United States District Court, S.D. Georgia, Dublin Division
interlocutory appeal requires the Court to decide how quickly
after the expiration of the objection deadline a bankruptcy
court must enter a discharge order to comply with Federal
Rule of Bankruptcy Procedure 4004(c)'s requirement that
discharge be entered "forthwith." Before that
question can be addressed, however, the Court must determine
whether Appellant-Debtor Archie Joel Champion III may appeal
the Bankruptcy Court's interlocutory order denying his
motion for entry of discharge. For the reasons set forth
below, the motion for leave to appeal (doc. no. 1-6) is
September 28, 2017, Appellant-Debtor Archie Joel Champion III
("Debtor") filed a Chapter 7 petition in the
Bankruptcy Court for the Southern District of Georgia, Dublin
Division. The meeting of creditors required by 11 U.S.C.
§ 341 was held on November 13, 2017, and later continued
until December 11th. (Bankr. Doc. Nos. 5, 14.J Morris Bank and
Merchant and Citizens Bank (collectively, the
"Banks") are both creditors in this case. Before
the January 12, 2018 objection deadline, Debtor and the
United States Trustee agreed to multiple consent orders to
file objections to discharge or motions to dismiss; the final
deadline was June 11, 2018. (Bankr. Doc. Nos. 22, 40, 44.)
The Banks, however, were not parties to the consent orders.
14, 2018 - three days past the Trustee's final objection
deadline - the Banks filed identical motions to dismiss under
11 U.S.C. § 707(a). (Bankr. Doc. Nos. 46, 47.) The
Banks' motions argued there was cause to dismiss
Debtor's petition because he failed to disclose material
income and assets, made misrepresentations in his bankruptcy
schedules, had surplus income to pay creditors, and filed his
petition only to frustrate and prejudice creditors. Four days
later, on June 18th, Debtor filed a motion requesting entry
of discharge. (Bankr. Doc. No. 51.) The Bankruptcy Court
subsequently held a telephone hearing regarding Debtor's
motion and requested additional briefing. Ultimately, the
Bankruptcy Court denied Debtor's request for entry of
discharge because the Banks' § 707(a) motions to
dismiss were pending.
March 28, 2019 Order and Opinion, the Bankruptcy Court relied
on Rule 4004(c)(1)(D) to conclude that a pending §
707(a) motion to dismiss prevented entry of discharge. The
Bankruptcy Judge reasoned that Rule 4004(c)'s requirement
that a discharge be entered "forthwith7' did not
require immediate entry of discharge upon the expiration of
the objection deadline. Rather, "forthwith" meant
"as soon as practicable" under Eleventh Circuit
caselaw. Further, the Bankruptcy Court concluded the Rules
proscribed no deadline to file a § 707(a) motion to
dismiss. Therefore, the three-day gap period between the end
of the objection deadline and the Banks' § 707(a)
motions to dismiss did not violate Rule 4004(c)'s
requirement to enter discharge "forthwith".
reaching the merits of the appeal, the Court must first
determine whether it has jurisdiction to hear the
interlocutory appeal. District courts have appellate
jurisdiction over both final and interlocutory orders of
bankruptcy courts. 28 U.S.C. § 158(a). However,
interlocutory appeals may only be heard with leave of the
district court. Id. To decide whether to hear an
interlocutory appeal, district courts employ the same
standard used by circuit courts of appeals under 28 U.S.C.
§ 1292(b). See In re Charter Co., 778 F.2d 617,
620 n.5 (11th Cir. 1985).
this standard, the appellant must show there is (1) a
controlling question of law; (2) over which there is
substantial ground for difference of opinion; and (3) the
immediate resolution of the issue would materially advance
the ultimate termination of the litigation. 28 U.S.C. §
1292(b); Laurent v. Herkert, 196 Fed.Appx. 771, 772
(11th Cir. 2006). Interlocutory orders should be appealed
sparingly, consistent with the policy against piecemeal
appeals and considerations of judicial economy. See
McFarlin v. Conseco Servs., LLC, 381 F.3d 1251, 1259
(11th Cir. 2004).
controlling question of law is one that presents "an
abstract legal issue or what might be called one of
'pure' law" where the appeals court can decide
the issue "quickly and cleanly" without having to
delve beyond the surface of the record. Id. at 1258
(citing Ahrenholz v. Bd. of Tr. of the Univ. of
Ill., 219 F.3d 674, 676-77 (7th Cir. 2000)). Generally,
a question of law under § 1292(b) includes "the
meaning of a statutory or constitutional provision,
regulation, or common law doctrine" and "does not
mean the application of settled law to fact."
the Court must determine the meaning of "forthwith"
under Rule 4004(c). Interpreting the meaning of bankruptcy
rules and statutes is a "pure" question of law.
See id. Further, this question does not require the
Court to study the factual record of the case; rather the
Court need only consider a handful of dates relevant to the
there must be substantial ground for difference of opinion on
the issue. To satisfy this element, the movant must show that
courts interpret the relevant legal principles differently.
In re Pac. Forest Prods. Corp., 335 B.R. 910, 922
(S.D. Fla. 2005). A difficult ruling or a lack of authority
on the issue will not satisfy the movant's burden.
Id. In reviewing the relevant authority, a court may
consider cases from within and beyond the circuit in which it
sits. Id. (citing In re Lykes Bros. S.S.
Co., 200 B.R. 933, 938 (M.D. Fla. 1996)).
parties' appellate briefs cite many cases to support
their respective positions. The Banks focus on In re
Coggin, 30 F.3d 1443 (11th Cir. 1994), abrogated on
other grounds by Kontrick v. Ryan, 540 U.S. 443 (2004).
In that case, the Eleventh Circuit interpreted
"forthwith" to mean "as soon as practicable
after the passage of the bar date." Id. at
1449. Preceding that language, the Eleventh Circuit
approvingly cited Black's Law Dictionary defining
"forthwith" as "immediately; without delay;
directly; within a reasonable time under the circumstances of
the case; promptly and with reasonable dispatch."
Id. (citing Black's Law Dictionary 654 (6th ed.
1990)). However, the precise issue on appeal in
Coggin concerned a motion for extension under Rule
4004(b). Thus, although the Eleventh Circuit held
"forthwith" means "as soon as
practicable," Coggin did not consider the
effect of a § 707(a) motion to dismiss filed after the
objection deadline but before entry of discharge.
cites multiple cases to support his contention that
"forthwith" means "immediately." The
First Circuit case In re Rosado, 2011 WL
4572021 (B.A.P. 1st Cir. Aug. 10, 2011), held the bankruptcy
court erred by not entering discharge at the expiration of
the deadline to object because none of the exceptions listed
in Rule 4004(c) existed at the deadline. Id. at *3.
The bankruptcy court postponed entry of discharge based on
the creditors' pending adversary complaints seeking an
exception to discharge of particular debts under § 523.
Id. at *1. The appeals panel determined that was an
abuse of discretion because such complaints are not grounds
to deny entry of discharge under Rule 4004(c). Id.
Notably, however, the creditors in Rosado also filed
a § 707 (a) motion to dismiss after the expiration of
the deadline to object, but before discharge was entered.
Id. at *1-2.
also cites In re Emery, 132 F.3d 892 (2d Cir. 1998),
where the Second Circuit criticized delaying entry of
discharge past the objection deadline because it contravened
Congress's intent. Id. at 896. Specifically, the
Second Circuit held "a gap period is the direct result
of the inability of the bankruptcy court system to comply
with Rule 4004(c)'s mandate that a discharge be entered
'forthwith' after a bar date has passed."
in the Ninth Circuit case In re Dietz, 914 F.2d 161
(9th Cir. 1990), the appeals court affirmed the bankruptcy
court's decision to deem the discharge entered at the end
of the objection period, even though the bankruptcy court
never formally entered a discharge. Id. at 164. By
doing so, "the court acted consistently with the spirit
of the bankruptcy rules, which contemplate that discharge is
effective immediately upon expiration" of the objection
deadline. Id. However, both Emery and
Dietz concerned actions to revoke discharge under
§ 727(d), not the effect of a § 707(a) motion to
Court is unable to find any case that specifically addresses
whether a § 707(a) motion to dismiss filed after the
objection deadline but before discharge is entered prevents a
bankruptcy court from entering discharge. The cases cited
above interpreting Rule 4004(c)'s "forthwith"
requirement arose under different procedural backgrounds from
this case but are nevertheless instructive to the issue
raised in this appeal. These cases reveal a difference of
opinion as to whether "forthwith" means immediately
or some longer period of time. Accordingly, the ...