FILED MAY 31 2016 1 NOT FOR PUBLICATION 2 SUSAN M. SPRAUL, CLERK U.S. BKCY. APP. PANEL OF THE NINTH CIRCUIT 3 UNITED STATES BANKRUPTCY APPELLATE PANEL 4 OF THE NINTH CIRCUIT 5 In re: ) BAP No. NV-14-1589-DFB ) 6 MICHELLE DARLENE WILSON, ) ) Bk. No. 14-14674-BTB 7 Debtor. ) ______________________________) 8 ) MICHELLE DARLENE WILSON, ) Adv. Proc. No. 14-01120-BTB 9 ) Appellant, ) 10 ) v. ) M E M O R A N D U M1 11 ) DESERT REALTY, INC.; EDWARD ) 12 KANIA; SOUTHERN NEVADA ) EVICTION SERVICES, ) 13 ) Appellees. ) 14 _____________________________ ) 15 Submitted Without Oral Argument on May 19, 2016 16 Filed - May 31, 2016 17 Appeal from the United States Bankruptcy Court for the District of Nevada 18 Honorable Bruce T. Beesley, Bankruptcy Judge, Presiding 19 20 Appearances: Appellant Michelle Darlene Wilson, pro se on brief; John Wendland of Weil & Drage, APC on brief 21 for Appellee Desert Realty, Inc.; Edward D. Kania on brief for Appellees Edward D. Kania and 22 Southern Nevada Eviction Services. 23 24 25 26 1 This disposition is not appropriate for publication. 27 Although it may be cited for whatever persuasive value it may have (see Fed. R. App. P. 32.1), it has no precedential value. 28 See 9th Cir. BAP Rule 8024-1.
1 Before: DUNN, FARIS, and BARASH,2 Bankruptcy Judges. 2 3 Michelle Darlene Wilson appeals orders of the bankruptcy 4 court that dismissed the adversary proceeding Ms. Wilson filed in 5 her bankruptcy case alleging that Desert Realty, Inc. (“DRI”), 6 Edward D. Kania, Esq. (“Mr. Kania”), and Southern Nevada Eviction 7 Services (“SNES”) had violated the stay which arose pursuant to 8 § 362(l)3 of the Bankruptcy Code. 9 We AFFIRM. 10 I. FACTUAL BACKGROUND 11 Ms. Wilson and her sister, Patricia Roberta Lindsey, entered 12 into a lease agreement with DRI on November 15, 2013, for an 13 apartment in Las Vegas, Nevada. After the sisters defaulted in 14 paying rent under the terms of the lease agreement, DRI commenced 15 eviction proceedings. 16 To delay those proceedings, Ms. Lindsey filed a chapter 13 17 bankruptcy petition on March 5, 2014. DRI promptly moved for 18 relief from the § 362 automatic stay against Ms. Lindsey 19 (“Lindsey MRS”) to continue the eviction proceedings. After 20 Ms. Lindsay did not bring the payments due under the lease 21 current by April 30, 2014, as ordered by the bankruptcy court as 22 a condition to continuing the automatic stay, an order granting 23 2 24 Hon. Martin R. Barash, United States Bankruptcy Judge for the Central District of California, sitting by designation. 25 3 Unless otherwise indicated, all chapter and section 26 references are to the federal Bankruptcy Code, 11 U.S.C. 27 §§ 101-1532, and all “Rule” references are to the Federal Rules of Bankruptcy Procedure, Rules 1001-9037. All “Civil Rule” 28 references are to the Federal Rules of Civil Procedure.
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1 the Lindsey MRS was entered on June 2, 2014 (“RFS Order”). DRI 2 thereafter obtained an order for eviction (“Eviction Order”) in 3 the state court on June 19, 2014. The sisters’ appeal of the 4 Eviction Order was denied on July 8, 2014. Ms. Wilson filed her 5 own bankruptcy petition at 3:43 p.m. on July 8, 2014. 6 The Eviction Order and §§ 362(b)(22) and (l) 7 To put the facts in proper context, it is necessary to set 8 forth the statutory provisions that govern the issues before us. 9 As relevant to this appeal, § 362(a) provides: 10 Except as provided in subsection (b) of this section, a petition filed under section 301 . . . of this 11 title . . . operates as a stay, applicable to all entities, of 12 . . . . 13 (3) any act to obtain possession of property of the 14 estate or of property from the estate or to exercise control over property of the estate . . . . 15 16 (Emphasis added.) 17 As relevant to this appeal, § 362(b)(22) provides: 18 The filing of a petition under section 301 . . . of this title . . . does not operate as a stay – 19 (22) subject to subsection (l), under subsection 20 (a)(3), of the continuation of any eviction, unlawful detainer action, or similar proceeding by a lessor 21 against a debtor involving residential real property in which the debtor resides as a tenant under a lease or 22 rental agreement and with respect to which the lessor has obtained before the date of the filing of the 23 bankruptcy petition, a judgment of possession of such property against the debtor . . . . 24 25 As demonstrated below, Ms. Wilson clearly understood that 26 the Eviction Order, entered well before she filed her bankruptcy 27 petition, meant that the eviction proceedings were not covered by 28 the automatic stay unless somehow the terms of § 362(l) became
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1 applicable in her case. 2 Section 362(l) provides: 3 (1) Except as otherwise provided in this subsection, subsection (b)(22) shall apply on the date that is 30 days 4 after the date on which the bankruptcy petition is filed, if the debtor files with the petition and serves upon the 5 lessor a certification under penalty of perjury that – 6 (A) under nonbankruptcy law applicable in the jurisdiction, there are circumstances under which the debtor 7 would be permitted to cure the entire monetary default that gave rise to the judgment for possession, after that 8 judgment for possession was entered; and 9 (B) the debtor (or an adult dependent of the debtor) has deposited with the clerk of the court, any rent that would 10 become due during the 30-day period after the filing of the bankruptcy petition. 11 (2) If, within the 30-day period after the filing of the 12 bankruptcy petition, the debtor (or an adult dependent of the debtor) complies with paragraph (1) and files with the 13 court and serves upon the lessor a further certification under penalty of perjury that the debtor (or an adult 14 dependent of the debtor) has cured, under nonbankruptcy law applicable in the jurisdiction, the entire monetary default 15 that gave rise to the judgment under which possession is sought by the lessor, subsection (b)(22) shall not apply, 16 unless ordered to apply by the court under paragraph (3). 17 (3)(A) If the lessor files an objection to any certification filed by the debtor under paragraph (1) or (2), and serves 18 such objection upon the debtor, the court shall hold a hearing within 10 days after the filing and service of such 19 objection to determine if the certification filed by the debtor under paragraph (1) or (2) is true. 20 (B) If the court upholds the objection of the lessor 21 filed under subparagraph (A) - 22 (I) subsection (b)(22) shall apply immediately and relief from the stay provided under subsection (a)(3) shall 23 not be required to enable the lessor to complete the process to recover full possession of the property; and 24 (ii) the clerk of the court shall immediately serve 25 upon the lessor and the debtor a certified copy of the court’s order upholding the lessor’s objection. 26 (4) If a debtor, in accordance with paragraph (5), indicates 27 on the petition that there was a judgment for possession of residential real property in which the debtor resides and 28 does not file a certification under paragraph (1) or (2) --
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1 (A) subsection (b)(22) shall apply immediately upon failure to file such certification, and relief from the stay 2 provided under subsection (a)(3) shall not be required to enable the lessor to complete the process to recover full 3 possession of the property; and 4 (B) the clerk of the court shall immediately serve upon the lessor and the debtor a certified copy of the docket 5 indicating the absence of a filed certification and the applicability of the exception to the stay under subsection 6 (b)(22). 7 (5)(A) Where a judgment for possession of residential property in which the debtor resides as a tenant under a 8 lease or rental agreement has been obtained by the lessor, the debtor shall so indicate on the bankruptcy petition and 9 shall provide the name and address of the lessor that obtained that pre-petition judgment on the petition and on 10 any certification filed under this subsection. 11 (B) The form of certification filed with the petition, as specified in this subsection, shall provide for the debtor 12 to certify, and the debtor shall certify – 13 (I) whether a judgment for possession of residential rental housing in which the debtor resides has been obtained 14 against the debtor before the date of the filing of the petition; and 15 (ii) whether the debtor is claiming under paragraph (1) 16 that under nonbankruptcy law applicable in the jurisdiction, there are circumstances under which the debtor would be 17 permitted to cure the entire monetary default that gave rise to the judgment for possession, after that judgment of 18 possession was entered, and has made the appropriate deposit with the court. 19 (C) The standard forms (electronic and otherwise) used in 20 a bankruptcy proceeding shall be amended to reflect the requirements of this subsection. 21 (D) The clerk of the court shall arrange for the prompt 22 transmittal of the rent deposited in accordance with paragraph (1)(B) to the lessor. 23 24 Section 362(l) proceedings. 25 Again, Ms. Wilson filed her bankruptcy petition on July 8, 26 2014. The following day, July 9, 2014, Ms. Wilson filed an 27 amended petition (“Amended Petition”). The Amended Petition was 28 necessary, as stated by Ms. Wilson under penalty of perjury,
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1 because Ms. Wilson had failed to mark the “Certification by a 2 Debtor Who Resides As a Tenant of Residential Property” 3 (“Certification”) that appears at the bottom of page 2 of 4 Official Form 1 in effect on the petition date. Ms. Wilson 5 checked each box of the Certification, thus representing under 6 penalty of perjury: 7 – that DRI had a judgment against her for possession of her 8 residence; 9 – that under applicable nonbankruptcy law there were 10 circumstances under which she would be permitted to cure the 11 entire monetary default that gave rise to the judgment for 12 possession, after the judgment for possession was entered; and 13 – that she was including with the Amended Petition the deposit 14 with the bankruptcy court of any rent that would become due 15 during the 30-day period after the filing of the petition. 16 Also on July 9, 2014, Ms. Wilson tendered to the clerk 17 (“Clerk”) of the bankruptcy court a money order payable to DRI in 18 the amount of $700.00. The Clerk promptly served on DRI its 19 “Clerk’s Acceptance and Transmittal of Rent Deposit” 20 (“Transmittal”) together with the money order. The Transmittal 21 states: 22 The debtor in the above captioned case filed a petition in this court on July 8, 2014. The debtor asserts an 23 exception to the limitation of the automatic stay under [§ 362(l)(1)], and a right to cure the pre-petition 24 judgment under non-bankruptcy law. 25 Pursuant to [[§ 362(l)(1)(B)], the clerk has accepted from the debtor a deposit of rent in the amount of 26 $700.00 which represents the rent that becomes due during the 30-day period after the filing of the 27 bankruptcy petition. The clerk hereby transmits, by certified mail, the rent deposit to [DRI]. 28
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1 DRI filed its response (“Response”) to the Transmittal on 2 July 28, 2014, asserting that because Ms. Wilson did not tender 3 the full 30 days’ rent, which was $2,5344 pursuant to the terms 4 of the lease, a copy of which was attached to the Response, 5 Ms. Wilson had not complied with the requirements of § 362(l)(1). 6 The bankruptcy court scheduled a hearing (“§ 362(l) 7 Hearing”) on the Response. The § 362(l) Hearing was held on 8 August 6, 2014.5 At the § 362(l) Hearing, Ms. Wilson argued 9 that (1) the Eviction Order was void because DRI had not obtained 10 relief from the § 1301 co-debtor stay as to Ms. Wilson in 11 Ms. Lindsey’s bankruptcy case, and (2) Ms. Wilson had tendered 12 the full amount of “her portion” of the lease payment for the 13 next 30 days. The bankruptcy court clarified for Ms. Wilson that 14 the full amount of the lease payment, or $2,534, was required to 15 be paid to receive the protections of § 362(l). On September 8, 16 2014, the bankruptcy court entered its order (“§ 362(l) Order”) 17 with respect to the Certification and the Response. The § 362(l) 18 Order required Ms. Wilson (and/or Ms. Lindsey) to pay to DRI in 19 20 4 The monthly rent was $2,500; there was also an obligation to pay $34 each month for utilities. 21 5 22 On August 5, 2014, the day before the § 362(l) Hearing, Ms. Wilson filed a second certification stating “Debtor under 23 penalty of perjury has cured, under non-bankruptcy law applicable in the jurisdiction, the entire monetary default that gave rise 24 to the judgment under which possession is sought by the lessor, 25 [sic] subsection (b)(22) shall not apply, unless ordered to apply by the Court under paragraph (3).” (Emphasis added.) This 26 second certification was not discussed at the § 362(l) Hearing. 27 In any event, there is no dispute that Ms. Wilson had not cured the underlying default at the time she filed it or at any time 28 thereafter.
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1 certified funds (1) $2,534.00 for the August 2014 lease payment 2 on or before August 11, 2014, and (2) the monthly lease payment 3 of $2,534.00 on or before the 5th day of each month thereafter. 4 If DRI did not receive the lease payments as specified, the 5 § 362(l) Order provided that the bankruptcy court would 6 immediately lift any and all stays relating to Ms. Wilson and 7 Ms. Lindsey in both bankruptcy cases and permit DRI to go forward 8 with all available remedies to take possession of the leased 9 property. When Ms. Wilson or her sister failed to pay the 10 December 2014 rent by December 5, 2014, as required by the 11 § 362(l) Order, the bankruptcy court entered its “Amended 12 Supplemental Ex Parte Order” (“Stay Relief Order”), which granted 13 relief from all stays as described in the § 362(l) Order.6 14 Adversary Proceeding 15 In the meantime, despite Ms. Wilson’s Certification under 16 § 362(l) in her bankruptcy case, on July 18, 2014, DRI, 17 Mr. Kania, and SNES filed a motion (“Enforcement Motion”) in 18 state court for an expedited hearing to enforce the Eviction 19 Order. Ms. Wilson was then served with a Notice to Appear in 20 state court on July 29, 2014 with respect to the Enforcement 21 Motion. 22 On July 29, 2014, Ms. Wilson initiated in her bankruptcy 23 case an adversary proceeding (“Adversary Proceeding”) against 24 DRI, Mr. Kania, and SNES, by filing a complaint (“Complaint”) in 25 26 6 Ms. Wilson appealed the Stay Relief Order. On May 1, 27 2015, our Motions Panel dismissed that appeal, BAP No. 14-1592, on Ms. Wilson’s motion, on the basis that she had been evicted, 28 and the appeal therefore was moot.
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1 which she asserted that the actions taken with respect to the 2 Enforcement Motion constituted “willful, intentional, gross and 3 flagrant violations of the provisions of [§§ 362 and 1301].” 4 Ms. Wilson alleged that she suffered significant emotional harm 5 as a result of the willful violation of the automatic stay, for 6 which she sought compensatory and punitive damages in an 7 unspecified amount. (The cover sheet to the Adversary Proceeding 8 reflects that the demand amount was “$75,000 actual and punitive 9 damages and costs.”) 10 DRI’s Motion to Dismiss 11 On August 28, 2014, DRI filed its motion to dismiss the 12 Complaint (“DRI Dismissal Motion”) pursuant to Civil 13 Rule 12(b)(6) for failure to state a claim upon which relief 14 could be granted. DRI asserted that Ms. Wilson never had a right 15 to seek a temporary stay under § 362(l), because under Nevada 16 law, she was not permitted to cure the monetary default 17 underlying the Eviction Order and because she did not tender 18 30 days’ rent. DRI further asserted that even if its actions 19 with respect to the Enforcement Motion violated the temporary 20 stay available through § 362(l), Ms. Wilson had not suffered any 21 prejudice or damages where she continued to enjoy the use of the 22 property without fully compensating DRI for that use.7 The DRI 23 Dismissal Motion was set for hearing to be held October 14, 2014. 24 The deadline for Ms. Wilson to respond to the DRI Dismissal 25 Motion was September 30, 2014. 26 7 27 The hearing on the Eviction Motion took place on July 29, 2014 as scheduled. The state court entered a further Eviction 28 Order, but stayed the order until 5:00 p.m. August 11, 2014.
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1 Ms. Wilson filed her “answer” to the DRI Dismissal Motion on 2 October 2, 2014, and appears to have attempted to postpone 3 resolution of the DRI Dismissal Motion by scheduling her answer 4 for hearing on November 25, 2014. The “answer” complains only 5 that DRI did not comply with Local Rule 5004(a), (b) and (c), 6 which deprived her of her due process rights. 7 DRI filed its reply to Ms. Wilson’s “answer” on October 7, 8 2014, pointing out that it was untimely and failed to oppose the 9 DRI Dismissal Motion substantively. 10 At the October 14, 2014 hearing on the DRI Dismissal Motion, 11 at which Ms. Wilson appeared, the bankruptcy court granted the 12 DRI Dismissal Motion. Fundamental to the issues Ms. Wilson 13 asserts in this appeal, the bankruptcy court ruled that the 14 § 1301 codebtor stay Ms. Wilson had in her sister’s bankruptcy 15 case terminated on June 2, 2014, when the order was entered in 16 Ms. Lindsey’s case granting relief from the automatic stay to DRI 17 to continue eviction proceedings. Because there was no active 18 codebtor stay when the Eviction Order was entered, it was a valid 19 order entered prepetition [with respect to Ms. Wilson’s 20 bankruptcy case] as to which applicable nonbankruptcy law did not 21 afford a right to cure. The order (“DRI Dismissal Order”) was 22 entered December 23, 2014. The DRI Dismissal Order recited that 23 Ms. Wilson’s “answer” was untimely, that the bankruptcy court 24 previously had determined in an adversary proceeding Ms. Wilson 25 had filed in Ms. Lindsey’s bankruptcy case that § 1301 did not 26 provide Ms. Wilson with a stay beyond June 2, 2014, that would 27 render the Eviction Order void, and that Ms. Wilson had filed 28 multiple bankruptcy cases since 1993 and, in Case No. 12-18817,
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1 had been found by the bankruptcy court to be a serial filer. The 2 DRI Dismissal Order granted the DRI Dismissal Motion and 3 dismissed the Adversary Proceeding but used an incorrect case 4 number to do so. Ms. Wilson timely appealed the DRI Dismissal 5 Order. 6 Kania/SNES Motion to Dismiss 7 On August 28, 2014, Mr. Kania (on behalf of himself and 8 SNES) also filed a motion to dismiss the Complaint (“Kania 9 Dismissal Motion”) pursuant to Civil Rule 12(b)(6) for failure to 10 state a claim upon which relief could be granted. Mr. Kania 11 asserted that Ms. Wilson was abusing the bankruptcy system where 12 she had filed bankruptcy twelve times since 1993, and that 13 Ms. Wilson never had a right to seek a temporary stay under 14 § 362(l) because under Nevada law she was not permitted to cure 15 the monetary default underlying the Eviction Order and because 16 she did not tender 30 days’ rent. In defense of his own 17 behavior, Mr. Kania asserted that the actions undertaken in the 18 state court did not violate any stay because they were 19 ministerial. Finally, Mr. Kania asserted that even if the 20 actions did violate a stay in Ms. Wilson’s bankruptcy case, she 21 had not incurred damages as a matter of law. 22 Ms. Wilson filed her “answer” to the Kania Dismissal Motion 23 on October 2, 2014. The “answer” complains that Mr. Kania and 24 SNES did not comply with Local Rules 5004(a), (b) and (c), 25 7005(a), 7010(a) and (b), 7056 and 9014(b)(1), all of which 26 deprived her of her due process rights. 27 Mr. Kania filed his reply to Ms. Wilson’s “answer” on 28 October 6, 2014, pointing out that it was untimely and failed to
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1 oppose the motion substantively. 2 Although it does not appear that the Kania Dismissal Motion 3 ever was set for hearing, Mr. Kania appeared and argued at the 4 October 14, 2014 Hearing. After ruling on the DRI Dismissal 5 Motion, the bankruptcy court stated that “the individual case and 6 the case against the company are the same. I’m dismissing those 7 also. I’m granting the [Kania Dismissal Motion] for the same 8 reasons I’m granting the [DRI Dismissal Motion].” 9 The bankruptcy court entered its order (“Kania Dismissal 10 Order”) granting the Kania Dismissal Motion and dismissed the 11 Adversary Proceeding, but again used an incorrect case number to 12 do so. Ms. Wilson timely appealed the Kania Dismissal Order. 13 Proceedings on Remand 14 DRI filed an emergency motion in the appeal on January 27, 15 2015, seeking remand to return to the bankruptcy court to correct 16 the DRI Dismissal Order, both as to the incorrect case number, 17 and to include its holding, inadvertently omitted, that the 18 temporary stay under § 362(l) was not applicable and therefore 19 not violated. Our motions panel granted a limited remand on 20 February 4, 2015 to allow the bankruptcy court “to rule on a 21 motion to amend or correct the [DRI Dismissal Order] to whatever 22 extent the bankruptcy court sees fit.” 23 An amended order (“Amended DRI Dismissal Order”) granting 24 the DRI Dismissal Motion was entered on January 5, 2016 and is 25 now the order on appeal as to DRI.8 The Amended Dismissal Order 26 8 27 It does not appear that Mr. Kania took any action to correct the Kania Dismissal Order which contained the same flaws 28 (continued...)
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1 now includes the following finding: “DRI did not violate the 2 thirty (30) day temporary stay under [§ 362(l)] as the [Eviction 3 Order] had been entered in favor of DRI prior to Wilson’s filing 4 bankruptcy and Wilson, under Nevada law, had no circumstances or 5 mechanism to cure said judgment. See In re Jackson, 6 No. 13-21676, 2013 WL 3956994 (Bankr. D. Colo. July 30, 2013); 7 see also Nev. R. Stat. § 40.253.” 8 As did the DRI Dismissal Order, the Amended DRI Dismissal 9 Order denied Ms. Wilson’s oral motion for stay pending appeal. 10 This panel was advised through pleadings filed by Ms. Wilson 11 in another appeal that she was evicted on January 12, 2015. In 12 addition, on January 27, 2016, the bankruptcy court dismissed 13 Ms. Wilson’s bankruptcy case because she had failed to obtain 14 confirmation of any of the nine plans she had proposed. At that 15 time, her bankruptcy case had been pending more than nineteen 16 months. 17 II. JURISDICTION 18 The bankruptcy court had jurisdiction under 28 U.S.C. 19 §§ 1334 and 157(b)(2)(G). We have jurisdiction under 28 U.S.C. 20 § 158. 21 III. ISSUES 22 1) Whether the Bankruptcy Court erred when it determined 23 that Ms. Wilson was not entitled to the benefit of the § 362(l) 24 temporary stay. 25 2) Whether Ms. Wilson’s due process rights were violated by 26 27 8 (...continued) 28 as the DRI Dismissal Order.
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1 the bankruptcy court’s dispositions of the DRI Dismissal Motion 2 and the Kania Dismissal Motion.9 3 IV. STANDARDS OF REVIEW 4 Application of basic rules of procedure and construction of 5 the Bankruptcy Code present questions of law that we review de 6 novo. All Points Capital Corp. v. Meyer (In re Meyer), 373 B.R. 7 84, 87 (9th Cir. BAP 2007). De novo review requires that “we 8 consider a matter anew, as if no decision had been rendered 9 previously.” Mele v. Mele (In re Mele), 501 B.R. 357, 362 (9th 10 Cir. BAP 2013). 11 Assertions of violation of due process are reviewed de novo. 12 In re Victoria Station, 875 F.2d 1380, 1382 (9th Cir. 1989). 13 We may affirm a decision of the bankruptcy court on any 14 basis supported by the record. Hooks v. Kitsap Tenant Support 15 Services, Inc., 816 F.3d 550, 554 (9th Cir. 2016); ASARCO, LLC v. 16 17 9 Ms. Wilson asserts that the bankruptcy court further 18 erred as follows: 19 1. In granting the Kania Dismissal Motion and the DRI Dismissal Motion. 20 2. In ruling that her “answers” were untimely. 3. In determining that the § 1301 codebtor stay is designed only 21 for the protection of the debtor and is merely incidental to the 22 codebtor. 4. In determining that the § 1301 codebtor stay available to 23 Ms. Wilson in Ms. Lindsey’s bankruptcy case terminated on June 2, 2014, with the result that the Eviction Order was not entered in 24 violation of the § 1301 codebtor stay. 25 5. In determining that Ms. Wilson previously had been found to be a serial filer. 26 6. In entering the Kania Dismissal Order despite the Kania 27 parties’ failure to follow the local rules. We have distilled the issues before us to the two listed 28 above necessary to the disposition of this appeal.
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1 Union Pac. R.R. Co., 765 F.3d 999, 1004 (9th Cir. 2014); Shanks 2 v. Dressel, 540 F.3d 1082, 1086 (9th Cir. 2008). 3 V. DISCUSSION 4 Ms. Wilson Was Not Entitled to a Temporary Stay Under § 362(l) 5 Section 362(l)(1)(B) required that Ms. Wilson certify on her 6 petition that she had deposited with the Clerk any rent that 7 would become due during the 30-day period after the filing of the 8 petition. DRI established that Ms. Wilson’s Certification under 9 § 362(l)(1)(B) was patently false, where she deposited only $700 10 of the $2,534 rent due under the lease. Because the requirements 11 of both § 362(l)(1)(A) and (B) must be met, as evidenced by use 12 of the conjunction “and” between them, Ms. Wilson’s failure to 13 tender the required deposit to the bankruptcy court with her 14 Amended Petition is fatal to any claim that the eviction 15 proceedings were stayed under § 362(l). In re Jackson, 16 No. 13-21676, 2013 WL 3956994 (Bankr. D. Colo. July 30, 2013). 17 Further, Ms. Wilson asserted, unsuccessfully, in both the 18 state court and in her adversary proceeding in her sister 19 Ms. Lindsey’s bankruptcy case that the § 1301 codebtor stay 20 applied to void the Eviction Order.10 However, in her Amended 21 10 22 At the October 2, 2014 hearing in Ms. Wilson’s adversary proceeding filed in Ms. Lindsey’s bankruptcy case, the bankruptcy 23 court stated that the RFS Order entered June 2, 2014, dealt with the co-debtor stay where the issue had been raised at the hearing 24 and where the RFS Order provided that DRI could go to state court 25 and exercise all remedies it had. In light of the apparent uncertainty regarding the state of the co-debtor stay, however, 26 the bankruptcy court ruled that “to the extent I did not lift the 27 stay as to the co-debtor stay, I am retroactively, to the day of the hearing, doing that in the interest of equity, which I’m 28 (continued...)
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1 Petition, Ms. Wilson certified under penalty of perjury both that 2 under applicable nonbankruptcy law, she would be permitted to 3 cure the monetary defaults under her lease and that she had 4 deposited with the bankruptcy court “any rent that would become 5 due during the 30-day period after the filing of [her] petition.” 6 Because she never fulfilled the rental deposit requirement of her 7 certification, we do not consider her co-debtor stay argument 8 with respect to her further certification that she had a right to 9 cure the lease rent defaults. 10 Dismissal Under Civil Rule 12(b)(6) Was Appropriate 11 Ms. Wilson was evicted from her residence after this appeal 12 was commenced. Her Complaint sought damages for violation of the 13 stay she believed arose under § 362(l). However, as discussed 14 above, Ms. Wilson never satisfied the requirements for § 362(l) 15 to apply and counter the effects of § 362(b)(22). 16 Section 362(b)(22) operated to allow appellees to continue with 17 their eviction efforts postpetition without obtaining relief from 18 stay. With the Complaint premised on the application of § 362(l) 19 to cause a stay to arise, it consequently failed to state a claim 20 upon which relief could be granted, and the bankruptcy court did 21 not err in dismissing the Complaint under Civil Rule 12(b)(6), 22 applicable in adversary proceedings before the bankruptcy court 23 under Rule 7012(b).11 24 10 25 (...continued) allowed to do under appropriate case law.” We express no opinion 26 as to the propriety of these rulings. 27 11 While we do not reach the merits of Ms. Wilson’s 28 (continued...)
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1 Alleged Lack of Due Process 2 Ms. Wilson argues that the bankruptcy court’s dismissal of 3 her Complaint violated her due process rights in light of 4 appellees’ violations of various local rules of the bankruptcy 5 court in noticing the DRI Dismissal Motion and the Kania 6 Dismissal Motion. “The due process requirements for notice are 7 relatively minimal; they merely require notice ‘reasonably 8 calculated, under all the circumstances, to apprise interested 9 parties of the pendency of the action and afford them an 10 opportunity to present their objections.’” Keys v. 701 Mariposa 11 Project, LLC (In re 701 Mariposa Project, LLC), 514 B.R. 10, 15 12 (9th Cir. BAP 2014), quoting Mullane v. Cent. Hanover Bank & 13 Trust Co., 339 U.S. 306, 314 (1950). 14 Ms. Wilson raises a number of alleged violations of the 15 bankruptcy court’s local rules by the appellees in providing her 16 with notice and scheduling the hearing at which the bankruptcy 17 court considered the DRI Dismissal Motion and the Kania Dismissal 18 Motion. However, the record is clear that Ms. Wilson had notice 19 of the motions weeks in advance of the hearing and that she 20 attended the hearing, and she does not argue otherwise. Her 21 responses to the motions were filed late, and Ms. Wilson did not 22 raise any substantive arguments in opposition to the motions in 23 24 11 (...continued) 25 Complaint, we note that Ms. Wilson failed to quantify any component of her damages claim either in the allegations of her 26 Complaint or in its prayer. The record establishes that through 27 her actions and the actions of her sister, Ms. Wilson received the benefit of continued possession of the leased premises 28 postpetition for at least six months.
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1 either response. The bankruptcy court refused to consider her 2 late responses, but ultimately, we do not perceive any violation 3 of Ms. Wilson’s due process rights with respect to the 4 proceedings that resulted in the dismissal of her Complaint. See 5 generally United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 6 260, 272 (2010). Accordingly, Ms. Wilson’s due process arguments 7 lack merit. 8 VI. CONCLUSION 9 The bankruptcy court did not err when it determined that 10 Ms. Wilson was not entitled to the benefit of the § 362(l) 11 temporary stay by the terms of the statute. Accordingly, the 12 bankruptcy court did not err in dismissing her Complaint for 13 failure to state a claim upon which relief could be granted. 14 We AFFIRM. 15 16 17 18 19 20 21 22 23 24 25 26 27 28
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