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Rabbit v. Mills8/22/2005
ter 13 bankruptcy automatic stay as a means to suspend the running of the statute of limitations is erroneous. A bankruptcy stay itself cannot suspend the running of the statute of limitations. Weaver v. Hamrick, 907 S.W.2d 385, 391 (Tenn.1995). A suspension of the statute of limitations during an automatic stay can only result from a federal or state statute expressly providing for a suspension. Weaver, 907 S.W.2d at 391.. Section 108(c) of the U.S. Bankruptcy Code provides in pertinent part:
§ 108. Extension of time...(c) Except as provided in section 524 of this title, if applicable non-bankruptcy law, an order entered in a non-bankruptcy proceeding, or an agreement fixes a period for commencing or continuing a civil action in a court other than a bankruptcy court on a claim against the debtor, or against an individual with respect to which such individual is protected under section 1201 or1301 of this title, and such period has not expired before the date of the filing of the petition, then such period does not expire until the later of - -
(1) the end of such period, including any suspension of such period occurring on or after the commencement of the case; or
(2) 30 days after notice of the termination or expiration of the stay under section 362, 922, 1202, or 1301 of this title, as the case may be, with respect to such claim.
Essentially, section 108(c) allows a creditor to act on a judgment within the applicable statute of limitations plus any time in which the statute of limitations was expressly suspended under state or federal law or thirty days after the stay is lifted, whichever is longer. Accordingly, "if the limitations period has expired and no other federal or state law mandates that the time period is suspended, then under section 108(c)(2), a party has only thirty days after the lifting of the stay to act." Weaver, 907 S.W.2d at 391-92.
Applying section 108(c) to this case, the Rabbitts had the longer of thirty days after the stay was lifted, which was April 6, 1995, or ten years from May 12, 1993 plus any time of suspension under state law in order to file their petition for a writ of scire facias. The automatic stay effected by bankruptcy filing does not suspend the statute of limitations, and thus, the only basis in which to find a suspension of the limitations period in this case was during the Order to Pay Judgment by Installments.
The Order to Pay Judgment by Installments expressly stayed " he issuance, execution or return of any writ of garnishment or execution against wages or salary due the Defendant or any other funds belonging to the Defendant." The order, while injunctive in nature, did not prevent the Rabbitts in any form, from reviving their judgment. Instead, the order merely prevented the Rabbitts from executing on their judgment against Mills in any other fashion than the installment payments outlined in the order.
Additionally, the statute establishing the applicable ten-year statute of limitations in this matter is devoid of any language providing for tolling. The statute provides that " he following actions shall be commenced within ten (10) years after the cause of action accured... Actions on judgments and decrees of courts of record of this or any other state or government." Tenn.Code Ann. § 28-3- 110(2).
Tennessee Code Annotated section 28-3-110 was section 2776 of the Code of 1858. It has never been amended. Addressing specifically Tennessee Code Annotated section 28-3-110 and the possible tolling thereof, the Supreme Court of Tennessee held:
In enacting this ten year limitation statute, Code section 8601, the legislature did not provide any tolling, eith
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