Harold G. Swain and Julia A Swain

OCR transcription for search; preserved printed pages are authoritative

The court incorporates by reference in this paragraph and adopts as the findings and orders
of this court the document set forth below.

Russ Kendig
United States Bankruptcy Judge

UNITED STATES BANKRUPTCY COURT
NORTHERN DISTRICT OF OHIO
EASTERN DIVISION

CHAPTER 13

IN RE:

HAROLD G. SWAIN AND CASE NO. 09-62957

JULIA A. SWAIN,

Debtors.
MEMORANDUM OF OPINION
(NOT INTENDED FOR

)

)

) JUDGE RUSS KENDIG
)

)

) PUBLICATION)

On April 4, 2011, the court entered an order compelling creditor Western Finance &
Lease, Inc. (“Western Finance”) to release its lien on a TAS Winkler building system
(“building”). Ten days later, Western Finance moved to vacate the order under Federal Rule
of Bankruptcy Procedure 9024. Debtors oppose the motion. A hearing was held on June 8,

2011.

The court has jurisdiction of this matter pursuant to 28 U.S.C. § 1334 and the general
order of reference entered in this district on July 16, 1984. Venue in this district and division
is proper pursuant to 28 U.S.C. § 1409.

This opinion is not intended for publication or citation. The availability of this
opinion, in electronic or printed form, is not the result of a direct submission by the court.

FACTUAL BACKGROUND

When Debtors filed their joint chapter 13 case on July 21, 2009, they were
indebted to Western Finance under an Equipment Finance Agreement for the building.
Western Finance entered a notice of appearance on September 30, 2009 directing notices
to be mailed to counsel, Christopher J. Niekamp. Mr. Niekamp is a registered ECF user

AUTHENTICATED
U.S. GOVERNMENT
INFORMATION

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in this court.

Western Finance objected to Debtors’ plan because it failed to provide for the
secured claim on the building. The parties resolved the dispute on April 14, 2010 with

Debtors agreeing to surrender the building (“agreed order”).

On February 11, 2011, following nearly ten months of inaction by Western
Finance, Debtors filed a motion to compel Western Finance to either accept surrender of
the building or release its lien. The certificate of service indicates the motion and notice
were served via the CM/ECF system to Mr. Niekamp on February 11, 2011.

Western Finance did not respond to the motion to compel and the court granted
the motion, by default, on April 4, 2011, and required release of the lien on the building.
A motion to vacate the order was filed on April 14, 2011.

LAW AND ANALYSIS

Western Finance argues that the order should be set aside under Federal Rule of
Bankruptcy Procedure 9024, which incorporates Federal Rule of Civil Procedure 60 into
bankruptcy practice, based on a lack of notice and/or excusable neglect. It also argues
that an adversary proceeding was required to force release of its lien under Rule 7001.
Debtors oppose giving Western Finance relief from the order to compel. It is their
position that notice was properly provided, so Western Finance has not demonstrated the
right to relief under Rule 9024. They also argue that an adversary proceeding is not

required on these facts.

The court decides this matter on independent grounds from those argued by the

parties. A motion to compel, by its nature, is a contested matter and therefore governed

y Federal Rule of Bankruptcy Procedure 9014. Under Rule 9014(b), the motion
initiating a contested matter is served in the same manner as an adversary complaint and
summons, which directs service pursuant to Federal Rule of Procedure 7004. Rule 7004
required service to Western Finance. Debtors did not serve Western Finance with either
the motion or notice and therefore failed to comply with the service requirements. The
court will therefore set aside the order compelling release of the lien under Federal Rule
of Bankruptcy Procedure 9024, as it incorporates Federal Rule of Civil Procedure

60(b)(4).

After the initial motion in a contested matter is served, subsequent pleadings in
that matter may be served to a party’s attorney. See Fed. R. Bankr. P. 9014(b) (“[a]ny
paper served after the motion shall be served in the manner provided by Rule 5(b) F. R.

Civ. P.”) Rule 7005(b) allows for service to a party’s attorney.

An appropriate order will be issued immediately.

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Service List:

Erin R Kick

KICK & GILMAN

133 South Market St.
Loudonville, OH 44842

Christopher J. Niekamp

Bermlohr, Niekamp & Weinsensell, LLP
301 Nantucket Building

23 S. Main St.

Akron, OH 44308-1822

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