IN THE SUPERIOR COURT OF GUAM
2 WENDELL C. O'CONNOR (Minor) by and ) CIVIL CASE NO.: CV0149-08 through his Guardian Ad Litem WALTER A. ~ 3
4 O'CONNOR, ) DECISION,AND ORDER Plaintiff,) RE. MOTION TO RECONSIDER.
~ 5 vs. ORDER DISMISSING CASE FOR FAILURE TO PROSECUTE 6 LITO CAPILI and SALLY CAPILI, ~ 7 Defendants.)
9 This matter came before the Honorable Maria T. Cenzon on January 18, 2013, on
10 Plaintiffs Motion to Reconsider Order Dismissing Case for Lack of Prosecution. Attorney 11 William Gavras appeared on behalf of Plaintiff. Attorney Vince Leon Guerrero appeared on 12 behalf of Defendants, who were represented by Attorney Mark Williams during the course of 13 this case. At the conclusion of the hearing, the Court ordered Plaintiff to provide additional 14
15 information evidencing Defendants' bankruptcy filing and status of the proceeding in the
16 Bankruptcy Court. 1 On February 11, 2013, Plaintiff filed a Memorandum to Court and 17 Submission of Exhibits Regarding Plaintiff's Motion for Reconsideration. The Court, having 18 reviewed all of the pleadings and the oral arguments presented during the hearing of this matter, 19
20 including the additional filing made by Plaintiff, now issues the following written Order
21 DENYING Plaintiffs request for reconsideration. 22 BACKGROUND 23 The procedural history of this case is set forth succinctly in the Court's order of August 24 8, 2012 as follows: The Complaint was filed on February 1, 2008 and assigned to the 25
26 1 27 During the January 8, 2013 hearing, the Court required Plaintiff to file: (1) a copy of Defendants' Petition fo Bankruptcy that was filed in the District Court of Guam, which would include the Schedule of Creditors; and (2) th 28 District Court of Guam's Notice to Creditors of Automatic Stay. When Plaintiff failed to do so by February 5, 2013 the Court issued a written order mandating the submission by February 11.
Page 1 of5 Honorable Judge Elizabeth Barrett-Anderson. A jury demand was made and jury trials were
2 scheduled for April 15, 2008, May 27, 2009 and February 3, 2010, respectively- all of which
3 were vacated. On May 7, 2010, Attorney Gavras moved to withdraw as counsel for the Plaintiff 4 and on June 30, 2010, the Court was informed by Attorney Gavras that Defendants had filed for 5 bankruptcy protection in the District Court of Guam, Bankruptcy Division. At the time, the 6 Court did not permit his withdrawal? In denying counsel's withdrawal, the Court also 7
8 dismissed the case without prejudice after finding that the case had been called back for status
9 hearings every six months since June 30, 2010 and that Attorney Mark Williams (on behalf of 10 the Defendants) failed to appear for any hearing after June 30, 2010. On August 8, 2012, the 11 Court ordered the dismissal without prejudice but also granted his motion to withdraw. 12
13 Notwithstanding that he was granted his motion to withdraw on August 29, 2012,
14 Attorney Gavras filed the instant Motion requesting that the August 8 Order be set aside and, 15 further, if Plaintiff's claims are discharged in bankruptcy prior to the hearing on Plaintiff's 16 motion, the case be dismissed due to such discharge. Plaintiff's Mot. to Reconsider Order 17 Dismissing Case, at ~~ 1, 2. The hearing on Plaintiff's Motion was held on January 18, 2013; 18
19 during which the Court ordered that Plaintiff produce additional documentation in support of the
20 motion. 21 DISCUSSION 22 The decision of whether to dismiss an action for failure to prosecute generally lies 23 within the sound discretion of the Court and the Court's decision will not be disturbed absent a 24
25 "clear abuse of discretion." GRCP 41(b); Santos v. Carney, 1997 Guam 4 at ~4 (Guam
26 1997)(citing to Lynn v. Chin Heung Intern., Inc., 852 F.2d 1221 (9th Cir. 1988)). The Guam 27
2 28 At all times relevant prior to January 2013, the Honorable Elizabeth Barrett-Anderson, Senior Judge Pro tempore, presided over this case and issued the Order which is the subject of the instant Motion to Reconsider.
Pagelof5 Supreme Court in Santos v. Carney recognized that the trial courts "may consider prevailing
2 local conditions in administering their dockets," subject to ensuring that trial courts do not abuse
3 their discretion by utilizing a procedural rule (here, dismissal for failure to prosecute) in doing 4 so. Santos, 1997 Guam 4 (Guam 1997). 5 The Plaintiff argues that its hands were tied after Defendants' filing of the petition for 6 bankruptcy on February 15, 2010 because of the automatic stay provisions under the 7
8 Bankruptcy Code. Plaintiff cites to 11 U.S.C.A. §362(k)(1) as prohibiting the continued
9 prosecution of the case against Defendant; however, that section only provides for the recovery 10 of damages for willfully violating an automatic stay. The provision of the Bankruptcy Code 11 which imposes the automatic stay is Section 362(a), which provides, in relevant part, as follows: 12
13 (a) Except as provided in subsection (b) of this section, ~petition 14 filed under section 301, 302, or 303 of this title, or an application filed under section 5(a)(3) of the Securities Investor Protection Act 15 of 1970, operates as ~ stay, applicable to all entities, of-- 16 (1) the commencement or continuation, including the 17 issuance or employment of process, of a judicial, administrative, or other action or proceeding against the 18 debtor that was or could have been commenced before the 19 commencement of the case under this title, or to recover a claim against the debtor that arose before the 20 commencement of the case under this title .... (Emphasis added). 21
22 During the hearing on January 18, 2013, the Court inquired whether Plaintiff sought
23 relief in the bankruptcy court from the automatic stay. In response to whether Plaintiff 24 proceeded against Defendants in Bankruptcy Court, Mr. Gavras's responded that Plaintiff was 25 represented by a different attorney in the federal action - Attorney Mark Williams - and, 26
Page3 ofS therefore, he had no knowledge of what occurred during the bankruptcy proceedings. 3 As the
2 record indicates, Mr. Williams had not appeared before the Court since June 30, 2010 despite
3 the Court holding status hearings every six months from June 30, 2010 until August 8, 2012 4 when Judge Barrett-Anderson dismissed the action without prejudice for failure to prosecute. 5 Allowing a lawsuit to languish for over two years after it has been scheduled to proceed 6 to trial on three separate occasions, purportedly because a party files an intervening bankruptcy 7
8 proceeding, is simply insufficient to support Plaintiff's request for reconsideration of the
9 dismissal order. As the Supreme Court of Guam recognized in Santos v. Carney, involuntary 10 dismissal for failure to prosecute is "a proper docket management tool and that dismissal may 11 be proper in certain situations." Santos, 1997 Guam 4 (Guam 1997). Indeed, Rule CVR 41.1 of 12
13 the Local Rules of the Superior Court codifies the Court's ability to dismiss for this reason:
14 CVR 41.1. Call of the Docket- Status Hearings. Status hearings 15 shall be scheduled by the clerk in all cases pending with no action 16 taken in the preceding six (6) months. Notice shall be given in writing to each attorney of record in every case to be called, stating 17 the date and time for such hearing. If good and sufficient reasons are not presented by counsel for failure to have taken appropriate 18
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IN THE SUPERIOR COURT OF GUAM
2 WENDELL C. O'CONNOR (Minor) by and ) CIVIL CASE NO.: CV0149-08 through his Guardian Ad Litem WALTER A. ~ 3
4 O'CONNOR, ) DECISION,AND ORDER Plaintiff,) RE. MOTION TO RECONSIDER.
~ 5 vs. ORDER DISMISSING CASE FOR FAILURE TO PROSECUTE 6 LITO CAPILI and SALLY CAPILI, ~ 7 Defendants.)
9 This matter came before the Honorable Maria T. Cenzon on January 18, 2013, on
10 Plaintiffs Motion to Reconsider Order Dismissing Case for Lack of Prosecution. Attorney 11 William Gavras appeared on behalf of Plaintiff. Attorney Vince Leon Guerrero appeared on 12 behalf of Defendants, who were represented by Attorney Mark Williams during the course of 13 this case. At the conclusion of the hearing, the Court ordered Plaintiff to provide additional 14
15 information evidencing Defendants' bankruptcy filing and status of the proceeding in the
16 Bankruptcy Court. 1 On February 11, 2013, Plaintiff filed a Memorandum to Court and 17 Submission of Exhibits Regarding Plaintiff's Motion for Reconsideration. The Court, having 18 reviewed all of the pleadings and the oral arguments presented during the hearing of this matter, 19
20 including the additional filing made by Plaintiff, now issues the following written Order
21 DENYING Plaintiffs request for reconsideration. 22 BACKGROUND 23 The procedural history of this case is set forth succinctly in the Court's order of August 24 8, 2012 as follows: The Complaint was filed on February 1, 2008 and assigned to the 25
26 1 27 During the January 8, 2013 hearing, the Court required Plaintiff to file: (1) a copy of Defendants' Petition fo Bankruptcy that was filed in the District Court of Guam, which would include the Schedule of Creditors; and (2) th 28 District Court of Guam's Notice to Creditors of Automatic Stay. When Plaintiff failed to do so by February 5, 2013 the Court issued a written order mandating the submission by February 11.
Page 1 of5 Honorable Judge Elizabeth Barrett-Anderson. A jury demand was made and jury trials were
2 scheduled for April 15, 2008, May 27, 2009 and February 3, 2010, respectively- all of which
3 were vacated. On May 7, 2010, Attorney Gavras moved to withdraw as counsel for the Plaintiff 4 and on June 30, 2010, the Court was informed by Attorney Gavras that Defendants had filed for 5 bankruptcy protection in the District Court of Guam, Bankruptcy Division. At the time, the 6 Court did not permit his withdrawal? In denying counsel's withdrawal, the Court also 7
8 dismissed the case without prejudice after finding that the case had been called back for status
9 hearings every six months since June 30, 2010 and that Attorney Mark Williams (on behalf of 10 the Defendants) failed to appear for any hearing after June 30, 2010. On August 8, 2012, the 11 Court ordered the dismissal without prejudice but also granted his motion to withdraw. 12
13 Notwithstanding that he was granted his motion to withdraw on August 29, 2012,
14 Attorney Gavras filed the instant Motion requesting that the August 8 Order be set aside and, 15 further, if Plaintiff's claims are discharged in bankruptcy prior to the hearing on Plaintiff's 16 motion, the case be dismissed due to such discharge. Plaintiff's Mot. to Reconsider Order 17 Dismissing Case, at ~~ 1, 2. The hearing on Plaintiff's Motion was held on January 18, 2013; 18
19 during which the Court ordered that Plaintiff produce additional documentation in support of the
20 motion. 21 DISCUSSION 22 The decision of whether to dismiss an action for failure to prosecute generally lies 23 within the sound discretion of the Court and the Court's decision will not be disturbed absent a 24
25 "clear abuse of discretion." GRCP 41(b); Santos v. Carney, 1997 Guam 4 at ~4 (Guam
26 1997)(citing to Lynn v. Chin Heung Intern., Inc., 852 F.2d 1221 (9th Cir. 1988)). The Guam 27
2 28 At all times relevant prior to January 2013, the Honorable Elizabeth Barrett-Anderson, Senior Judge Pro tempore, presided over this case and issued the Order which is the subject of the instant Motion to Reconsider.
Pagelof5 Supreme Court in Santos v. Carney recognized that the trial courts "may consider prevailing
2 local conditions in administering their dockets," subject to ensuring that trial courts do not abuse
3 their discretion by utilizing a procedural rule (here, dismissal for failure to prosecute) in doing 4 so. Santos, 1997 Guam 4 (Guam 1997). 5 The Plaintiff argues that its hands were tied after Defendants' filing of the petition for 6 bankruptcy on February 15, 2010 because of the automatic stay provisions under the 7
8 Bankruptcy Code. Plaintiff cites to 11 U.S.C.A. §362(k)(1) as prohibiting the continued
9 prosecution of the case against Defendant; however, that section only provides for the recovery 10 of damages for willfully violating an automatic stay. The provision of the Bankruptcy Code 11 which imposes the automatic stay is Section 362(a), which provides, in relevant part, as follows: 12
13 (a) Except as provided in subsection (b) of this section, ~petition 14 filed under section 301, 302, or 303 of this title, or an application filed under section 5(a)(3) of the Securities Investor Protection Act 15 of 1970, operates as ~ stay, applicable to all entities, of-- 16 (1) the commencement or continuation, including the 17 issuance or employment of process, of a judicial, administrative, or other action or proceeding against the 18 debtor that was or could have been commenced before the 19 commencement of the case under this title, or to recover a claim against the debtor that arose before the 20 commencement of the case under this title .... (Emphasis added). 21
22 During the hearing on January 18, 2013, the Court inquired whether Plaintiff sought
23 relief in the bankruptcy court from the automatic stay. In response to whether Plaintiff 24 proceeded against Defendants in Bankruptcy Court, Mr. Gavras's responded that Plaintiff was 25 represented by a different attorney in the federal action - Attorney Mark Williams - and, 26
Page3 ofS therefore, he had no knowledge of what occurred during the bankruptcy proceedings. 3 As the
2 record indicates, Mr. Williams had not appeared before the Court since June 30, 2010 despite
3 the Court holding status hearings every six months from June 30, 2010 until August 8, 2012 4 when Judge Barrett-Anderson dismissed the action without prejudice for failure to prosecute. 5 Allowing a lawsuit to languish for over two years after it has been scheduled to proceed 6 to trial on three separate occasions, purportedly because a party files an intervening bankruptcy 7
8 proceeding, is simply insufficient to support Plaintiff's request for reconsideration of the
9 dismissal order. As the Supreme Court of Guam recognized in Santos v. Carney, involuntary 10 dismissal for failure to prosecute is "a proper docket management tool and that dismissal may 11 be proper in certain situations." Santos, 1997 Guam 4 (Guam 1997). Indeed, Rule CVR 41.1 of 12
13 the Local Rules of the Superior Court codifies the Court's ability to dismiss for this reason:
14 CVR 41.1. Call of the Docket- Status Hearings. Status hearings 15 shall be scheduled by the clerk in all cases pending with no action 16 taken in the preceding six (6) months. Notice shall be given in writing to each attorney of record in every case to be called, stating 17 the date and time for such hearing. If good and sufficient reasons are not presented by counsel for failure to have taken appropriate 18
19 3 The following is an excerpt from the January 18,2013 hearing on Plaintiff's Motion: 20 AITORNEY GAVRAS: "I am not the lawyer on the bankruptcy. Actually, I was for just a very short period of time. . . . Mr. Williams is the lawyer for the debtor in the bankruptcy. So, I don't know the status of the bankruptcy. Th 21 stay can still be in effect. The claims may not have been resolved in the bankruptcy court... I don't even know if claim was filed in the bankruptcy court for this thing. I believe it was listed by the debtor. I do think judge w 22 mistaken for ordering that the case be dismissed for failure to prosecute because there was a stay involved ... th was no way it COULD be prosecuted." 23 COURT: "Mr. Gavras, are the O'Connors, or at least the minor, Mr. O'Connor- Wendell O'Connor- is he listed 24 an unsecured, unliquidated claim of the estate?"
25 GAVRAS: "I believe that is correct, your Honor."
26 COURT: "Ok. Now at any point did you file, on behalf of the Plaintiffs in the bankruptcy case, any motion to li the stay to liquidate the claim that is pending here?'' 27 GAVRAS: ''No, I did not. I am not a bankruptcy attorney. I did not feel at all comfortable proceeding in that court." 28
Page4of5 action in any such case, the Court may dismiss the action or enter such other order as may be proper. 2 CONCLUSION 3 Plaintiff failed to provide any evidence that the claims against Defendants/Debtors were 4
5 closely monitored in the bankruptcy proceedings; or that Plaintiff requested to lift the automatic
6 stay to proceed with the lawsuit in the Superior Court of Guam; or that Plaintiff sought to 7 pursue his claims in Bankruptcy Court by filing an adversary proceeding to liquidate the claim 8 in that venue; or that Plaintiff appeared at the initial Creditors Meeting or in entered any 9
10 objection to discharge in bankruptcy of the claims against the debtors; or any reasonable basis
11 for continuance on the Court's calendar. 4 Despite Defendants/Debtors identifYing Plaintiff as a 12 creditor of the estate, with all the attendant rights of creditors under the Bankruptcy Code, 13 Plaintiff simply failed to exercise those rights in either forum. For all the aforementioned 14 reasons, Plaintiff's Motion is DENIED. 15
16 SO ORDERED this 26th day of April2013.
~T.cENzoN 17
19 Judge Superior Court of Guam 20
21 4 22 The Arizona Court of Appeals Court case of Barber v. Nelson, 2009 WL 449250 (Ariz. App. Div. 1 2009)(unpublished decision), while not legal precedent in this jurisdiction, supports this Court's ruling that 23 notwithstanding the filing by a defendant for bankruptcy protection - thereby evading prosecution in state co during pendency of the automatic stay, a plaintiff must diligently prosecute the claims in whatever avenue i 24 available to it and not allow it to sit idle for years on the trial court's calendar simply because an automatic stay been imposed. In Barber, the Arizona Court of Appeals affirmed the dismissal of a plaintiffs state court action afte 25 it had been placed on the court's "Inactive Calendar" following the defendant's filing of a voluntary petition fo Chapter 11 bankruptcy. The trial court there had cautioned counsel that it would dismiss the matter unless plaint· 26 demonstrated that "(1) he had moved to lift the stay, (2) he sought to pursue his claims in the bankruptcy court, (3 he obtained severance of the claims against nelson from the claims against other parties or (4) there was a reasonabl 27 basis for continuance on the inactive calendar." Plaintiff failed to take any of the specified actions; therefore, th trial court dismissed for failure to prosecute, finding that there was no equitable tolling despite the automatic stay i 28 bankruptcy because plaintiff did not pursue any available remedy in the bankruptcy court. Similar circumstance existed in this lawsuit.
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