Shari L. Garcia

UNITED STATES BANKRUPTCY COURT
DISTRICT OF NEW MEXICO
In re
SHARI L. GARCIA,
Debtor. 	No. 13-05-13996 SA
MEMORANDUM OPINION ON MOTION TO
RECONSIDER DISMISSAL OF CASE
This matter is before the Court on Shari L. Garcia’s
(“Debtor”) Motion to Reconsider Dismissal of Case (doc 71) and
the objection thereto filed by the Trustee (doc 73). 	For the
reasons set forth below, the Motion will be denied. 	This is a
core proceeding. 	28 U.S.C. § 157(b)(2)(A).
FACTS
This case was filed on May 18, 2005, pre-BAPCPA. 	Debtor
filed her statements and schedules on June 1, 2005 (doc 6) and
her Chapter 13 Plan on June 2, 2005 (doc 8). 	New Mexico Taxation
and Revenue filed an objection to confirmation on June 1, 2005
(doc 5) and the Trustee filed an objection on June 23, 2005 (doc
11). 	On October 21, 2005, a stipulated Order Amending and
Confirming Chapter 13 Plan was entered. 	(Doc 19). 	This Order
confirmed the Plan as modified to increase the plan payments and
to further increase payments if income increased over a certain
amount.
On February 5, 2007, Trustee filed a Motion to Dismiss Case
for Failure to Make Plan Payments of approximately $2,812 (doc
26), to which the Debtor objected (doc 28) stating her intention
to become current. 	The Court conducted a preliminary hearing on
Case 05-13996-s13 Doc 79 Filed 08/13/10 Entered 08/13/10 15:37:14 Page 1 of 11

Page -2-
April 5, 2007, and ordered the Debtor to amend Schedules I and J
and to modify her plan by April 13, 2007. 	The Court continued
the dismissal motion to a hearing on the motion to modify. 	On
April 13, 2007, Debtor filed her amended schedules and a Motion
to Modify Plan (docs 31 and 32). 	On May 22, 2007, the Court
entered an Order Granting the Motion to Modify Confirmed Chapter
13 Plan (doc 37). 	The Modification increased the plan payment
and extended the life of the plan. 	On May 31, 2007, the
Trustee’s Motion to Dismiss was denied as moot. 	(Doc 39).
On May 21, 2008, the Trustee filed her second Motion to
Dismiss Case for Failure to Make Plan Payments in the approximate
amount of $2,450 (doc 41), to which the Debtor objected (doc 43),
stating her intention to become current. 	The Court set the final
hearing on the second Motion to Dismiss for September 30, 2008.
On August 16, 2008, Debtor filed her second Motion to Modify Plan
(doc 48), to which the Trustee objected (doc 50). 	The September
30, 2008 hearing was continued to October28, 2008. 	On October
28, 2008 the parties submitted a Stipulated Order Granting the
second Motion to Modify. (Doc 55). 	This modification calls for
wage withholding of the plan payments. 	On October 29, 2008, the
parties submitted a stipulated Order Denying Trustee’s second
Motion to Dismiss as moot. 	(Doc 56).
On August 19, 2009, Trustee filed her third Motion to
Dismiss for Failure to Make Plan Payments. 	(Doc 60). 	The Debtor
Case 05-13996-s13 Doc 79 Filed 08/13/10 Entered 08/13/10 15:37:14 Page 2 of 11

1Apparently Debtor never did this after the second
modification, which directed wage withholding.
Page -3-
objected, citing unforseen medical and household expenses, and
stated her intention to become current. 	(Doc 63). 	On October
16, 2009, Debtor and Trustee submitted a Stipulated Order
Resolving Trustee’s third Motion to Dismiss (“Stipulated Order”)
(doc 66). 	This Order stipulated that Debtor was $2,527 in
arrears as of that date. 	It called for a plan payment of $987
beginning October 18, 2009 through the end of the plan. 	Debtor
agreed to enter into a wage withholding order within 30 days. 1
The parties expressly agreed that if the debtor did not comply
with the terms of the Stipulated Order, or if the Debtor ever
became 30 days past due again, the trustee may submit an order
dismissing the case without further notice.
On March 12, 2010, Trustee submitted an Order Dismissing
Case (doc 69). 	Debtor filed a Motion to Vacate Dismissal of Case
on March 25, 2010 citing Bankruptcy Rules 9023 and 9024 and
Bankruptcy Code § 105 as authority (doc 71). 	As grounds, Debtor
asserts that before she could get her wage withholding order in
place she encountered unexpected expenses. 	She also states that
she has paid over $30,000 into her plan and can pay the remaining
$5,166 through eight payments of $646 which would be made every
two weeks. 	As additional grounds, she argues that if she had to
refile a chapter 7 case at this point, the BAPCPA means test
Case 05-13996-s13 Doc 79 Filed 08/13/10 Entered 08/13/10 15:37:14 Page 3 of 11

Page -4-
would cause a problem. 	Trustee objected, citing the three prior
motions to dismiss and the Stipulated Order which resolved the
third motion. 	Trustee states that only one payment was made
after the Stipulated Order was entered, and the case was properly
dismissed. 	Trustee argues that the Stipulated Order should be
respected as a final order.
On June 1, 2010, the Court held a status conference on the
Motion to Vacate at which Debtor’s attorney and the Trustee
appeared. 	Debtor’s attorney announced at the hearing that the
Debtor now preferred to convert the case to Chapter 7 and not
pursue completion of her plan. 	Because the case had already been
dismissed (but was still open pending the Chapter 13 Trustee’s
final report), the Court asked Debtor’s attorney for points and
authorities that would allow a debtor to convert after dismissal.
The Court told the Trustee that she need not file a brief until
or unless the Court asked for one after reviewing Debtor’s
submissions. 	Debtor filed a brief on June 21, 2010. 	The Court
has reviewed the brief and the pertinent authorities and finds
that the Motion to Vacate should be denied.
DISCUSSION
Under New Mexico law “the general rule is that stipulations
are ordinarily binding on the parties absent fraud, mistake,
improvidence, material change in circumstances, or unless
equitable considerations require otherwise.” 	Jones v. Lee, 126
Case 05-13996-s13 Doc 79 Filed 08/13/10 Entered 08/13/10 15:37:14 Page 4 of 11

Page -5-
N.M. 467, 472, 971 P.2d 858, 863 (Ct. App. 1998). 	Federal law is
the same. 	In re New Mexico Properties, Inc., 18 B.R. 936, 941
(Bankr. D. N.M. 1982)(citation omitted.) 	A stipulated judgment
is not a judicial determination but a contract between the
parties to the stipulation. 	Id.
“It is not within the province of the courts to write a new
contract for the parties. 	Absent any ambiguity, our duty is
confined to interpreting the contract which they made for
themselves.” 	Lazo v. Board of County Commissioners of Bernalillo
County, 102 N.M. 35, 38, 690 P.2d 1029, 1032 (1984)(quoting
Thompson v. Occidental Life Insurance Co., 90 N.M. 620, 621, 567
P.2d 62, 63 (Ct.App.), cert. denied, 91 N.M. 4, 569 P.2d 414
(1977).)
The Court finds the Stipulated Order unambiguous.
Therefore, this Court cannot rewrite the stipulated order but
rather must enforce it absent fraud, mistake, improvidence,
material change in circumstances, or unless equitable
considerations require otherwise. 	Debtor’s only argument is that
it would be inequitable to not allow her to set aside the
dismissal and convert after she has paid over $30,000 into the
plan. 	The Court disagrees. 	Debtor voluntarily entered into the
Stipulated Order after she had paid presumably over $29,000 into
the plan. 	It anticipates dismissal if the clear requirements are
not met. 	Debtor took a calculated chance that she would be able
Case 05-13996-s13 Doc 79 Filed 08/13/10 Entered 08/13/10 15:37:14 Page 5 of 11

2That section provides:
The court may issue any order, process, or judgment
that is necessary or appropriate to carry out the
provisions of this title. 	No provision of this title
providing for the raising of an issue by a party in
interest shall be construed to preclude the court from,
sua sponte, taking any action or making any
determination necessary or appropriate to enforce or
implement court orders or rules, or to prevent an abuse
of process.
Page -6-
to finish the plan and receive a discharge. 	She miscalculated.
That is not inequitable.
Furthermore, Debtor is essentially asking the Court to
formulate a right or remedy under Bankruptcy Code § 105(a) 2.
While the bankruptcy courts have fashioned relief under
Section 105(a) in a variety of situations, the powers
granted by that statute may be exercised only in a
manner consistent with the provisions of the Bankruptcy
Code. 	That statute does not authorize the bankruptcy
courts to create substantive rights that are otherwise
unavailable under applicable law, or constitute a
roving commission to do equity.
United States v. Sutton, 786 F.2d 1305, 1308 (5 th Cir. 1986)
(citations omitted.) 	The Code anticipates dismissal if plan
payments are not made. 	Bankruptcy Code § 1307(c)(6) (2005)
provides:
Except as provided in subsection (e) of this section,
on request of a party in interest or the United States
trustee and after notice and a hearing, the court may
convert a case under this chapter to a case under
chapter 7 of this title, or may dismiss a case under
this chapter, whichever is in the best interests of
creditors and the estate, for cause, including--
...
(6) 	material default by the debtor with respect to a
term of a confirmed plan[.]
Case 05-13996-s13 Doc 79 Filed 08/13/10 Entered 08/13/10 15:37:14 Page 6 of 11

3Both Fed.R.Civ.P. 59 and Fed.R.Bankr.P. 9023 were amended
effective December 1, 2009. 	The amendment to Fed.R.Civ.P. 59
increased the time for filing post-judgment motions from ten days
to twenty eight days. 	Fed.R.Bankr.P. 9023 adopts Fed.R.Civ.P. 59
(continued...)
Page -7-
Nothing in the Code suggests that a Debtor should have a fourth
bite at the apple. 	The Court finds that setting aside the
Stipulated Order would not be a proper use of §105(b).
Furthermore, Debtor could have avoided this situation entirely by
converting her case voluntarily before it was dismissed; she was
presumably aware that she was not making required payments and
that her case would be dismissed without further notice. 	In
conclusion, the Court finds that the Stipulated Order should be
enforced. 	Equitable considerations do not suggest otherwise.
The Motion to Vacate should be denied.
Second, Debtor’s Motion to Vacate does not specify under
which rule it is filed; it refers to both Bankruptcy Rule 9023
and 9024. 	Rule 9023 deals with new trials and motions to alter
or amend judgments, incorporating Fed.R.Civ.P. 59. 	Rule 9024
deals with relief from judgment or order, incorporating
Fed.R.Civ.P. 60.
The Motion to Vacate is really in the nature of a motion for
reconsideration. 	Although the federal rules do not recognize a
motion for reconsideration, these motions are dealt with under
either Rule 59 or 60. 	Ysais v. Richardson, 603 F.3d 1175, 1178
n. 2 (10 th Cir. 2010). 	Formerly 3, when a motion for
Case 05-13996-s13 Doc 79 Filed 08/13/10 Entered 08/13/10 15:37:14 Page 7 of 11

3(...continued)
but limits the time for filing post-judgment motions to fourteen
days to conform to Fed.R.Bankr.P. 8002(a)’s deadline for filing a
notice of appeal.
Page -8-
reconsideration was filed within 10 days of the entry of the
judgment or order, it was deemed to be a Rule 59 motion and when
a motion for reconsideration was filed after 10 days it was
deemed to be a Rule 60 motion. 	Id. (citing Van Skiver v. United
States, 952 F.2d 1241, 1243 (10 th Cir. 1991))(decided under
former law). 	In this case the Order Dismissing Case was entered
on March 12, 2010 and the Motion to Vacate was filed March 25,
2010. 	Therefore it was filed within the 14 day window of the
amended Fed.R.Bank.P. 9023 and will be deemed a rule 59 motion.
Grounds warranting a motion to reconsider include (1)
an intervening change in the controlling law, (2) new
evidence previously unavailable, and (3) the need to
correct clear error or prevent manifest injustice. 	See
Brumark Corp. v. Samson Resources Corp., 57 F.3d 941,
948 (10th Cir. 1995). 	Thus, a motion for
reconsideration is appropriate where the court has
misapprehended the facts, a party's position, or the
controlling law. 	Cf. Fed.R.App.P. 40(a)(2) (grounds
for rehearing). 	It is not appropriate to revisit
issues already addressed or advance arguments that
could have been raised in prior briefing. 	See Van
Skiver v. United States, 952 F.2d 1241, 1243 (10th Cir.
1991).
Servants of the Paraclete v. Does, 204 F.3d 1005, 1012 (10 th Cir.
2000). 	Debtor’s Motion to Vacate does not allege a change in the
law or new evidence previously unavailable or clear error.
Debtor perhaps believes that dismissal is manifest injustice, but
dismissal is what Debtor agreed to in the Stipulated Order. 	It
Case 05-13996-s13 Doc 79 Filed 08/13/10 Entered 08/13/10 15:37:14 Page 8 of 11

Page -9-
cannot be unjust to receive exactly what one bargains for.
Therefore, the Court finds that the Motion to Vacate does not
meet the requirements of Rule 59 and should be denied.
As an additional reason, the Court believes that conversion
after dismissal is not possible. 	Debtor correctly argues that
Code § 1307(a) states that a debtor may convert a chapter 13 case
to chapter 7 “at any time.” 	Debtor also correctly argues that 1)
unless the plain meaning of a statute is obviously at odds with
the overall purposes of the code, the court should enforce it,
citing United States v. Ron Paid Enterprises, Inc., 489 U.S. 235,
241 (1989) (citing Caminetti v. United States, 242 U.S. 470, 485
(1917)), and 2) when the language of a statute is plain, the sole
function of the courts, when the disposition required is not
absurd, is to enforce it according to its terms, citing Lamie v.
United States Trustee, 540 U.S. 526, 534 (2004)(citing Hartford
Underwriters Ins. Co. v. Union Planters Bank, N.A., 530 U.S. 1, 6
(2000)). 	Debtor argues that section 1307 is plain that a debtor
may convert from 13 to 7 at any time including after dismissal.
The Court disagrees.
First, the Court finds that allowing conversion “at any
time” including after dismissal is at odds with the overall
purposes of the code. 	A dismissal order takes effect
immediately. 	In re Rivera, 280 B.R. 699, 701 (Bankr. S.D. Ala.
2001)(“The law as to the status of a dismissed case is ‘almost
Case 05-13996-s13 Doc 79 Filed 08/13/10 Entered 08/13/10 15:37:14 Page 9 of 11

4Indeed, reading “at any time” without any limitations
whatever would entitle a debtor to reopen any closed chapter 13
case and convert it.
Page -10-
unanimous’ that an order dismissing a case is not stayed pursuant
to Fed.R.Bankr.P. 7062.”); Weston v. Franklin S. Cibula, a Law
Corp. (In re Weston), 101 B.R. 202, 205 (Bankr. E.D. Ca. 1989),
aff’d., 123 B.R. 466 (9 th Cir. BAP 1991), aff’d., 967 F.2d 596
(9 th Cir. 1992), cert. denied, 506 U.S. 1051 (1993)(“[T]his court
must find that the ten day stay within [Bankruptcy Rule 7062 and
Fed.R.Civ.P. 62(a)] was not intended to apply to orders involving
the dismissal of bankruptcy petitions without a contrary order of
the court.”) 	Obviously, in any Chapter 13 dismissal the case
itself remains alive for some time to allow the Chapter 13
trustee to wind up the estate and for the Court to rule on
administrative expenses, unclaimed funds, or similar
administrative matters. 	In re Hill, 305 B.R. 100, 104 (Bankr.
M.D. Fla. 2003). 	To read the statute the way Debtor urges would
allow every dismissed Chapter 13 debtor to convert to Chapter 7 4
.
Debtors could thereby circumvent certain creditor protection
sections of the code that prevent or penalize serial filings.
See, e.g., Sections 109(g), 362(c)(3), 362(c)(4). 	This does not
seem to fit in with the overall purposes of the code.
Furthermore, an order of dismissal is a directive by the
Court to the world that a debtor’s bankruptcy protection has
ended. 	See 11 U.S.C. § 349(b)(3) (stating that upon dismissal
Case 05-13996-s13 Doc 79 Filed 08/13/10 Entered 08/13/10 15:37:14 Page 10 of 11

Page -11-
property of the estate revests elsewhere, thereby terminating the
estate) and 11 U.S.C. §§ 362(c)(1) and 362(c)(2)(B) (stating that
automatic stay protection for estate property terminates when the
property leaves the estate, stating that automatic stay
protection for all other actions terminates when the case is
dismissed). 	The Court finds it absurd that a debtor could
unilaterally undo that directive simply by filing a notice of
conversion.
In summary, the Court disagrees that “at any time” can be
read to extend a debtor’s ability to convert a chapter 13 past
entry of an order of dismissal. 	A separate Order will enter
denying the Motion to Vacate.
Honorable James S. Starzynski
United States Bankruptcy Judge
Date Entered on Docket: 	August 13, 2010
Copies to:
Christopher L Trammell
Attorney for Debtor
3900 Juan Tabo NE
Albuquerque, NM 87111-3984
Kelley L. Skehen
625 Silver Avenue SW
Suite 350
Albuquerque, NM 87102-3111
United States Trustee
PO Box 608
Albuquerque, NM 87103-0608
Case 05-13996-s13 Doc 79 Filed 08/13/10 Entered 08/13/10 15:37:14 Page 11 of 11