Menu    1 ABR 340 

HERBERT A. ROSS
U.S. Bankruptcy Judge





UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF ALASKA
605 West 4th Avenue, Anchorage, AK 99501-2296



_______________________________x 
In re 
JOHN GROSS, 
Case No. 3-86-00598-HAR
 Chapter 11

Debtor(s).MEMORANDUM REGARDING DENIAL OF
MOTION TO REOPEN
_______________________________x 

      Alaska USA Federal Credit Union (AUSA) filed a motion to reopen this case on January 18, 1991. The case was dismissed on October 5, 1990.

      AUSA wants to reopen to bring the debtor under the jurisdiction of the Bankruptcy Court again so that he cannot, in concert with his wife or former wife, Barbara Gross, manipulate the bankruptcy process with multiple filings to prevent AUSA from foreclosing on real property in the Anchorage area.

      AUSA claims that the John Gross case was dismissed with the understanding that AUSA would be able to foreclose against real property in the Anchorage area. Barbara Gross was part owner of TOP    1 ABR 341  that property. The property was an asset in her chapter 11 case in Alaska, Case No. 3-83-00173, in which she has a confirmed plan. AUSA says she is in default under that plan with respect to AUSA's secured claim and it should be entitled to foreclose. The Barbara Gross case was "closed" on September 21, 1990 according to AUSA. The court denied a motion to reopen Barbara's Alaska case. Barbara Gross has recently filed another chapter 11 case in California, staying AUSA's pending foreclosure.

      Various properties involved in the Gross cases in Alaska have been transferred or "parked" with relatives and friends of the Grosses under suspicious circumstances which led the court to believe the purpose was merely to avoid foreclosure.

      AUSA is attempting to avoid being whipped around by the Grosses by serial and repeated bankruptcy filings. It states: "[essentially Alaska USA seeks to re-open Mr. Gross's case to prevent him from repeating a pattern of his family members in abusing the Bankruptcy Code" (Memorandum in Support of Motion to Re-Open Case and to Conduct Rule 2004 Examination at 6, filed January 18, 1991).

      The court, however, treats a motion to reopen a "dismissed" case differently from a motion to reopen a "closed" case. The motion to reopen a "dismissed" case is more like a motion to vacate an order of dismissal under Bankruptcy Rule 9024, incorporating some of the F.R.Civ.P. 60 provisions. The distinction between "dismissal" and "closing" is explained in In re Garcia., 115 B.R. 169, 170 (Bankr.N.D.Ind. 1990):

TOP    1 ABR 342 

      Pursuant to 11 U.S.C. s 350(b), a bankruptcy case may be reopened for various reasons. Such a motion, however, necessarily contemplates that the proceedings have been "closed" in accordance with 11 U.S.C. § 350(a). As the Ninth Circuit has observed, an order dismissing a bankruptcy is very different from an order closing it. See In re Income Property Builders, Inc., 699 F.2d 963, 965 (9th Cir.1982). An order closing a bankruptcy case contemplates that the bankruptcy proceedings and administration of the estate have been completed. An order of dismissal, however, terminates a bankruptcy proceeding for reasons other than the completed administration of the estate.

[A bankruptcy is normally closed after the bankruptcy proceedings are completed.... A bankruptcy is reopened under 11 U.S.C. s 350(b), not to restore the pre-bankruptcy status, but to continue the bankruptcy proceeding. The word 'reopened' used in Section 350(b) obviously relates to the word 'closed' used in the same section. In our opinion a case cannot be reopened unless it has been closed. An order dismissing a bankruptcy case accomplishes a completely different result than an order closing it would and is not an order closing. Id. at 965.

      This court agrees with the Ninth Circuit's observations. To do otherwise would make dismissal an almost meaningless act, since the court would be required to reinstate a dismissed case upon being presented with some articulated "cause" for reopening it. Accordingly, we hold that a case which has been dismissed may not be reopened pursuant to 11 U.S.C. s 350(b).

      In addition, the court has discretion as to whether or not to reopen. The frustration of AUSA is justified, but, AUSA has consented to dismissal of this case once. The court will not reopen the case on the eventuality that John Gross might hinder AUSA's reacquiring title. He may attempt to do that in a TOP    1 ABR 343  subsequent bankruptcy filing, but that would be the case in which to raise the bad faith issues alluded to by AUSA. The decision not to reopen is one within the discretion of this court. Matter of Gratrix, 72 B.R. 163, 164 (D.Alaska 1984).



DATED: January 23, 1991 
  
 _______________________
 HERBERT A. ROSS
 Bankruptcy Judge


Serve: 
Marshall Coryell, Esq., for Alaska USA Federal Credit Union 
Larry L. Caudle, Esq., for John Gross 
John Gross, individually 
Thomas Yerbich, Esq., attorney for Barbara Gross in 3-83-00173 
U.S. Trustee 
Jamilia George, Chief Deputy ClerkH3307(HAR/lp)