In re Suburban West Properties, LLC

504 B.R. 477, 2013 Bankr. LEXIS 5596, 2013 WL 6172740
CourtUnited States Bankruptcy Court, N.D. Illinois
DecidedNovember 26, 2013
DocketNo. 13bk18697
StatusPublished
Cited by6 cases

This text of 504 B.R. 477 (In re Suburban West Properties, LLC) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, N.D. Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Suburban West Properties, LLC, 504 B.R. 477, 2013 Bankr. LEXIS 5596, 2013 WL 6172740 (Ill. 2013).

Opinion

MEMORANDUM DECISION

TIMOTHY A. BARNES, Bankruptcy Judge.

The matter before the court is on the Motion of Debtor for Contempt Sanctions for Violations of the Automatic Stay and for Other Relief (the “Sanctions Motion ”) brought by Suburban West Properties, LLC (the “Debtor”) against Ahad Real Estate, LLC (“Ahad”), Beach Business Bank (“EBB ”), Macon Group, LLC (“Macon”) and the state appointed receiver John Flanders Kennedy (the “Receiver”). With the exception of Ahad, which did not respond, the parties timely filed separate responses and supplemental responses to the Sanctions Motion. Upon a review of the parties’ respective filings and after holding a hearing on the matter, the court finds that the postpetition actions in relation to 3680 Riverside Drive, Macon, GA 31210 (the “Property”) and the payment made to the Receiver by the principal of the Debtor do not violate the automatic stay and accordingly denies the Sanctions Motion.

JURISDICTION

The federal district courts have “original and exclusive jurisdiction” of all cases under title 11 of the United States Code (the “Bankruptcy Code ”). 28 U.S.C. § 1334(a). The federal district courts also have “original but not exclusive jurisdiction” of all civil proceedings arising under title 11 of the United States Code, or arising in or related to cases under title 11. 28 U.S.C. § 1334(b). District courts may, however, refer these cases to the bankruptcy judges for their districts. 28 U.S.C. § 157(a). In accordance with section 157(a), the District Court for the Northern District of Illinois has referred all of its bankruptcy cases to the Bankruptcy Court for the Northern District of Illinois. N.D. Ill. Internal Operating Procedure 15(a).

A bankruptcy judge to whom a case has been referred may enter final judgment on any core proceeding arising under the Bankruptcy Code or arising in a case under title 11. 28 U.S.C. § 157(b)(1). A request for sanctions for alleged violations of the automatic stay may only arise in a case under title 11 and, therefore, is a core proceeding. 11 U.S.C. § 363(k); 28 U.S.C. § 157(b)(2)(o); In re Glenn, 359 B.R. 200, 203 (Bankr.N.D.Ill.2006) (Black, J.) (“[T]he cause of action for violating the automatic stay under section 362(k)(l) [480]*480does not appear to have had a counterpart in eighteenth century England.”).

Accordingly, final judgment is within the scope of the court’s authority.

PROCEDURAL HISTORY

• In considering the Sanctions Motion [Docket No. 26], the court has evaluated the arguments of the parties at the October 2, 2013 hearing on the Sanctions Motion (the “Hearing”), has reviewed and considered the Sanctions Motion itself, and has considered:

(1) The Receiver’s Response and Statement [Docket No. 61];
(2) BBB’s Response to Debtor’s Motion for Contempt Sanctions for Violations of the Automatic Stay [Docket No. 77];
(3) Macon’s Response in Opposition to Debtor’s Motion for Contempt Sanctions for Violations of the Automatic Stay and for Other Relief [Docket No. 78];
(4) The Reply of Suburban West Properties, LLC to John Flanders Kennedy’s Response and Statement [Docket No. 87];
(5) The Debtor’s Reply to Beach Business Bank’s Response to Debtor’s Motion for Contempt Sanctions for Violations of the Automatic Stay [Docket No. 89];
(6) The Debtor’s Reply to Macon Group, LLC’s Response in Opposition to Debtor’s Motion for Contempt Sanctions for Violations of the Automatic Stay and for Other Relief [Docket No. 92];
(7) Beach Business Bank’s Sur-Reply in Opposition to Debtor’s Motion for Sanctions [Docket No. 95-1]1; and
(8) Macon’s Supplemental Memorandum in Opposition to Debtor’s Motion for Contempt Sanctions for Violations of the Automatic Stay and Other Relief [Docket No. 115].

The court has also taken into consideration any and all exhibits submitted in conjunction with the foregoing. Though these items do not constitute an exhaustive list of the filings in the above-captioned bankruptcy case, the court has taken judicial notice of the contents of the docket in this matter. See Levine v. Egidi, No. 93C188, 1993 WL 69146, at *2 (N.D.Ill. Mar. 8, 1993); Inskeep v. Grosso (In re Fin. Partners), 116 B.R. 629, 635 (Bankr.N.D.Ill.1989) (Sonderby, J.) (authorizing a bankruptcy court to take judicial notice of its own docket).

FACTUAL BACKGROUND

The Debtor alleges that the automatic stay with respect to the Property has been violated by Ahad, BBB, Macon and the Receiver.

While the matter before the court is, ultimately, a disagreement between the parties as to the legal effect of certain prepetition and postpetition actions and not in essence a factual dispute, the facts in question are nonetheless integral to a ruling on the matter. As the arguments raised by the Debtor are based in large part in fact, the court considers here the facts as they have been presented:

(1) In 2010, BBB made a loan to Ahad for the purchase and operation of a Baymont Inn and Suites Hotel located on the Property. BBB took [481]*481and recorded the original security deed (the “Deed ”) to evidence and secure the loan. The Deed provides that, should Ahad default, BBB may sell the Property at its discretion after first giving notice of the time, place and terms of the sale by advertisement, published once a week for four weeks.
(2) The Debtor became associated with the Property through its principal, Kenneth Moore (the “Principal”). On September 11, 2012, the Principal entered into a partnership agreement with Ahad for the purpose of conducting the general business of operating the Baymont Inn and Suites Hotel located on the Property. The partnership agreement stated that if the Principal desired for the partnership to acquire legal title to the Property, and such desire was agreeable to both parties and within ninety (90) days from the execution of the partnership agreement, the Principal was required to assume fifty percent (50%) of the outstanding indebtedness to BBB.
(3) Ahad defaulted on its loan payments due in October, November and December of 2012.
(4) In December 2012, Ahad and the Debtor entered into a franchise agreement with Baymont Franchise Systems, Inc.
(5) On January 13, 2013, BBB began foreclosure on the Property pursuant to the non-judicial foreclosure procedures set forth in the Deed and applicable Georgia law.

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Cite This Page — Counsel Stack

Bluebook (online)
504 B.R. 477, 2013 Bankr. LEXIS 5596, 2013 WL 6172740, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-suburban-west-properties-llc-ilnb-2013.