UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF ALASKA

In re KATHRYN LEANNE HERMAN and ROGER DEAN HERMAN Debtor(s)

Case No. A07-00138-HAR In Chapter 7 MEMORANDUM DENYING UNOPPOSED MOTION FOR SANCTIONS FOR VIOLATION OF AUTOMATIC STAY

Debtors filed a motion on April 26, 2007, for sanctions under 11 USC § 362(h) for violations of the automatic stay against creditor Affordable Loan Company (Dkt 24). The motion alleges six harassing phone calls, demanding payment and threatening arrest. Debtors also filed a Notice of Motion for Sanctions (Dkt 25), stating Affordable Loan had until May 11, 2007, to respond to the motion. The notice has a notation: “was faxed to Affordable Loans at 563-7329.”

No response has been docketed for Affordable Loan to date. The debtors have not lodged a proposed order ¹   although they prematurely requested a hearing when they filed their motion. Nonetheless, upon the court’s review of the notice and motion, it has determined that it should be denied for several reasons, even though it has not been opposed.

IMPROPER METHOD AND MANNER OF SERVICE- The first reason is lack of proper method of service. The notice indicates it was served by fax on Affordable Loan. The motion contains no notation of service, but perhaps it too was served by fax with the notice. No particular person or officer at Affordable Loan was designated to receive the service. This manner of service is not sufficient to effect service.

     8 ABR 426 

A motion seeking sanctions is a contested matter governed by Rule 9014 of the Federal Rules of Bankruptcy Procedure (the FRBPs). FRBP 9014 requires the initial service to be done in the same manner as a summons and complaint. ²   FRBP 7004 is the bankruptcy rule describing how to serve a summons and complaint. Among the methods is service by mail, ³   but not service by fax.

Secondly, the service of the motion and a proper notice on a corporation or partnership (assuming Affordable Loan is one of those) by first class must be specifically directed to “to the attention of an officer, a managing or general agent, or to any other agent authorized by appointment or by law to receive service of process and, if the agent is one authorized by statute to receive service and the statute so requires, by also mailing a copy to the defendant.” ⁴   That was not done by the debtors.

FORM OF NOTICE WAS NOT SUFFICIENT- Debtors used a cursory form of notice (Dkt 25), which did not comply with Local Bankruptcy Form 11. Our local bankruptcy rules require respondents to receive a form of notice in an approved form. ⁵   A copy of LBF 11 is appended for the benefit of debtors.

A PRO SE DEBTOR MUST COMPLY WITH THE RULES- While the debtors may feel the court should cut them a break, unrepresented debtors must comply with the      8 ABR 427  bankruptcy rules, too, ⁶   even though they may be complicated. The debtors allude to what may be an egregious violation of the automatic stay, but Affordable Loan is nonetheless entitled to due process.

DATED: May 15, 2007

BY THE COURT

HERB ROSS

U.S. Bankruptcy Judge

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N O T E S:

  1.  Alaska LBR 9021-1(a).

  2.  FRBP 9014(b) provides: “The motion shall be served in the manner provided for service of a summons and complaint by Rule 7004. Any paper served after the motion shall be served in the manner provided by Rule 5(b) F.R.Civ.P.”

  3.  FRBP 7004(b).

  4.  FRBP 7004(b)(3), compare, In re Villar, 317 BR 88, 92-3 (9th Cir BAP 2004).

  5.  Alaska LBR 9009-1(1).

  6.  Warrick v Birdsell, 278 BR 182, 187 (9th Cir BAP 2002).

Editors Note:
The LBF11 attachment has been removed by the web site editor. A copy of the Local Bankruptcy Form 11 can be found at http://www.akb.uscourts.gov/lbf11.pdf . It is included in the printable pdf version that is accusable through the printer icon at the top of the page.