Floyd Sims and Cynthia Sims

1This chapter 13 case was filed prior to the effective date
of most of the provisions of the Bankruptcy Abuse Prevention and
Consumer Protection Act of 2005 (“BAPCPA”), Pub. L. No. 109-08,
119 Stat. 23, and therefore the changes enacted by that
legislation are not applicable to this case.
UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF NEW MEXICO
In re:
Floyd Sims and
Cynthia Sims,
Debtors. 	No. 13 - 05-20101 - SR
MEMORANDUM OPINION ON DEBTORS’ AMENDED
MOTION TO RECONSIDER DISMISSAL OF CASE
On April 3, 2007, the Court entered a Memorandum Opinion on
Eligibility (doc 70) finding that Debtors’ unsecured debt
exceeded the limits of Section 109(e) by $32,112, and an Order
Dismissing the Case (doc 71). 	On April 13, 2007, Debtors filed a
Motion for Reconsideration of Order Dismissing Bankruptcy Case
(doc 80), and then an Amended Motion for Reconsideration of Order
Dismissing Bankruptcy Case (the “Motion”)(doc 83).
This matter is now before the Court on Debtors’ Motion, the
objections thereto by Tom R. Cone (doc 87) and Lea County State
Bank (“Bank”)(doc 88), the Trustee’s joinder in Bank’s objection
(doc 89), and the Debtors’ Reply (doc 90). 	The Court entered an
Order allowing Debtors to supplement the record (doc 91), which
the Debtors did (doc 94), and Bank responded (doc 95). 	This is a
core proceeding. 1
The Motion seeks reconsideration of the Order Dismissing
Case in order to provide to the Debtors the option of amending
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their homestead exemption downwards from $60,000 to $27,888. 	The
effect of this amendment would reduce the unsecured debt because
Bank’s lien on their homestead would not be avoided by a
corresponding amount. 	The result is to increase the secured
portion of Bank’s claim and correspondingly to reduce the
unsecured portion. 	The Motion also seeks reconsideration of its
finding that Bank’s claim was not secured to the extent it held a
lien on $64,222 of Tom Cone’s (a joint debtor to Bank) money
interpleaded into a state court case. 	The Motion also seeks
reconsideration that half the value of lots jointly owned by
Floyd Sims and Floyd Sims Pipeline Construction, Inc. do not
secure Bank’s claim, citing Branch Banking & Trust Co. v.
Russell, 188 B.R. 542 (E.D. N.C. 1995). 	Finally, the Motion also
seeks reconsideration of the Court’s decision that Bank applied
the payments correctly.
Debtors’ motion was filed within 10 days after entry of the
Order, so will be treated as a motion under Rule 59(e). 	See
Lopez v. Long (In re Long), 255 B.R. 241, 244 (10 th Cir. B.A.P.
2000). 	The grounds that warrant a motion to reconsider include
1) an intervening change in the law, 2) new evidence previously
unavailable, and 3) the need to correct clear error or prevent
manifest injustice. 	Servants of the Paraclete v. Doe, 204 F.3d
1005, 1012 (10 th Cir. 2000). 	“[A] motion to reconsider is
appropriate where the court has misapprehended the facts, a
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2 Ms. Meagle: “... 	So – and, of course, you know, if we’re
a couple dollars off here and there, I mean, they could even
amend their exemption; but I don’t think that’s necessary.” 	In
its previous review of the oral transcript, the Court failed to
listen to the opening statements.
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party’s position, or the controlling law.” 	Id. 	Motions for
reconsideration should not revisit issues already argued or
advance arguments that could have been raised earlier. 	Id.
In its Memorandum Opinion (doc 70), the Court did not
consider Debtors’ argument that they would reduce their homestead
exemption if required to fit within the debt limits. 	The partial
transcript provided by the Debtors shows that they made this
offer in their opening statement, see doc. 94, p. 20, l. 20 - p.
21, l. 1 2, and the Court erred in not considering it. 	Therefore,
the Court has misapprehended the facts and the Debtors’ position
regarding the homestead exemption. 	Reconsideration of that
portion of the Memorandum Opinion and Order (doc 71) is
appropriate.
Having reconsidered the matter, the Court finds that it
should amend its findings to include the following paragraph:
Debtors offered at trial to reduce their homestead exemption
if necessary to fit within the debt limits of Section 109(e).
The Court finds that a reduction of $32,112 will enable Debtors
to qualify as Chapter 13 Debtors. 	Orders will be entered 1)
setting aside the Order Dismissing case, and 2) directing Debtors
to amend their homestead exemption and to file a new Plan in
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accordance with the Memorandum Opinion on Eligibility, as amended
by this Memorandum Opinion.
With respect to the Motion to Reconsider the extent of
Bank’s secured claims (on the interpleaded funds and the jointly
owned property), the Court finds that it should not change its
prior ruling. 	Debtors cite Branch Banking & Trust Co. v.
Russell, 188 B.R. 542 (E.D. N.C. 1995) as support for including
Tom Cone’s interplead funds and the full value of the jointly
owned land in the secured claim. 	The Court has reviewed Russell
and is convinced that it was incorrectly decided. 	See also In re
Brown, 250 B.R. 382, 386 (Bankr. D. Idaho 2000)(Court declines to
follow Russell.)
Finally, the Debtors provide no basis to reconsider the
Court’s earlier decision upholding the Bank’s method of applying
payments, so that portion of the Motion should be denied. 	The
Court will enter an Order in conformity with this Opinion.
Honorable James S. Starzynski
United States Bankruptcy Judge
copies to:
James A Askew
Attorney for LCSB
PO Box 1888
Albuquerque, NM 87103-1888
Shay E Meagle
Attorney for Debtors
PO Box 30707
Albuquerque, NM 87190-0707
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Kelley L. Skehen
Chapter 13 Trustee
625 Silver Avenue SW
Suite 350
Albuquerque, NM 87102-3111
United States Trustee
PO Box 608
Albuquerque, NM 87103-0608
Tom R. Cone
PO Box 778
Jay, OK 74346
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