Fidelity Financial Services, Inc. v. Montgomery County Department of Human Resources (In Re Davis)

237 B.R. 177, 1999 U.S. Dist. LEXIS 12342, 1999 WL 607871
CourtDistrict Court, M.D. Alabama
DecidedAugust 6, 1999
DocketCiv.A.99-T-093-N
StatusPublished
Cited by18 cases

This text of 237 B.R. 177 (Fidelity Financial Services, Inc. v. Montgomery County Department of Human Resources (In Re Davis)) is published on Counsel Stack Legal Research, covering District Court, M.D. Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Fidelity Financial Services, Inc. v. Montgomery County Department of Human Resources (In Re Davis), 237 B.R. 177, 1999 U.S. Dist. LEXIS 12342, 1999 WL 607871 (M.D. Ala. 1999).

Opinion

OPINION

MYRON H. THOMPSON, District Judge.

Appellant Fidelity Financial Services, Inc. challenges three orders of the United States Bankruptcy Court for the Middle District of Alabama allowing a late filed proof of claim for child support to be a part of a Chapter 13 bankruptcy plan. Appellees Montgomery County Department of Human Resources and Bernard J. Davis respond that the appeal was not timely filed and lacks merit. The court heard oral argument on July 28, 1999. For the reasons that follow, this court holds that it has jurisdiction to hear Fidelity’s appeal of the three orders and that one of the orders should be vacated and this matter remanded to the bankruptcy court for further consideration.

I. STANDARD OF REVIEW

Acting in an appellate capacity, this court reviews the factual findings of a bankruptcy court for clear error, and questions of law are reviewed de novo. In re Patterson, 967 F.2d 505 (11th Cir.1992).

II. BACKGROUND

In February 1997, Bernard Davis filed for bankruptcy under Chapter 13 of the Bankruptcy Code in the Bankruptcy Court for the Middle District of Alabama. The clerk of the court then issued a notice of the bankruptcy petition to all of Davis’s creditors, including Fidelity Financial Services, Inc., and the Montgomery County Department of Human Resources. The notice advised these creditors that the deadlines for filing proofs of claim against the bankruptcy estate would be June 4, 1997, for private creditors and August 4, 1997, for government agencies.

Fidelity filed a proof of claim on March 12, 1997. The Human Resources Department claims to have “mailed” a proof of claim on February 21, 1997, but such mailing was never filed by the clerk of the bankruptcy court. Not until March 20, 1998, did the department ever file a proof of claim.

In June 1997, the bankruptcy court officially approved Davis’s bankruptcy plan. Notwithstanding the fact that no proof of claim from the Human Resources Department had yet been filed, the plan included the department’s claim, which arises from Davis’s child-support obligations. The plan further provided for 100% repayment of all unsecured creditors, including Fidelity. Fidelity did not appeal or otherwise object to this plan.

Almost a year later, Davis filed a motion in bankruptcy court to modify the 1997 plan. He sought to reduce the repayment of his unsecured creditors from 100% to 0% on the grounds that the Human Resources Department’s claim was larger than expected and that an unexpected student-loan claim had been filed after entry of the earlier plan. Fidelity objected to the modification and contested the student-loan and the Human-Resources-Department claims on the ground that they were untimely filed.

The bankruptcy court held a hearing on Fidelity’s objection and its contest and, on September 30, 1998, issued two orders. The first disallowed the student-loan claim as untimely but allowed the Human Resources Department’s claim, despite its untimeliness, “because it involves the protec *180 tion of Debtor’s children and because a disallowance would result in possible criminal proceedings against Debtor, which would jeopardize this plan.” 1 The second order approved an amended bankruptcy plan over Fidelity’s objection.

Fidelity filed a “motion for reconsideration” on October 8, 1998. After a hearing, the bankruptcy court entered a third order, denying the motion on November 13, 1998. Fidelity then filed a notice of appeal on November 19, 1998 — six days after entry of the order denying its motion for reconsideration and 50 days after entry of the orders allowing the Human Resources Department’s claim and approving Davis’s amended plan over Fidelity’s objections. Fidelity seeks to appeal all three orders.

III. DISCUSSION

A.

As a threshold matter, the Montgomery County Human Resources Department and Davis challenge this court’s jurisdiction to hear Fidelity’s appeal on the ground that the notice of appeal was untimely filed. In general, a notice of appeal must “be filed within 10 days of the date of the entry of the judgment, order, or decree appealed from,” Fed.R.Bankr.P. 8002(a), and this court has no jurisdiction over an untimely bankruptcy appeal. See In re Morrow, 564 F.2d 189, 190 (5th Cir.1977) (failure to file timely notice of appeal is a jurisdictional matter). 2 If, however, a party “makes a timely motion of a type specified immediately below,” the time for appeal is tolled until such motion has been resolved. Fed.R.Bankr.P. 8002(b).

“This provision applies to a timely motion:”
(1) to amend or make additional findings of fact under Rule 7052, whether or not granting the motion would alter the judgment;
(2) to alter or amend the judgment under Rule 9023;
(3) for a new trial under Rule 9023; or
(4) for relief under Rule 9024 if the motion is filed no later than 10 days after the entry of judgment.

Id.

Fidelity did not file any one of the four tolling motions listed in Rule 8002(b). Rather, it filed a motion for reconsideration of claims “pursuant to 11 U.S.C. § 502(j) and Bankruptcy Rule 3008.” 3 These provisions authorize a court to reconsider an order allowing or disallowing a claim against the bankruptcy estate, but they do not by themselves toll the appeals period. 4 As a result, Fidelity’s notice of appeal would not be timely if its reconsideration motion had implicated only § 502(j) and Bankruptcy Rule 3008.

Fidelity correctly asserts, however, that its appeal is timely because its motion for reconsideration was filed not only pursuant to Bankruptcy Rule 3008 but also pursuant to Bankruptcy Rule 8002(b). In the language of subpart (2) of Rule 8002(b), its reconsideration motion was also a motion “to alter or amend the judgment under Bankruptcy Rule 9023.” 5

*181 Rule 9028 of the Federal Rules of Bankruptcy Procedure provides that “Rule 59 F.R.Civ.P. applies in cases under the [Bankruptcy] Code, except as provided in Rule 3008.” 6

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Cite This Page — Counsel Stack

Bluebook (online)
237 B.R. 177, 1999 U.S. Dist. LEXIS 12342, 1999 WL 607871, Counsel Stack Legal Research, https://law.counselstack.com/opinion/fidelity-financial-services-inc-v-montgomery-county-department-of-human-almd-1999.