Midgard Corporation v. Todd

Opinion

F I L E D United States Court of Appeals Tenth Circuit UNITED STATES COURT OF APPEALS MAR 5 1997 FOR THE TENTH CIRCUIT PATRICK FISHER Clerk

In re:

MIDGARD CORPORATION,

Debtor.

Plaintiff-Appellant, Nos. 96-6016, 96-6017 (D.C. Nos. CIV-94-2073-T & v. CIV-94-2072-T) (W.D. Okla.) PAUL TODD, CUSTOM CUTTING MILLWORKS INCORPORATED and TODD’S RECYCLING CENTER INCORPORATED,

Defendants-Appellees.

ORDER AND JUDGMENT *

Before PORFILIO, ANDERSON, and BRISCOE, Circuit Judges.

* This order and judgment is not binding precedent, except under the doctrines of law of the case, res judicata, and collateral estoppel. The court generally disfavors the citation of orders and judgments; nevertheless, an order and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3. After examining the briefs and appellate record, this panel has determined

unanimously to grant the parties’ request for a decision on the briefs without oral

argument. See Fed. R. App. P. 34(f) and 10th Cir. R. 34.1.9. The cases are

therefore ordered submitted without oral argument.

This appeal challenges the bankruptcy court’s imposition under Bankruptcy

Rule 9011 of sanctions of $500 each, payable to the court, against debtor Midgard

Corporation’s president, David Personette, and its attorney, Wilburn C. Hall, for

bringing an adversary proceeding against defendants that was not well-grounded

in law or fact. (The merits of the adversary proceeding are addressed in a

separate appeal, No. 96-6018.) Midgard itself was not sanctioned because the

bankruptcy court expressly chose not to further burden the estate. However,

Midgard is the appellant here, as it was in the district court. The district court

questioned its jurisdiction over the sanctions imposed on Hall, but entered orders

affirming the imposition of sanctions on both Hall and Personette.

Defendants have moved to dismiss the appeal because Midgard itself was

not sanctioned and therefore lacks standing to appeal. Midgard contends that it is

the “real party in interest” and that “[a]ll related sanction rights, titles, interests or

expectancies have been disclaimed” by Hall and Personette in favor of Midgard.

Appellant’s response to appellees’ motions to dismiss at 1. It also contends that

the district court “ratified” its interests by ruling on the matter. Id.

-2- Standing is a jurisdictional issue that can be raised at any time. See

Uselton v. Commercial Lovelace Motor Freight, Inc., 9 F.3d 849, 854 (10th Cir.

1993). Federal courts have only limited jurisdiction, and when the record

discloses that the district court lacked jurisdiction to address the merits of a case,

we will correct the district court’s error. See Bender v. Williamsport Area Sch.

Dist., 475 U.S. 534, 541 (1986); see also Deyhimy v. Rupp (In re Herwit), 970

F.2d 709, 709-10 (10th Cir. 1992) (dismissing appeal where district court lacked

jurisdiction over appeal from bankruptcy court, even though district court

addressed merits of appeal). Thus, the district court here could not have

“ratified” Midgard’s standing if Midgard lacked standing to begin with.

We conclude Midgard did lack standing. “To have standing, one must be

aggrieved by the order from which appeal is taken.” Uselton, 9 F.3d at 854. The

imposition of sanctions against Hall and Personette personally did not aggrieve

Midgard. We note that Midgard cites no authority for the interesting proposition

that a party can assign its rights or interests in being sanctioned.

The district court orders affirming the imposition of sanctions are

VACATED. Appellees’ motion to dismiss these appeals is GRANTED.

Entered for the Court

Stephen H. Anderson Circuit Judge

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