Refinancing Estate Property and Voluntary Dismissal Under § 707(a): The Tenth Circuit’s Guidance in McGann v. Jagow

I. Introduction

The Tenth Circuit’s nonprecedential order in McGann v. Jagow, Nos. 25‑1065 & 25‑1066 (10th Cir. Dec. 3, 2025), addresses two recurring and often contentious issues in consumer bankruptcy practice:

When a Chapter 7 debtor may be held in civil contempt for failing to comply with a turnover order concerning estate property; and
When a Chapter 7 debtor may voluntarily dismiss a case under 11 U.S.C. § 707(a), particularly where the debtor proposes to refinance estate property and selectively pay only “legitimate” creditors.

Debtor–Appellant Sherry Ann McGann, proceeding pro se, appealed two bankruptcy court rulings (later affirmed by the Tenth Circuit Bankruptcy Appellate Panel (BAP)):

A civil contempt finding and fee award for failing to comply with an order to turn over a key and allow access to her real property at 1535 Grand Avenue, Grand Lake, Colorado; and
The denial of her motion to voluntarily dismiss her Chapter 7 case under § 707(a), where she asserted an ability to pay certain creditors through a conditional refinance of the same property.

Although designated as an “Order and Judgment” with no binding precedential effect except under law-of-the-case, res judicata, and collateral estoppel, the decision is citable for its persuasive value and offers concrete guidance on:

What constitutes a sufficient violation to support civil contempt in bankruptcy;
The debtor’s burden to show “cause” for dismissal under § 707(a);
The limits on using estate property to secure post-petition financing; and
The need to preserve arguments and tie them clearly to the specific order under appellate review.

II. Summary of the Tenth Circuit’s Decision

The Court resolved the two appeals as follows:

A. Appeal No. 25‑1065 – Civil Contempt for Failure to Comply with Turnover Order

The Court affirmed the bankruptcy court’s finding of civil contempt against McGann for violating a clear, specific turnover order requiring her to deliver a key and provide reasonable access to the bankruptcy estate’s real property by November 13, 2023.
McGann did not comply by the deadline, and when she eventually mailed a key on January 31, 2024, she sent it to the Office of the United States Trustee, not to the Chapter 7 Trustee as ordered.
The Tenth Circuit held there was no abuse of discretion in the contempt finding or in the resulting fee sanction: McGann had notice of the order, failed to comply with its specific terms, and failed to show lack of harm or a valid excuse.

B. Appeal No. 25‑1066 – Denial of Motion to Voluntarily Dismiss Chapter 7 Case

The Court affirmed the bankruptcy court’s denial of McGann’s motion to voluntarily dismiss her Chapter 7 case under § 707(a).
The bankruptcy court had concluded that:
- McGann’s proposal to refinance the real property was structurally flawed because the property was part of the bankruptcy estate; she therefore could not validly grant a first lien on it, nor could the bankruptcy court authorize such refinancing in that posture.
- Even if refinancing were possible, a debtor’s ability to pay is not, by itself, sufficient “cause” for dismissal under § 707(a).
- Under the totality of the circumstances, dismissal would prejudice creditors and administrative claimants, in part because McGann wished to pay only “legitimate” creditors, her discharge had already been entered, and dismissal would remove the estate property from the bankruptcy estate after years during which creditors were stayed from collection.
The Tenth Circuit held that McGann failed to engage with or rebut these reasons and therefore failed to show that the bankruptcy court abused its discretion.

The Court also rejected McGann’s various attempts to inject broader accusations of trustee misconduct, to rely on hearings and events occurring long after the denial of dismissal, and to raise new arguments for the first time in her reply briefs.

III. Factual and Procedural Background

A. The Bankruptcy Filing and the Real Property

In December 2020, McGann filed for relief under Chapter 7. She owned real property located at 1535 Grand Avenue, Grand Lake, Colorado (the “Property”), encumbered by four liens. The Chapter 7 Trustee, Jeanne Y. Jagow, was appointed.

In March 2021, McGann received a discharge under 11 U.S.C. § 727. That discharge relieved her of personal liability on covered debts but did not remove liens or take the Property out of the estate. In May 2022, the Trustee settled an adversary proceeding with two lienholders.

B. Attempts to Convert and Trustee’s Efforts to Market the Property

After the settlement, McGann sought to convert her Chapter 7 case to Chapter 12 or 13, presumably to propose a repayment plan. That conversion litigation lasted almost a year; in May 2023, the bankruptcy court denied conversion.

In June 2023, the Trustee obtained court authorization—over McGann’s objection—to employ a realtor to market the Property for sale. To carry out that order, the Trustee eventually sought physical access.

C. The Turnover Motion and Turnover Order

On August 25, 2023, the Trustee filed a motion for access to the Property (the “Turnover Motion”). After considering McGann’s response and holding a hearing, the bankruptcy court entered a detailed Turnover Order on October 24, 2023. That order required McGann:

To provide the Trustee with a key to the Property no later than November 13, 2023; and
To allow “reasonable access” to the Property.

McGann filed a motion for reconsideration of the Turnover Order and, separately, a motion to voluntarily dismiss her Chapter 7 case (the “Motion to Dismiss”).

D. The Motion to Dismiss and McGann’s Refinance Proposal

In her Motion to Dismiss, McGann:

Asserted that she intended to pay the two remaining lienholders and other “legitimate” creditors; but
Announced she would not pay claims she characterized as illegitimate, including the Trustee’s administrative expenses for legal and accounting professionals.

She alleged that she had been approved for a conditional loan to pay the creditors she deemed legitimate, but that closing was contingent upon the bankruptcy court’s approval and on her ability to pledge a first lien on the Property.

E. Noncompliance with the Turnover Order and Contempt Motion

McGann did not deliver a key by November 13, 2023. On November 20, 2023, the bankruptcy court denied reconsideration of the Turnover Order and explicitly warned McGann that continued noncompliance could result in a contempt finding.

On January 3, 2024, the Trustee filed a motion for order to show cause why McGann should not be held in contempt (the “Contempt Motion”). On January 31, 2024—approximately eleven weeks after the deadline—McGann mailed a key, but she sent it to the Office of the United States Trustee rather than to the Chapter 7 Trustee, contrary to the Turnover Order’s express terms.

F. Denial of the Motion to Dismiss and Motion for Reconsideration

At the end of January 2024, the bankruptcy court denied McGann’s Motion to Dismiss. It found that:

She had not met her burden to show “cause” for dismissal under § 707(a);
Her proposed refinance was structurally impossible because the Property belonged to the estate; and
The court lacked authority to approve the proposed refinancing transaction.

The court also held, in the alternative, that a debtor’s ability to pay is not sufficient cause for dismissal, and that, under the totality of circumstances, dismissal would prejudice creditors and administrative claimants. McGann’s later motion for reconsideration of this denial was itself denied.

G. Contempt Hearing and Sanctions

At the February 2024 hearing on the Contempt Motion, McGann argued that:

The Trustee acted with “unclean hands”; and
She had been mistreated and harassed by both the Trustee and the bankruptcy court.

The bankruptcy court rejected these contentions, found McGann in civil contempt of the Turnover Order, and awarded the Trustee attorneys’ fees as a sanction. It later entered a separate fee order in the amount of $7,012.50 in fees, noting that McGann failed to object and thus waived any challenge. McGann did not appeal that separate fee order.

H. BAP and Tenth Circuit Proceedings

McGann appealed both the contempt ruling and the denial of dismissal to the Tenth Circuit BAP, which affirmed both orders. She then appealed to the Tenth Circuit, which:

Treated the BAP as a non-deferential intermediate appellate tribunal;
Reviewed the bankruptcy court’s decisions directly for abuse of discretion; and
Affirmed both orders in full.

IV. Precedents and Authorities Cited

A. Appellate Posture and Standard of Review

The Court clarified that, in appeals from BAP decisions, it reviews the bankruptcy court’s orders directly rather than according deference to the BAP:

“[W]e treat the BAP as a subordinate appellate tribunal whose rulings are entitled to no deference (although they certainly may be persuasive).”

This formulation, quoting Johnson v. Riebesell (In re Riebesell), 586 F.3d 782, 788 (10th Cir. 2009), and reiterated in Bird v. Wardley (In re White), 144 F.4th 1216, 1228 (10th Cir. 2025), underscores that the Tenth Circuit conducts its own review of the bankruptcy court’s application of law to facts.

Both issues—civil contempt and voluntary dismissal—were reviewed for abuse of discretion:

Contempt: Lucre Mgmt. Grp., LLC v. Schempp Real Estate, LLC (In re Lucre Mgmt. Grp., LLC), 365 F.3d 874, 875 (10th Cir. 2004) (finding of contempt reviewed for abuse of discretion);
§ 707(a) dismissal: Redmond v. Kester (In re Kester), 339 B.R. 749, 751 (B.A.P. 10th Cir. 2006) (decision on voluntary dismissal of bankruptcy petition reviewed for abuse of discretion).

The Court quoted Mid‑Continent Cas. Co. v. Village at Deer Creek Homeowners Ass’n, Inc., 685 F.3d 977, 981 (10th Cir. 2012) to define abuse of discretion:

“‘An abuse of discretion has been characterized as an arbitrary, capricious, whimsical, or manifestly unreasonable judgment. Put differently, under the abuse-of-discretion standard, a trial court’s decision will not be disturbed unless the appellate court has a definite and firm conviction that the lower court made a clear error of judgment or exceeded the bounds of permissible choice in the circumstances.’”

B. Civil Contempt in Bankruptcy – In re Lucre Mgmt. Group

To sustain a finding of civil contempt, the Court applied the standard from In re Lucre Mgmt. Grp., LLC:

“[T]o be held in contempt, a court must find the party violated a specific and definite court order and the party had notice of the order.”

Thus, the contempt inquiry focuses on:

Existence of a clear, specific order;
Notice to the alleged contemnor; and
Noncompliance with that order.

C. Voluntary Dismissal Under § 707(a)

The Court grounded its analysis of voluntary dismissal in several authorities:

No absolute right to dismissal: Citing Smith v. Geltzer (In re Smith), 507 F.3d 64, 72 (2d Cir. 2007), the Court reiterated that “Under section 707(a), the debtor has no absolute right to dismissal of a Chapter 7 case.”
Debtor’s burden and ability-to-pay: Relying on Sicherman v. Cohara (In re Cohara), 324 B.R. 24, 27 (B.A.P. 6th Cir. 2005), the Court emphasized:
“It is the debtor’s burden to prove cause exists for dismissal and ‘a debtor’s ability to repay her debts will not, on its own, constitute cause for dismissal.’”
Discretionary nature of dismissal: The Court quoted Peterson v. Atlas Supply Corp. (In re Atlas Supply Corp.), 857 F.2d 1061, 1063 (5th Cir. 1988): “the decision whether to grant a motion to dismiss a petition in bankruptcy lies within the discretion of the bankruptcy judge.”

D. Waiver, Issue Preservation, and Pro Se Litigants

Several authorities guided the Court’s approach to issues McGann failed to raise properly:

Pro se filings: Yang v. Archuleta, 525 F.3d 925, 927 n.1 (10th Cir. 2008) – courts liberally construe pro se filings but do not act as the litigant’s advocate.
Arguments raised for first time in reply: United States v. Leffler, 942 F.3d 1192, 1197 (10th Cir. 2019) – arguments first asserted in a reply brief are ordinarily deemed waived.
Arguments not raised below: Robinson v. Tenantry (In re Robinson), 987 F.2d 665, 669 (10th Cir. 1993) – a court does not commit clear error by failing to address an argument not properly presented to it.

E. Unclean Hands Doctrine

The BAP, quoted by the Tenth Circuit, described the unclean hands doctrine:

“‘The unclean hands doctrine means, in general, that equity will not aid a party whose conduct has been unlawful, unconscionable, or inequitable.’”

The bankruptcy court considered McGann’s accusations against the Trustee, rejected them, and the record, as the Court observed, supported a finding that the Trustee sought sanctions solely because of McGann’s failure to obey the Turnover Order.

V. The Court’s Legal Reasoning

A. Civil Contempt for Violating the Turnover Order (No. 25‑1065)

1. Clear Order, Notice, and Violation

The Turnover Order was explicit: McGann was required to provide a key to the Property to the Chapter 7 Trustee by November 13, 2023, and to allow reasonable access. McGann did not dispute notice of this order.

The Court focused on two critical facts:

McGann missed the November 13 deadline by approximately eleven weeks; and
When she finally mailed a key on January 31, 2024, she sent it to the Office of the United States Trustee, not to the Chapter 7 Trustee to whom the order was directed.

The Court held that these facts established a straightforward violation of a “specific and definite” order, satisfying the Lucre standard for civil contempt.

2. Rejection of “Compliance under Duress” and “No Harm” Arguments

McGann argued that she “complied under duress” and that the Trustee had suffered no actual harm. The Court rejected these arguments for several reasons:

The record refuted any claim of timely compliance: McGann did not meet the deadline and did not deliver the key to the proper party.
She provided no record support for the assertion that the Trustee suffered no harm.
The bankruptcy court had ordered the Trustee to submit a detailed fee motion reflecting time spent enforcing the Turnover Order. The Trustee sought $7,012.50 in fees, and McGann filed no response, thus waiving any objection. The court then found the fees “reasonable and necessary due to McGann’s contempt and failure to comply.”
McGann did not appeal that separate fee order.

On these facts, there was no abuse of discretion in finding both noncompliance and compensable harm.

3. Mental Health Considerations and PTSD

On appeal, McGann asserted the bankruptcy court failed to consider her post-traumatic stress disorder (PTSD), alleged harassment, and other mental health factors as mitigating circumstances. Crucially, the Court found:

McGann pointed to no place in the bankruptcy record where she argued that PTSD or mental health issues prevented her from complying with the Turnover Order.
Her one citation related to PTSD concerned a request to appear remotely at the contempt hearing, not an excuse for violating the Turnover Order.

Because she had not properly raised these arguments below, the bankruptcy court did not abuse its discretion by not considering them. The Court cited In re Robinson to support the principle that a court commits no error by not addressing an argument never presented.

4. “Unclean Hands” and Trustee Misconduct

McGann argued the Trustee had “unclean hands,” suggesting that alleged trustee misconduct should bar a contempt finding. The Court, agreeing with the BAP, held:

The unclean hands doctrine applies when a party seeking equitable relief has engaged in unlawful or inequitable conduct related to the dispute.
The bankruptcy court considered McGann’s accusations of misconduct and rejected them on the merits.
The record supported the conclusion that the Trustee sought sanctions solely due to McGann’s disregard of the Turnover Order, not as part of any broader scheme of harassment.

Thus, the unclean hands doctrine did not bar relief to the Trustee; the contempt finding remained justified.

5. Fee Award as a Compensatory Sanction

The bankruptcy court awarded the Trustee $7,012.50 in attorneys’ fees incurred to enforce the Turnover Order and address McGann’s noncompliance. The Court noted:

McGann did not object to the fee motion, so any challenge was waived.
She did not appeal that specific fee order, further insulating it from review.

Given these circumstances, and the established principle that civil contempt sanctions are commonly compensatory, the Tenth Circuit found no abuse of discretion.

B. Denial of Voluntary Dismissal under § 707(a) (No. 25‑1066)

1. Statutory Background and Framework

Section 707(a) provides that:

“The court may dismiss a case under this chapter only after notice and a hearing and only for cause….”

Key points applied by the Court:

The debtor has no absolute right to dismiss a Chapter 7 case (In re Smith).
The debtor bears the burden of proving “cause” (In re Cohara).
A debtor’s ability to repay debts is not, standing alone, sufficient cause for dismissal.
Dismissal is discretionary and must be assessed under the “totality of the circumstances.”

2. Structural Infeasibility of the Proposed Refinance

A central pillar of McGann’s cause argument was a conditional loan approval to refinance the Property and pay certain creditors. The bankruptcy court identified a fatal “structural flaw,” summarized by the BAP and adopted by the Tenth Circuit:

The Property was “property of the bankruptcy estate,” not McGann’s individual, unencumbered collateral.
McGann’s proposed transaction required her to grant the new lender a first lien on the Property.
Because the Property belonged to the estate, she was “not entitled to refinance the Property during the bankruptcy proceedings,” and the court lack authority to approve that proposed refinance.

In other words, the plan she offered as “cause” could not legally be implemented in the case’s existing posture. The Court agreed that this structural defect alone justified denial of dismissal: a debtor cannot show cause by proposing a transaction the bankruptcy court is powerless to authorize.

3. Ability to Pay Is Not Enough

The bankruptcy court alternatively held, and the Tenth Circuit agreed, that even if refinancing were conceptually possible, McGann’s asserted ability to pay her creditors in full would still not constitute “cause” for dismissal. The Court, following In re Cohara, endorsed the widely accepted view that:

Ability to pay is a factor, but not determinative; and
Congress has provided conversion options (e.g., to Chapter 13) for debtors wishing to repay, rather than a guaranteed right to dismiss a Chapter 7 case whenever they later assert solvency or new financing.

4. Totality of Circumstances and Creditor Prejudice

Examining the totality of circumstances, the bankruptcy court found dismissal would prejudice creditors and administrative claimants. The BAP’s summary, adopted by the Tenth Circuit, highlighted several points:

Selective treatment of creditors. McGann’s proposal was explicitly to pay only creditors she deemed “legitimate,” while refusing to pay others, including the Trustee’s professionals. That “reordering” of distribution priorities conflicted with the Bankruptcy Code’s mandatory priority scheme and would prejudice disfavored creditors.
Effect of prior discharge. McGann had already received a § 727 discharge in March 2021. The bankruptcy court found that the discharge had not been revoked and that “a dismissal would not nullify the effect of the discharge.” Thus, dismissing the case would leave unsecured creditors unable to recover from McGann personally, while simultaneously stripping the estate of the Property—the primary nonexempt asset from which they might receive payment.
Delay and reliance. The Motion to Dismiss was filed more than three years after the petition date, during which creditors were stayed from collecting debts. Dismissal so late in the process, after creditors had been restrained and had relied on the bankruptcy proceedings, was inherently prejudicial.
Removal of estate property. Dismissal would remove the Property from the estate, depriving creditors of a key asset while leaving them bound by the existing discharge.
Trustee objection and likely delay. The Trustee objected to dismissal. The court also found that McGann’s proposed dismissal and refinancing would likely delay payments to creditors further, contrary to bankruptcy’s goal of orderly and expeditious administration.

Together, these factors convincingly supported the denial of dismissal under § 707(a).

5. Scope of Appeal: Trustee Misconduct and Collateral Issues

A significant portion of McGann’s appellate briefing focused on alleged trustee misconduct, failure to collect certain assets, and supposed improprieties related to other claims (e.g., the “Swany Judgment,” claimed sales proceeds, terms of prior settlements, and later state-court rulings). The Tenth Circuit, echoing the BAP, limited its review to the specific order on appeal—the January 31, 2024 Order Denying Motion to Dismiss:

The Court emphasized that its task was not to adjudicate trustee misconduct as an independent issue through this appeal, but to decide whether denying dismissal under § 707(a) was an abuse of discretion.
McGann failed to explain how the alleged failures to collect certain assets or enforce particular judgments bore directly on the § 707(a) “cause” analysis.
Events occurring after the denial of dismissal (such as an April 3, 2025 hearing or a May 23, 2025 Hawaii state-court ruling) were outside the temporal and evidentiary scope of the appeal.
Arguments raised for the first time in the reply brief, or not raised in the bankruptcy court, were deemed waived or forfeited.

The Court also noted that McGann’s arguments often appeared in bullet-point lists without developed legal analysis connecting them to the § 707(a) standard. Her conclusory assertion that the case had become “abusive,” was “built on a foundation of misrepresentation and fraud,” and that she had “in good faith” offered to pay all creditors, was insufficient to show an abuse of discretion in light of the bankruptcy court’s detailed reasoning.

VI. Complex Concepts Simplified

Several legal concepts recur throughout the opinion. The following plain-language explanations may aid understanding.

1. Chapter 7 vs. Chapters 12 and 13

Chapter 7 is a liquidation chapter: a trustee gathers nonexempt assets, liquidates them, and distributes proceeds according to statutory priorities. The debtor ordinarily receives a discharge relatively quickly.
Chapters 12 and 13 are reorganization/repayment chapters: the debtor proposes a multi-year plan to pay creditors over time from future income, often keeping key assets.

McGann attempted to convert from Chapter 7 to Chapter 12 or 13 to reconfigure her obligations but was denied, leaving her in Chapter 7 with a trustee controlling estate assets.

2. Property of the Estate

When a debtor files bankruptcy, virtually all legal and equitable interests in property become “property of the estate.” That means:

The Chapter 7 Trustee, not the debtor, controls such property, subject to court oversight.
The debtor cannot unilaterally refinance, sell, or encumber estate property without proper authorization.

In McGann, the Property remained estate property, which is why McGann’s proposed refinance—requiring her to grant a first lien—was structurally inconsistent with the estate’s ownership and with the Trustee’s exclusive control.

3. Turnover Order

A “turnover order” is an order requiring the debtor (or another party) to turn over property or access to property belonging to the estate. Here, the Turnover Order required McGann to:

Deliver a key; and
Ensure access to the Property for the Trustee’s administration efforts (e.g., inspection, realtor showings).

4. Civil Contempt

Civil contempt is a tool courts use to enforce compliance with their orders. In bankruptcy, civil contempt can:

Compensate parties injured by noncompliance (e.g., attorney’s fees); and
Coerce future compliance (e.g., fines or other sanctions until the order is obeyed).

To find civil contempt, a court typically must see:

A clear, specific order;
Notice to the alleged contemnor; and
A violation not excused by an inability to comply.

5. Unclean Hands

“Unclean hands” is an equitable doctrine: a party asking for equitable relief (such as sanctions or enforcement) may be denied if that party has acted unfairly or improperly in connection with the dispute. However:

The misconduct must be serious, and
It must relate sufficiently to the transaction or controversy at issue.

In McGann, the bankruptcy court and the appellate courts found no record support for accusations that the Trustee’s conduct rendered her hands “unclean” in seeking contempt sanctions.

6. Voluntary Dismissal under § 707(a)

Section 707(a) allows a court to dismiss a Chapter 7 case “for cause,” but:

There is no debtor “right” to dismissal.
The debtor must affirmatively prove “cause.”
Courts assess “cause” under the totality of circumstances, frequently including:
- Good faith/bad faith of the debtor;
- Extent of prejudice to creditors;
- Timing and motive for the motion;
- Whether the debtor is attempting to manipulate the system or avoid consequences; and
- Whether dismissal serves the purposes of bankruptcy.

7. Administrative Expenses and Distribution Priorities

In Chapter 7, the Bankruptcy Code sets strict priority rules for how estate funds are distributed. Among the highest-priority claims are “administrative expenses,” such as:

Trustee’s fees;
Trustee’s counsel and professionals; and
Certain costs of preserving or liquidating estate property.

A debtor cannot use dismissal or private refinancing to “skip over” these priority claims or to substitute her own view of which claims are “legitimate.”

8. Abuse of Discretion, Waiver, and Preservation

Abuse of discretion is a highly deferential standard; an appellate court will not reverse unless it has a “definite and firm conviction” that the lower court made a clear error of judgment.
Waiver/forfeiture occur when a party fails to timely raise an argument in the trial court or in the opening brief on appeal. New arguments in a reply brief are usually deemed waived.

In McGann, these concepts explain why:

Her unraised PTSD argument could not be considered as an excuse for contempt; and
Her failure to contest the fee motion waived any later challenge to that sanction.

VII. Broader Impact and Practical Implications

A. Voluntary Dismissal: Refinancing Estate Property Is Not a Silver Bullet

McGann illustrates several important limitations on using refinancing as a basis to seek dismissal under § 707(a):

Estate status matters. If property remains part of the estate, the debtor cannot credibly propose to grant a new lender a first lien without the Trustee’s and court’s authorization, and even then, complex statutory requirements apply.
“Structural flaw” is fatal. A dismissal motion grounded in a transaction that legally cannot occur in the case’s current posture cannot show “cause.” Courts will scrutinize whether the proposed solution is actually feasible under bankruptcy law.
Ability to pay is a factor, not a trump card. Even a plausible ability to pay in full does not require dismissal. The Code gives courts discretion and insists on protecting creditors from strategic behavior and prejudice.

B. Debtors Cannot Rewrite the Priority Scheme Through Dismissal

McGann’s attempt to distinguish between “legitimate” and “illegitimate” creditors, particularly by excluding trustee professionals from payment, ran headlong into the statutory priority system. The decision underscores:

Debtors may not selectively honor some debts while using dismissal to escape others that Congress has placed at a higher or equal priority;
Court-approved fees and administrative claims are integral to the functioning of the bankruptcy system and are not optional.

C. Importance of Timing and Creditor Prejudice

The timing of McGann’s dismissal request—over three years into the case, after a discharge, and after extensive estate administration—strongly weighed against dismissal. Creditors had already:

Been stayed from collecting for years; and
Relied on the Trustee’s administration, including adversary settlements and sale preparations.

Dismissing at that stage, while allowing the debtor to retain estate property and the benefit of discharge, would have imposed substantial prejudice. Future debtors should understand that the longer a Chapter 7 case progresses and the more reliance creditors place on the bankruptcy process, the less likely dismissal becomes.

D. Enforcement of Turnover Orders and Trustee Tools

The contempt portion of the decision confirms that:

Bankruptcy courts may and will enforce turnover orders through civil contempt sanctions;
Trustees can recover their reasonable attorney’s fees incurred in enforcing clear orders against recalcitrant debtors; and
Arguments about “no harm” or “substantial compliance” must be grounded in the specific terms of the order and record evidence, not mere assertion.

E. Mental Health and Compliance: Record Development Is Critical

The Court’s treatment of McGann’s PTSD argument carries a practical lesson:

Mental health conditions may be relevant to a court’s exercise of discretion (e.g., in assessing willfulness or tailoring sanctions), but only if they are timely raised, supported with some evidence, and clearly tied to the debtor’s ability to comply.
Failing to create a record below will generally foreclose reliance on such factors on appeal.

F. Appellate Practice Lessons for Pro Se Litigants and Counsel

The opinion offers several reminders about effective appellate advocacy:

Define the scope of appeal. Arguments must be tied directly to the order under review (here, the contempt order and the order denying dismissal), not to every perceived wrong during the entire case.
Develop arguments, don’t list them. Bare bullet points or unexplained references to prior hearings or judgments do not satisfy an appellant’s burden to show error.
Preserve issues. Raise legal and factual bases in the bankruptcy court and in the opening appellate brief; do not wait until the reply brief.
Respect the record. Events and evidence arising after the order on appeal generally cannot retroactively demonstrate error in that prior order.

VIII. Conclusion

McGann v. Jagow is nonprecedential but provides clear, practical guidance in two important areas of bankruptcy law:

Civil contempt and enforcement of turnover orders. Where a debtor has notice of a clear turnover order and fails to comply with its specific requirements—particularly after an express warning—bankruptcy courts possess broad discretion to find contempt and award compensatory attorney’s fees. Unsupported claims of “duress,” alleged lack of harm, or unpreserved mental-health defenses will not forestall sanctions.
Voluntary dismissal under § 707(a). A Chapter 7 debtor has no automatic right to dismiss a case. The debtor bears the burden of showing “cause,” and a mere ability to pay (even allegedly in full) does not suffice. Proposals built on structurally impossible transactions—such as refinancing estate property with a new first lien that the debtor cannot lawfully grant—cannot establish cause. Courts will also deny dismissal when it would prejudice creditors, undermine statutory priorities, or allow the debtor to keep both the benefits of discharge and the estate’s principal asset.

The decision also reaffirms essential appellate principles: issues must be preserved, arguments must be developed and anchored to the specific orders under review, and the record on appeal is not a vehicle to litigate every dissatisfaction with the bankruptcy process. For practitioners, trustees, and debtors alike, McGann serves as a cautionary illustration of both the power and the limits of the court’s equitable discretion in the face of noncompliance and late-stage strategic maneuvering in Chapter 7.