UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF KENTUCKY
KENNETH DELVIS BAILEY
DEBTOR CASE NO. 88-00275
JUDY BROWN BAILEY PLAINTIFF
VS. ADV. NO. 90-0363
KENNETH DELVIS BAILEY DEFENDANT
This matter has been submitted to the Court for decision on the Complaint and Answer filed herein. Both the plaintiff and the defendant have filed briefs. The issue to be resolved is whether the plaintiff could proceed in Magoffin Circuit Court for temporary maintenance, child support and custody without seeking relief from the automatic stay provisions of 11 U.S.C.'362. This Court has jurisdiction of this matter pursuant to 28 U.S.C. '1334(b); it is a core proceeding pursuant to 28 U.S.C. '157(b)(2)(O).
The record in this case reveals that the defendant filed his Chapter 11 petition in this Court on August 10, 1988. The plaintiff states that she filed a Petition for Dissolution of Marriage in Magoffin Circuit Court in 1989. The plaintiff filed his Amended Chapter 11 Plan on August 16, 1990. On August 21, 1990, the Magoffin Circuit Court entered an Order granting the plaintiff herein maintenance in the amount of $3000.00 per month and custody of the couple's minor child. The defendant's Amended Disclosure Statement was approved on September 24, 1990, and on November 20, 1990, his Amended Plan was confirmed.
This adversary proceeding was commenced by the filing of the plaintiff's Complaint on December 5, 1990. The Complaint alleges that the defendant is indebted to the plaintiff for support (maintenance) from the date of the Magoffin Circuit Court Order at the rate of $3000.00 per month, and that the plaintiff is "entitled to receive these funds on a priority basis, from the proceeds of the bankruptcy estate." The plaintiff asks for judgment in an amount equal to that which she alleges she would prove at the time of trial of this matter, and for a declaration of this Court as to the priority of her claim and the enforceability of the claim in the courts of the Commonwealth of Kentucky.
The defendant filed his Answer on December 26, 1990. He responds that plaintiff's filing of her Petition for Dissolution of Marriage subsequent to the defendant's filing of his bankruptcy petition was a violation of the automatic stay. He also maintains that this Court's Order confirming the defendant's Chapter 11 Plan "takes precedence over any order of the Magoffin Circuit Court."
The issue in this case has been defined in a stipulation entered into by both parties as "whether or not Plaintiff has the right, without a lifting of the stay, to ask the Circuit Court to establish maintenance." The plaintiff argues that 11 U.S.C.'362(b) supports her position. This provision states in pertinent part:
The filing of a petition under Section 301, 302, or 303 of this Title, or of an application under Section 5(a)(3) of the Securities Investor Protection Act of 1970 (15 U.S.C.
(2) Under Subsection (a) of this section, of the collection of alimony, maintenance, or support from property that is not property of the estate;
Without benefit of citation to any authority, the plaintiff comes to the conclusion that the language of'362(b)(2) includes the concept of commencement of a divorce action. She is mistaken.
First of all, the plain language of'362(b)(2) limits its application to the "collection of alimony, maintenance, or support". The question then becomes whether the commencement of an action to establish alimony, maintenance, or support amounts to collection of such support. Courts have consistently held that it does not. In Matter of Petrey, 116 B.R. 95 (Bkrtcy.S.C.Ohio 1990), the court held that a modification proceeding to increase child support was stayed on the date the debtor filed his bankruptcy petition, and that all subsequent post-petition activity with respect to the modification request violated the automatic stay.
In reaching its decision, the Petrey court cited In re Stringer, 847 F.2d 549 (9th Cir. 1988), wherein the court conducted an extensive analysis of the language and legislative history of'362(b)(2) and came to the following conclusion:
'Collection,' a less inclusive phrase than 'commencement or continuation,' indicates that Congress did not intend for debtors to be subject to new suits or modifications or orders in the domestic relations context having an economic impact on debtors. We find the exemption of
The Petrey court found the Stringer reasoning "compelling". At 94. This Court agrees and concludes that the plaintiff's action in Magoffin Circuit Court to establish maintenance or support was a violation of the automatic stay provisions of 11 U.S.C.'362. The plaintiff's Complaint, therefore, should be DISMISSED. A separate Order consistent with the foregoing Memorandum Opinion will be entered.
By the Court -
C.K. Belhasen, Esq.
W. Thomas Bunch, Esq.