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#2275 signed 10-7-96



In Re:



NO. 93-40662-7


ROBERT L. BAER, Trustee,





ADV. NO. 95-7118


This proceeding is before the Court on the defendant's motion to dismiss. The defendant appears by counsel Charles R. Hay. The trustee appears by counsel John T. Houston. The Court has reviewed the relevant pleadings and is now ready to rule.


The trustee commenced these proceedings in November 1995, seeking to recover a postpetition transfer under 11 U.S.C.A. §549, a preference under §547, and an account receivable from the defendant. The summons the trustee used contained the case caption but otherwise identified the party being summoned only as "You." The trustee mailed the summons to:

Dan Frands

1 S Dakota Ave

Helena, MT 59601

The summons and complaint did not indicate why the trustee chose to serve this individual, but the mailing was never returned to the trustee or the Court. The defendant did not respond to the summons, and in February 1996, the trustee moved for default judgment. At the Court's direction, the Clerk's Office informed the trustee's counsel he needed to show the relationship between the person served and the defendant. On March 6, counsel filed an affidavit swearing that Dan Frands was the Executive Director for the defendant.

On April 24, the Court entered an order denying the requested default judgment and quashing the attempted service because Mr. Frands would not necessarily have been able to determine that the defendant was being sued rather than him personally. The order stated the trustee was free to attempt service again.

On April 29, a new summons was issued and mailed to:

Montana High School Association

c/o Dan L. Freund, Executive Director

1 South Dakota Ave.

Helena, MT 59601

This summons said "YOU (OR THE ENTITY ON WHOSE BEHALF YOU ARE ADDRESSED) ARE SUMMONED." This time, the defendant responded, first seeking an extension of time to answer, and then filing an answer asserting, among other things, that the trustee had failed to obtain timely service of process. In July, it filed a motion to consolidate this proceeding with another similar one, and then in August, filed its motion to dismiss for failure to obtain service within 120 days of filing the complaint.


Federal Rule of Civil Procedure 4(j) (1990), made applicable here by Bankruptcy Rule 7004(a), provided:

If a service of the summons and complaint is not made upon a defendant within 120 days after the filing of the complaint and the party on whose behalf such service was required cannot show good cause why such service was not made within that period, the action shall be dismissed as to that defendant without prejudice upon the court's own initiative or upon motion.

In Broitman v. Kirkland (In re Kirkland), 86 F.2d 172, 174 (10th Cir. 1996), the Tenth Circuit indicated dismissal under this rule is dedicated to the bankruptcy court's discretion and will be set aside by an appellate court only for an abuse of discretion. The court also made clear that "good cause" under this rule requires a greater showing than "excusable neglect" under Civil Rule 60(b). Id. at 175. The court affirmed the bankruptcy court's dismissal where pro se litigants had miscalculated by one day the time they had to effect service and had, for strategic reasons, waited until the last possible moment to serve the defendant. Id. at 176. Otherwise, the decision provides no additional guidelines for applying the "good cause" standard. A leading treatise on civil procedure states that the Rule "reflects the modern trend of encouraging more efficient litigation." 4A Wright & Miller, Fed. Prac. & Pro. Civil 2d, §1137 at 385 (1987).

The Court agrees with the trustee that the time the Court held the trustee's motion for default judgment under advisement should not count against his 120 days for obtaining service. Had the Court not chosen to protect the defendant against a default judgment due to a questionable attempt at service, the defendant might now be asking the Court to set aside such a judgment rather than to dismiss for failure to satisfy Rule 4(j). In light of the relatively minimal changes the trustee made to the summons in order to obtain service that did get the defendant to appear before the Court, it was not unreasonable for the trustee to believe the initial service was adequate and to rely on it until the Court ruled otherwise. Certainly the trustee's oversight was not so great that any of his claims should be barred by the lapse of time instead of decided on the merits. Furthermore, since the defendant appeared when the trustee directed service to the same address and a person of nearly the same name as he used for the first attempt at service, the Court would not have to stretch very far to conclude Mr. Freund received and chose to ignore the first summons from the Court, perhaps in hopes the defendant could obtain the benefit it now seeks, rather than contacting the trustee or the Court to point out the discrepancies in the attempted service. Parties should be encouraged to respond even to erroneous Court-sponsored mail and not rewarded for remaining silent in reliance on such mistakes.

The defendant's motion is hereby denied.


Dated at Topeka, Kansas, this _____ day of October, 1996.





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