Suffness v. Petros ( 1995 )

IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
_____________________
No. 95-10442
Summary Calendar
________________________
In The Matter Of: AVANTE REAL ESTATE, INC
Debtor
_________________________________________________________________
MICHAEL B. SUFFNESS
Appellant,
v.
JOHN PETROS, US Trustee; ROBERT NEWHOUSE, Trustee;
WILLIAM T NEARY
Appellees
_________________________________________________________________
Appeal from the United States District Court
for the Northern District of Texas
(3:95-CV-410-T)
_________________________________________________________________
(October 11, 1995)
Before KING, SMITH, and BENAVIDES, Circuit Judges.
PER CURIAM:*
*
Local Rule 47.5 provides: "The publication of opinions
that have no precedential value and merely decide particular
cases on the basis of well-settled principles of law imposes
needless expense on the public and burdens on the legal
profession." Pursuant to that Rule, the court has determined
1
Attorney Michael Suffness ("Suffness") appeals various
actions and orders of the bankruptcy court, including: (1) the
December 6, 1994 Order Requiring Michael Suffness to Show Cause
Why He Should Not Be Sanctioned Under Fed. R. Bankr. P. 9011; (2)
the February 14, 1995 Order Sanctioning Michael Suffness, which
enjoined Suffness from practicing in the bankruptcy court for the
Northern District of Texas for six months ("the suspension
order"); and (3) the January 25, 1995 Order Requiring Michael
Suffness to Pay Retainer in to the Registry of the Court, which
ordered the disgorgement of Suffness's retainer in the underlying
bankruptcy appeal. The district court affirmed all three orders
on April 17, 1995. Upon appeal to this court, we affirm.
I. FACTUAL AND PROCEDURAL HISTORY
In May, 1994, John Petros ("Petros") and Ruben de la Torres
("de la Torres") formed Avante Real Estate, Inc. ("Avante") to
own and operate two apartment complexes. Shortly thereafter, the
working relationship between Petros and de la Torres
deteriorated. On August 15, 1994, and August 25, 1994,
respectively, Petros transferred, by special warranty deed, both
apartment complexes to other entities owned or controlled by him.
On August 26, 1994, Suffness, on behalf of Petros, wrote to
Avante's bank, Central Bank and Trust, requesting that the bank
freeze Avante's bank account.
that this opinion should not be published.
2
On September 8, 1994, Petros and Suffness caused Avante to
file a voluntary chapter 7 bankruptcy petition. Petros signed
the petition as the debtor's president, and Suffness signed the
petition as the debtor's attorney. It is not clear if, and in
fact doubtful that, de la Torres, Petros's partner, was ever
served with notice of the bankruptcy filing. In the schedules
and statement of affairs that the debtor filed with the chapter 7
petition, the debtor identified one bank account number -- that
of an account at Central Bank and Trust -- and did not schedule
any real property or other assets.
At the first creditors' meeting, held on October 12, 1994,
Suffness appeared as debtor's counsel, but no one appeared on
behalf of the debtor. The trustee agreed to continue the meeting
until October 19, 1994, to allow the debtor an opportunity to
appear. Prior to the scheduled October 19, 1994 meeting,
Suffness contacted the chapter 7 trustee, Robert Newhouse
("Newhouse"), and informed him that the debtor would not be
appearing at the meeting, and that Suffness intended to file a
motion to dismiss the bankruptcy case.
On October 25, 1994, because Suffness had not yet filed a
motion to dismiss the case, the United States Trustee,
represented by Mary Frances Durham, filed a motion to dismiss the
case and to require payment to trustee. In this motion, the
United States Trustee requested the bankruptcy court to order the
disgorgement of $200.00 of Suffness's $840.00 retainer and
payment of that money to trustee Newhouse as compensation for his
3
time and effort, as well as to penalize Suffness for his failure
to fulfill his stated commitment to file a motion to dismiss and
to bear the costs of service of notice on the creditors. On
October 27, 1995, Suffness filed a response to the United States
Trustee's motion, urging that Newhouse seek compensation from
funds in the debtor's account at Central Bank and Trust, and
opposing the disgorgement of his retainer.
On November 21, 1994, the bankruptcy court held a hearing on
the United States Trustee's motion to dismiss and require payment
to trustee. At that hearing, the court heard from the United
States Trustee, the bankruptcy trustee, and Suffness. The
bankruptcy trustee, Newhouse, testified under oath regarding the
poor condition of the Avante properties,1 and his ultimate
decision to abandon the assets of the estate. Newhouse also
testified that he was unable to ascertain the amount of money in
the Central Bank and Trust account, and that he was unable to
retrieve the books and records of the rental properties. Next,
Newhouse noted that he was never able to discern who was the true
owner of the properties, because there appeared to be a dispute
between Petros and de la Torres, who both claimed to be owners in
full,2 and because the properties had been transferred, prior to
1
Newhouse testified that one complex appeared to be in
inhabitable condition and needed to be condemned, while the
other, while in terrible condition, appeared to be operating,
albeit without complete utilities.
2
The trustee testified that he had received a letter
from de la Torres, containing an original signature and
impression from a corporate seal, thus indicating that de la
Torres also claimed ownership and active management of the
4
the filing of the bankruptcy, from Avante to two separate
entities. Newhouse stated that it was his understanding that the
funds in the Central Bank and Trust account were not accessible
to the U.S. Trustee because they had been frozen pursuant to a
state court order regarding the dispute between Petros and de la
Torres.
Suffness did not cross-examine Newhouse. When the
bankruptcy court asked Suffness about the assets of the debtor,
and, in particular the amount of money in the Central Bank and
Trust account, Suffness responded that he "ha[d] not been told
what the amount in the account is." Suffness also was not able
to relate to the court the whereabouts of his client, or even his
confidence that his client, Petros, was in fact the sole owner of
the debtor corporation. Finally, Suffness requested that, rather
than through disgorgement of his fee, the bankruptcy trustee be
compensated for his services by money from the Central Bank and
Trust account.
At the conclusion of the November 21, 1994 hearing, the
bankruptcy court orally entered the following orders: (1) the
estate's interest in any real property was abandoned; (2) Central
Bank and Trust was to appear and show cause why it should not
turn over all funds on deposit for the debtor; (3) Suffness was
to pay one half of his retainer ($420.00) into the registry of
the court pending consideration of sanctions against him; and (4)
Suffness was to appear at a future date to show cause why he
properties, and, in fact, possessed the corporate seal.
5
should not be sanctioned pursuant to Rule 9011 of the Federal
Rules of Bankruptcy Procedure. The court ordered the attorney
for the United States Trustee to draft and submit a proposed
order reflecting its oral ruling.
On December 6, 1994, the bankruptcy court entered the Show
Cause Order it discussed at the November 21 hearing. That order,
entitled "Order Requiring Michael Suffness to Show Cause Why He
Should Not Be Sanctioned Under FRBP 9011," stated, inter alia,
that the court "believes that the debtor through Mr. Suffness may
have filed this bankruptcy for an improper purpose and,
therefore, the court is considering levying sanctions against Mr.
Suffness under Fed. R. Bank. Proc. 9011." Thus the court
ordered that, "pending disposition of this case," Suffness pay
one-half of his fee into the registry of the court. Finally, the
court ordered that, in order to show cause why he should not be
sanctioned, Suffness respond to the court regarding eight
specific matters: (1) proof of ownership of the stock of the
debtor; (2) the authority of Petros to sign the bankruptcy
petition for the debtor; (3) proof of notice of the filing of the
bankruptcy to the first lienholder on each property; (4) proof of
notice of the filing of the bankruptcy to the Central Bank and
Trust and its counsel; (5) failure to inform the court on
November 21, 1994 that the funds held by Central Bank and Trust
had been interpleaded in the Tarrant County Court of Law; (6)
failure to inform the chapter 7 trustee of the state court
proceedings and failure to forward documents regarding the bank
6
accounts and state court proceeding to the trustee; (7) failure
to include complete information regarding the two bank accounts
at the Central Bank and Trust; and (8) the source and amount of
any money paid to Suffness by the debtor, Petros, or any other
party for any matter regarding the debtor, the bankruptcy, or any
state court matters.
On that same day, the United States Trustee served notice of
a forthcoming December 22, 1994 hearing. In order to obtain a
correct service list, the Trustee contacted the attorney for
Central Bank and Trust, Dabney Bassell ("Bassell"), who informed
the United States Trustee that the bank had no knowledge of the
bankruptcy filing, had interpleaded the funds from two bank
accounts into the Tarrant County Court of Law on November 1,
1994, and had written Suffness four times prior to the November
21 hearing, asking Suffness to take some action regarding the
accounts or else respond to the petition and interpleader, but
had received no response. Upon learning of the interpleader, and
reasoning that it would serve no purpose to serve the bank with a
show cause order, the United States Trustee prepared a proposed
turnover order directed to the Tarrant County Court of Law, which
the court accepted as written.
Bassell filed an affidavit for the purpose of the December
22 hearing, and, after neither Suffness nor the debtor filed any
objections, the court admitted it into evidence. In the
affidavit, Bassell stated that an attorney in his firm,
representing the bank, wrote both Suffness and Cram, the attorney
7
for de la Torres, on September 14, 1994, regarding the freeze on
the bank accounts, and received no response. On October 17,
1994, Bassell wrote Suffness and Cram himself, and received a
response from Cram but not from Suffness. Concluding that there
continued to be a dispute as to the ownership of the account's
funds, on November 1, 1994, the bank filed a Petition in
Interpleader, and transmitted a copy of the petition to both Cram
and Suffness. In order to resolve the interpleader issue,
Bassell transmitted another letter to Cram and Suffness on
November 11, 1994. Bassell stated that, at the time that he had
written all of the letters described above, he had not been aware
of the debtor's petition in bankruptcy. Thus, the attorney for
the bank had contacted Suffness four times in writing prior to
the November 21 hearing at which Suffness told the court that
there was one, rather than two accounts at Central Bank and
Trust, that Suffness was not aware of the amount of money in the
account, and that the trustee should seek his payment out of the
bank account.
Prior to the December 22, 1994 hearing, the United States
Trustee designated several exhibits pursuant to the Northern
District of Texas Local Rule 8.1 and Local Bankruptcy Rule 9032.
Suffness, however, did not designate any witnesses or exhibits,
even though the Show Cause Order setting the December 22 hearing
required Suffness to respond to eight issues and also stated that
the court would consider all state court pleadings and all
correspondence between Suffness and Central Bank and Trust.
8
At the December 22 hearing, the United States Trustee
introduced fourteen exhibits without objection, including the
letters sent from the bank to Suffness. Suffness, testifying on
his own behalf, admitted that he had received correspondence from
Central Bank and Trust prior to the November 21, 1994, hearing,
but claimed that he had not read the letters. He also admitted
having received a copy of the petition for interpleader from the
bank, but Suffness claimed that he mistook it for an application
to intervene in the bankruptcy case. When the court asked
Suffness why he had failed to include the rents, machinery and
office equipment as assets of the estate, as well as why Suffness
had represented the debtor's two bank accounts as if they
consisted of a single bank account, Suffness responded that he
did not know about the estate at the time of filing, but that he
had filed the petition nonetheless, in a hasty attempt to protect
the assets of the estate.
Petros also testified at the December 22, 1994 hearing.
Petros admitted that he was involved in a dispute over the
ownership and control of the Avante properties with de la Torres,
that he had transferred both of the properties to entities he
owned prior to the filing of the bankruptcy, and that he had
filed the bankruptcy largely as an alternative to state court
proceedings, as a "last resort" to gain control of the properties
and keep them out of the hands of de la Torres.3 After all of the
3
Petros testified that he had "tried" to gain control of
the properties through state court proceedings, but that de la
Torres "kept avoiding [him] for almost forty-five days."
9
testimony had been heard, Suffness voiced an objection to the
United States Trustee's exhibits. Because the exhibits had
already been entered into evidence without objection, the
bankruptcy court denied Suffness's request.
At the conclusion of the December 22 hearing, the bankruptcy
court made its findings of fact and conclusions of law pursuant
to 28 U.S.C. 157(b)(2)(A) and (O), and Bankruptcy Rule 7052. The
court found that both Suffness and Petros filed the bankruptcy
action for an improper purpose, namely, to cause harassment and
delay of another person who was contesting Petros's control of
the apartments. The court also found that the schedule of assets
filed with the bankruptcy court case stated that the two
properties were assets of the debtor at a time when the
properties had already been deeded out of the estate by Petros
himself, as evidenced by Petros's signature on the deeds. The
court found that the purpose of the filing was to have the
trustee pursue the properties and the rents, while Petros and
Suffness enjoyed the benefits of the automatic stay provision of
the Bankruptcy Code -- a purpose which is clearly improper.
Finally, the court stated that it was most troubled by its
finding that Suffness had intentionally "misrepresented to th[e]
Court knowledge that he had received form Mr. Bassell in at least
three letters and two other documents, a petition and an order,"
when he failed to disclose that there were two rather than one
account at Central Bank and Trust, and that the bank had in fact
contacted him with information about the accounts.
10
Because of the intentional misrepresentations, the court
invoked its duty to regulate the practitioners pursuant to 11
U.S.C. § 105, and, accordingly, ordered that, "[f]or the
misrepresentation, Mr. Suffness will forfeit his fees in this
case. The total of $840.00 will be paid to the trustee. Mr.
Suffness is barred and enjoined from practicing in the Northern
District of Texas Bankruptcy Court for six months from December
23." The court did not explicitly impose any sanctions pursuant
to Rule 9011 of the Federal Rules of Bankruptcy Procedure.
Suffness appealed the rulings of the bankruptcy court,
including the Show Cause Order, the Suspension Order and the
Disgorgement Order, to the district court, which affirmed. The
district court concluded that the Show Cause Order was not a
final order and therefore not appealable, and that the bankruptcy
court did not err in sanctioning Suffness for his conduct.
We affirm.
II. STANDARD OF REVIEW
We review findings of fact by the bankruptcy court under the
clearly erroneous standard and decide issues of law de novo.
Henderson v. Belknap (In re Henderson), 18 F.3d 1305, 1307 (5th
Cir. 1994); Haber Oil Co. v. Swinehart (In re Haber Oil Co.), 12
F.3d 426, 434 (5th Cir. 1994). Although the court of appeals
benefits from the district court's consideration of the matter,
the amount of persuasive force to be assigned to the district
court's conclusion is entirely a matter of discretion with the
11
court of appeals. Heartland Fed. Sav. & Loan Ass'n v. Briscoe
Enters., Ltd., II (In re Briscoe Enters., Ltd., II), 994 F.2d
1160, 1163 (5th Cir. 1993).
A finding of fact is clearly erroneous when, although there
is enough evidence to support it, the reviewing court is left
with a firm and definite conviction that a mistake has been
committed. United States v. United States Gypsum Co., 333 U.S.
364, 395 (1948); In re Henderson, 18 F.3d at 1307. If the trial
court's account of the evidence is plausible in light of the
record viewed in its entirety, the court of appeals may not
reverse even though convinced that, had it been sitting as the
trier of fact, it would have weighed the evidence differently.
Anderson v. City of Bessemer City, 470 U.S. 564, 573-74 (1985).
III. DISCUSSION
Suffness raises thirteen issues on appeal. Specifically,
Suffness contends that the bankruptcy court made thirteen errors,
all of which and any of which require reversal. None of
Suffness's arguments contains any merit. They will be addressed
in turn.
First, Suffness argues that the bankruptcy court erred by
failing to give "proper FRBP 9011 notice" prior to "imposing
sanctions in the First Hearing." In other words, Suffness
contends that the court's order at the conclusion of the November
21, 1994 hearing requiring him to deposit one-half of his
retainer into the registry of the court pending consideration of
12
sanctions constituted a sanction itself for which he was entitled
prior notice. This contention is wrong. First, the court order
requiring him to deposit the money did not constitute a sanction,
but merely was an order -- as it states on its face -- requiring
him to deposit money pending consideration of sanctions. Because
Suffness was not sanctioned by means of that order, he was not
due any notice. Second, even if Suffness were sanctioned, which
he was not, he did receive notice. Suffness was given notice
prior to the hearing that the court would hear argument on the
United State's motion to dismiss and to require payment to the
trustee. In this motion, filed with the bankruptcy court October
25, 1994 -- a month before the hearing -- the United States
argued that Suffness should be required to disgorge part of his
retainer to the trustee. Suffness responded to that motion by
arguing that the trustee's payment should instead be drawn from
the bank account at Central Bank and Trust. Thus, Suffness was
under notice that his retainer was under risk of disgorgement by
the court. Suffness's first argument fails on its face.
Second, Suffness argues that the court erred in failing to
specify the reasons for the "sanction" at the conclusion of the
November 21, 1994 hearing. Suffness again mischaracterizes the
actions of the bankruptcy court. As discussed above, the court
did not sanction Suffness at the November 21, 1994 hearing. And,
even if the order requiring Suffness to pay half of his retainer
into the registry of the court constituted a sanction -- which it
did not -- the court gave adequate reasons for that order. The
13
court specifically stated that, based upon the representations
made by the trustee, the attorney for the bank, the United States
Trustee, and Suffness himself, it believed that Suffness might
have filed the bankruptcy case for improper purposes. The court
asked Suffness pointed questions about this issue at the hearing
itself, and also ordered Suffness to respond to eight specific
matters of concern, all regarding the propriety of the bankruptcy
filing and the veracity of Suffness's statements to the court.
Thus Suffness's second argument fails.
Third, Suffness argues that the bankruptcy court erred by
concluding at the conclusion of the November 21, 1994 evidentiary
hearing that Suffness had filed the bankruptcy case for an
improper purpose. Once again, Suffness mischaracterizes the
actions of the bankruptcy court on November 21, 1994. Although
the court heard testimony at the November 21 hearing that may
have justified such a conclusion, the bankruptcy court did not
make the legal finding that Suffness had filed the case for an
improper purpose until after considering the testimony and
evidence presented by all parties, including Suffness, at the
hearing on the subsequent Show Cause Order. As discussed above,
at the conclusion of the November 21, 1994 hearing, the court
only concluded that Suffness "may have filed this bankruptcy
case for an improper purpose," (emphasis added) and reflected
that conclusion in its written order filed December 6, 1994.
Fourth, Suffness argues that the court erred in imposing
Federal Rule of Bankruptcy Procedure 9011 sanctions at the
14
conclusion of the November 21, 1994 hearing without first
inquiring into the effect of the sanctions or standards for the
imposition of the sanctions. This argument fails because, as
discussed above, the court did not impose sanctions at the
conclusion of the November 21, 1994 hearing.
Fifth, Suffness argues that the bankruptcy court erred in
executing the December 6, 1994 Show Cause Order, which, Suffness
contended, "greatly exceeded the Order rendered in court at the
conclusion of the [November 21, 1994] hearing." Suffness's
argument is futile, however, because, as the district court
correctly concluded, the Show Cause Order was nothing more than a
scheduling order, establishing a hearing date and matters to be
considered at the hearing, and therefore was not a final order
and therefore not appealable. Even if it were appealable,
however, the order was entered on December 6, 1994, and Suffness
did not file his notice of appeal until January 31, 1995, at a
time when the filing deadline had expired. Also, Suffness did
not seek permission to appeal an interlocutory order. Thus, this
court lacks jurisdiction to review the scheduling order.4
For the same reason, we lack jurisdiction to review
Suffness's sixth argument, also challenging the legality of the
4
It should be noted that, ironically, the Order to Show
Cause is precisely the type and kind of order Suffness contends
that due process requires prior to the imposition of sanctions.
It gave Suffness notice that the court was considering
sanctioning him, described specifically the sanctionable behavior
suspected by the court, and gave Suffness ample opportunity to
prepare a defense, provide evidence and testify on his own
behalf.
15
bankruptcy court's December 6, 1994 Show Cause Order.
Seventh, Suffness argues that the bankruptcy court erred by
adopting the documents and events that were presented by the
attorney representing the United States Trustee. Suffness did
not object to the introduction of the items into evidence. We
generally do not consider on appeal matters not presented to the
trial court, and see no reason to make an exception in this case.
Quenzer v. United States (In re Quenzer), 19 F.3d 163, 165 (5th
Cir. 1993). Furthermore, even though Suffness had been directed
by means of the December 6, 1994 Show Cause Order to prepare and
submit evidence on his own behalf in order to counter the
assertions made by the United States Trustee, and in order to
rebut the inferences reasonably drawn from the evidence submitted
by the United States Trustee, he failed to introduce any
documentary evidence. Thus, the court committed absolutely no
error by adopting the uncontested, unopposed evidence provided by
the United States Trustee.
Eighth, Suffness contends that the bankruptcy court erred in
finding that Suffness filed the bankruptcy for the improper
purpose of causing the harassment and delay of another person.
In making this argument, Suffness primarily attacks the
credibility of the evidence put forth by the United States
Trustee, as well as the testimony of the chapter 7 trustee and
the attorney for the bank. Suffness also repeated his own
testimony and that given by Petros at the December 22, 1994
hearing. The bankruptcy court, however, was more than qualified
16
to evaluate the credibility of witnesses, and it would be an
abuse of our discretion to substitute our judgment for that of
the factfinder's. Anderson v. City of Bessemer City, 470 U.S.
564, 573-74 (1985). Suffness's conclusory allegations are simply
insufficient to establish that the bankruptcy court's findings
were clearly erroneous. United States v. United States Gypsum
Co., 333 U.S. 364, 395 (1948); Henderson v. Belknap (In re
Henderson), 18 F.3d 1305, 1307 (5th Cir. 1994); Haber Oil Co. v.
Swinehart (In re Haber Oil Co.), 12 F.3d 426, 434 (5th Cir.
1994).
Suffness's next three arguments fail for the same reasons as
his eighth argument. Specifically, Suffness's ninth argument,
that the bankruptcy court erred by holding that Suffness violated
Rule 9011 of the Federal Rule of Bankruptcy Procedure by filing
the case for an improper purpose, his tenth argument, that the
bankruptcy court erred in concluding that Suffness violated Rule
9011 by making misrepresentations to the court concerning the
bank account, and his eleventh argument, that the court erred in
concluding that Suffness had abused the bankruptcy process, all
must be rejected because the court had ample factual grounds on
which to base its factual findings, as evidenced by the
transcripts of the two hearings and the documents entered into
evidence. As described in detail in part II, supra, the court
had more than adequate factual grounds on which to base its
decision to reject the testimony put forth by Suffness and
Petros.
17
Twelfth, Suffness argues that the bankruptcy court erred in
imposing sanctions at the conclusion of the December 22, 1994
hearing without inquiring into the effect of the sanctions or the
standards for the imposition of the sanctions. This argument is
meritless. The bankruptcy court has inherent power to guard the
practice of attorneys who appear in that court. State Bar Rule
3.03; 11 U.S.C. § 105; Northern District of Texas Local Rule 13.2
(made applicable through Local Bankruptcy Rule 9050); Matter of
Johnson, 921 F.2d 585, 586 (5th Cir. 1991). These powers are
discretionary, and the bankruptcy court has broad authority to
discipline attorneys and to award or disgorge fees paid in
connection with bankruptcy proceedings. Matter of Prudhomme, 43
F.3d 1000, 1003-04 (5th Cir. 1995); In re Anderson, 936 F.2d 199,
204 (5th Cir. 1991); 11 U.S.C. §§ 327, 329, and 330(a)(2); Fed.
R. Bankr. Proc. 2016(b) and 2017. It is common for a bankruptcy
court to order disgorgement of fees in order to obtain compliance
with a court order or punish misconduct of attorneys. Woods v.
City Nat'l Bank & Trust Co. 312 U.S. 262, 268 (1941); Anderson,
936 F.2d at 204.
In this case, the court's sanction was reasonable, and
Suffness has put forth no credible argument to establish that the
bankruptcy court abused its discretion. In re Lawler, 807 F.2d
1207, 1211 (5th Cir. 1987). Given the fact that the bankruptcy
court found that Suffness had filed the chapter 7 case for purely
improper purposes -- in order to delay creditors and to settle a
state law dispute over the ownership of the properties -- as well
18
as that Suffness had intentionally and deliberately misled the
court on crucial information, the bankruptcy court's ultimate
decision to require Suffness to disgorge his $840 retainer fee
and to bar Suffness from practicing in the bankruptcy court for
the Northern District of Texas for sixth months was reasonable.
Finally, Suffness argues that the bankruptcy court erred by
failing to give proper notice of possible "section 105 or
inherent court power sanctions" prior to imposing sanctions at
the conclusion of the second hearing. This argument is
meritless. The court's oral ruling on November 21, 1994 and the
December 6, 1994 Show Cause Order both provided Suffness with
notice and information regarding each of the issues the court was
to consider at the December 22, 1994 hearing. Specifically,
Suffness was directed to bring proof of ownership of the stock of
the debtor, evidence of Petros's authority to sign the chapter 7
petition, proof that he served notice of the bankruptcy filing to
the secured creditors, and proof that he served notice of the
filing on the bank. If Suffness required more time to gather
this information, he did not so indicate, either by filing a
motion to continue the hearing or for clarification of the
court's Show Cause Order. The court explicitly stated, both in
court and through its December 6 Show Cause Order, that it had
serious doubts as to the veracity of the representations Suffness
had made, and was continuing to make, to the court.
Thus, the court gave Suffness ample opportunity to correct
his misrepresentations to the court and to limit the damage to
19
creditors caused by his delay and misrepresentations. Suffness
nonetheless chose to make direct misrepresentations to the court,
and cannot with a straight face argue that he did not have notice
that he would be sanctioned for his misrepresentations.
IV. CONCLUSION
For the reasons stated above, we
AFFIRM.
20