Case: 19-13771 Date Filed: 07/07/2020 Page: 1 of 13
[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 19-13771
Non-Argument Calendar
________________________
D.C. Docket Nos. 8:19-cv-01472-WFJ; 8:17-bkc-08959-RCT
In re:
SARAH KATHERINE SUSSMAN,
Debtor.
________________________________________________________________
SARAH KATHERINE SUSSMAN,
Plaintiff - Appellant,
versus
ESTATE OF JOHN J. GAFFNEY,
Defendant - Appellee.
________________________
Appeal from the United States District Court
for the Middle District of Florida
________________________
(July 7, 2020)
Case: 19-13771 Date Filed: 07/07/2020 Page: 2 of 13
Before MARTIN, ROSENBAUM, and JULIE CARNES, Circuit Judges.
PER CURIAM:
Sarah Katherine Sussman, a debtor proceeding pro se, filed for bankruptcy
to obtain a stay of eviction from property formerly owned by her grandfather, John
J. Gaffney, on Clark Avenue in Tampa, Florida (“the Property”). The bankruptcy
court granted the Estate of John J. Gaffney (“the Estate”) relief from the automatic
stay, holding that the Property was not part of Debtor’s bankruptcy estate because
a state court declared the deed conveying the Property to Debtor void before
Debtor filed her bankruptcy petition. The bankruptcy court also sanctioned Debtor
for intentionally destroying a laptop containing electronically stored information
relevant to determining whether Debtor complied with the statutory requirement to
take a credit counseling course, applying a rebuttable presumption that Debtor did
not take the required course on that laptop. The bankruptcy court deemed Debtor’s
testimony countering that presumption not credible and dismissed the remainder of
Debtor’s bankruptcy case for failure to comply with the course requirement. The
district court affirmed the bankruptcy court on appeal. After careful review, we
too, affirm the bankruptcy court.
I. BACKGROUND
This appeal of the bankruptcy court’s decision is one of many battles
between Debtor and Phillip A. Baumann, the Administrator Ad Litem of the
2
Case: 19-13771 Date Filed: 07/07/2020 Page: 3 of 13
Estate, over claims to the Property. Before John J. Gaffney, the original owner of
the Property, passed away in December 2011, the property was conveyed to
Debtor’s mother, Teresa M. Gaffney, subject to a life estate retained by Mr.
Gaffney. After Mr. Gaffney passed, Teresa Gaffney conveyed the Property to
Debtor as trustee of The Sussman Family Trust Living Trust.
A. The State Court Action Divesting Debtor of the Property
Operating under a state probate court order, the Estate Administrator
commenced a state court action to recover the Property from Debtor by voiding the
deeds that purported to convey title to Teresa Gaffney and Debtor as trustee. The
state court entered defaults against Teresa Gaffney and Debtor following an order
that struck their answer and affirmative defenses as a sanction for their refusal to
cooperate in discovery and to abide by directives of the court. The state court
entered Final Judgment Upon Default on October 16, 2017, ordering that title to
the Property be vested in and held by the Administrator of the Estate. The state
court also directed the state court clerk to issue a writ of possession commanding
the sheriff’s office to place the Administrator in possession of the property.
B. Debtor’s Bankruptcy Petition
After service of the writ of possession, Debtor filed this bankruptcy case on
October 24, 2017, triggering an automatic stay precluding creditors from collecting
debts from Debtor. In-house counsel for the sheriff’s office determined that the
3
Case: 19-13771 Date Filed: 07/07/2020 Page: 4 of 13
automatic stay did not apply to the Property because it was not part of the
bankruptcy estate by virtue of the state court order. Accordingly, the sheriff’s
office executed the writ of possession on October 25, 2017. A flurry of motions in
the bankruptcy case followed.
Debtor filed an emergency motion to enforce the automatic stay and
requested damages, fees, and costs, arguing that execution of the writ of possession
dispossessed her of her homestead and violated the automatic stay. The Estate
filed an emergency motion for relief from the stay, a motion to dismiss for
Debtor’s failure to comply with the requirement of 11 U.S.C. § 109(h)(1) and for
fraud on the court, and objections to Debtor’s claim of exemptions. Following a
trial on these contested matters, the bankruptcy court issued the order now on
appeal.
The bankruptcy court denied Debtor’s motion to enforce the automatic stay.
It determined that the Property was not property of the bankruptcy estate subject to
the automatic stay because Debtor’s claim to the Property arose from a deed that
was declared void by the state court before her bankruptcy petition was filed. The
bankruptcy court further found that even if Debtor had homestead status under Art.
X § 4 of the Florida Constitution before entry of the state court judgment, that
status did not provide additional rights or interests in the Property that might be
protectable by the automatic stay. The bankruptcy court declined to consider
4
Case: 19-13771 Date Filed: 07/07/2020 Page: 5 of 13
Debtor’s attacks on the state court judgment because early in the case, and with the
parties’ agreement, it had modified the automatic stay to allow Debtor’s appeal of
the judgment to proceed to conclusion in state court. The bankruptcy court further
determined that Debtor had been provided ample opportunity to retrieve her
personal property and that there had been no willful violation of the stay that
would support a claim for damages.
At the same time, the bankruptcy court granted the Administrator’s motion
for relief from the stay. It concluded that the sole purpose of Debtor’s bankruptcy
petition “was an attempt to relitigate issues that were or should have been litigated
in state court.” It further noted that both the state trial court and appellate court
had denied Debtor’s request for a stay of the judgment pending appeal.
The bankruptcy court also granted the Administrator’s motion to dismiss
Debtor’s case for her failure to complete prepetition credit counseling as required
by 11 U.S.C. § 109(h)(1). Although Debtor filed a certificate of completion of a
credit counseling course, the course provider’s records indicated that the IP address
from which the course was taken placed the connected computer in Tampa,
Florida, at a time when Debtor was clocked in at work in Washington, D.C.
Before trial, the court held a three-day evidentiary hearing relative to Debtor’s
failure to preserve electronically stored information stored on the laptop computer
on which Debtor claims to have taken the credit counseling course. The court
5
Case: 19-13771 Date Filed: 07/07/2020 Page: 6 of 13
ultimately concluded that Debtor, after being directed to preserve the laptop,
destroyed it with the intent to deprive the Administrator of access to the
information contained on the laptop. As a sanction for her misconduct, the court
ordered that it would presume that Debtor did not take the credit counseling course
on that laptop computer.
After trial, the bankruptcy court found that Debtor did not rebut that
presumption because the only evidence that she took the course before filing a
bankruptcy petition was her own testimony, which the court deemed not credible.
Accordingly, the bankruptcy court dismissed Debtor’s case for failure to comply
with 11 U.S.C. § 109(h)(1).
On appeal, the district court affirmed the bankruptcy court’s holding that the
Property was not part of the bankruptcy estate, and therefore not subject to the
automatic stay, noting that the Florida Second District Court of Appeal had since
affirmed the state court judgment rendering the matter as to property title final and
not subject to further review. The district court also affirmed the sanction for
spoliation of electronic evidence stored on Debtor’s laptop computer, especially in
view of the “very few potential remedies or benefits available to [Debtor] via
continuing in bankruptcy.”
6
Case: 19-13771 Date Filed: 07/07/2020 Page: 7 of 13
II. DISCUSSION
We discern from Debtor’s scattershot appeal, two issues sufficiently
developed for appellate review.1 First, Debtor asserts that the bankruptcy court
erred in relying on the state court judgment to lift the automatic stay and deny her
homestead claim. Second, Debtor maintains that the bankruptcy court erred in
finding she intentionally destroyed relevant evidence and imposing an evidentiary
sanction that precipitated dismissal of her case.
“As the second court to review the bankruptcy court’s judgment, we
examine the bankruptcy court’s order independently of the district court.”
Westgate Vacation Villas, Ltd. v. Tabas (In re Int’l Pharmacy & Disc. II, Inc.),
443
F.3d 767, 770 (11th Cir. 2005). “Specifically, we review determinations of law
made by either the district or bankruptcy court de novo, while reviewing the
bankruptcy court’s findings of fact for clear error.”
Id. “[F]indings of fact are not
1
Debtor waived arguments not raised below or raised in a cursory fashion without citation to
authority in her opening brief. Tannenbaum v. United States,
148 F.3d 1262, 1263 (11th Cir.
1998) (“[I]ssues not raised below are normally deemed waived.”); Sapuppo v. Allstate Floridian
Ins. Co.,
739 F.3d 678, 681 (11th Cir. 2014) (“[A]n appellant abandons a claim when he either
makes only passing references to it or raises it in a perfunctory manner without supporting
arguments and authority.”). For instance, Debtor asserts the bankruptcy court abused its
discretion by failing to grant Debtor’s Motion to Disqualify. But Debtor did not state in her
Amended Notice of Appeal that she was appealing any order denying a motion to disqualify.
We typically lack jurisdiction to consider an appeal of an order not specifically mentioned in the
appellant’s Notice of Appeal. Seminole Tribe of Fla. v. Stranburg,
799 F.3d 1324, 1343 (11th
Cir. 2015). Even if we have jurisdiction to consider the issue, Debtor’s cursory allegations of
bias, unsupported by record cites and case authority, are insufficient to preserve the issue for
appeal. In any event, after reviewing the record, we harbor no doubt regarding the bankruptcy
judge’s impartiality.
7
Case: 19-13771 Date Filed: 07/07/2020 Page: 8 of 13
clearly erroneous unless, in light of all the evidence, we are left with the definite
and firm conviction that a mistake has been made.”
Id. “Neither the district court
nor this Court is authorized to make independent factual findings; that is the
function of the bankruptcy court.” In re Sublett,
895 F.2d 1381, 1384 (11th Cir.
1990).
A. The Bankruptcy Court Did Not Err in Relying on the State Court
Judgment Divesting Debtor of the Property
We agree with both lower courts in this action that the automatic stay did not
apply to the Property because the state court divested Debtor of any interest in the
Property before Debtor filed her bankruptcy petition. Once an individual files a
bankruptcy petition, all proceedings against the bankrupt estate are stayed during
the pendency of the bankruptcy proceedings. 11 U.S.C. § 362; Carver v. Carver,
954 F.2d 1573, 1576 (11th Cir. 1992). With limited exceptions not applicable
here, the bankrupt estate includes “all legal or equitable interests of the debtor in
property as of the commencement of the case.” 11 U.S.C. § 541(a) (emphasis
added). While the issue of whether a debtor’s interest constitutes property of the
estate is a federal question, “the nature and existence of the [debtor’s] right to
property is determined by looking at state law.” In re Kalter,
292 F.3d 1350, 1353
(11th Cir. 2002), quoting Southtrust Bank of Ala. v. Thomas (In re Thomas),
883
F.2d 991, 995 (11th Cir.1989).
8
Case: 19-13771 Date Filed: 07/07/2020 Page: 9 of 13
Here, it is undisputed that, as of the commencement of Debtor’s bankruptcy
case, the state court had voided the deeds transferring the Property to Debtor and
awarded the Property to the Estate of John Gaffney. Accordingly, the Property
was not part of Debtor’s bankruptcy estate at the commencement of her case and,
consequently, was not subject to the automatic stay.
Although the Florida Second District Court of Appeal affirmed the state
court judgment 2 before Debtor filed her opening brief, Debtor contends the
bankruptcy court should have declared the state court judgment void for a variety
of reasons, including that it violated her homestead rights under the Florida
Constitution, the Administrator lacked standing, improper ex parte
communications between the state court and the Administrator, and alleged “sexual
harassment” by the state court. Those arguments could and should have been
raised in the state court proceedings and appeal. The bankruptcy court exercised
appropriate discretion in deferring to the ongoing state court matter, especially
when the parties agreed to modify the automatic stay to allow Debtor’s appeal of
the judgment to proceed to conclusion in state court. See
Carver, 954 F.2d at 1580
(finding bankruptcy court should have abstained under 28 U.S.C. § 1334(c)(1)3
2
Gaffney v. Baumann,
272 So. 3d 1264 (Fla. Dist. Ct. App. 2019), case dismissed, No. SC19-
893,
2019 WL 2307362 (Fla. May 31, 2019), and review dismissed, No. SC19-899,
2019 WL
2315040 (Fla. May 31, 2019).
3
28 U.S.C. § 1334(c)(1) provides: “Nothing in this section prevents a district court in the
interest of justice, or in the interest of comity with State courts or respect for State law, from
9
Case: 19-13771 Date Filed: 07/07/2020 Page: 10 of 13
from ruling on state family law involving domestic obligations). In any event,
Debtor cites no trial evidence supporting her various contentions regarding the
propriety of the state court judgment. For these reasons, we affirm the bankruptcy
court’s denial of Debtor’s emergency motion to enforce the automatic stay.
B. The Bankruptcy Court Did Not Clearly Err in Finding that
Debtor Intentionally Destroyed Relevant Evidence
An individual may not be a debtor in bankruptcy court unless that individual
has received credit counseling from a nonprofit budget and credit counseling
agency. 11 U.S.C. § 109(h)(1). Although Debtor produced a certificate of course
completion, the parties disputed whether Debtor actually took the credit counseling
course, as opposed to her mother, the salient facts being that Debtor’s mother
hastily filed the bankruptcy petition and records indicated the course was taken on
a computer in Tampa, Florida, when Debtor was working in Washington, D.C.
Debtor does not dispute the Estate was denied access to the laptop she allegedly
used to take an online credit counseling course. After a three-day hearing on
Debtor’s motion for spoliation sanctions, the bankruptcy court found that “in
failing to preserve the laptop in question [Debtor] acted with the intent to deprive
the Estate of its use in the litigation between the parties” and, as a sanction,
abstaining from hearing a particular proceeding arising under title 11 or arising in or related to a
case under title 11.”
10
Case: 19-13771 Date Filed: 07/07/2020 Page: 11 of 13
presumed that “[Debtor] did not take the required prepetition credit counseling
course on the laptop computer that now is destroyed.”
Although Debtor admits the laptop was destroyed, she maintains that the
record does not support a sanction for spoliation because the Administrator failed
to show she destroyed her laptop hard drive in bad faith with intent to obfuscate
evidence. Without citation to record evidence, Debtor argues that only she could
have accessed the course and that she did so by linking through a VPN that
identified the computer location as Tampa, Fl, even though she was in Washington,
D.C.
As an initial matter, our review of the bankruptcy court’s decision is
hampered by Debtor’s failure to designate and provide the full evidentiary hearing
transcript, much less specifically cite the portions of that record supporting her
factual assertions. That alone provides grounds for affirmance. Fed. R. Bankr. P.
8009(b)(1); Fed. R. App. P. 6(b)(2)(B); Loren v. Sasser,
309 F.3d 1296, 1304 (11th
Cir. 2002) (“[P]ro se appellants, like appellants represented by counsel, must
provide trial transcripts in the appellate record to enable this court to review
challenges to sufficiency of the evidence.”).
As to the merits, Debtor cites documents allegedly supporting her assertion
that she alone took the credit counseling course. Some of that evidence does not
appear to have been presented to the bankruptcy court and is not properly
11
Case: 19-13771 Date Filed: 07/07/2020 Page: 12 of 13
considered on appeal. In any event, the potential existence of countervailing
evidence supporting Debtor’s position has no bearing on the relevance of the
information contained on Debtor’s laptop or Debtor’s culpability in destroying the
laptop. Debtor’s actions deprived the Estate of the single best source of evidence
to prove Debtor’s noncompliance with 11 U.S.C. § 109(h)(1).
Further, the record before us does not render the bankruptcy court’s
determination that Debtor acted in bad faith clearly erroneous. The record reflects
that Debtor was informed on multiple occasions of the need to preserve the
electronic information on the laptop and that Debtor failed to take reasonable steps
to preserve the information. Moreover, as the bankruptcy court found, Debtor’s
story regarding the laptop, “change[d] as necessary and convenient to suit her
needs.” Debtor waffled between claiming (1) she took the exam on her Mom’s
laptop which later “died,” (2) she ripped out the computer’s hard drive and tossed
it in the trash shortly after taking the course, and (3) that it was stolen. The
bankruptcy court further deemed Debtor’s testimony and demeanor regarding the
fate of the laptop “not at all credible.” Debtor fails to address these findings, and
we see nothing in the record even suggesting that the bankruptcy court clearly
erred in finding that Debtor intentionally destroyed the laptop to deprive the
Administrator of evidence.
12
Case: 19-13771 Date Filed: 07/07/2020 Page: 13 of 13
Under the circumstances, the bankruptcy court acted well within its
discretion when it imposed, as a reasonable and measured sanction for Debtor’s
misconduct, a rebuttable presumption that Debtor did not take the credit counseling
course on that laptop computer. See Flury v. Daimler Chrysler Corp.,
427 F.3d
939, 943 (11th Cir. 2005) (spoliation sanctions reviewed for abuse of discretion).
That Debtor’s failure to rebut that presumption ultimately led to dismissal of her
case does not render the bankruptcy court’s decision to impose that sanction an
abuse of discretion. See
Flury, 427 F.3d at 943 (Plaintiff’s spoliation of critical
evidence that deprives opposing party of an opportunity to put on a complete
defense warrants dismissal sanction).
III. CONCLUSION
For the reasons explained above, we AFFIRM the decision of the district
court.
13
