U.S. Bank National Assn. v. Crawford

CourtSupreme Court of Connecticut
DecidedNovember 26, 2019
DocketSC19903
StatusPublished

This text of U.S. Bank National Assn. v. Crawford (U.S. Bank National Assn. v. Crawford) is published on Counsel Stack Legal Research, covering Supreme Court of Connecticut primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
U.S. Bank National Assn. v. Crawford, (Colo. 2019).

Opinion

*********************************************** The “officially released” date that appears near the be- ginning of each opinion is the date the opinion will be pub- lished in the Connecticut Law Journal or the date it was released as a slip opinion. The operative date for the be- ginning of all time periods for filing postopinion motions and petitions for certification is the “officially released” date appearing in the opinion.

All opinions are subject to modification and technical correction prior to official publication in the Connecticut Reports and Connecticut Appellate Reports. In the event of discrepancies between the advance release version of an opinion and the latest version appearing in the Connecticut Law Journal and subsequently in the Connecticut Reports or Connecticut Appellate Reports, the latest version is to be considered authoritative.

The syllabus and procedural history accompanying the opinion as it appears in the Connecticut Law Journal and bound volumes of official reports are copyrighted by the Secretary of the State, State of Connecticut, and may not be reproduced and distributed without the express written permission of the Commission on Official Legal Publica- tions, Judicial Branch, State of Connecticut. *********************************************** U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE v. JACQUELYN N. CRAWFORD ET AL. (SC 19903) Palmer, McDonald, Robinson, D’Auria, Mullins, Kahn and Ecker, Js.*

Syllabus

The plaintiff in error, E, who had been appointed by the trial court as the committee to conduct a foreclosure sale in the underlying foreclosure action brought by the defendant in error bank, U Co., against the defen- dant in error property owner, C, filed a writ of error, claiming, inter alia, that the trial court improperly denied his motion to recover fees and expenses from U Co. U Co. had sought to foreclose a mortgage on certain of C’s real property. The trial court rendered judgment of foreclosure by sale, and U Co. was the successful bidder. Before the sale could be completed, C filed a bankruptcy petition under chapter 13 of the United States Bankruptcy Code in the United States Bankruptcy Court, which automatically stayed the foreclosure proceedings pursuant to the automatic stay provision (11 U.S.C. § 362 [a] [2012]) of the code. Thereafter, pursuant to statute (§ 49-25), E filed a motion seeking to recover from U Co. the fees and expenses that he had incurred in preparing for the sale. The trial court denied E’s motion for fees and expenses on the ground that, pursuant to the Appellate Court’s decision in Equity One, Inc. v. Shivers (150 Conn. App. 745), the motion automati- cally was stayed by 11 U.S.C. § 362 (a) and the court was barred from acting on the motion during the duration of the stay. In connection with his writ of error, E claimed, inter alia, that this court should overrule Shivers because state courts lack jurisdiction to extend the automatic stay provision to motions for fees and expenses filed by committees for sale seeking expenses from nondebtor plaintiffs in foreclosure actions. Held: 1. This court could review E’s writ of error because, although the trial court’s order denying E’s motion for fees and expenses was an interlocutory order, it constituted an appealable final judgment under the second prong of the test for determining the appealability of interlocutory orders set forth in State v. Curcio (191 Conn. 27), as the denial of the motion so substantially resolved the rights of the parties that further proceedings could not affect them: E, who was not a party to the underlying foreclo- sure action, had an undisputed right to recover the fees and expenses that he had incurred in preparing for the sale immediately upon the filing of a proper and timely motion, that right was separate from and collateral to the rights being asserted in the foreclosure action, and there was no possibility that his claim could be raised on direct appeal from the trial court’s judgment in the foreclosure action without first being rendered moot; moreover, the claim E asserted in his writ of error, which already has arisen on numerous occasions in the courts of this state, involved a matter of public importance, as committees for sale, whice are appointed by and act as representatives of the court, may be reluctant to accept appointment if they are unable to promptly recover the fees and expenses they incur in that capacity, and allowing review of the trial court’s ruling in the present case would entirely dispose of the issue presented, would not open the floodgates to additional writs of error raising the same issue, and would avoid the bizarre result of allowing Shivers, which is inconsistent with the majority of federal bankruptcy decisions, to continue to bind this state’s trial courts. (Three justices dissenting in one opinion) 2. Although E’s writ of error was rendered moot because the automatic stay terminated when, during the pendency of the writ of error, C’s bankruptcy petition was dismissed, E’s claim was reviewable under the capable of repetition, yet evading review exception to the mootness doctrine; because of the limited duration of chapter 13 bankruptcy proceedings, which, on average in the federal bankruptcy court in Con- necticut, span approximately ten months, there existed a strong likeli- hood that the majority of cases challenging a denial of a motion for committee fees and expenses would be moot before appellate litigation could be completed, the issue presented by E’s writ of error, which already has arisen on numerous occasions in the courts of this state, was likely to recur, and resolution of that issue was of public importance. 3. This court having determined that a state court lacks subject matter jurisdiction to extend the automatic bankruptcy stay to proceedings against nondebtors, it overruled the Appellate Court’s decision in Shiv- ers, and, because the trial court relied exclusively on Shivers in denying E’s motion for fees and expenses, this court granted E’s writ of error and remanded the case to the trial court with direction to vacate the order denying E’s motion and to consider the motion on the merits; Connecticut and federal case law indicated that the stay provision set forth in 11 U.S.C. § 362 (a), which operates to benefit the debtor and bankruptcy trustee only, does not apply automatically to claims against nondebtors, and that, although state courts have jurisdiction to interpret the provisions of the bankruptcy code and orders of the bankruptcy court to determine whether, under their plain terms, the automatic stay provision applies in a state court proceeding, the bankruptcy court has exclusive jurisdiction to modify a stay by extending it to proceedings to which it does not automatically apply or by barring it in proceedings to which it does automatically apply, and, therefore, a state court lacks jurisdiction to extend the automatic stay provision to the motion of a committee for sale to recover fees and expenses from a nondebtor. Submitted on briefs April 2, 2018—officially released November 26, 2019

Procedural History

Writ of error from the decision of the Superior Court in the judicial district of Hartford, Robaina, J., denying the motion to award interim foreclosure committee fees and expenses filed by the plaintiff in error. Writ of error granted; remanded with direction. C. Donald Neville and Gregory W. Piecuch filed a brief for the plaintiff in error (Douglas M. Evans). Robert A. White, Proloy K. Das, Sarah Gruber, Irve Goldman, Thomas J. Sansone and Charles A.

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U.S. Bank National Assn. v. Crawford, Counsel Stack Legal Research, https://law.counselstack.com/opinion/us-bank-national-assn-v-crawford-conn-2019.