FILED FEB 11 2019 NOT FOR PUBLICATION SUSAN M. SPRAUL, CLERK U.S. BKCY. APP. PANEL OF THE NINTH CIRCUIT
UNITED STATES BANKRUPTCY APPELLATE PANEL OF THE NINTH CIRCUIT
In re: BAP No. EC-18-1088-LBS
DONALD STEVEN PARKS, Bk. No. 2:16-bk-23173
Debtor. DONALD STEVEN PARKS,
Appellant,
v. MEMORANDUM*
KIMBERLY J. HUSTED, Trustee,
Appellee.
Argued and Submitted on January 24, 2019 at Sacramento, California
Filed – February 11, 2019
Appeal from the United States Bankruptcy Court for the Eastern District of California
* This disposition is not appropriate for publication. Although it may be cited for whatever persuasive value it may have, see Fed. R. App. P. 32.1, it has no precedential value, see 9th Cir. BAP Rule 8024-1. Honorable Christopher D. Jaime, Bankruptcy Judge, Presiding
Appearances: Appellant Donald S. Parks argued pro se; Kristen Renfro of Desmond, Nolan, Livaich & Cunningham argued for Appellee.
Before: LAFFERTY, BRAND, and SPRAKER, Bankruptcy Judges.
INTRODUCTION
Debtor Donald Parks appeals the discharge order (“Discharge
Order”) entered in his chapter 71 bankruptcy case. But the relief Mr. Parks
seeks actually pertains more directly to other orders entered by the
bankruptcy court, which he did not appeal. One order approved the
settlement of fraudulent transfer litigation brought by the chapter 7 trustee,
Kimberly J. Husted (“Trustee”), against Mr. Parks’ ex-wife seeking to avoid
Mr. Parks’ pre-petition transfers to her of his interests in real properties
(the “Compromise Order”). The other order dismissed Trustee’s § 727
claims against Mr. Parks, clearing the way for him to receive his discharge
(the “Dismissal Order”).
Mr. Parks has not demonstrated that the bankruptcy court erred in
1 Unless specified otherwise, all chapter and section references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532, all “Rule” references are to the Federal Rules of Bankruptcy Procedure, and all “Civil Rule” references are to the Federal Rules of Civil Procedure.
2 entering the Discharge Order. Moreover, even if we were to reverse the
Discharge Order, such reversal would not give Mr. Parks the relief he
seeks. To the extent Mr. Parks assigns error to the Compromise Order and
the Dismissal Order, we lack jurisdiction to review those orders as they
were not timely appealed.
We therefore AFFIRM.
FACTUAL BACKGROUND2
In January 2015 a Kentucky state court entered a default judgment for
legal malpractice against Mr. Parks and in favor of Check Martin. At the
time judgment was entered, Mr. Parks was married to Edina Torlak and
2 The Panel waived the requirement of Rule 8018(b) that Appellant file and serve an appendix to the brief containing excerpts of record. Therefore, in ascertaining the relevant facts, we have exercised our discretion to review the bankruptcy court’s docket and imaged papers in Case No. 16-23173 and related adversary proceedings. See Woods & Erickson, LLP v. Leonard (In re AVI, Inc.), 389 B.R. 721, 725 n.2 (9th Cir. BAP 2008).
Mr. Parks filed a “Motion for Judicial Notice” requesting the Panel to take judicial notice of certain background facts. Under Fed. R. Evid. 201(b), we may take judicial notice of facts that are not subject to reasonable dispute because they are “generally known within the trial court's territorial jurisdiction . . . or . . . can be accurately and readily determined from sources whose accuracy cannot reasonably be questioned.” Fed. R. Evid. 201(b). The factual recitation presented by Mr. Parks does not meet those criteria. We therefore deny Mr. Parks’ request for judicial notice. See Credit Alliance Corp. v. Idaho Asphalt Supply, Inc. (In re Blumer), 95 B.R. 143, 147 (9th Cir. BAP 1988) (bankruptcy court properly refused to take judicial notice of facts set forth in witness deposition).
3 held an interest in four parcels of real property, three of which were located
in Louisville, Kentucky, and the fourth in Granite Bay, California (the
“Properties”).
Less than two weeks after entry of the malpractice judgment,
Mr. Parks and Ms. Torlak filed for divorce in Kentucky state court.
Pursuant to the parties’ marital settlement agreement, in February and
March 2015 Mr. Parks executed and recorded quitclaim deeds transferring
his interests in the Properties to Ms. Torlak.3
In July 2015 Mr. Martin commenced a fraudulent transfer action
against Mr. Parks and Ms. Torlak in Kentucky state court with respect to
the transfers of Mr. Parks’ interests in the three Kentucky properties. In
May 2016, while the Kentucky litigation was still pending, Mr. Parks filed a
chapter 7 petition. Trustee filed two adversary proceedings. The first
sought denial of Mr. Parks’ discharge under §§ 727(a)(2), (a)(4), and (a)(5)
based on his concealment of and/or failures to disclose assets, including the
Properties. The second named Ms. Torlak as defendant and sought to avoid
as fraudulent and recover for the estate the transfers of Mr. Parks’ interests
in the Properties.
Eventually, in September 2017, Trustee reached a compromise of the
fraudulent transfer litigation, which included settlement of Mr. Martin’s
3 According to his bankruptcy schedules, Mr. Parks' primary residence is the Granite Bay property.
4 state court fraudulent transfer claims. The settlement agreement provided
that Ms. Torlak would pay the estate $105,000 and Mr. Martin $4,100. In
return, Trustee and Mr. Martin would exchange mutual releases with
Ms. Torlak, withdraw any recorded lis pendens against the Properties, and
dismiss both Trustee’s and Mr. Martin’s fraudulent transfer actions.
Mr. Parks was served with notice of the compromise but did not file an
objection. The bankruptcy court approved the compromise by order
entered October 18, 2017.
On October 31, 2017, Mr. Parks filed a motion to set aside the order
approving the compromise. The bankruptcy court denied the motion
without prejudice due to procedural defects. Mr. Parks never attempted to
re-file the motion.
On February 12, 2018, after having received the $105,000 payment
from Ms. Torlak, Trustee filed a motion under Civil Rule 41 (applicable via
Rule 7041) to dismiss her § 727 action against Mr. Parks. On March 13,
2018, the date set for hearing on the motion to dismiss, Mr. Parks filed an
untimely objection, arguing that:
I. The Trustee has created a procedurally unfair advantage over the Debtor by, 1) filing separate adversary complaints against the debtor and his ex-wife, 2) then litigating them separately in hopes that expensive litigation would obtain a settlement offer from doctor/non-petitioner ex-wife of the Debtor, 3) while simultaneously telling the Debtor that if he filed any motion it would greatly reduce his chances of getting
Free access — add to your briefcase to read the full text and ask questions with AI
FILED FEB 11 2019 NOT FOR PUBLICATION SUSAN M. SPRAUL, CLERK U.S. BKCY. APP. PANEL OF THE NINTH CIRCUIT
UNITED STATES BANKRUPTCY APPELLATE PANEL OF THE NINTH CIRCUIT
In re: BAP No. EC-18-1088-LBS
DONALD STEVEN PARKS, Bk. No. 2:16-bk-23173
Debtor. DONALD STEVEN PARKS,
Appellant,
v. MEMORANDUM*
KIMBERLY J. HUSTED, Trustee,
Appellee.
Argued and Submitted on January 24, 2019 at Sacramento, California
Filed – February 11, 2019
Appeal from the United States Bankruptcy Court for the Eastern District of California
* This disposition is not appropriate for publication. Although it may be cited for whatever persuasive value it may have, see Fed. R. App. P. 32.1, it has no precedential value, see 9th Cir. BAP Rule 8024-1. Honorable Christopher D. Jaime, Bankruptcy Judge, Presiding
Appearances: Appellant Donald S. Parks argued pro se; Kristen Renfro of Desmond, Nolan, Livaich & Cunningham argued for Appellee.
Before: LAFFERTY, BRAND, and SPRAKER, Bankruptcy Judges.
INTRODUCTION
Debtor Donald Parks appeals the discharge order (“Discharge
Order”) entered in his chapter 71 bankruptcy case. But the relief Mr. Parks
seeks actually pertains more directly to other orders entered by the
bankruptcy court, which he did not appeal. One order approved the
settlement of fraudulent transfer litigation brought by the chapter 7 trustee,
Kimberly J. Husted (“Trustee”), against Mr. Parks’ ex-wife seeking to avoid
Mr. Parks’ pre-petition transfers to her of his interests in real properties
(the “Compromise Order”). The other order dismissed Trustee’s § 727
claims against Mr. Parks, clearing the way for him to receive his discharge
(the “Dismissal Order”).
Mr. Parks has not demonstrated that the bankruptcy court erred in
1 Unless specified otherwise, all chapter and section references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532, all “Rule” references are to the Federal Rules of Bankruptcy Procedure, and all “Civil Rule” references are to the Federal Rules of Civil Procedure.
2 entering the Discharge Order. Moreover, even if we were to reverse the
Discharge Order, such reversal would not give Mr. Parks the relief he
seeks. To the extent Mr. Parks assigns error to the Compromise Order and
the Dismissal Order, we lack jurisdiction to review those orders as they
were not timely appealed.
We therefore AFFIRM.
FACTUAL BACKGROUND2
In January 2015 a Kentucky state court entered a default judgment for
legal malpractice against Mr. Parks and in favor of Check Martin. At the
time judgment was entered, Mr. Parks was married to Edina Torlak and
2 The Panel waived the requirement of Rule 8018(b) that Appellant file and serve an appendix to the brief containing excerpts of record. Therefore, in ascertaining the relevant facts, we have exercised our discretion to review the bankruptcy court’s docket and imaged papers in Case No. 16-23173 and related adversary proceedings. See Woods & Erickson, LLP v. Leonard (In re AVI, Inc.), 389 B.R. 721, 725 n.2 (9th Cir. BAP 2008).
Mr. Parks filed a “Motion for Judicial Notice” requesting the Panel to take judicial notice of certain background facts. Under Fed. R. Evid. 201(b), we may take judicial notice of facts that are not subject to reasonable dispute because they are “generally known within the trial court's territorial jurisdiction . . . or . . . can be accurately and readily determined from sources whose accuracy cannot reasonably be questioned.” Fed. R. Evid. 201(b). The factual recitation presented by Mr. Parks does not meet those criteria. We therefore deny Mr. Parks’ request for judicial notice. See Credit Alliance Corp. v. Idaho Asphalt Supply, Inc. (In re Blumer), 95 B.R. 143, 147 (9th Cir. BAP 1988) (bankruptcy court properly refused to take judicial notice of facts set forth in witness deposition).
3 held an interest in four parcels of real property, three of which were located
in Louisville, Kentucky, and the fourth in Granite Bay, California (the
“Properties”).
Less than two weeks after entry of the malpractice judgment,
Mr. Parks and Ms. Torlak filed for divorce in Kentucky state court.
Pursuant to the parties’ marital settlement agreement, in February and
March 2015 Mr. Parks executed and recorded quitclaim deeds transferring
his interests in the Properties to Ms. Torlak.3
In July 2015 Mr. Martin commenced a fraudulent transfer action
against Mr. Parks and Ms. Torlak in Kentucky state court with respect to
the transfers of Mr. Parks’ interests in the three Kentucky properties. In
May 2016, while the Kentucky litigation was still pending, Mr. Parks filed a
chapter 7 petition. Trustee filed two adversary proceedings. The first
sought denial of Mr. Parks’ discharge under §§ 727(a)(2), (a)(4), and (a)(5)
based on his concealment of and/or failures to disclose assets, including the
Properties. The second named Ms. Torlak as defendant and sought to avoid
as fraudulent and recover for the estate the transfers of Mr. Parks’ interests
in the Properties.
Eventually, in September 2017, Trustee reached a compromise of the
fraudulent transfer litigation, which included settlement of Mr. Martin’s
3 According to his bankruptcy schedules, Mr. Parks' primary residence is the Granite Bay property.
4 state court fraudulent transfer claims. The settlement agreement provided
that Ms. Torlak would pay the estate $105,000 and Mr. Martin $4,100. In
return, Trustee and Mr. Martin would exchange mutual releases with
Ms. Torlak, withdraw any recorded lis pendens against the Properties, and
dismiss both Trustee’s and Mr. Martin’s fraudulent transfer actions.
Mr. Parks was served with notice of the compromise but did not file an
objection. The bankruptcy court approved the compromise by order
entered October 18, 2017.
On October 31, 2017, Mr. Parks filed a motion to set aside the order
approving the compromise. The bankruptcy court denied the motion
without prejudice due to procedural defects. Mr. Parks never attempted to
re-file the motion.
On February 12, 2018, after having received the $105,000 payment
from Ms. Torlak, Trustee filed a motion under Civil Rule 41 (applicable via
Rule 7041) to dismiss her § 727 action against Mr. Parks. On March 13,
2018, the date set for hearing on the motion to dismiss, Mr. Parks filed an
untimely objection, arguing that:
I. The Trustee has created a procedurally unfair advantage over the Debtor by, 1) filing separate adversary complaints against the debtor and his ex-wife, 2) then litigating them separately in hopes that expensive litigation would obtain a settlement offer from doctor/non-petitioner ex-wife of the Debtor, 3) while simultaneously telling the Debtor that if he filed any motion it would greatly reduce his chances of getting
5 a discharge, and 4) while knowing that as soon as she had an offer from the ex-wife she could dismiss all complaints, grant Debtor his discharge and effectively avoid having to file a motion for summary judgment or contend with any affirmative action’s [sic] on the part of the Debtor.
Mr. Parks did not appear at the hearing, and the bankruptcy court
entered the Dismissal Order. The next day, the Discharge Order was
entered. Mr. Parks filed a timely notice of appeal of the Discharge Order.
JURISDICTION
The bankruptcy court had jurisdiction pursuant to 28 U.S.C. §§ 1334
and 157(b)(2)(A). We have jurisdiction under 28 U.S.C. § 158.
ISSUE
Whether the bankruptcy court erred in granting Mr. Parks a
discharge.
STANDARD OF REVIEW
We review the bankruptcy court’s findings of fact for clear error and
its conclusions of law de novo. Adinolfi v. Meyer (In re Adinolfi), 543 B.R. 612,
614 (9th Cir. BAP 2016).
DISCUSSION
During the pendency of this appeal, the Panel issued an order
informing Mr. Parks that “[t]he BAP’s authority is limited to review of the
order on appeal. The order on appeal granted a discharge to appellant.
Accordingly, the BAP’s review of this appeal is limited to whether the
6 bankruptcy court erred in granting appellant a discharge.” Despite this
admonition, to the extent Mr. Parks’ arguments on appeal can be discerned,
they relate not to the propriety of the Discharge Order but rather the
Compromise Order and the Dismissal Order. Unfortunately, his approach
misconceives the functions of both the bankruptcy court and this Panel.
To begin, Mr. Parks alleges that Benjamin Carter, Mr. Martin’s
attorney, contacted Trustee and tainted her view of the facts so that Trustee
failed to consider evidence that Mr. Parks never held any interests in the
Properties. He then alleges that Trustee violated her duties by “pressuring”
Mr. Parks to hold off on filing any dispositive motions in the § 727 action
until after Trustee finished discovery in the fraudulent transfer litigation.
According to Mr. Parks, Trustee intended to keep Mr. Parks “at bay while
she leveraged costly litigation against Torlak for a settlement, planning to
then quickly dismiss Appellant[‘]s case and grant a ‘hollow’ discharge,
effectively denying Appellant an opportunity to defend himself.”
Mr. Parks contends that he did not receive an “actual” discharge because
Trustee collected funds from Ms. Torlak and used it to pay creditors, when
the purpose of bankruptcy is to discharge debts, not pay them.
Mr. Parks also contends that he never had any interests in the
Properties and that Trustee never established that any of his conduct was
blameworthy, nor did she establish that he did not receive reasonably
equivalent value for the Properties.
7 Finally, he asserts that Mr. Martin’s “claims” should be denied
because Mr. Martin’s counsel purportedly failed to inform Mr. Parks who
his client was before discussing Mr. Parks’ case with him.
None of these arguments are relevant to whether the bankruptcy
court properly entered the Discharge Order. Because Mr. Parks has not
specifically and distinctly addressed this issue, we may summarily affirm
the bankruptcy court on that basis alone. See Padgett v. Wright, 587 F.3d 983,
986 n.2 (9th Cir. 2009) (per curiam) (appellate court “will not ordinarily
consider matters on appeal that are not specifically and distinctly raised
and argued in appellant's opening brief”). We also do not consider
arguments on appeal that were not raised before the bankruptcy court
sufficiently for the bankruptcy court to rule upon them. See O’Rourke v.
Seaboard Surety Co. (In re E.R. Fegert, Inc.), 887 F.2d 955, 957 (9th Cir. 1989).
Mr. Parks did not object to the entry of discharge in the bankruptcy court.
He thus waived the opportunity to appeal from the Discharge Order. See
In re Parmenter, BAP No. 15-1170-TaKuJu, 2016 WL 7189829, at *2 (9th Cir.
BAP Dec. 5, 2016).
To the extent Mr. Parks intended a collateral attack on the
Compromise Order or the Dismissal Order, as stated, those orders are now
final and incapable of attack through any appeal.4 See id.
4 Even if we had jurisdiction to review the Compromise Order or the Dismissal (continued...)
8 CONCLUSION
For these reasons, we AFFIRM.
4 (...continued) Order, Mr. Parks did not timely present any of his arguments or appear at the hearings on the motions underlying those orders. Additionally, nothing in the bankruptcy court filings suggests a plausible basis for Mr. Parks to have had standing to object to the compromise of the fraudulent transfer action.