Opinion
Civil Action No. 20-cv-549 Bankruptcy No. 12-16730-BHK
2020-06-29
Tomislav MILIC, Appellant, v. Kevin R. MCCARTHY, Chapter 7 Bankruptcy Trustee, Appellee.
Tomislav Milic, Bealeton, VA, pro se. Kevin R. McCarthy, McCarthy & White PLLC, Vienna, VA, Stephen E. Leach, Hirschler Fleischer PC, Tysons Corner, VA, for Appellee.
Tomislav Milic, Bealeton, VA, pro se.
Kevin R. McCarthy, McCarthy & White PLLC, Vienna, VA, Stephen E. Leach, Hirschler Fleischer PC, Tysons Corner, VA, for Appellee.
ORDER
T. S. Ellis, III, United States District Judge
This matter is before the Court on the Chapter 7 Bankruptcy Trustee's motion to dismiss debtor representative Tomislav Milic's appeal on the ground that Mr. Milic has appealed interlocutory orders without requesting leave to do so as required by Rule 8004(d), Fed. R. Bankr. P. Mr. Milic, proceeding pro se, has appealed two Bankruptcy Court orders, namely: (i) an order that overruled Mr. Milic's objection to a Bankruptcy Court order that authorized employment of a real estate broker ("Employment Objection Order"), and (ii) an order that denied Mr. Milic's motion to reconsider that same Bankruptcy Court order authorizing employment of a real estate broker ("Employment Reconsideration Order") (collectively, the "Appealed Orders"). The matter has been fully briefed and is thus ripe for disposition. Oral argument is dispensed with as the facts and legal contentions are adequately set forth in the existing record and oral argument would not aid in the decisional process.
See In re D.C. Diamond Corporation, 12-16730-BHK, Dkt. 888 (Bankr. E.D. Va. Apr. 14, 2020).
See In re D.C. Diamond Corporation, 12-16730-BHK, Dkt. 902 (Bankr. E.D. Va. Apr. 30, 2020).
Rule 78, Fed. R. Civ. P., provides that a court may determine motions on the briefs without oral hearings. The hearing on these motions scheduled for July 17, 2020 is therefore cancelled.
Instead of dismissing Mr. Milic's appeal for failure to seek leave to appeal an interlocutory order, Mr. Milic's notice of appeal has been treated as a motion for leave to appeal pursuant to Rule 8004(d), Fed. R. Bankr. Pr. For the reasons stated below, Mr. Milic's appeal must be dismissed for lack of jurisdiction. In short, Mr. Milic's appeal is an appeal of two interlocutory orders, and neither interlocutory order meets the requirements of 28 U.S.C. § 1292(b).
I.
The first issue that must be resolved is whether the Appealed Orders are final or interlocutory orders. In this respect, the Employment Objection Order denied Mr. Milic's objection to a Bankruptcy Court order that authorized the Trustee's employment of a real estate broker and auctioneer. And the Employment Reconsideration Order denied Mr. Milic's motion to reconsider that same Bankruptcy Court order authorizing the Trustee's employment of a real estate broker and auctioneer. The Fourth Circuit has made clear that bankruptcy court orders authorizing the employment of professionals are interlocutory orders. Accordingly, there is no doubt that the Employment Objection Order and the Employment Reconsideration Order are interlocutory orders.
See In re Minh Vu Hoang, 473 F. App'x 263 (4th Cir. 2012) (affirming district court order dismissing as interlocutory a debtor's appeal from a Bankruptcy Court's orders authorizing the employment of certain financial professionals in the underlying bankruptcy proceeding).
Because the Appealed Orders are interlocutory, the next question to address is whether leave to appeal should be granted. In determining whether to grant leave for an interlocutory appeal, district courts have routinely looked by analogy to the standard set forth in 28 U.S.C. Section 1292(b), which governs interlocutory appeals in non-bankruptcy cases. See First Owners’ Ass'n of Forty Six Hundred v. Gordon Properties, LLC, 470 B.R. 364, 371 (E.D. Va. 2012). Pursuant to § 1292(b), leave to file an interlocutory appeal should be granted only where (i) the order involves a controlling question of law, (ii) as to which there is substantial ground for difference of opinion, and (iii) immediate appeal would materially advance the termination of the litigation. See 28 U.S.C. § 1292(b). Because § 1292(b) is contrary to the general rule that appeals may be had only after a final judgment, it should be used sparingly, and its requirements strictly construed. See Myles v. Laffitte, 881 F.2d 125, 127 (4th Cir. 1989).
Rule 8004(d), Fed. R. Bankr. P., provides that "[i]f an appellant timely files a notice of appeal ... but does not include a motion for leave, the district court ... may order the appellant to file a motion for leave, or treat the notice of appeal as a motion for leave and either grant or deny it. " Rule 8004(d), Fed. R. Bankr. Pr. (emphasis added). In the interest of judicial economy, Mr. Milic's notice of appeal will be treated as a motion for leave to appeal the interlocutory orders.
Title 28 U.S.C. § 158(a)(3) offers no guidance as to when a district court should grant leave to appeal an interlocutory bankruptcy court order, but § 158(c)(2) provides that bankruptcy appeals "shall be taken in the same manner as appeals in civil proceedings generally are token to the courts of appeals from the district courts." 28 U.S.C. § 158(c)(2).
Here, the Appealed Orders denied Mr. Milic's objection to, and his motion for reconsideration of, the Bankruptcy Court's authorization of the Trustee's employment of a real estate broker and auctioneer. It is clear that the Bankruptcy Court's authorization of the employment of a real estate broker and auctioneer does not involve a controlling question of law, let alone one as to which there is substantial ground for difference of opinion. Title 11 U.S.C. § 327 provides a bankruptcy court with broad discretion to approve a Trustee's choice of a real estate professional. See In re Harold & Williams Dev't. Co., 977 F.2d 906, 909 (4th Cir. 1992) (holding that the Bankruptcy Code "gives broad discretion to the bankruptcy court over the appointment of professionals to work on behalf of the trustee and the estate, in part by empowering the court to approve candidates so selected" under § 327(a).) (citing In re Martin, 817 F.2d 175, 182 (1st Cir. 1987) ). Section 1292(b) does not permit interlocutory appeal of such discretionary factual determinations. See Coopers & Lybrand v. Livesay, 437 U.S. 463, 477 n.30, 98 S.Ct. 2454, 57 L.Ed.2d 351 (1978) (interlocutory appeals from "discretionary orders [are] plainly inconsistent with the policies promoted by [ Section] 1292(b)").
Moreover, there is no indication that consideration of the Appealed Orders would materially advance the termination of the underlying bankruptcy proceeding. To the contrary, the underlying bankruptcy proceeding began over seven years ago, and further review of the Bankruptcy Court's approval of the Trustee's choice of a real estate professional would only further delay the termination of this litigation. Thus, the appealed interlocutory orders do not meet the requirements of g 1292(b), and Mr. Milic's appeal must be dismissed for lack of jurisdiction.
Accordingly,
It is hereby ORDERED that Kevin R. McCarthy's motion to dismiss Mr. Milic's appeal for failure to seek leave to appeal an interlocutory order (Dkt. 4) is DENIED AS MOOT .
It is further ORDERED that Mr. Milic's appeal is DISMISSED for lack of jurisdiction because it is an interlocutory appeal that does not meet the requirements of 28 U.S.C. & 1292(b).
It is further ORDERED that the hearing currently scheduled for July 17, 2020 at 10 a.m. is CANCELED .
Should Mr. Milic wish to appeal this Order, he must do so by filing a notice of appeal with the Clerk of this court within thirty (30) days after entry of this Order, pursuant to Rules 4, 5 and 6 Fed. R. App. P. Failure to file a timely notice of appeal waives the right to appeal.