Azam v. U.S. Bank National Ass'n Ex Rel. Bank of America National Ass'n (In Re Azam) , 642 F. App'x 777 ( 2016 )

NOT FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FILED
FOR THE NINTH CIRCUIT
MAR 21 2016
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
In re NAZIE AZAM, No. 14-55523
Debtor, D.C. No. 8:13-cv-01485-JLS
NAZIE AZAM, MEMORANDUM*
Appellant,
v.
U.S. BANK NATIONAL
ASSOCIATION, as Trustee, Successor in
Interest to Bank of America National
Association as Successor by Merger to La
Salle Bank NA as Trustee for Wamu
Mortgage Pass Through Certificates 2006-
AR Trust,
Appellee.
Appeal from the United States District Court
for the Central District of California
Josephine L. Staton, District Judge, Presiding
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
Submitted March 10, 2016**
Pasadena, California
Before: REINHARDT, MURGUIA, and OWENS, Circuit Judges.
Nazie Azam appeals from the district court’s order affirming the decision of
the bankruptcy court, which dismissed Azam’s chapter 13 case. Independently
reviewing the bankruptcy court’s conclusions of law de novo and its factual
findings for clear error, Leavitt v. Soto (In re Leavitt), 171 F.3d 1219, 1222 (9th
Cir. 1999), we affirm.1
1. Azam’s filing of two interlocutory appeals of matters related to the
automatic stay did not deprive the bankruptcy court of jurisdiction to dismiss her
bankruptcy case. While the bankruptcy court “may not finally adjudicate
substantial rights directly involved in the appeal,” Neary v. Padilla (In re Padilla),
222 F.3d 1184, 1190 (9th Cir. 2000) (citation omitted), “[t]he appeal of an order
does not . . . deprive the trial court of jurisdiction over issues not raised in that
order,” Wade v. State Bar of Ariz. (In re Wade), 115 B.R. 222, 230 (B.A.P. 9th Cir.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
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Azam’s requests for judicial notice are granted “to the extent that it is
compatible with Fed. R. Evid. 201 and does not require the acceptance of facts
subject to reasonable dispute.” Associated Gen. Contractors of Am., San Diego
Chapter, Inc. v. Cal. Dep’t of Transp., 713 F.3d 1187, 1190 n.1 (9th Cir. 2013)
(internal quotation marks and alteration omitted).
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1990), aff’d, 948 F.2d 1122 (9th Cir. 1991). Azam did not seek to stay the
proceedings pending the outcome of her appeals related to the bankruptcy stay, and
the appeals did not preclude the bankruptcy court from dismissing Azam’s
bankruptcy case. See Sherman v. SEC (In re Sherman), 491 F.3d 948, 967 (9th
Cir. 2007) (“If a party wants to stay all of the proceedings in bankruptcy court
while an appeal is pending, it must file a motion for a stay.”); Wade, 115 B.R. at
230 (holding that a bankruptcy court retained jurisdiction to dismiss a debtor’s
counterclaims related to alleged violations of the automatic stay despite an appeal
of matters related to the automatic stay).
2. The bankruptcy court could dismiss Azam’s bankruptcy case regardless of
whether U.S. Bank had standing to request dismissal. See de la Salle v. U.S. Bank,
N.A. (In re de la Salle), 461 B.R. 593, 604 (B.A.P. 9th Cir. 2011) (noting that
whether a creditor had standing was “irrelevant” to the bankruptcy court’s ability
to convert or dismiss a debtor’s chapter 13 case). In any event, U.S. Bank did have
standing. Under 11 U.S.C. § 1307(c), a “party in interest” may request dismissal
for cause. But “a creditor does not need an allowed claim to be a party in interest
for purposes of § 1307(c).” de la Salle, 461 B.R. at 604. Rather, any creditor with
a right to payment has standing to request dismissal. Id. Here, U.S. Bank had a
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right to payment under Azam’s bankruptcy plan due to the unlawful detainer action
and therefore had standing to request dismissal.
3. U.S. Bank had filed an objection to Azam’s proposed plan and a request for
dismissal for bad faith before the hearing. Azam responded to this motion in
writing. Azam also had ample opportunity to argue at the hearing why her case
should not be dismissed. She was therefore given “a meaningful opportunity to be
heard.” Rosson v. Fitzgerald (In re Rosson), 545 F.3d 764, 776 (9th Cir. 2008).
4. The bankruptcy court made sufficient findings of fact to justify dismissal for
bad faith. It was evident throughout the hearing that the bankruptcy court saw no
legitimate purpose in Azam’s chapter 13 petition. Rather, the bankruptcy court
found that Azam’s case was brought for the improper purpose of seeking a more
favorable forum in which to litigate claims related to the foreclosure of her home
and to buy more time. This finding was not clearly erroneous, and it amply
supports dismissal for bad faith. See Leavitt, 171 F.3d at 1224 (noting that a
debtor’s unfair manipulation of the Bankruptcy Code, history of filings and
dismissals, intent to defeat state court litigation through the bankruptcy filing, and
egregious behavior are all factors supporting a finding of bad faith under the
totality of the circumstances). Azam’s present bankruptcy filing, her fourth,
proposed to pay her creditors only half of what they were owed. Yet she was
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statutorily ineligible for this sort of discharge because she had received a chapter 7
discharge three years before. See 11 U.S.C. § 1328(f). Thus her petition was
clearly not brought in good faith.
5. The district court judge was not required to recuse herself. Because Azam
raises recusal for the first time on appeal, we review the issue for plain error.
United States v. Holland, 519 F.3d 909, 911 (9th Cir. 2008). A judge must
disqualify herself “in any proceeding in which [her] impartiality might reasonably
be questioned.” 28 U.S.C. § 455(a). Azam fails to make an intelligible argument
that “a reasonable person with knowledge of all the facts would conclude that the
judge’s impartiality might reasonably be questioned.” Holland, 519 F.3d at 913(citation omitted).
AFFIRMED.
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