Dial National Bank v. Albert Van Houweling ( 2001 )

United States Bankruptcy Appellate Panel
FOR THE EIGHTH CIRCUIT
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No.00-6085SI
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In re: *
*
Albert Van Houweling and *
Jenny Van Houweling, *
*
Debtors. *
*
Dial National Bank, *
*
Appellant, * Appeal from the United States
* Bankruptcy Court for the Southern
v. * District of Iowa
*
Albert Van Houweling and *
Jenny Van Houweling, *
*
Appellees. *
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Submitted: January 23, 2001
Filed: February 7, 2001
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Before KRESSEL, SCHERMER, and SCOTT, Bankruptcy Judges.
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KRESSEL, Bankruptcy Judge.
Dial National Bank appeals from the order of the bankruptcy court1 denying its motion to extend
the time to file a notice of appeal. Because the bankruptcy court did not abuse its discretion in denying
Dial’s motion, we affirm.
BACKGROUND2
The debtors, Albert and Jenny Van Houweling, filed a chapter 7 case on April 10, 2000. On May
24, 2000, they served a motion to redeem under 11 U.S.C. § 722, which allows chapter 7 individual
debtors to keep certain personal property free of a secured creditor’s lien by paying the secured creditor
in cash the value of the collateral.
The motion has not been made part of the record on appeal, but according to the debtors’ brief
and the bankruptcy court’s order, the notice stated that June 12, 2000, was the deadline to object to the
debtors’ motion.3 On June 16, 2000, four days after the deadline, Dial attempted to file a combined
objection to the debtors’ motion and its own motion for evaluation of collateral. The clerk did not file the
objection, but rather stamped it “received” and called it to the attention of the court. On June 19, 2000,
1
The Honorable Lee M. Jackwig, United States Bankruptcy Judge for the Southern District of
Iowa.
2
The record is scant. For example, Dial has included in its appendix copies of documents
which have never been filed. This is an unfortunate side-effect of the bankruptcy court’s decision to
return documents. Dial’s brief is filled with factual assertions which appear nowhere in the record. We
limit, as best we can, our recitation of the facts to those which are actually in the record.
3
While Dial states that perhaps it had an additional three days to file a response because of the
provisions of Rule 9006(f), we disagree. The additional time provided by that rule for responding when
service is made by mail, is only applicable when the response period is calculated from the date of
service. Here, the date to file a response was a date certain, not dependent upon when it was served,
and there is no additional time allowed by Rule 9006(f). See Fed. R. Bankr. P. 9006(f);
Constellation Development Corp. v. Dowden (In re McAdams), 999 F.2d 1221, 1225 (8th
Cir. 1993).
2
the next business day, the court entered an order directing the clerk to return Dial’s pleading because it did
not comply with the court’s local rules.
Also, on June 19, 2000, the court granted the debtors’ motion to redeem. The order was entered
the same day. The last date to timely appeal the June 19th order was June 29, 2000. Dial did not appeal,
but on July 10, 2000, it filed a motion asking the court to extend the time for it to file a notice of appeal.
The debtors objected and the bankruptcy court denied the motion in an order dated and entered on July
18, 2000. It is from that order that Dial now appeals. Dial’s brief opens with the sentence, “[T]his appeal
is from an Order of the United States Bankruptcy Court for the Southern District of Iowa granting the
Debtors’ Motion to Redeem certain collateral in which Appellant held a security interest.” This statement
is incorrect. Dial has never filed a notice of appeal from that order and we lack jurisdiction to review that
order. We limit our review to the order appealed from, i.e., the order denying the motion to extend the
time for it to appeal.
DISCUSSION
Orders denying motions to extend the time to file a notice of appeal are reviewed for abuse of
discretion. See Ceridian Corp. v. SCSC Corp., 212 F.3d 398, 401 (8th Cir. 2000); Lowry v.
McDonnell Douglas Corp., 211 F.3d 457, 460, 462, 464 (8th Cir. 2000), cert. denied,
___U.S.___, 121 S. Ct. 309 (2000); Gretchen’s of Minneapolis, Inc. v. Highland House, Inc.
(In re Interco, Inc.), 186 F.3d 1032, 1034 (8th Cir. 1999); Nugent v. Betacom of Phoenix, Inc.
(In re Betacom of Phoenix, Inc.), 250 B.R. 376, 379 (B.A.P. 9th Cir. 2000). An abuse of discretion
occurs if the bankruptcy court relies upon erroneous legal conclusions or clearly erroneous factual findings.
Amtech Lighting Srvs. v. Payless Cashways (In re Payless Cashways, Inc.), 230 B.R. 120, 138
(B.A.P. 8th Cir. 1999), aff’d, 203 F.3d 1081 (8th Cir. 2000).
Under Federal Rule of Bankruptcy Procedure 8002(a), the normal period for filing a notice of
appeal is ten days. Fed. R. Bankr. P. 8002(a). Dial did not file a timely notice of appeal. The time to
appeal can be extended under Rule 8002(c)(2), which provides that a motion for an extension of time must
be filed within the same ten day period. Dial also did not make such a motion. Rather, it relies on that part
of Rule 8002(c)(2) which allows the bankruptcy court to extend the notice of appeal period based on a
showing of excusable neglect. See Fed. R. Bankr. P. 8002(c)(2) (providing that “a motion filed not later
3
than 20 days after the expiration of the time for filing a notice of appeal may be granted upon a showing
of excusable neglect”).
The question in this appeal is whether or not the bankruptcy court’s finding that Dial did not
demonstrate excusable neglect for its failure to timely file a notice of appeal was clearly erroneous.
Excusable neglect is a phrase that is not defined, but appears in a number of places in the Federal Rules,
most notably, in Federal Rule of Civil Procedure 60(b)(1), which is incorporated into bankruptcy cases
by Federal Rule of Bankruptcy Procedure 9024. It also appears in Federal Rule of Appellate Procedure
4(a)(5)(A), which allows the district court to extend the time to file a notice of appeal upon a showing of
excusable neglect if the motion is made within 30 days of the expiration of the of the appeal period.
“Excusable neglect” also appears in Federal Rule of Bankruptcy Procedure 9006(b)(1), regarding
enlargement of time, which provides generally that certain time periods can be extended when motions and
extensions are made after the expiration of the time period, but only upon a showing of excusable neglect.
See Fed. R. Bankr. P. 9006(b)(1).
In 1993, the United States Supreme Court interpreted the phrase “excusable neglect” as it was
used in Rule 9006(b)(1). See Pioneer Inv. Srvs. Co. v. Brunswick Assocs., 507 U.S. 380 (1993).
We are confident that the phrase and its interpretation is the same throughout the Rules, including its use
in Rule 8002(c)(2). See Ceridian, 212 F.3d at 402-405 (applying Pioneer’s interpretation of
excusable neglect to Fed. R. Civ. P. 60(b)); Lowry, 211 F.3d at 462-64 (applying Pioneer’s excusable
neglect factors to Fed. R. App. P. 4(a)(5)); Hartford Cas. Ins. Co. v. Food Barn Stores, Inc. (In
re Food Barn Stores, Inc.), 214 B.R. 197, 199-201 (B.A.P. 8th Cir. 1997) (wherein we previously
applied Pioneer’s excusable neglect interpretation to the rule in question, Fed. R. Bankr. P. 8002(c)).
In Pioneer, the Supreme Court said that the determination of what sorts of neglect will be considered
excusable is an equitable determination, taking account of all relevant circumstances including:
1. danger of prejudice to the debtor,
2. the length of the delay and its potential impact on judicial
proceedings,
3. the reason for the delay, including whether it was within
the reasonable control of the movant, and
4. whether the movant acted in good faith.
4
Pioneer, 507 U.S. at 395. The Court of Appeals for the Eighth Circuit has held that these four factors
are not equal in weight: “the excuse given for the late filing must have the greatest import.” Lowry, 211
F.3d at 463; see also Ivy v. Kimbrough, 115 F.3d 550, 552 (8th Cir. 1997 (stating that “[e]xcusable
neglect means ‘good faith and some reasonable basis for noncompliance with the rules’”) (quoting Adams
v. AlliedSignal Gen. Aviation Avionics, 74 F.3d 882, 887 (8th Cir. 1996)).
With this standard in mind, we examine Dial’s reasons for not filing a timely notice of appeal. In
its motion, Dial attacks the actions of the bankruptcy court. It attacks the clerk for not filing Dial’s
objection, arguing that this was a violation of Federal Rule of Civil Procedure 5(e). While that rule applies
in adversary proceedings as a result of Bankruptcy Rule 7005, it does not otherwise apply in bankruptcy
cases. Contrary to Dial’s unsupported assertions, this matter was not an adversary proceeding under the
Bankruptcy Rules. See Fed. R. Bankr. P. 7001. However, Fed. R. Bankr. P. 5001(a) contains language
similar to that relied upon by Dial. Dial’s assertion that the clerk refused to file its papers is mistaken
because it was the court that reviewed the pleading and ordered that it not be filed and instead be returned.
Dial goes on to argue that its response was timely; a rather incredible assertion in light of the fact that it was
four days late.4 While the assertion is both factually and legally incorrect, again the argument misses the
point. The issue is not whether the bankruptcy court was correct or incorrect in its decision to approve
the redemption, or even in its decision to return Dial’s pleadings. The issue is whether or not Dial was guilty
of excusable neglect when it missed the appeal period.
4
Dial argues strenuously that its objection to the debtors’ redemption motion was timely
pursuant to certain inapplicable Federal Rules of Civil and Bankruptcy Procedure. Indeed, Dial
intimates that it was free to ignore the explicit bar date provided in the notice because, according to
Dial, the general time lines provided in the Federal Rules of Civil Procedure are superior to local rules
and bar dates set by bankruptcy courts. Even if this were true, this does not demonstrate that any
excusable neglect exists in Dial’s failure to file a timely notice of appeal from the order granting the
debtors’ redemption motion. Even if Dial’s misapplication of inapplicable Federal Rules could
somehow be accredited with its failure to timely appeal, Dial has still failed to demonstrate excusable
neglect. See Pioneer, 507 U.S. at 392 (stating that “inadvertence, ignorance of the rules, or mistakes
construing the rules do not usually constitute ‘excusable neglect’”); Ceridian, 212 F.3d at 403-404(noting that mistakes of law do not constitute excusable neglect); Food Barn, 214 B.R. at 200-201(maintaining that mistakes caused by the ignorance or misapplication of the law, such as unfamiliarity
with bankruptcy, are not excusable neglect).
5
In its motion for an extension of time, Dial makes no factual allegations or any attempt to explain
why it missed the deadline to appeal.5 Obviously, it is incumbent upon Dial, in making its motion, to make
a factual showing of excusable neglect. See Food Barn, 214 B.R. at 200 (noting that the burden of
demonstrating to the bankruptcy court that excusable neglect exists is on the movant). Instead, Dial offers
no explanation of what its neglect was, much less why it was excusable. The only factual allegation
remotely connected to this issue is its allegation that it did not receive the court’s order (incorrectly referred
to by Dial in its motion as a notice from the clerk) returning its objection and motion.6 Like the bankruptcy
court, we fail to see why the failure to receive this order constitutes excusable neglect for failing to appeal
the order granting the debtors’ motion for redemption. Dial makes no assertion, and certainly presented
the bankruptcy court with no evidence, that it failed to receive the order granting the debtors’ redemption
motion. Dial made no showing of neglect, excusable or otherwise. Dial’s failure to timely file a notice of
appeal is simply inexplicable.
CONCLUSION
Since Dial failed to provide any evidence to support its claim of excusable neglect, the bankruptcy
court did not abuse its discretion in refusing to extend the appeal period. Therefore, we affirm the
bankruptcy court’s order denying Dial’s motion to extend the time to file a notice of appeal.
A true copy.
Attest:
CLERK, U.S. BANKRUPTCY APPELLATE
PANEL, EIGHTH CIRCUIT.
5
Dial provided no evidence to support any of its factual obligations, but, for the purposes of
this appeal, we assume the allegations to be true.
6
Other factual assertions were made in Dial’s brief and at oral argument. None of these “facts”
were presented to the bankruptcy court, so we do not consider them.
6