Opinion
NOT FOR PUBLICATION
Argued and Submitted at Tucson, Arizona, February 17, 2010
Appeal from the United States Bankruptcy Court for the District of Arizona. Honorable James M. Marlar, Chief Bankruptcy Judge, Presiding. Bk. No. 08-12559-JMM.
Before: DUNN, JURY and PAPPAS, Bankruptcy Judges.
MEMORANDUM
The debtor, Sabra Albritton, appeals the bankruptcy court decision to grant Countrywide Home Loans Inc.'s (" Countrywide") motion for relief from stay (" Motion"). Because the debtor did not provide us with transcripts of the hearings on the Motion, precluding us from conducting an informed review of the bankruptcy court's determinations, we AFFIRM.
Unless otherwise indicated, all chapter, section and rule references are to the Bankruptcy Code, 11 U.S.C. § § 101-1532, and to the Federal Rules of Bankruptcy Procedure, Rules 1001-9037.
FACTS
Two years before filing for bankruptcy, the debtor executed a promissory note, which was secured by a deed of trust encumbering real property located in Sierra Vista, Arizona (the " Property"). The debtor later lost the Property to foreclosure.
The debtor noted on her Statement of Financial Affairs (" SOFA") that the Property had been sold at a foreclosure sale some six months before the petition date.
The debtor filed her chapter 7 petition on September 18, 2008. She did not list the Property as her mailing address on her voluntary petition or as an asset on her schedules.
Countrywide, as assignee of the deed of trust, filed its Motion to foreclose on the Property, to evict the debtor and/or " successors of [the] [d]ebtor" from the Property and " to obtain ownership, possession and control of the Property." The debtor filed a response to the Motion, contending that the Property was At the November 17, 2008 preliminary hearing on the Motion, the debtor stated that she did not own the Property. The bankruptcy court granted the Motion, noting that the Property was not property of the estate, that the Property had no equity for the bankruptcy estate, and that the debtor could " fight [the matter] in state court."
Countrywide did not cite § 362(d) in the Motion as the basis for relief from stay; it simply requested that the bankruptcy court " vacate" the stay imposed under § 362(a).
According to the minute entry of the November 17, 2008 hearing, the bankruptcy court directed counsel for Countrywide to submit an order on the Motion. It appears from the docket, however, that no order was entered.
Another hearing was held on the Motion on December 8, 2008. At the hearing, counsel for Countrywide reported that the trustee's sale had been completed; he requested that the stay be lifted to complete the eviction process. The bankruptcy court granted the Motion.
It is not clear from the record or the docket why another hearing on the Motion was set. We assume that the December 8, 2008 hearing was set because, on November 17, 2008, the debtor filed another response to the Motion. In the second response, the debtor objected to the notice of the preliminary hearing, contending that counsel for Countrywide did not mail the notice on November 7, 2008, as stated on the proof of service, but on November 12, 2008. She also asserted the same arguments she made in the first response.
On April 27, 2009, the bankruptcy court entered the order granting relief from stay. The debtor timely appeals.
The order provided, somewhat confusingly, that the stay was terminated as to Countrywide with respect to the Property which was subject to the deed of trust " wherein Countrywide Home Loan Servicing LP [was] the current beneficiary and Sabra Albritton [had] an interest in . . . ."
The debtor filed a notice of appeal on December 15, 2008, several months before the bankruptcy court entered the order granting relief from stay. Though premature, the notice of appeal is considered timely under Rule 8002(a).
JURISDICTION
The bankruptcy court had jurisdiction under 28 U.S.C. § 1334 and 157(b)(2)(G). We have jurisdiction under 28 U.S.C. § 158.
ISSUE
Whether the bankruptcy court abused its discretion in granting Countrywide relief from stay.
STANDARDS OF REVIEW
We review the bankruptcy court's decision to grant relief from stay for abuse of discretion. Gruntz v. County of Los Angeles (In re Gruntz), 202 F.3d 1074, 1084 n.9 (9th Cir. 2000)(en banc). To determine whether the bankruptcy court abused its discretion, we conduct a two-step inquiry: (1) we review de novo whether the bankruptcy court " identified the correct legal rule to apply to the relief requested" and (2) if it did, whether the bankruptcy court's application of the legal standard was illogical, implausible or " without support in inferences that may be drawn from the facts in the record." United States v. Hinkson, 585 F.3d 1247, 1261-62 (9th Cir. 2009).
DISCUSSION
We begin by emphasizing that, because the bankruptcy court's decision to grant relief from stay rests on factual findings, see In re Fischer, 136 B.R. 819, 824 (D. Alaska 1992), we review its decision for abuse of discretion. Cf. Rabkin v. Or. Health Scis. Univ., 350 F.3d 967, 977 (9th Cir. 2003)(abuse of discretion is " a plain error, discretion exercised to an end not justified by the evidence, a judgment that is clearly against the logic and effect of the facts as are found.")(internal quotations and citation omitted). As we earlier explained, our determination as to abuse of discretion focuses on whether the bankruptcy court identified the correct legal standard and, if it did, whether it applied the legal standard illogically, implausibly or without support from inferences properly drawn from the facts in the record.
The debtor, as appellant, has the responsibility to provide an adequate record on appeal. Kritt v. Kritt (In re Kritt), 190 B.R. 382, 387 (9th Cir. BAP 1995). She also bears the burden of demonstrating that the bankruptcy court's factual findings are clearly erroneous. Id . " Appellants should know that an attempt to reverse the [bankruptcy] court's findings of fact will require the entire record relied upon by the [bankruptcy] court be supplied for review." Id . (internal quotations and citation omitted).
We have discretion to dismiss an appeal or summarily affirm a bankruptcy court's ruling if the appellant does not provide a sufficient record to enable us to conduct an informed review. Kyle v. Dye (In re Kyle), 317 B.R. 390, 393 (9th Cir. BAP 2004), aff'd 170 Fed.Appx. 457 (9th Cir. 2006). Failure to provide a transcript may, but need not, result in dismissal or summary affirmance. Id . Exercising our discretion, we may disregard such a defect and decide the appeal on the merits. Id . Before exercising such discretion, however, we first should consider whether we can conduct an informed review with the record provided. Id.
On appeal, the debtor sets forth the same arguments she made before the bankruptcy court. But the record before us is incomplete because we do not have transcripts of the relevant hearings. Without the transcripts, we cannot review the bases for the bankruptcy court's determinations. See Kyle, 317 B.R. at 393. We do not know what legal standard(s) the bankruptcy court applied nor the documents and evidence on which it relied in granting relief from stay.
The minute entries suggest the factual bases on which the bankruptcy court may have granted relief from stay. The minute entry for the November 17, 2008 hearing states that there was no equity in the Property for the bankruptcy estate and that the Property was not property of the estate, both of which may provide grounds sufficient to grant relief from stay under § 362(d)(1) or (d)(2). The minute entry for the December 8, 2008 hearing states that the trustee's foreclosure sale was complete and that the stay needed to be lifted to complete the eviction process, which may constitute sufficient grounds for relief from stay under § 362(d)(1).
The debtor contends that Countrywide was not entitled to seek relief from stay because it did not hold the original promissory note. Because we do not have transcripts of the hearings in the record before us, we do not know how the debtor made this argument before the bankruptcy court, beyond the arguments made in her written opposition, nor how the bankruptcy court addressed it.
At oral argument, counsel for Countrywide conceded that Countrywide was not a holder of the promissory note. Counsel for Countrywide speculated that because Countrywide was the servicer for the promissory note and deed of trust before foreclosure, it was obligated by contract to aid in obtaining possession of the Property. We express no opinion as to whether Countrywide was a holder or a beneficiary of the promissory note.
The debtor also argues that the bankruptcy court " made light" of the fact that the original deed of trust was signed " void by void, " which made it invalid or unenforceable. Reviewing the deed of trust, promissory note and adjustable rate rider attached to the Motion as exhibits, we note that all three documents appear to have been signed by a Josh Albritton as the debtor's " attorney in fact." Each page of all three documents appears to have been initialed in the same way. We further note that the signature on the deed of trust was acknowledged by a notary public. Comparing the signatures on all three documents, arguably they had not been signed " void by void" but by Josh Albritton. But again, because we do not have transcripts of the hearings, we do not know how the debtor made this argument to the bankruptcy court, beyond what was stated in her written opposition, nor how the bankruptcy court addressed it.
In short, it is impossible for us to conduct a meaningful, informed review as to whether the bankruptcy court's findings support its grant of relief from stay. Nothing in the record before us provides insight into the bankruptcy court's considerations - the legal standards it identified and applied and the findings it made to support its ruling. The debtor fails to demonstrate that the bankruptcy court made clearly erroneous factual findings, thereby abusing its discretion in granting the Motion.
Moreover, the debtor does not demonstrate how the bankruptcy court's decision to grant relief from stay even harmed her. The debtor repeatedly asserted before the bankruptcy court that she held no interest in the Property. At oral argument, the debtor confirmed that she held neither a possessory nor an ownership interest in the Property. Because the debtor had no interest in the Property, the debtor arguably suffered no harm from the bankruptcy court terminating the stay. Thus, even if the bankruptcy court erred in granting the Motion (and we do not conclude that it did), it was harmless error.
Additionally, the stay only protects property of the bankruptcy estate, which includes a debtor's legal or equitable interests in property. See § § 362(a), 541(a). As the debtor herself points out, because she had no interest in the Property, it was not property of the estate. In such circumstances, the stay would not have protected the Property against a creditor's efforts to obtain ownership, possession and control of it, although the stay could protect a debtor's possessory interest.
CONCLUSION
Because the debtor did not provide us with transcripts of the hearings on the Motion in the record on appeal, we cannot review the findings the bankruptcy court made in support of its decision granting Countrywide relief from stay. We cannot conclude that the bankruptcy court abused its discretion in granting the Motion. Accordingly, we AFFIRM.
The order also did not state the specific statutory grounds on which the bankruptcy court granted relief from stay; it simply stated that the stay imposed by § 362(a) was terminated.