Rubino v. Fowler, No. 465-7-11 Rdcv (Teachout, J., Dec. 30, 2011)

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                                                STATE OF VERMONT

SUPERIOR COURT                                                                                   CIVIL DIVISION
Rutland Unit                                                                               Docket No. 465-7-11 Rdcv


PETER RUBINO, et al.,
     Appellants

           v.

JAMES T. FOWLER,
    Appellees

                                                             ORDER

        A hearing was held in Small Claims Court in Docket 198-3-11 Rdsc on June 1,
2011. The Court issued Judgment for James T. Fowler, Appellee. Appellants Peter N.
and Patricia Rubino appealed on the grounds that they were in bankruptcy at the time of
the hearing and permission had not been obtained from the Bankruptcy Court to pursue
the claim against them. This Court issued an Entry Order on July 22, 2011, staying the
proceedings and giving Mr. Fowler an opportunity to show that permission had been
granted by the Bankruptcy Court to proceed with the case in Small Claims Court.

        Mr. Fowler has not filed anything showing such permission. The undersigned has
listened to the full record of the hearing held on June 1, 2011. The undisputed evidence
was that the Rubinos had an open bankruptcy case, and they argued that the case against
them was prohibited by the bankruptcy stay. The Small Claims Judge acknowledged that
bankruptcy stays “everything,” but nonetheless issued judgment.

        The automatic stay precludes proceeding with cases against persons who have
filed for bankruptcy. 11 U.S.C.A. § 362. When a state court issues an order in violation
of the stay, that order is invalid, absent the Bankruptcy Court’s retroactive approval of the
order. See In re Soares, 

(1st Cir. 1997); see also Dudley v. Dudley, 

(Ala. Civ. App. Dec. 9, 2011)(vacating divorce judgment issued in
violation of automatic stay).

       The Small Claims Court Judgment of June 1, 2011 must be vacated, and the case
dismissed. This case is remanded to the Small Claims Court for entries showing the
judgment is vacated and the case dismissed due to the bankruptcy stay.

           Dated at Rutland this 29th day of December, 2011.

                                                                                ____________________________
                                                                                Hon. Mary Miles Teachout
                                                                                Superior Judge