Stutsman Construction, LLC v. Adair

CourtDistrict Court, M.D. Louisiana
DecidedSeptember 28, 2023
Docket3:22-cv-00664
StatusUnknown

This text of Stutsman Construction, LLC v. Adair (Stutsman Construction, LLC v. Adair) is published on Counsel Stack Legal Research, covering District Court, M.D. Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Stutsman Construction, LLC v. Adair, (M.D. La. 2023).

Opinion

UNITED STATES DISTRICT COURT

MIDDLE DISTRICT OF LOUISIANA

STUTSMAN CONSTRUCTION, LLC APPEAL CIVIL ACTION

VERSUS

ROSS ADAIR, ET AL 22-664-SDD-RLB

OPINION This matter is before the Court on the appeal filed by Stutsman Construction, LLC (“Stutsman”). Appellant-Creditor Stutsman appealed the Bankruptcy Court’s order denying Stutsman’s request for an extension of the deadline to file proof of a claim in the underlying Chapter 13 bankruptcy proceeding, No. 22-10249, in the Middle District of Louisiana. For the reasons set forth below, the ruling and order of the Bankruptcy Court denying Stutsman’s Motion for Enlargement and Extension of Time to File Proof of Claim is AFFIRMED. I. Factual and Procedural History On May 24, 2022, Debtor-Ross Shaun Adair (“Adair”) filed for protection from his creditors under Chapter 13 of the Bankruptcy Code. Pursuant to Federal Bankruptcy Procedure Rule 2002(a), notice of the case and corresponding deadlines was issued by the clerk and mailed to all parties on June 11, 2022.1 The Section 341 creditors meeting

1 Rec. Doc. No. 3-1, pp. 12–13. was set for July 18, 2022 and the deadline for creditors to file proofs of claim was set for August 2, 2022.2 Due to a calendaring error by Adair’s counsel, neither Adair nor Adair’s counsel appeared for the July 18, 2022 creditors meeting. The bankruptcy trustee requested dismissal of the case, pursuant to Local Rule 2003-1.3 Assuming dismissal would be

granted, Stutsman’s counsel cleared the remaining deadlines from his calendar and did not file a proof of claim by the August 2nd deadline.4 Adair filed a Motion to Reschedule the creditors meeting on July 20, 2022.5 The trustee objected to rescheduling the creditors meeting, in part because she had not yet received required documentation from Adair. The Bankruptcy Court set Adair’s Motion to Reschedule the Creditor’s Meeting for Hearing on August 17, 2022.6 By July 29, 2022, Adair submitted the requested documents to the trustee and filed them in the record, upon which the trustee reset the creditors meeting.7 By Notice issued on July 29, 2022, the trustee re-set the creditors meeting for August 8, 2022.8 The notice resetting the meeting was silent regarding the proof of claims

filing deadline. There is no dispute that all parties received notice of the resetting on July 29, 2022—four days before the proof of claims deadline.9

2 Id. 3 Rec. Doc. No. 3-1, p. 69; Bankr. M.D. La. R. 2003-1(d). 4 Rec. Doc. No. 3; p. 2; Rec. Doc. No. 3-1, p. 67; Rec. Doc. No. 6, p. 2. 5 Rec. Doc. No. 3-1, p. 59; Rec. Doc. No. 6, p. 6. 6 Rec. Doc. No. 3-1, p. 63. 7 Rec. Doc. No. 3-1, p. 64. It is unclear, from the record and the briefs provided by Appellant, whether the trustee rescheduled the creditors meeting on July 18, 2022, or July 29, 2022, but it is not disputed that the trustee’s Amended Section 341 Meeting Proceeding Memorandum resetting the meeting was issued to all parties by July 29, 2022. The disparity is of no consequence to this appeal. Compare Rec. Doc. No. 3-1, p.64, and Rec. Doc. No. 3-1, p. 107, with Rec. Doc. No. 3, p. 8. 8 Rec. Doc. No. 3-1, p. 64. 9 See Rec. Doc. No. 6, p. 2. Stutsman, Adair, and counsel appeared at the August 8th creditors meeting. The next day, on August 9th, Stutsman filed an out-of-time motion to extend its deadline to file proof of its claim.10 Stutsman argued it was “surprised when a few days before the deadline for filing [a proof of claim], an amending [sic] [Rule] 341(a) meeting was filed and [Stutsman] received that notice instead of receiving a dismissal of the case.”11 Stutsman’s

counsel explained that he did not file a proof of claim by the August 2nd deadline because he believed the trustee’s previous request for dismissal would be granted.12 Stutsman’s Motion to Extend was heard on September 14th. The court acknowledged that Stutsman was seeking an extension based on the trustee’s request for dismissal. Stutsman argued this constituted excusable neglect and sought an extension pursuant to the Supreme Court’s holding in Pioneer Investment Services v. Brunswick Associates Limited Partnership.13 After hearing arguments of Stutsman, Adair, and the trustee, the court denied Stutsman’s Motion to Extend because neither of the conditions of Bankruptcy Rule 3002(c)(6)(A) or (B) were applicable to Stutsman’s request:

Stutsman does not argue under Rule 3002(c)(6)(A) that the debtor failed to timely file a list of creditors' names and addresses required by Bankruptcy Rule 1007(a). In fact, the debtor had filed the required list. Nor does Stutsman contend that Rule 3002(c)(6)(B) applies in that the notice was sufficient and was not mailed to a foreign address.

So neither of the conditions in 3002(c)(6) are applicable. Thus, Stutsman has not met the requirement under Bankruptcy Rule 3002(6), 3002(c)(6) for extension of the proof of claim deadline. Stutsman argues, understandably, that the interests of justice support allowing it to file an untimely proof of claim, but cites no law for that proposition. That's Paragraph 4 of its motion, although in counsel's

10 Rec. Doc. No. 3-1, pp. 67–68. 11 Rec. Doc. No. 3-1, p. 67. 12 Id. 13 507 U.S. 380 (1993). argument today he cites Pioneer. But the Federal Rules of Bankruptcy Procedure is straightforward on these undisputed facts.14

Stutsman appeals this denial of its Motion to Extend. In this appeal, Stutsman challenges not only the Bankruptcy Court’s denial of its Motion to Extend but also the Bankruptcy Court’s setting of Adair’s Motion to Reschedule the creditor’s meeting for hearing.15 Stutsman also challenges the bankruptcy judge’s failure to automatically dismiss the case upon the trustee’s recommendation after Adair missed the initial creditors meeting. Stutsman argues that it was denied due process when the Bankruptcy Court allowed the rescheduling of the Section 341(a) creditors meeting and allowed the rescheduling to take place before the case could be dismissed on the trustee’s recommendation.16 Stutsman also contends that its failure to meet the deadline to file its proof of claim was due to excusable neglect, and the Bankruptcy Court should have applied the Pioneer factors and granted its Motion to Extend.17 In its Reply, Stutsman clarifies that it is not challenging the Bankruptcy Court’s authority to deny its Motion to Extend but “rather the Bankruptcy Judge’s arbitrary and capricious ruling in allowing the Debtor to avoid dismissal of the case…. [t]he Bankruptcy Judge abused his discretion by setting the ex-parte motion [to reschedule the creditors meeting] for hearing.”18

14 Rec. Doc. No. 6, p. 8. 15 Notice of Appeal, Rec. Doc. No. 3-1, pp. 112–113; Rec. Doc. No. 3, p. 6. 16 Rec. Doc. No. 3. 17 Rec. Doc. No. 3. 18 Rec. Doc. No. 9. II. Law & Analysis A. Standard of Review Stutsman does not articulate a standard of review on any issue he raises.19 In fact, Stutsman’s briefs and Adair’s brief are devoid of the applicable standards of review, in derogation of Federal Rules of Appellate Procedure Rule 28(a)(8)(B) and (b).20

Legal conclusions by bankruptcy courts are reviewed de novo, as are mixed questions of law and fact.21 And “[d]ecisions concerning interpretations of the federal rules of bankruptcy procedure are reviewed de novo.”22 The Court will address the standard of review that is applicable to each issue, in turn. B.

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