Motion to Extend Stay and Third Party Injunction

In re Shea; Case No. 08-10350-RGM; February 27th, 2008

The debtor in this case previously had a case dismissed within the last year. Because of this, according to Bankruptcy Code §362(c)(3)(B), a hearing to extend the automatic stay beyond this 30 day period must be “completed before the expiration of the 30-day period.” That court rules that because the motion for an expedited hearing to extend the stay was not filed until one day after the 30-day period, it is futile to set the hearing and therefore the motion was denied.

Interestingly, the court also commented on the purported reason the debtor was seeking the stay (to prevent foreclosure of home she didn’t own, but lived in). The court noted that the automatic stay does not extend to the lender of the debtor’s landlord. Judge Mayer noted that, “at best, the debtor could seek an injunction premised on Bankruptcy Code § 105.” citing A.H. Robbins Co. Inc v. Piccinin, 788 F.2d 994 (4th Cir. 1986). In any event, an action for an injunction must be in the form of an adversary proceeding, and not by the filing of a motion.