Opinion
Case No. 02-14043-CJK
October 18, 2002
ORDER TO SHOW CAUSE WHY SANCTIONS SHOULD NOT BE ENTERED AGAINST DEBTOR ROBERT J. PETTEY AND ATTORNEY JOSEPH CZERWONKA
The Court hereby ORDERS Debtor Robert J. Pettey and Attorney Joseph Czerwonka, as Debtor's counsel in this case, to show cause why this Court should not, pursuant to 11 U.S.C. § 105 (a), FED. R. BANKR. P. 9011(c), and its inherent authority, enter sanctions against them for the following causes:
1. Against Debtor Robert J. Pettey, for violating FED. R. BANKR. P. 9011(b)(1) and (3), and Attorney Joseph Czerwonka, for violating FED. R. BANKR. P. 9011(b)(1), (2), and (3), by signing and filing in this case the petition for relief under Chapter 13 of the Bankruptcy Code, despite the fact that, as now appears to be the case, the Debtor was ineligible under 11 U.S.C. § 109 (e) to be a debtor under Chapter 13 because his noncontingent, unliquidated, unsecured debts exceed the limit of $290,525;
2. Against Debtor Robert J. Pettey, for violating FED. R. BANKR. P. 9011(b)(1) and (3) by signing under penalty of perjury and filing in this case the schedules of creditors and the numbered listing of creditors while omitting from such filed documents the name and address of creditor Elinore M. Davey and her claim in the amount of $40,000 under a Judgment of Divorce Nisi, entered by the Bristol County Probate and Family Court;
3. Against Debtor Robert J. Pettey and Attorney Joseph Czerwonka, for violating FED. R. BANKR. P. 9011(b)(1) and (3) by signing under penalty of perjury and filing in this case the list of creditors (mailing matrix) while omitting from such filed document the name and address of creditor Elinore M. Davey;
4. Against Debtor Robert J. Pettey, for violating FED. R. BANKR. P. 9011(b)(1) and (3), and against Attorney Joseph Czerwonka, for violating FED. R. BANKR. P. 9011(b)(1), (2), and (3), by signing and filing in this case the Chapter 13 Plan, and later the Amended Chapter 13 Plan, while failing to make provision therein for the claim of creditor Elinore M. Davey, including by failing to include the amount of her claim in the total of unsecured claims on which the plans proposed to pay a dividend;
5. Against Attorney Joseph Czerwonka, for violating FED. R. BANKR. P. 9011(b)(1) by signing and filing in this case the Chapter 13 Plan, and later the Amended Chapter 13 Plan, while failing to serve these on creditor Elinore M. Davey;
6. Against Debtor Robert J. Pettey, for violating FED. R. BANKR. P. 9011(b)(1) and (3) by signing under penalty of perjury and filing in this case the Statement of Financial Affairs but failing to disclose, in part 4 of the Statement, certain suits to which he was a party within one year immediately preceding the filing of his bankruptcy petition, including (i) No. 92-D0886-DV1 in Bristol County Probate and Family Court, in which he is a defendant; (ii) Civil Action No. 91-02654 in Bristol County Superior Court, in which he is a defendant; (iii) Civil Action No. 95-01582C in Bristol County Superior Court, in which he is a defendant; and (iv) Civil Action No. 01-1934 in Norfolk County Superior Court, in which he is a defendant;
7. Against Debtor Robert J. Pettey, for violating FED. R. BANKR. P. 9011(b)(1) and (3) by signing under penalty of perjury and filing in this case the Statement of Financial Affairs but failing to disclose, in part 17a of the Statement, the name of Bruce Hague, an accountant who, within six years immediately preceding the filing of Debtor's bankruptcy case kept or supervised the keeping of books of account and records of the Debtor;
8. Against Debtor Robert J. Pettey, for violating FED. R. BANKR. P. 9011(b)(1) and (3) by signing under penalty of perjury and filing in this case the schedules of creditors, the numbered listing of creditors, and the list of creditors (mailing matrix) and incorrectly listing in each of these the address of Attorney Mark Itzkowitz, as counsel to creditor William Belanger, as he is Father and Next Friend of Christina Belanger and Melissa Belanger;
9. Against Attorney Joseph Czerwonka, for violating FED. R. BANKR. P. 9011(b)(1) and (3) by signing under penalty of perjury and filing in this case the list of creditors ("mailing matrix") and incorrectly listing in it the address of Attorney Mark Itzkowitz, as counsel to creditor William Belanger, as he is Father and Next Friend of Christina Belanger and Melissa Belanger;
10. Against Attorney Joseph Czerwonka, for violating FED. R. BANKR. P. 9011(b)(1) and (3) by signing and filing his certificate of service with respect to the Amended Chapter 13 Plan and the Motion to Approve the Amended Plan, which certificate indicated that he had by mail served the Plan and Motion on the Chapter 13 Trustee and on Attorney Mark Itzkowitz, while in fact he had not mailed the documents to the Chapter 13 Trustee and Attorney Itzkowitz, and did not do so until approximately one month after he filed the certificate of service.
If, after hearing, the Court determines that sanctions should enter for some or all of the above causes, the sanctions may include (i) payment of the attorney's fees incurred by Attorney Itzkowitz for creditor William Belanger in rectifying the lack of service upon him and contending with a case for which the Debtor was not eligible, (ii) payment of the attorney's fees and costs incurred by the Chapter 13 Trustee in dealing with this case, (iii) payment into Court of the costs to the Bankruptcy Court of dealing with this case. Where appropriate, sanctions may also include (iv) as to Debtor Robert J. Pettey and Attorney Joseph Czerwonka, a referral of the above matter to the United States Attorney for possible prosecution for perjury and other bankruptcy crimes, and (v) as to Attorney Joseph Czerwonka, a referral to the Board of Bar Overseers for appropriate investigation and sanctions for violation of the Massachusetts Rules of Professional Conduct, including Rules 3.3(a)(1) (a lawyer shall not knowingly make a false statement of material fact to a tribunal), 3.3(a)(2) (a lawyer shall not knowingly fail to disclose a material fact to a tribunal), 3.4(c) (a lawyer shall not knowingly disobey an obligation under the rules of a tribunal, in this instance the local rules requiring service of pleadings on all parties in interest), and 4.1(a) (in the course of representing a client, a lawyer shall not knowingly make a false statement of fact to a third person).
In addition, the Court further orders Debtor Robert J. Pettey to show cause why, if this case is dismissed as requested by the Chapter 13 Trustee and the Belanger creditors, such dismissal should not, pursuant to 11 U.S.C. § 349 (a) and for cause, expressly bar the discharge, in a later case under the Bankruptcy Code, of the debts presently owing to the Belanger defendants and to Elinore Davey, the cause being that
1. Debtor Robert J. Pettey signed under penalty of perjury and filed in this case the schedules of creditors, the numbered listing of creditors, and the list of creditors (mailing matrix) while omitting from such filed documents the name and address of creditor Elinore M. Davey and her claim in the amount of $40,000 under a Judgment of Divorce Nisi, entered by the Bristol County Probate and Family Court; and
2. Debtor Robert J. Pettey signed under penalty of perjury and filed in this case the schedules of creditors, the numbered listing of creditors, and the list of creditors (mailing matrix) and incorrectly listed in each of these the address of Attorney Mark Itzkowitz, for creditor William Belanger, as he is Father and Next Friend of Christina Belanger and Melissa Belanger.
The hearing on this order, which shall be an evidentiary hearing, shall be held on November 25, 2002, at 1 p.m., in Courtroom 4 of the United States Bankruptcy Court for the District of Massachusetts, 11th Floor, Thomas P. O'Neill Building, 10 Causeway Street, Boston, Massachusetts.