FILED NOV 23 2022 NOT FOR PUBLICATION SUSAN M. SPRAUL, CLERK U.S. BKCY.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. OR-22-1012-BFT PETER SZANTO, Debtor. Bk. No. 3:16-bk-33185-pcm7
PETER SZANTO, Appellant, v. MEMORANDUM∗ CANDACE AMBORN, Chapter 7 Trustee, Appellee.
Appeal from the United States Bankruptcy Court for the District of Oregon Peter C. McKittrick, Bankruptcy Judge, Presiding
Before: BRAND, FARIS, and TAYLOR, Bankruptcy Judges.
Debtor Peter Szanto appeals pro se1 an order overruling his objection to
a motion filed by the chapter 72 trustee, Candace Amborn ("Trustee"), to incur
expenses for monthly banking fees for the estate's account at Independent
∗ 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. 1 As prior Panels have noted, Szanto is not the ordinary pro se litigant. He has an
MBA and a J.D.; he has filed at least three bankruptcy cases in three different states; and he is a serial litigant and party to numerous court cases nationwide. Among other courts, he is subject to a vexatious litigant pre-filing review order in the Ninth Circuit Court of Appeals. See In re Szanto, No. 17-80195, Doc. 6 (9th Cir. Nov. 24, 2017). 2 Unless specified otherwise, all chapter and section references are to the
Bankruptcy Code, 11 U.S.C. §§ 101–1532. 1 Financial (aka Independent Bank).
Szanto filed a chapter 11 bankruptcy case in 2016. After not disclosing
some financial accounts and engaging in unauthorized postpetition transfers
of funds, Szanto's case was converted to chapter 7. Ultimately, he was denied
a discharge.
Since then, Szanto has been on a relentless crusade against Trustee and
her professionals in the Oregon bankruptcy court. He has burdened not only
that court with his many meritless pleadings, but he also has burdened the
Oregon district court, this Panel, and the Ninth Circuit Court of Appeals with
his many meritless bankruptcy appeals. This appeal is no different.
Trustee maintains a bank account for the Szanto chapter 7 estate with
Independent Financial, which had agreed to waive monthly fees for several
years. However, due to the length of time the case has been pending (over six
years), waiver of these fees was no longer reasonable or feasible.
Trustee filed a Motion and Notice of Intent to Incur Expenses for the
monthly banking fees of approximately $570.00 for the Szanto account
("Banking Fees Motion"). Szanto objected, arguing that Independent Financial
was not an FDIC bank, it was not located in Oregon, and Trustee was
improperly allowing a non-FDIC, non-Oregon bank to hold the estate's
money. He also accused Trustee of pocketing the "phony" fees and alleged
that the bankruptcy court would condone such conduct. Finally, he argued
that the fees were usurious and excessive. In response, Trustee presented
evidence that Independent Financial is an FDIC insured bank, as part of the
2 Independent Bank Group, Inc., the funds are held in accordance with
statutory and United States Trustee requirements, and under the Uniform
Depository Agreement in place, Independent Financial is permitted to assess
fees for services, subject to court approval as reasonable. Trustee argued that
the monthly banking fees were reasonable.
The bankruptcy court granted the Banking Fees Motion. It first found
that Szanto likely lacked standing to object because he was not "directly and
adversely affected pecuniarily" by an order approving banking fees.
However, even if Szanto had standing, the court overruled his objection
because Independent Financial is an FDIC insured bank and has complied
with all requirements for bankruptcy estate accounts, and the monthly fee
amount was consistent with similar cases and reasonable, particularly since
Trustee had negotiated a fee waiver for several years.
"We lack jurisdiction over appeals when the appellant lacks standing."
Landress v. Cambridge Land Co. II, LLC (In re Cambridge Land Co. II, LLC), 626
B.R. 319, 323 (9th Cir. BAP 2021), appeal dismissed, No. 21-60027, 2022 WL
15523094 (9th Cir. Oct. 27, 2022). As the appellant, Szanto has the burden to
establish standing. Id. Bankruptcy appellate standing requires an appellant to
show that it is a "person aggrieved" who was "directly and adversely affected
pecuniarily" by the bankruptcy court's decision. Palmdale Hills Prop., LLC v.
Lehman Com. Paper, Inc. (In re Palmdale Hills Prop., LLC), 654 F.3d 868, 874 (9th
Cir. 2011); Fondiller v. Robertson (In re Fondiller), 707 F.2d 441, 442-43 (9th Cir.
1983). "A 'person aggrieved' is someone whose interest is directly affected by
3 the bankruptcy court's order, either by a diminution in property, an increase
in the burdens on the property, or some other detrimental effect on the rights
of ownership inherent in the property." In re Cambridge Land Co. II, LLC, 626
B.R. at 323 (citing In re Fondiller, 707 F.2d at 442-43).
Generally, a chapter 7 debtor lacks standing to challenge a bankruptcy
court order concerning the administration of the estate. However, when the
debtor has been denied a discharge, the debtor has a pecuniary interest in the
administration of the estate and has standing to challenge the trustee's
actions. Koshkalda v. Schoenmann (In re Koshkalda), 622 B.R. 749, 764 n.7 (9th
Cir. BAP 2020). Because Szanto was denied a discharge, he is directly and
adversely affected pecuniarily by the order granting the Banking Fees
Motion; he is a "person aggrieved," and has standing to appeal. To the extent
the bankruptcy court granted the Banking Fees Motion on the basis of lack of
standing, this was error; but it was harmless error.
The only argument Szanto asserts in his opening brief is that
Independent Financial does not exist. He did not raise this argument before
the bankruptcy court. Generally, we will not consider arguments raised for
the first time on appeal. Smith v. Marsh, 194 F.3d 1045, 1052 (9th Cir. 1999).
Even if we did, Szanto's argument lacks merit. Trustee submitted ample
evidence to show that Independent Financial exists and is qualified to hold
estate assets. Szanto's remaining arguments raised for the first time in his
reply brief are waived. Id. (appellate court does not consider arguments
raised for the first time in a reply brief). In summary, the record demonstrates
4 that the bankruptcy court did not abuse its discretion in granting the Banking
Fees Motion.
At oral argument, Szanto railed against Trustee and her professionals
accusing them of "thieving" and "looting" the estate and accusing the court of
being complicit in these acts. These arguments had no basis in the record and
were not relevant to the issues on appeal. This is not the first time that Szanto
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FILED NOV 23 2022 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. OR-22-1012-BFT PETER SZANTO, Debtor. Bk. No. 3:16-bk-33185-pcm7
PETER SZANTO, Appellant, v. MEMORANDUM∗ CANDACE AMBORN, Chapter 7 Trustee, Appellee.
Appeal from the United States Bankruptcy Court for the District of Oregon Peter C. McKittrick, Bankruptcy Judge, Presiding
Before: BRAND, FARIS, and TAYLOR, Bankruptcy Judges.
Debtor Peter Szanto appeals pro se1 an order overruling his objection to
a motion filed by the chapter 72 trustee, Candace Amborn ("Trustee"), to incur
expenses for monthly banking fees for the estate's account at Independent
∗ 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. 1 As prior Panels have noted, Szanto is not the ordinary pro se litigant. He has an
MBA and a J.D.; he has filed at least three bankruptcy cases in three different states; and he is a serial litigant and party to numerous court cases nationwide. Among other courts, he is subject to a vexatious litigant pre-filing review order in the Ninth Circuit Court of Appeals. See In re Szanto, No. 17-80195, Doc. 6 (9th Cir. Nov. 24, 2017). 2 Unless specified otherwise, all chapter and section references are to the
Bankruptcy Code, 11 U.S.C. §§ 101–1532. 1 Financial (aka Independent Bank).
Szanto filed a chapter 11 bankruptcy case in 2016. After not disclosing
some financial accounts and engaging in unauthorized postpetition transfers
of funds, Szanto's case was converted to chapter 7. Ultimately, he was denied
a discharge.
Since then, Szanto has been on a relentless crusade against Trustee and
her professionals in the Oregon bankruptcy court. He has burdened not only
that court with his many meritless pleadings, but he also has burdened the
Oregon district court, this Panel, and the Ninth Circuit Court of Appeals with
his many meritless bankruptcy appeals. This appeal is no different.
Trustee maintains a bank account for the Szanto chapter 7 estate with
Independent Financial, which had agreed to waive monthly fees for several
years. However, due to the length of time the case has been pending (over six
years), waiver of these fees was no longer reasonable or feasible.
Trustee filed a Motion and Notice of Intent to Incur Expenses for the
monthly banking fees of approximately $570.00 for the Szanto account
("Banking Fees Motion"). Szanto objected, arguing that Independent Financial
was not an FDIC bank, it was not located in Oregon, and Trustee was
improperly allowing a non-FDIC, non-Oregon bank to hold the estate's
money. He also accused Trustee of pocketing the "phony" fees and alleged
that the bankruptcy court would condone such conduct. Finally, he argued
that the fees were usurious and excessive. In response, Trustee presented
evidence that Independent Financial is an FDIC insured bank, as part of the
2 Independent Bank Group, Inc., the funds are held in accordance with
statutory and United States Trustee requirements, and under the Uniform
Depository Agreement in place, Independent Financial is permitted to assess
fees for services, subject to court approval as reasonable. Trustee argued that
the monthly banking fees were reasonable.
The bankruptcy court granted the Banking Fees Motion. It first found
that Szanto likely lacked standing to object because he was not "directly and
adversely affected pecuniarily" by an order approving banking fees.
However, even if Szanto had standing, the court overruled his objection
because Independent Financial is an FDIC insured bank and has complied
with all requirements for bankruptcy estate accounts, and the monthly fee
amount was consistent with similar cases and reasonable, particularly since
Trustee had negotiated a fee waiver for several years.
"We lack jurisdiction over appeals when the appellant lacks standing."
Landress v. Cambridge Land Co. II, LLC (In re Cambridge Land Co. II, LLC), 626
B.R. 319, 323 (9th Cir. BAP 2021), appeal dismissed, No. 21-60027, 2022 WL
15523094 (9th Cir. Oct. 27, 2022). As the appellant, Szanto has the burden to
establish standing. Id. Bankruptcy appellate standing requires an appellant to
show that it is a "person aggrieved" who was "directly and adversely affected
pecuniarily" by the bankruptcy court's decision. Palmdale Hills Prop., LLC v.
Lehman Com. Paper, Inc. (In re Palmdale Hills Prop., LLC), 654 F.3d 868, 874 (9th
Cir. 2011); Fondiller v. Robertson (In re Fondiller), 707 F.2d 441, 442-43 (9th Cir.
1983). "A 'person aggrieved' is someone whose interest is directly affected by
3 the bankruptcy court's order, either by a diminution in property, an increase
in the burdens on the property, or some other detrimental effect on the rights
of ownership inherent in the property." In re Cambridge Land Co. II, LLC, 626
B.R. at 323 (citing In re Fondiller, 707 F.2d at 442-43).
Generally, a chapter 7 debtor lacks standing to challenge a bankruptcy
court order concerning the administration of the estate. However, when the
debtor has been denied a discharge, the debtor has a pecuniary interest in the
administration of the estate and has standing to challenge the trustee's
actions. Koshkalda v. Schoenmann (In re Koshkalda), 622 B.R. 749, 764 n.7 (9th
Cir. BAP 2020). Because Szanto was denied a discharge, he is directly and
adversely affected pecuniarily by the order granting the Banking Fees
Motion; he is a "person aggrieved," and has standing to appeal. To the extent
the bankruptcy court granted the Banking Fees Motion on the basis of lack of
standing, this was error; but it was harmless error.
The only argument Szanto asserts in his opening brief is that
Independent Financial does not exist. He did not raise this argument before
the bankruptcy court. Generally, we will not consider arguments raised for
the first time on appeal. Smith v. Marsh, 194 F.3d 1045, 1052 (9th Cir. 1999).
Even if we did, Szanto's argument lacks merit. Trustee submitted ample
evidence to show that Independent Financial exists and is qualified to hold
estate assets. Szanto's remaining arguments raised for the first time in his
reply brief are waived. Id. (appellate court does not consider arguments
raised for the first time in a reply brief). In summary, the record demonstrates
4 that the bankruptcy court did not abuse its discretion in granting the Banking
Fees Motion.
At oral argument, Szanto railed against Trustee and her professionals
accusing them of "thieving" and "looting" the estate and accusing the court of
being complicit in these acts. These arguments had no basis in the record and
were not relevant to the issues on appeal. This is not the first time that Szanto
has engaged in this type of conduct before this Panel.3 He has been given a
full and fair opportunity to argue the issues in all of his appeals; however, the
Panel will no longer tolerate his repeated practice of using every appeal
before us as an opportunity to hurl insults and make absurd accusations
about Trustee, her professionals, and the court. Szanto is cautioned to use his
time to address the issues presented in his appeals without unwarranted
personal attacks.
For the reasons stated above, we AFFIRM.
3 For example, see Szanto v. Amborn (In re Szanto), BAP No. 21-1118-GBS; Szanto v. Hon (In re Szanto), BAP No. 21-1069-FBS; Szanto v. Amborn (In re Szanto), 20-1167-LBT; Szanto v. Amborn (In re Szanto), BAP No. 20-1148-BTL; Szanto v. United States Tr. (In re Szanto), BAP No. OR-20-1106-TLB. 5