A-1 Claim—A-1’s failure to

provide the Debtor with a copy of the Note or Deed of Trust, failure to make disclosures

under the Truth in Lending Act, and failure to identify interest charges and attorneys’

fees—all “easily could have been raised in 2012 rather than 2016.” 55 As these delays

were “patently unreasonable” (and, in this Court’s opinion, inexcusable), the Debtor

failed to demonstrate sufficient cause to justify reconsideration of the allowance of the

A-1 Claim. 56

       Additionally, the Debtor did not provide any newly discovered evidence that, with

reasonable diligence, could not have been discovered at the time the A-1 Claim was filed

or evidence that the claim had been satisfied to establish cause to reconsider the A-1

Claim. While the Debtor alleged below, and argues on appeal, that he recently discovered

       53
          Tr. of Feb. 25, 2016 Hearing at 28, in Appellant’s App. at 134 (“a motion under
60(b) must be made within a reasonable time and for reasons [in 60(b)] 1, 2, and 3. One
is mistake[], inadvertence, surprise, and excusable neglect, which is what you just told
me.”).
       54
            Tr. of Mar. 3, 2016 Hearing at 20, in Appellee’s App. at 196.
       55
            Id.
       56
            Id. at 22, in Appellant’s App. at 198.

                                                     17
that a third party paid off the Note, the Debtor proffered no evidence to prove this.

Although the bankruptcy court entered the Oral Ruling after conducting a non-

evidentiary hearing on the legal issues involved in the Claim Objection Pleadings, the

Debtor never requested an evidentiary hearing to establish these facts despite the

bankruptcy court’s invitation to do so. 57 Thus, there are no facts in the record to suggest

newly discovered evidence justifying reconsideration of the A-1 Claim or suggesting the

claim had been satisfied. Nor did the Debtor establish any fraud, misrepresentation, or

misconduct on the part of A-1 that warranted reconsideration of the A-1 Claim. 58

       Accordingly, the bankruptcy court appropriately considered whether there was

“cause” under § 502(j) to reconsider the A-1 Claim, and the decision to overrule the

Claim Objection and deny the Motion to Reclassify was not “arbitrary, capricious or

whimsical,” or a “manifestly unreasonable judgment.” 59

       Under step two of the claim reconsideration analysis, the bankruptcy court

considered the equities involved in the case. Relying on factors set forth in In re Fryer,

the bankruptcy court concluded reconsideration of allowed claims is only appropriate

after weighing (1) the extent and reasonableness of any delay, or prejudice to any party in

       57
         Tr. of Feb. 25, 2016 Hearing at 5, in Appellant’s App. at 181 (“at the hearing no
party expressly requested an evidentiary hearing.”).
       58
         The Debtor argued that the first page of the Note that he signed was not the
same as the first page of the Note that was attached the A-1 Claim, but again did not
provide any evidence to support these contentions. Furthermore, the Debtor appears to
have abandoned this argument on appeal.
       59
          In re Arenas, 535 B.R. 845, 849 (10th Cir. BAP 2015) (quoting Moothart v.
Bell, 21 F.3d 1499, 1504-1505 (10th Cir. 1994)).

                                                 18
interest; (2) the effect on efficient court administration; and (3) the moving party’s good

faith. 60 After considering these factors, the bankruptcy court concluded the Debtor did

not meet his burden to sufficiently demonstrate the equities necessitated allowing a late

filed objection to the A-1 Claim. The only justification the Debtor provided for the late

filed objection was the “stress” he was under in 2012. 61 However, the bankruptcy court

noted that, during the same period of time, the Debtor filed numerous plans, objections,

and other pleadings. The bankruptcy court also concluded that allowing a late-filed

objection prejudiced A-1 and did not promote efficient court administration. Finally, the

bankruptcy court seriously questioned the Debtor’s good faith in filing the Claim

Objection, noting the Debtor’s explanation of stress was undermined by his active role in

the bankruptcy case and his prior failures to dispute the A-1 Claim.

       The bankruptcy court correctly weighed the equities at stake, applying the test

articulated in In re Fryer and made numerous findings of fact on the record that weighed

against reconsidering the A-1 Claim. Most notably, the bankruptcy court recognized that

the Debtor could not adequately explain why he was unable to file a timely objection to

the A-1 Claim prior to confirmation of the Plan despite actively participating in his

bankruptcy case and objecting to the claims of numerous other creditors. As the Debtor

provides no compelling argument on appeal to suggest the bankruptcy court’s findings

       60
        Fryer v. Easy Money Title Pawn, Inc. (In re Fryer), 172 B.R. 1020 (Bankr.
S.D.Ga. 1994).
       61
            Tr. of Mar. 3, 2016 Hearing at 21, in Appellee’s App. at 197.

                                                 19
were arbitrary, capricious, or whimsical or that the Oral Ruling was otherwise an abuse of

discretion, the decision is affirmed.

       IV.    CONCLUSION

       The bankruptcy court made no error in holding that the provisions of the Plan did

not extinguish or otherwise modify A-1’s lien against the Residence and did not abuse its

discretion in determining the Debtor did not establish “cause” sufficient to reconsider the

A-1 Claim pursuant to § 502(j). Accordingly, the bankruptcy court’s orders on the Claim

Objection Pleadings are AFFIRMED.

                                                20