Opinion
Civil No. SA-05-CV-382-RF, Bankruptcy No. 50-50115.
June 21, 2005
Before the Court are Appellee's Motion to Dismiss Appeal and Request for Damages (Docket No. 7, 9, 11). After due consideration, the Court GRANTS Appellee's Motion to Dismiss Appeal and DENIES Appellee's Request for Damages under Fed.R.Bankr.P. 8020.
On February 10, 2005, the Honorable Bankruptcy Judge Lief M. Clark heard arguments on and granted FIRST NATIONAL BANK's Motion for Sanctions against Morris J. Kirschberg, individually, Melvin R. Blumberg, individually, and Morris J. Kirschberg, P.C. (hereinafter Appellants). On Februrary 17, 2005, Judge Clark signed the Order on FIRST NATIONAL BANK's Motion for Sanctions against Appellants for violations of Bankruptcy Rule 9011 and Rule 11, Fed.R.Civ.P., for violating Section 109(g)(2) of the Bankruptcy Code. In said Order, Appellants were ordered to pay, jointly and severally, the total sum of $5,319.60 to Appellee for its costs, attorney's fees, and expenses directly resulting from their violations.
On February 24, 2004, Appellants entered a Notice of Appeal under 28 U.S.C. § 158 from Judge Clark's sanctions order. However, they failed to file a Designation of Record and Statements of the Issues to be Presented within ten (10) days of filing the Notice of Appeal as required by Fed.R.Bankr.P. 8001(a). Four (4) days past the deadline, on March 10, 2005, Appellants filed a Designation of Record and Statement of Issues to be Presented. The Designation of Record and Statement of Issues to be Presented that they filed merely stated that Appellants "respectfully disagree with this ruling by the Court." They did not list a Statement of Issues to be Presented.
Appellants contend that the failure to file a timely Designation of Record and State of Issues to be Presented is due to the late receipt of a copy of the transcript from the Court and/or excusable neglect. On March 3, Appellants submitted a Transcript Order Form to the Clerk of the Bankruptcy Court. Even though options existed for one (1) day, four (4) day or seven (7) day delivery, Appellants elected to receive the transcript through Ordinary thirty day (30) delivery despite their deadline to file a Designation of Record and Statement of Issues to be Presented being only four (4) days away. Although Appellants received the transcript on March 30, 2005, their Motion for Leave to File Late Designation under Fed.R.Bankr.P. 8006 was filed on April 28, 2005. Appellants delayed in filing this motion until twenty-nine (29) days after their March 30, 2005 receipt of the transcript and fifty-three (53) days after the March 7, 2005 deadline.
Furthermore, on June 2, 2005, Appellants' filed a Motion for Leave to Allow Late Filing of Appellants' Brief which had been due on May 27, 2005 as required by Fed.R.Bankr.P. 8009. The following Monday, on June 6, 2005, the Appellants submitted a Brief. Although Appellants contacted Appellee to request a one day extension on May 27th, Appellee objects to the filing of the Appellant's Brief more than a week after the May 27, 2005 deadline. On the other hand, Appellants claim that they have attempted unsuccessfully since May 27, 2005 to confer with opposing counsel on the substance of this motion. Also, Appellants did give a reason for their failure to file their brief on time in their Motion for Leave to Allow Late Filing of Appellants' Brief: the lateness was "due to illness in the family of the person researching the primary issue and the novel nature of that issue." However, despite the extra time, the Brief does not appear to have been given due time and energy since, among other things, it contains multiple references to a previous case, Norris v. Thomas, where the name of the present case should appear. Appellants submitted a brief that corrected these problems on June 15, 2005.
The Court reviews the bankruptcy court's findings of fact under the clearly erroneous standard, which calls for reversal only if, considering all the evidence, the Court is left with the definite and firm conviction that a mistake has been made. When the Court reviews the bankruptcy court's conclusions of law, it reviews them de novo. Also, the Court applies the same standard of review in a bankruptcy appeal that a court of appeals applies in reviewing a district court proceeding.
In re Kemp, 52 F.3d 546, 550 (5th Cir. 1995).
Id.
The Motion to Dismiss Appeal must be granted because the issue has not been preserved for appeal. In re GGM, P.C., the 5th Circuit held that an issue argued and ruled on by a bankruptcy court is not preserved for appeal under Fed. Bankr. R. 8006 "unless the appellant includes the issue in its statement of issues on appeal." Appellants' Statement of Issues to be Presented was insufficient to preserve any issues because it merely stated that Appellants "respectfully disagree with this ruling by the Court." Since Appellants are not eligible under either prong of Fed.R.Bankr.P. 9006(1) to file a late Designation and their Motion for Leave to File A Late Designation is denied, the five (5) statements listed in their supplemental Statement of Issues to be Presented do not preserve error. Therefore, the Court finds that the issues were not preserved for appeal and grants the Appellee's Motion to Dismiss Appeal.
165 F.3d 1026, 1032 (5th Cir. 1999).
Appellee's Request for Damages pursuant to Fed.R.Bankr.P. 8020 will be denied because the claim on appeal was not so frivolous as to indicate bad faith on the part of Appellants. Fed.R.Bankr.P. 8020 provides that:
"If a district court or bankruptcy appellate panel determines that an appeal from an order, judgement, or decree of a bankruptcy judge is frivolous, it may, after a separately filed motion or notice from the district court or bankruptcy appellate panel and reasonable opportunity to respond, award just damages and single or double costs to the appellee."In re Sherk clarifies under what circumstances a district court would find an appeal "frivolous." There the 5th Circuit held that arguable claims on appeal are not frivolous except where there is an indication of bad faith on the part of the appellant. The Appellants' "Designation of Record and Statement of Issues to be Presented" stated that they "respectfully disagree with this ruling by the Court." Appellee contends that since Appellants' claim is not a sufficient arguable, they fail to meet the standard of In re Sherk, and are thus required to pay damages under Fed.R.Bankr.P. 8020. However, the Court finds that the failure to properly order the transcript does not rise to the level of bad faith that would warrant a damage award to Appellee. Therefore, the Appellee's request for damages should be denied.
918 F.2d 1170, 1178 (5th Cir. 1990).
Id.
Id.
Accordingly, the Court ORDERS that the Motion to Dismiss Appeal be GRANTED and the Request for Damages be DENIED.
It is so ORDERED.
On this day, the Court entered an Order granting in part and denying in part Appellee's Motion to Dismiss Appeal and Request for Damages (Docket No. 7, 9, 11). The Court GRANTS Apellee's Motion to Dismiss Appeal. However, the Court DENIES Appellee's Request for Damages under Fed R. Bankr. P. 8020. The Court now enters its Final Judgment pursuant to Federal Rule of Civil Procedure 58.
Accordingly, it is hereby ORDERED that Respondent's Motion to Dismiss Appeal (Docket No. 7, 9, 11) be GRANTED.
In addition, it is hereby ORDERED that Appellee's Request for Damages (Docket No. 7, 9, 11) be DENIED.
It is ORDERED that the case be DISMISSED WITH PREJUDICE.
It is ORDERED that each party bear its own costs.
It is ORDERED that all pending motions are denied as MOOT.