Evans v. Bank of New York Trust Co. (In Re Evans) ( 2012 )

FILED
United States Court of Appeals
Tenth Circuit
UNITED STATES COURT OF APPEALSFebruary 24, 2012
Elisabeth A. Shumaker
FOR THE TENTH CIRCUIT Clerk of Court
In Re: PATRICIA ANN EVANS,
Debtor,
------------------------------ No. 11-1096
(BAP No. 10-031-CO)
PATRICIA ANN EVANS,
Appellant,
v.
THE BANK OF NEW YORK TRUST
COMPANY, N.A., as successor to
JPMorgan Chase Bank, N.A., as
Trustee,
Appellee.
ORDER AND JUDGMENT *
Before KELLY, Circuit Judge, PORFILIO, Senior Circuit Judge, and
MATHESON, Circuit Judge.
*
After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist the determination of
this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is
therefore ordered submitted without oral argument. This order and judgment is
not binding precedent, except under the doctrines of law of the case, res judicata,
and collateral estoppel. It may be cited, however, for its persuasive value
consistent with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
More than two years after the Bank of New York Trust Company (“New
York Trust” or “bank”) purchased a Denver home at foreclosure, Patricia Ann
Evans filed for Chapter 7 bankruptcy, listing the same home as her address. The
bank, which by then had already obtained a judgment of possession and writ of
restitution in state court, took care not to violate the automatic stay imposed in
Ms. Evan’s bankruptcy case, see 11 U.S.C. § 362(a). To that end, the bank
moved for relief from the automatic stay. The bankruptcy court granted the
motion, and the Tenth Circuit Bankruptcy Appellate Panel (“BAP”) affirmed the
order lifting the automatic stay. The BAP later denied Ms. Evans’ motion for
rehearing and eventually sanctioned her for filing a frivolous appeal.
Now in this court, Ms. Evans claims the bankruptcy court lacked
jurisdiction to grant relief from the automatic stay and the BAP erred in imposing
sanctions. 1 Unfortunately for Ms. Evans, two jurisdictional defects prevent us
from considering her claims. First, Ms. Evans’ notice of appeal designated for
appeal only the BAP’s order denying rehearing, not the BAP’s decision affirming
stay relief, nor the BAP’s imposition of sanctions. Second, although the notice of
appeal properly designated the BAP’s denial of rehearing, the issues resolved by
1
Ms. Evans also makes a vague allusion to a due process violation. We
afford Ms. Evans’ pro se materials a solicitous construction, see Van Deelen v.
Johnson, 497 F.3d 1151, 1153 n.1 (10th Cir. 2007), but her failure to adequately
develop this issue forfeits appellate review, see Murrell v. Shalala, 43 F.3d 1388,
1389 n.2 (10th Cir. 1994) (noting that failure to adequately develop an argument
forfeits appellate review).
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that decision were rendered moot by Ms. Evans’ bankruptcy discharge. We
therefore lack jurisdiction and accordingly dismiss this appeal.
BACKGROUND
The home in question was previously owned by Ms. Evan’s daughter, Vicki
Dillard-Crowe. After the house fell into foreclosure, New York Trust purchased
it at auction and, once all state statutory redemption periods expired, initiated
eviction proceedings against all occupants. The bank obtained a judgment of
possession and writ of restitution in state court, but before it could execute the
writ, Ms. Evans filed her bankruptcy petition listing the home as her address.
This caused the bank to halt its efforts to execute its writ and seek relief from the
automatic stay created by Ms. Evans’ bankruptcy filing.
At a hearing before the bankruptcy court, counsel for New York Trust
explained that after acquiring the house, the bank received a public trustee’s deed
and successfully defended its judgment of possession against Ms. Dillard-Crowe
in the Colorado Court of Appeals. The Colorado Supreme Court later declined to
review the dispute. Ms. Dillard-Crowe filed for bankruptcy, causing the bank to
seek relief from the stay imposed in Ms. Dillard-Crowe’s bankruptcy case. New
York Trust was granted relief, but the very next day, Ms. Evans filed her own
bankruptcy petition, leading the bank to seek stay relief in Ms. Evans’ case as
well.
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For her part, Ms. Evans asked to continue the hearing. She wanted to get a
lawyer because, in her view, she was uninvolved in the matter. As she told the
court: “[T]his doesn’t deal with me” because “I am just a guest in [t]his home, so
I don’t know why they’re trying to – they’re requesting a writ against me. I’m a
guest in [t]his home and I can’t answer to anything because I don’t know my
rights, and my name is not on the deed.” Aplt. Br., Ex. 1 (Hr’g Trans.) at 13-14.
Upon hearing these arguments, the bankruptcy court granted New York
Trust’s motion for relief from stay. The court observed that Ms. Dillard-Crowe’s
rights had been divested in foreclosure, New York Trust’s ownership rights
already had been established, and the stay arguably did not even apply to the
bank’s efforts to execute its writ of restitution. The court considered several
grounds for granting relief and settled on 11 U.S.C. § 362(d), which, among other
things, allows a court to grant a party-in-interest relief from stay for cause or if
the debtor has no equity in the property, id. § 362(d)(1), (d)(2)(A).
On January 4, 2011, the BAP affirmed the order lifting the automatic stay.
Notwithstanding the discharge of Ms. Evans’ bankruptcy during the pendency of
the appeal, the BAP rejected the bank’s argument that the appeal was moot,
reasoning that the stay remained in force so long as the property remained in the
estate. On the merits, the BAP agreed that relief from the automatic stay was
proper because Ms. Evans held no equity in the home. The BAP also noted that
Ms. Evans’ primary argument on appeal—that her daughter was a “necessary and
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indispensible [sic] party,” Aplee. App. at 1,—had twice been rejected by the BAP,
and her remaining contentions were meritless, bordering on frivolous.
Consequently, the BAP directed Ms. Evans to show cause why sanctions should
not be imposed.
On January 13, 2011, Ms. Evans responded with a motion for
reconsideration, maintaining that the bankruptcy court lacked jurisdiction to grant
stay relief and asserting that sanctions should not be imposed because it was
“self-evident” that her appeal was not frivolous. R., Vol. 1 at 36. On February 4,
2011, the BAP denied Ms. Evans’ motion for rehearing and directed the bank to
file an itemization of damages and costs. On March 4, 2011, Ms. Evans filed her
notice of appeal, designating for appeal only “the judgment, order, or decree of
the United States Bankruptcy Appellate Panel entered on February 4, 2011.” Id.
at 75. Thereafter, on March 11, 2011, the BAP entered an order sanctioning
Ms. Evans $4,737.50 for filing a frivolous appeal. See Fed. R. Bankr. P. 8020.
DISCUSSION
In this appeal, Ms. Evans contests the bankruptcy court’s jurisdiction,
claiming that a motion for relief from the automatic stay is a non-core proceeding
over which the bankruptcy court lacked jurisdiction. She also challenges the
BAP’s imposition of sanctions, insisting that her pro se appeal was not frivolous.
In any case, “including decisions involving a lower court’s subject matter
jurisdiction, . . . the first and fundamental question is that of jurisdiction, first, of
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this court, and then of the court from which the record comes.” Lang v. Lang
(In re Lang), 414 F.3d 1191, 1195 (10th Cir. 2005) (internal quotation marks
omitted). Indeed, “the question of this Court’s jurisdiction (i.e., our appellate
jurisdiction) is antecedent to all other questions, including the question of the
subject matter of the [lower court].” Id. (internal quotation marks omitted). We
must therefore consider our own jurisdiction before entertaining Ms. Evans’
challenge to the bankruptcy court’s jurisdiction, and notwithstanding that neither
party contests our jurisdiction. See Amazon, Inc. v. Dirt Camp, Inc., 273 F.3d
1271, 1274 (10th Cir. 2001) (“Although neither party challenges our appellate
jurisdiction, we have an independent duty to examine our own jurisdiction.”).
BAP’s Order Affirming Stay Relief
We first consider our jurisdiction to review the BAP’s January 4, 2011,
merits decision affirming stay relief. 2 Although she argues this decision on
appeal, Ms. Evans did not designate or otherwise reference this decision in her
notice of appeal. Rather, she designated the BAP’s denial of rehearing, entered
on February 4, 2011. Our jurisdiction “is limited to final judgments or parts
thereof that are designated in the notice of appeal.” Cunico v. Pueblo Sch. Dist.
No. 60, 917 F.2d 431, 444 (10th Cir. 1990). Although we “liberally construe the
requirements of [Federal] Rule [of Appellate Procedure] 3,” Smith v. Barry,
2
The BAP entered a separate final judgment the same day, January 4, 2011.
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502 U.S. 244, 248 (1992), Ms. Evans did not file any other document referencing
the January 4, 2011, order that could serve as the “functional equivalent” of a
timely notice of appeal, B. Willis, C.P.A., Inc. v. BNSF Ry. Corp., 531 F.3d 1282,
1296 (10th Cir. 2008) (internal quotation marks omitted) (observing that
documents such as a pro se docketing statement or timely filed brief may serve as
the “functional equivalent” of a notice of appeal). Ms. Evans’ failure to appeal
the BAP’s order affirming stay relief precludes us from reviewing that decision.
BAP’s Order Denying Rehearing
Ms. Evans designated for appeal the BAP’s order denying her motion for
rehearing. She sought rehearing on the same issue that formed the basis of her
underlying appeal: whether the bankruptcy court had jurisdiction to grant New
York Trust relief from the automatic stay. Ordinarily, we would review the
denial of rehearing for an abuse of discretion. See Shawnee State Bank v. First
Nat’l Bank of Olathe (In re Winders), 202 B.R. 512, 517 (D. Kan. 1996) (“Rule
8015 is silent as to the standard for granting a rehearing, but granting a motion
for reconsideration is within the discretion of the court whose order is subject to
the motion.”). Here, however, another kind of jurisdictional problem precludes
our review: mootness.
“Generally an appeal should be dismissed as moot when events occur that
prevent the appellate court from granting any effective relief.” Pursifull v. Eakin,
814 F.2d 1501, 1506 (10th Cir. 1987) (internal quotation marks omitted).
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Ms. Evans appealed the grant of stay relief to the BAP, and while her appeal was
pending, the bankruptcy court discharged her bankruptcy petition. The
bankruptcy code provides that a stay of any act against a Chapter 7 debtor
continues until the time a discharge is granted or denied. 11 U.S.C.
§ 362(c)(2)(C). By the time the BAP entered its merits decision and denied
rehearing, the stay had already terminated by operation of law, see id., thus
mooting the case.
Although the BAP recognized the discharge, it ruled that the appeal was not
moot because the stay remained in force until the property was no longer part of
the estate. See id., § 362(c)(1) (“the stay of an act against property of the estate .
. . continues until such property is no longer property of the estate”). The
problem with this rationale, however, is that the property--that is, the real
property, the actual house--was never part of the estate. The house had been
owned by Ms. Evans’ daughter, Ms. Dillard-Crowe; New York Trust acquired the
house at foreclosure; and Ms. Evans expressly disavowed any interest in the
home. Consequently, the stay protected only any possessory interest Ms. Evans
held by virtue of her occupancy. And when her discharge was granted, the stay
protecting that interest terminated, thus mooting any appeal of that issue.
BAP’s Order Imposing Sanctions
Finally, we consider our jurisdiction over the BAP’s order imposing
sanctions. The BAP directed Ms. Evans to show cause and, after receiving her
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response, entered its sanctions order on March 11, 2011. Because Ms. Evans’
notice of appeal was filed before that date, a second notice of appeal was required
to bring the sanctions order within our jurisdiction. See Willis, 531 F.3d at 1296.
Ms. Evans did not file a second notice of appeal, and there is no “functional
equivalent” of a second notice of appeal from the sanctions order. See id.Consequently, we have no jurisdiction to review the BAP’s imposition of
sanctions.
This appeal is DISMISSED for lack of jurisdiction. Ms. Evans’ motion to
proceed on appeal in forma pauperis is GRANTED.
Entered for the Court
Scott M. Matheson, Jr.
Circuit Judge
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