Opinion
C. A. 2:21-cv-01306-BHH-MHC
06-24-2022
Christopher James France, Appellant, v. HomeBridge Financial Services, Inc., Appellee.
REPORT AND RECOMMENDATION
Molly H. Cherry United States Magistrate Judge.
This matter is before the Court on a pro se appeal from an order entered by United States Bankruptcy Judge David R. Duncan in Appellant's Chapter 7 bankruptcy case, In re, Christopher James France, Debtor, C/A No. 20-03044-dd (D.S.C.), in the United States Bankruptcy Court for the District of South Carolina.
Pursuant to the provisions of Title 28, United States Code, Section 636(b)(1)(A), and Local Rule 73.02(B)(2)(e), D.S.C., all pretrial matters in cases involving pro se litigants are referred to a United States Magistrate Judge for consideration. For the reasons set forth below, the undersigned recommends that the Court affirm.
BACKGROUND
Appellant voluntarily commenced a chapter 7 bankruptcy liquidation case in July 2020. (Apx. H001.) Plaintiff listed a certain parcel of real property on his schedules and identified Appellee HomeBridge Financial Services, Inc. (“Homebridge”), as the mortgagee. (Apx. H010.)
Citations to “Apx.” refers to the Appendix found at ECF No. 12-1.
On March 19, 2021, Homebridge filed a motion seeking relief from the automatic stay pursuant to 11 U.S.C. § 362(d)(1), to allow Homebridge and any of its successors or assigns to “proceed under applicable non-bankruptcy law . . . to foreclose upon and obtain possession of the Property” (Apx. H021-022.) Homebridge asserted in the motion that Appellant “has willfully failed to make the regular mortgage payments [on his loan with Homebridge] since August 1, 2020 payment and beyond,” and, therefore, Homebridge has “not been provided adequate protection for its interest in the Property and is suffering irreparable harm and injury.” (Apx. H021.)
Appellant opposed the motion for relief from stay (Apx. H044), and the bankruptcy court held a hearing on the motion on April 22, 2021. (Apx. H062.) At the hearing, Appellant objected to the jurisdiction of the bankruptcy court, and the bankruptcy court overruled the objection. (Apx. H062-H067.) The bankruptcy court advised Appellant at the hearing that “[n]o court of the United States has recognized the legal theory that you espouse.” (Apx. H067.) The bankruptcy court went on to advise at the hearing that it “does have jurisdiction over” Appellant because he “voluntarily filed a bankruptcy case” in the bankruptcy court. (Apx. H069.)
The following day, on April 23, 2021, the bankruptcy court issued an order granting the motion for relief. (Apx. H058.) In the order, the bankruptcy court outlined Appellant's opposition to the relief sought by Homebridge:
Mr. France's main argument in opposition to HomeBridge's motion is that the Court does not have jurisdiction over Christopher James France, the living man. Mr. France asserts that the Court has jurisdiction only over “CHRISTOPHER JAMES FRANCE”, a “fictitious incorporated trust entity.” He asserts that HomeBridge's motion also “mis-identif[ies] the living man with the incorporated debtor.” Mr. France has repeatedly made these same or similar arguments throughout his chapter 7 case.(Apx. H058-059. (alteration in original)) The bankruptcy court concluded that “Mr. France has asserted no legitimate objection to HomeBridge's motion.” (Apx. H059.)
The bankruptcy court granted Homebridge's motion, finding that “Homebridge is a secured creditor of Mr. France by virtue of a note and mortgage executed and delivered by Mr. France on or about July 13, 2018”; “Mr. France has failed to make payments to HomeBridge”; “HomeBridge's motion states that payments are due for August 1, 2020 and beyond”; “Mr. France is in a chapter 7 case so is not reorganizing his financial affairs or proposing payments to HomeBridge under a chapter 13 plan”; and “Mr. France continues to repeat arguments and theories with no valid legal basis in his bankruptcy case and in response to HomeBridge's request for relief from stay.” (Apx. H059-60.)
Appellant timely filed a notice of appeal of the bankruptcy court's April 23, 2021, Order. (Apx. H091.)
JURISDICTION
Under 28 U.S.C. § 158(a), United States district courts have jurisdiction to hear appeals from final judgments, orders, and decrees of bankruptcy courts. “Orders in bankruptcy cases qualify as ‘final' when they definitively dispose of discrete disputes within the overarching bankruptcy case.” Ritzen Grp. Inc. v. Jackson Masonry, LLC, 140 S.Ct. 582, 586 (2020) (citing Bullard v. Blue Hills Bank, 575 U.S. 496, 501 (2015)); see In re Daufuskie Island Props., Inc., 441 B.R. 49, 55 (Bankr. D.S.C. 2010) (“Final orders are those that resolve the litigation, decide the merits, settle liability, establish damages, or determine the rights of the parties.”) (citing In re Looney, 823 F.2d 788, 790 (4th Cir. 1987)). The district court also has jurisdiction to hear appeals from interlocutory orders and decrees of the bankruptcy court, provided the district court grants the appellant leave to appeal. 28 U.S.C. § 158(a)(3).
This Court has jurisdiction over this appeal, as it involves the adjudication of a motion for relief from the automatic stay. See Ritzen Grp., 140 S.Ct. at 586 (“We hold that the adjudication of a motion for relief from the automatic stay . . . yields a final, appealable order when the bankruptcy court unreservedly grants or denies relief.”).
STANDARD OF REVIEW
On appeal from the bankruptcy court, the district court acts as an appellate court and reviews the bankruptcy court's findings of fact for clear error, while it generally reviews conclusions of law de novo. Devan v. Phoenix Am. Life Ins. Co. (In re Merry-Go-Round Enters., Inc.), 400 F.3d 219, 224 (4th Cir. 2005); Kielisch v. Educ. Credit Mgmt. Corp. (In re Kielisch), 258 F.3d 315, 319 (4th Cir. 2001).
However, a “decision to lift the automatic stay under section 362 is within the discretion of the bankruptcy judge[,] and this decision may be overturned on appeal only for abuse of discretion.” In re Robbins, 964 F.2d 342, 345 (4th Cir. 1992), as amended (May 27, 1992). “Under abuse of discretion review, the district court will not reverse the bankruptcy court unless its conclusion was guided by erroneous legal principles or rests upon a clearly erroneous factual finding.” In re Yellow Poplar Lumber Co., Inc., 598 B.R. 833, 836 (W.D. Va. 2019). “However, even if the bankruptcy court applies the proper legal principles to supported facts, the district court may reverse if it holds a definite and firm conviction that the bankruptcy court committed a clear error of judgment in the conclusion it reached upon a weighing of the relevant factors.” Mack v. Yankah (In re Yankah), 514 B.R. 159, 163-64 (E.D. Va. 2014).
DISCUSSION
“When a bankruptcy petition is filed, most judicial actions against the debtor commenced before the filing of the petition are automatically stayed.” In re Robbins, 964 F.2d at 345; see 11 U.S.C. § 362(a)(1). “The automatic stay gives the bankruptcy court an opportunity to harmonize the interests of both debtor and creditors while preserving the debtor's assets for repayment and reorganization of his or her obligations.” Id. Pursuant to 11 U.S.C. § 362(d), the bankruptcy court may lift the stay “for cause.” 11 U.S.C. § 362(d)(1). Because the Bankruptcy Code provides no definition of what constitutes “cause,” courts must determine when discretionary relief is appropriate on a case-by-case basis. In re Robbins, 964 F.2d at 345 (explaining that the bankruptcy court “must balance potential prejudice to the bankruptcy debtor's estate against the hardships that will be incurred by the person seeking relief from the automatic stay if relief is denied”); In re Beaumont, 548 B.R. 437, 441-42 (Bankr. D.S.C. 2016) (“[C]ourts must look at the specific facts of the case and the totality of the circumstances in order to determine whether cause to grant relief from stay has been established.”) (citation and internal quotation marks omitted).
Appellant has not shown that the bankruptcy court abused its discretion when it granted Homebridge's motion for relief from the automatic stay. The arguments asserted in Appellant's Notice of Appeal, Opening Brief, and Reply Brief are difficult to understand and generally seem unrelated to the bankruptcy court's decision to grant relief from the automatic stay. See ECF Nos. 1, 6 and 13. However, to the extent they argue that the bankruptcy court does not have jurisdiction over Appellant, the undersigned is unpersuaded. See Walker v. Florida, 688 Fed.Appx. 864, 865 (11th Cir. 2017) (“[C]ourts have repeatedly rejected as frivolous arguments that people are ‘sovereign citizens' who are not subject to the jurisdiction of any courts.”); United States v. Benabe, 654 F.3d 753, 767 (7th Cir. 2011) (“Regardless of an individual's claimed status of descent, be it as a ‘sovereign citizen,' a ‘secured-party creditor,' or a ‘flesh-and-blood human being,' that person is not beyond the jurisdiction of the courts. These theories should be rejected summarily, however they are presented.”); In re Hardee, No. 18-67130-BEM, 2021 WL 1186477, at *2 (Bankr. N.D.Ga. Mar. 26, 2021) (finding that bankruptcy court has personal jurisdiction over the debtor and rejecting debtor's arguments asserting “that he is a trust, a church and an indigenous person” as well as arguments relating to maritime law).
Appellant voluntarily initiated his chapter 7 bankruptcy liquidation case in the bankruptcy court in 2020 by filing a “Voluntary Petition for Individuals Filing for Bankruptcy” pursuant to Chapter 7 of title 11 of the United States Code, Apx. H001, and it is well established that “the filing of [a voluntary] petition commences the case, which has the effect under 28 U.S.C. § 1334(d) of vesting exclusive jurisdiction over the property of the debtor and of the estate in the district court, and hence the bankruptcy court, in which the petition is filed.” In re Garnett, 303 B.R. 274, 277 (E.D.N.Y. 2003); see 11 U.S.C. § 301(a) (section of Bankruptcy Code providing that a “voluntary case under a chapter of this title is commenced by the filing with the bankruptcy court of a petition under such chapter by an entity that may be a debtor under such chapter”); 28 U.S.C. § 1334(d); see also 28 U.S.C. § 157(a) (“Each district court may provide that any or all cases under title 11 and any or all proceedings arising under title 11 or arising in or related to a case under title 11 shall be referred to the bankruptcy judges for the district.”).
Moreover, the undersigned has reviewed the record on appeal from the bankruptcy court and finds no clear error in the findings of fact. The undersigned also finds that the bankruptcy court applied the proper legal principles to the supported facts, see 11 U.S.C. § 362(d)(1); In re Beaumont, 548 B.R. at 441, and there was no clear error of judgment in the bankruptcy court's conclusions. See In re Yellow Poplar Lumber Co., Inc., 598 B.R. at 836; In re Yankah, 514 B.R. at 163-64. Therefore, the undersigned concludes that the bankruptcy court's Order should be affirmed.
CONCLUSION
For the reasons set forth above, it is RECOMMENDED that the Bankruptcy Court's Ord be AFFIRMED.
The parties are referred to the Notice Page attached hereto.
Notice of Right to File Objections to Report and Recommendation
The parties are advised that they may file specific written objections to this Report and Recommendation with the District Judge. Objections must specifically identify the portions of the Report and Recommendation to which objections are made and the basis for such objections. “[I]n the absence of a timely filed objection, a district court need not conduct a de novo review, but instead must ‘only satisfy itself that there is no clear error on the face of the record in order to accept the recommendation.'” Diamond v. Colonial Life & Acc. Ins. Co., 416 F.3d 310 (4th Cir. 2005) (quoting Fed.R.Civ.P. 72 advisory committee's note).
Specific written objections must be filed within fourteen (14) days of the date of service of this Report and Recommendation. 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 72(b); see Fed.R.Civ.P. 6(a), (d). Filing by mail pursuant to Federal Rule of Civil Procedure 5 may be accomplished by mailing objections to:
Robin L. Blume, Clerk
United States District Court
Post Office Box 835
Charleston, South Carolina 29402
Failure to timely file specific written objections to this Report and Recommendation will result in waiver of the right to appeal from a judgment of the District Court based upon such Recommendation. 28 U.S.C. § 636(b)(1); Thomas v. Arn, 474 U.S. 140 (1985); Wright v. Collins, 766 F.2d 841 (4th Cir. 1985); United States v. Schronce, 727 F.2d 91 (4th Cir. 1984).