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IN RE BRYANT, JR.

Bankrupts — Revocation of Discharge — Excuseable Neglect

PEARSON, Bankruptcy Judge

Absent a showing of excusable neglect, the court will not revoke a discharge issued eight months previously and reopen the case to determine the dischargeability of a debt.

The petition in bankruptcy had been filed on September 17, 1975, discharge issued August 5, 1976 and the estate closed on August 27, 1976. Plaintiff then filed a complaint asking that the case be reopened to permit the filing of its complaint attacking the discharge on March 1, 1977. The court reopened the case on that date.

The facts indicate that the plaintiff had been listed as a creditor on defendant's schedules, received notice of the proceedings in bankruptcy and had been represented in court at the first meeting of creditors held October 6, 1975. The evidence showed that the defendant had borrowed from plaintiff the sum of $50,000.00 upon a negotiable note payable in sixty days. The note was purportedly signed by defendant and his wife and had been discharged. The complaint alleged that on January 28, 1977 demand was made on defendant's wife for payment. The creditor's counsel then learned on February 7, 1977 of the wife's claim of forgery of her signature upon the instrument and this proceeding was instituted.

The court noted that Section 15 of the Bankruptcy Act provides for certain instances where a court may revoke a discharge, none of which are applicable here. The court further stated that it lacked equity power to read exceptions into the operation of the judgment of discharge which do not exist. Absent a showing of excusable neglect, as required by Bankruptcy Rules 906 and 924, the complaint herein should have been filed on November 6, 1975, the last day fixed for the filing of complaints pursuant to Sections 14 and 17 of the Bankruptcy Act. The court was unable to find any case in which excusable neglect had been found where a period of more than one year had elapsed from the date an act was to have been performed. In addition, the court found no evidence here of a sufficient reason why plaintiff did not proceed to ascertain and determine its rights within the time frame set forth in the procedures of the case. The fact that sixteen months had elapsed without the exercise of diligence made excusable neglect even more difficult to find. In concluding that the complaint was not timely filed and in granting defedant's motion to dismiss the complaint, the court also noted that the rule of finality of judgments must be applied because at some time an end to litigation must be reached. See Sec. 15 at ¶ 10,128, Bankruptcy Rule 906 at ¶ 20,336 and Bankruptcy Rule 924 at ¶ 20,354.

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IN RE BRYANT, JR., (W.D.Va. 1978)
(Dec 27, 1978)