Opinion
No. 10-13558 A.P. No. 11-1136
09-28-2011
In re Paul and Melody Den Beste, Debtor(s). Paul Den Beste, Plaintiff(s), v. Lynn Searle, et al. Defendant(s).
Memorandum on Motion for Sanctions
Debtor and plaintiff Paul Den Beste filed a Chapter 13 petition on June 15, 2010. Incredibly, he failed to schedule as a creditor either defendant Elizabeth Mazzaferri or defendant Lynn Searle as creditors even though Mazzaferri had a lawsuit pending against him in state court and Searle represented a plaintiff in state court litigation against him. In addition, Den Beste falsely represented in his statement of affairs that he was not involved in any litigation in the year before filing. Notwithstanding his false bankruptcy papers, Den Beste commenced this adversary proceeding in pro se seeking damages against Searle and Mazzaferri for willful violation of the automatic stay.
Searle is an attorney representing the beneficiary of a living trust in a state court lawsuit, also unscheduled. On April 18, 2011, she sent a letter to nine persons, including Den Beste, seeking to resolve her client's claims for elder abuse. Instead of amending his schedules to reflect the disputed claims against him, Den Beste commenced this adversary proceeding. Searle filed a motion to dismiss the complaint along with her declaration that she did not know about the pending bankruptcy when she sent her letter.
In order to state a claim for damages for violation of the automatic stay, a plaintiff must show that the defendant knew about the automatic stay. In re Ozenne, 337 B.R. 214, 220 (9th Cir. BAP 2006). Den Beste responded to Searle's motion by filing an amended complaint and a "request for judicial notice." Full of unseemly invective, these documents failed to create a triable issue of fact that Searle knew about the automatic stay. The court accordingly treated Searle's motion as a motion for summary judgment and granted it. Searle has now filed a motion for sanctions pursuant to Rule 9011 of the Federal Rules of Bankruptcy Procedure. Incredibly, Den Beste has made a countermotion for sanctions.
The court has no difficulty finding that Den Beste's complaint against Searle was entirely unwarranted, both factually and legally, and was commenced against Searle solely for the purposes of harassment. It is also clear that Searle complied with the "safe harbor" provisions of Rule 9011(c)(1)(A) by serving her motion for sanctions more than 21 days before she filed it, giving Den Beste the required time to correct his sanctionable conduct. Within that time, it was Den Beste's duty to withdraw or appropriately correct his complaint. The vile amended complaint was not an appropriate correction. Searle is accordingly within her rights to seek sanctions from Den Beste.
However, there is no basis in the rule for the court to award Searle monetary sanctions. Attorneys who represent themselves are not entitled to recover attorneys' fees as sanctions. Massengale v. Ray, 267 F.3d 1298 267 F.3d 1298, 1302 (11th Cir. 2001). The best the court can do for her is issue an order requiring Den Beste to seek prior permission before commencing any more actions against her. The court agrees that monetary sanctions are in order, but those will have to be pursuant to the court's exercise of its own powers. Den Beste's countermotion will of course be denied.
The court will enter an appropriate order, and will commence separate sanction proceedings.
Alan Jaroslovsky
U.S. Bankruptcy Judge