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In the Matter of Yoder, 18-11818. (2019)

Court: United States Bankruptcy Court, N.D. Indiana Number: inbco20190703994 Visitors: 17
Filed: Feb. 07, 2019
Latest Update: Feb. 07, 2019
Summary: DECISION AND ORDER ON ORDER TO SHOW CAUSE ROBERT E. GRANT , Chief Bankruptcy Judge . On January 29, 2019, the court held a hearing with regard to PNC Bank's motion for relief from stay. Debtor's counsel, Frederick Wehrwein, and counsel for the trustee, Katherine Iskin, appeared for the hearing. PNC Bank's counsel, Seth Row, was nowhere to be seen. As a result, the court denied the motion for relief from stay, and, on its own motion, issued an order requiring Mr. Row to show cause, in writi
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DECISION AND ORDER ON ORDER TO SHOW CAUSE

On January 29, 2019, the court held a hearing with regard to PNC Bank's motion for relief from stay. Debtor's counsel, Frederick Wehrwein, and counsel for the trustee, Katherine Iskin, appeared for the hearing. PNC Bank's counsel, Seth Row, was nowhere to be seen. As a result, the court denied the motion for relief from stay, and, on its own motion, issued an order requiring Mr. Row to show cause, in writing, why he should not be sanctioned due to his failure to attend the scheduled hearing. Mr. Row filed a timely response to the order to show cause and it is that response which brings the matter before the court for a decision.

A court's most fundamental expectations of the attorneys who appear before it are to show up and be prepared. Thus, an attorney who fails to appear for proceedings scheduled because of something they have filed, or who appears but is substantially unprepared to participate in those proceedings, may be sanctioned either through the court's inherent authority or through Rule 16(f) of the Federal Rules of Civil Procedure. See, G. Heileman Brewing Co., Inc. v. Joseph Oat Corp., 871 F.2d 648, 651-53 (7th Cir. 1989); Matter of Sanction of Baker, 744 F.2d 1438 (10th Cir. 1984); Matter of Philbert, 340 B.R. 886 (Bankr. N.D. Ind 2006). In bankruptcy cases this is true for both adversary proceedings and contested matters. Philbert, 340 B.R. at 889. See also, N.D. Ind. L.B.R. B-9014-2(b).

The failure to appear is specifically identified by Rule 16(f) as the basis for sanctions. Unless non-compliance was "substantially justified" or other circumstances would make them "unjust" sanctions may be appropriate. As a result, the imposition of sanctions under the rule does not depend upon a finding of bad faith, willfulness, or contumaciousness. Matter of Sanction of Baker, 744 F.2d 1438, 1440-41 (10th Cir. 1984). A negligent failure to comply will suffice. Id. at 1441. See also, Harrell v. U.S., 117 F.R.D. 86, 88 (D.E.D.N.C. 1987); Barsoumian v. Szozda, 108 F.R.D. 426 (D.S.D. N.Y. 1985).

Counsel's response does not show that his failure to appear for the scheduled hearing was substantially justified or demonstrate that other circumstances would make sanctions unjust. Although he received electronic notice of the hearing, the response indicates that counsel failed to attend because the hearing date was left off of counsel's calendar. The Supreme Court has made it clear that internal office problems will not excuse an attorney's failure to comply with a filing deadline, Pioneer Inv. Services Co. v. Brunswick Assocs. Ltd. Partnership, 507 U.S. 380, 394-96, 113 S.Ct. 1489, 1498-99 (1993), and that same kind of excuse should not justify the failure to attend a scheduled hearing.

The court acknowledges that Mr. Row's absence was not willful or contumacious. It was, instead, simply negligent because his office's internal procedures failed. That may make counsel's absence understandable, but it does not make it "substantially justified."

Mr. Row shall, therefore, pay the reasonable attorney fees and expenses incurred by debtor's counsel and the trustee as a result of preparing for and attending the hearing on PNC's motion held in this matter on January 29, 2019. Furthermore, in order to compensate the United States for the costs he has unnecessarily imposed upon it and the additional time and attention he has required the court to devote to this matter, thereby depriving other litigants of its attention, and to deter similar conduct, see, BondPro Corp. v. Siemens Power Generation, Inc., 466 F.3d 562, 563 (7th Cir. 2006) ("The time has come to impose an exemplary public sanction in the hope of deterring further violations."), Mr. Row shall pay the clerk of this court the sum of $200.00.

The amounts due the clerk of this court shall be paid within fourteen (14) days. Mr. Wehrwein and Ms. Iskin shall have fourteen (14) days from this date within which time to file and serve affidavits itemizing any recoverable fees and expenses. Mr. Row shall have ten (10) days thereafter in which to file any objections thereto. In the absence of objection, the court will determine the reasonable amount of any fees and expenses without further notice or hearing

SO ORDERED.

Source:  Leagle

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