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755 F.2d 715

Docket No. 83-6509.

Mac Donald v. Mac Donald

Ninth Circuit Court of Appeals

Argued and Submitted Feb. 5, 1985.

Decided March 12, 1985.

Ninth Circuit Court of Appeals · decided 1985-03-12

2 counsel of record

Key passage — most relied on by later courts

““It is appropriate for bankruptcy courts to avoid invasions into family law matters ‘out of consideration of court economy, judicial restraint, and deference to our state court brethren and their established expertise in such matters.’ ””

quoted by 16 later decisions, including White v. White, Nutter v. Reed (In Re Reed)

“'Because there is no clear definition of what constitutes”

quoted by 7 later decisions, including Wade v. United Development Inc, Judkins v. Ali

Applies 11 U.S.C. § 362 · 28 U.S.C. § 1293

Relies on Vermont Yankee Nuclear Power Corp. v. Natural Resources Defense Council, Inc. · Fidelity Mortgage Investors v. Camelia Builders, Inc. · Litton Systems, Inc. v. Frigitemp Corp. (In Re Frigitemp Corp.)

Good law ✅— No negative treatment on recordhow we know

Decided 1985-03-12

How this case has been cited

Cited by 145 later decisions — most recently July 2018 · most notably Robert Gruntz Robert Gruntz v. Opinion County of Los Angeles (2000), In Re Castlerock Properties, Debtor. Piombo Corporation, a California Corporation v. Castlerock Properties, a California Limited Partnership (1986)

29 federal appellate · 7 district · 6 state decisions

6801985199020002010decided

Later decisions citing this case, by decade. The current decade is in progress, and our corpus holds fewer opinions from the most recent years, so the latest bars are undercounted — not a real decline.

View the full empirical analysis of this case →

¶1*716James Ensign, Orange, Cal., for defendant-appellant.

¶2Stephen R. Wade, Covington & Crowe, Ontario, Cal., for plaintiff-appellee.

¶3Before CHAMBERS, BOOCHEYER, and BEEZER, Circuit Judges.

¶4BEEZER, Circuit Judge.

¶5Appellant Francis Mac Donald appeals the Bankruptcy Appellate Panel’s order affirming the bankruptcy court’s decision granting appellee Donna Mac Donald relief from the automatic stay provisions of 11 U.S.C. § 362(a) to allow her to proceed in state court with her action for spousal support modification. We affirm.

¶6Francis and Donna Mac Donald commenced marriage dissolution proceedings in California Superior Court in 1980. The issues were bifurcated and the marriage status was dissolved on July 1, 1981.

¶7Final judgment on the reserved issues was entered on February 2, 1982. Francis was awarded the family residence. His dental school education was determined to be a community asset, and Donna was awarded reimbursement for it in the amount of $75,000 to be paid in three annual installments commencing May 1, 1983. In order to equalize the division of other assets and obligations, Francis was ordered to pay Donna an additional $27,678.61 on or before May 1, 1982. Donna was also awarded monthly spousal support of $500.00 until January 14, 1985.

¶8On May 5,1982, Francis filed a bankruptcy petition under 11 U.S.C. Chapter 7, listing Donna as a creditor and requesting discharge of all obligations imposed by the California judgment. Donna filed her complaint for relief from the automatic stay on June 15. On July 14, a hearing was held in bankruptcy court. By its order on August 16, 1982, the court granted Donna relief from the stay, allowing her to proceed in the California court with her spousal support modification action.

¶9Francis appealed the bankruptcy court’s order to the Bankruptcy Appellate Panel, which affirmed the bankruptcy court’s decision on November 18,1983. Francis timely appealed the panel’s order on December 8, 1983. We have jurisdiction to review this matter under 28 U.S.C. § 1293.

¶10A decision to lift the automatic stay under 11 U.S.C. § 362 is within the discretion of the bankruptcy judge and reviewed for an abuse of discretion. In re Frigitemp Corp., 8 B.R. 284 (S.D.N.Y.1981). *717We must therefore determine whether the bankruptcy court abused its discretion by granting Donna relief from the stay to proceed in state court with her spousal support modification action.

¶11The Bankruptcy Court Did Not Abuse Its Discretion In Granting Relief From the Section 362 Stay

¶12The Section 362 automatic stay gives the bankruptcy court an opportunity to harmonize the interests of both debtor and creditors while preserving the debtor’s assets for repayment and reorganization of his or her obligations. See In re Fidelity Mortgage Investors, 550 F.2d 47, 55 (2nd Cir.1976), cert. denied, 429 U.S. 1093, 97 S.Ct. 1107, 51 L.Ed.2d 540 (1977).

¶13Section 362(d) and Bank.R.Proc. 401(d)1 explicitly authorize the bankruptcy court to lift the stay “for cause shown.” Because there is no clear definition of what constitutes “cause,” discretionary relief from the stay must be determined on a case by case basis. 2 Collier Bankruptcy Manual § 362.06 (3d ed. 1979).

¶14Upon relief from the automatic stay being granted, Donna intends to seek modification of the final judgment under Cal.Civ. Proc.Code § 473 on the basis of mistake, inadvertence, surprise or fraud. She asserts that the domestic matters at issue here are best decided by the California Superior Court and therefore, good cause exists under Section 362 for granting relief from the stay.

¶15It is appropriate for bankruptcy courts to avoid incursions into family law matters “out of consideration of court economy, judicial restraint, and deference to our state court brethren and their established expertise in such matters.” In re Graham, 14 B.R. 246, 248 (Bankr.W.D.Ky. 1981). See also In re Howard, 27 B.R. 894, 895-96 (Bankr.W.D.Ky.1983) (bankruptcy court granted relief from the automatic stay to debtor’s ex-wife, who had alleged that the property settlement was fraudulently induced); cf. Schulze v. Schulze, 15 B.R. 106, 109 (Bankr.S.D.Ohio 1981) (granting debtor’s wife relief from the automatic stay in order to complete state proceedings for divorce, child custody, and property division).

¶16We affirm the Bankruptcy Appellate Panel’s decision.

¶17AFFIRMED.

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