United States District Court, E.D. Pennsylvania
Final Order of the Bankruptcy Court of July 6, 2016
F. Leeson, Jr. United States District Judge
Young appeals from the bankruptcy court's dismissal of
his chapter 13 bankruptcy petition on July 6, 2016. Because
the bankruptcy court did not abuse its discretion in
dismissing Young's petition for failure to obtain credit
counseling prior to filing his petition, the Court affirms
the bankruptcy court's order.
14, 2016, Johnny Young filed a petition for Chapter 13
bankruptcy. See Petition, In re Johnny
Young, No. 16-14264 (E.D. Bank. Pa. June 14, 2016), ECF
No. 1. Young filed his petition using “Official Form
101, ” which is the form approved by the Judicial
Conference of the United States for chapter 13 filings.
Question 15 of the Form directs petitioners to “[t]ell
the court whether you have received a briefing about credit
counseling” and explains that “[t]he law requires
that [a petitioner] receive a briefing about credit
counseling before [filing] for bankruptcy.” The Form
provides several options to answer this question. Young
marked the box indicating that he had “received a
briefing from an approved credit counseling agency within the
180 days before [he] filed this bankruptcy petition, but [he
did] not have a certificate of completion.” In these
circumstances, the Form states that the petitioner shall file
a copy of the certificate and payment plan, if any, within
fourteen days after filing the petition.
same day that Young filed his petition, the bankruptcy court
issued an order informing Young that his petition was missing
certain required documentation, including his
“Certification Concerning Credit Counseling and/or
Certificate of Credit Counseling.” Order, In re
Young, ECF No. 5. The court instructed Young to provide
this credit counseling documentation by June 28, 2016, or to
apply for an extension of time before that date. On June 28,
2016, Young filed a Certificate of Counseling, certifying
that he received credit counseling on June 27, 2016, which
was thirteen days after he filed his petition. Certificate,
In re Young, ECF No. 13. On July 6, 2016, the
bankruptcy court dismissed Young's case because he had
failed to obtain credit counseling before filing his
petition. Order, In re Young, ECF No. 24. Young
appeals this order.
Standard of Review
district court has jurisdiction to hear appeals from final
orders of a bankruptcy court. 28 U.S.C. § 158(a)(1). An
order dismissing a chapter 13 case is a final, appealable
order. In re Taal, 504 B.R. 682, 684 (B.A.P. 1st
reviewing an order of the bankruptcy court, a district court
applies a clearly erroneous standard to the bankruptcy
court's findings of fact and a de novo standard to the
bankruptcy court's legal conclusions. See In re
Sharon Steel Corp., 871 F.2d 1217, 1222 (3d Cir. 1989).
The court reviews an order dismissing a chapter 13 case for
abuse of discretion. In re Taal, 504 B.R. at 684;
In re Hoshan, No. CIV.A. 07-2931, 2008 WL 81994, at
*1 (E.D. Pa. Jan. 7, 2008) (applying abuse of discretion
standard to bankruptcy court's dismissal of chapter 13
petition for failure to comply with credit counseling
the Bankruptcy Abuse Prevention and Consumer Protection Act
of 2005, an individual debtor filing for bankruptcy under
chapter 13 must receive credit counseling from an approved
agency during the 180 days before filing the petition. 11
U.S.C. § 109(h)(1). To demonstrate compliance with this
requirement, a debtor must file with his petition a
certificate identifying the agency, describing the services
provided, and including a copy of any debt repayment plan.
Id. § 521(b).
did not obtain credit counseling before filing his petition.
In view of the fact that Young evidently obtained counseling
after submitting his petition, it appears that he
may have misunderstood the nature of the requirement.
Nevertheless, “[t]he law is clear . . . that a debtor
must get credit counseling before filing the bankruptcy
petition.” In re Hoshan, 2008 WL 81994, at *3.
Accordingly, the bankruptcy court did not abuse its
discretion in dismissing Young's case, see In re
Tomco, 339 B.R. 145 (Bankr. W.D. Pa. 2006) (finding that
dismissal is the proper remedy when a petitioner fails to
obtain pre-petition credit counseling), and the bankruptcy
court's order is affirmed. A separate order follows.