Appellant Barbara Lucas, as Administratrix of the Estate of Annette Austin, filed suit in the State Court of Fulton County against appellee Integrated Health Services of Lester, Inc. d/b/a Integrated Health Services of Atlanta @ Buckhead, “IHS” and others on January 27, 2000. After it had been served with the complaint but before its answer was due, IHS filed a Chapter 11 bankruptcy petition, and notified the state court of the imposition of the stay pursuant to 11 USC Section 362. On August 22, 2002, the bankruptcy court entered an order modifying and lifting the stay as to the claims being asserted against IHS by Lucas. On September 24, 2002, IHS filed its unverified answer to the complaint. Counsel for IHS made several attempts to contact Lucas’s counsel concerning whether Lucas was going to challenge the answer as untimely, and on October 4, 2002, Lucas’s counsel responded with a letter stating he considered the answer to be untimely. On October 25, 2002, IHS sent a check for costs to the trial court, and subsequently filed a motion seeking a declaration that it was not in default, or in the alternative, a motion to open default.
On January 8, 2003, the trial court entered an order finding that IHS’s answer was not untimely. The court further noted that even if the answer were deemed to be untimely, then the default should be opened based on either excusable neglect or because a proper case had been presented for opening the default. The court reasoned: “Pretermitting whether 11 U.S.C. § 108 c governs the time for filing answers in state court actions, the 30 day period began to run after notice of the expiration of the stay. In this case, a Notice of Stay was filed in this Court on February 23, 2000. While a Notice of Stay Modification was filed in the United States Bankruptcy Court on August 22, 2002, no such notice was filed in this Court so that, the Notice of Stay, previously filed, governs the time periods in this case. The Notice of Stay Modification filed in the bankruptcy court merely permits certain claims against IHS to proceed. It does not, as a matter of law, lift the stay in place in this case, but arguably, would allow the stay to be lifted by either agreement or Court Order. The original stay in this case remains in effect and shall remain in effect until such time as the parties either: 1 stipulate to an order lifting the stay; or 2 one party files a motion with this Court asking that the stay be lifted based upon a proper and competent showing that the bankruptcy court has authorized such a lifting of the stay for the claims that are pending in this Court. Once the Court has made a determination as to the lifting of the stay in this case, the time for filing Answers and other pleadings will like wise be determined.” The trial court also found that although the attorney representing IHS in this case did not have actual notice that the stay had been lifted until August 26, 2002, IHS had notice at the time of the issuance of the modification because its bankruptcy counsel signed the notice.
