OPINION REGARDING THE MOTIONS TO CONVERT THIS CASE TO CHAPTER 7, FILED BY THE UNITED STATES TRUSTEE AND BY CAL LAND INVESTMENTS, LLC

THOMAS J. TUCKER, Bankruptcy Judge.

This case came before the Court for a hearing on July 18, 2012, on two motions: (1) the United States Trustee's motion to convert this Chapter 11 case to Chapter 7 (Docket # 50); and (2) Cal Land Investment, LLC's motion to convert this Chapter 11 case to Chapter 7 (Docket # 51)(collectively the "Conversion Motions"). For the reasons stated in this opinion, the Court will grant the Motions, and will enter an order converting this case to Chapter 7, effective immediately.

The Court has considered the written arguments of the parties, and the arguments made during the July 18 hearing. The Court has reviewed the entire record in this Chapter 11 case, including Debtor's schedules, Statement of Financial Affairs, and amended Statement of Financial Affairs; and including the proceedings held regarding the United States Trustee's first motion to convert filed in this case, which the Court denied on May 10, 2012 (see the Order at Docket # 46). The Court also reviewed the Debtor's combined plan and disclosure statement, and amended plan and disclosure statement, and the Court's orders regarding same (Docket ## 57-60). And the Court has reviewed the stipulated adequate protection order entered on April 10, 2012, in favor of Cal Land Investment, LLC (Docket # 39). Finally, the Court has also reviewed the supplemental items that the Court required the parties to file after the July 18 hearing (Docket ## 67-69), and the Debtor's monthly operating reports filed after the July 18 hearing (Docket ## 70, 71).

The Court is very troubled by each of the following things, and even more so by the combination of all the following things: (1) the fact that it took three dates to be set for the first meeting of creditors (and two motions to convert by the United States Trustee) before Debtor's sole member, Hanna Karcho-Polselli, finally appeared and testified, on July 17, 2012;1 (2) the striking lack of knowledge displayed by Ms. Karcho-Polselli about the Debtor's financial affairs at that first meeting of creditors, and her utter lack of preparation for that first meeting of creditors—the transcript of her testimony is replete with answers in the nature of "I don't know;" "I'm not sure;" "I don't recall;" and "I have to check the records;" "probably [this] and probably [that];" with very little definite, substantive information being provided;2 (3) the Debtor's now-admitted failure to timely make the required monthly adequate protection payments that were due in June and July 2012 to Cal Land Investment, LLC, in violation of the Court's adequate protection order filed on April 10, 2012 (Docket # 39);3 (4) Debtor's failure to make important and required disclosures in Debtor's Statement of Financial Affairs, followed by Debtor's failure to promptly amend that document when errors were brought to its attention;4 and (5) Debtor's knowing failure to further amend its Statement of Financial Affairs, promptly or ever (as of this date), to correct a specific error brought to the attention of Debtor and Debtor's counsel, and Ms. Karcho-Polselli, during the July 17, 2012 first meeting of creditors.5

In addition to all of the above, the Court also notes the following: after the Debtor first filed its proposed Chapter 11 plan and disclosure statement in this case, on June 28, 2012 (Docket # 57), the Court entered an order on July 5, 2012, requiring Debtor to file an amended disclosure statement, no later than July 10, 2012, to correct sixteen specified problems. (Order, Docket # 58). Debtor filed an amended plan and disclosure statement on July 10, 2012 (Docket # 59). But the Court had to enter another order, this one on July 12, 2012, requiring Debtor to file yet another amended disclosure statement, because Debtor failed to do at least six of the sixteen things the Court had ordered Debtor to do in the July 5, 2012 Order. See Order, filed July 12, 2012 (Docket # 60). Thus, Debtor failed to comply with the Court's July 5, 2012 Order.

Based on all of the foregoing, the Court finds and concludes that there is cause to convert this case to Chapter 7, under each of the following statutory provisions: 11 U.S.C. §§ 1112(b)(1), 1112(b)(4)(B), 1112(b)(4)(E), and 1112(b)(4)(G). The Court further finds and concludes that this case should be converted to Chapter 7, and that conversion, rather than dismissal of the case, is in the best interests of creditors and the estate.6

For these reasons, the Court will enter an order converting this case to Chapter 7, effective immediately.