The Maine Bankruptcy Court recently ruled that a debtor may voluntarily dismiss a Chapter 13 case after a motion for relief from stay is filed by a creditor, but at a time when the motion is not longer pending, and then re-file a new Chapter 13 case without the re-filing prohibitions of Section 109(g) of the Code being triggered. In In re Hutchins (Maine Bankruptcy Case No. 07-21035), a secured creditor filed a motion for relief from stay, then failed to prosecute the motion. The Court dismissed the motion and later the credit union agreed to have its motion considered "withdrawn". The debtors filed a motion to strike the credit union motion, fearing that the existence of a filed motion for relief in the case would prohibit the debtors from later voluntarily dismissing and re-filing their Chapter 13 case, if that event became necessary.
The Court concluded that the debtors' motion to stirke was unnecessary, citing several Georgia Bankrutpcy Courts decisions for the proposition that resolved (or no longer pending) motions for relief would not bar a voluntary dismissal and re-filing of Chapter 13 cases by debtors. This important ruling on a previously unclear seciton of the Bankruptcy Code provides debtors with more flexible options for successfully navigating their way through the bankruptcy system.