J&M Food Services, Inc. v. Camel Investment, L.L.C. ( 2019 )

FILED
NOT FOR PUBLICATION
MAY 24 2019
UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
In re: J&M FOOD SERVICES, INC., No. 18-60021
Debtor, BAP No. 17-1291
------------------------------
MEMORANDUM*
J&M FOOD SERVICES, INC.,
Appellant,
v.
CAMEL INVESTMENT, L.L.C.,
Appellee.
Appeal from the Ninth Circuit
Bankruptcy Appellate Panel
Kurtz, Lafferty III, and Brand, Bankruptcy Judges, Presiding
Argued and Submitted May 17, 2019
San Francisco, California
Before: IKUTA and CHRISTEN, Circuit Judges, and MORRIS,** District Judge.
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The Honorable Brian M. Morris, United States District Judge for the
District of Montana, sitting by designation.
J&M Food Services, Inc., appeals the Bankruptcy Appellate Panel’s order
affirming the bankruptcy court’s grant of Camel Investment, L.L.C.,’s motion to
lift the automatic stay with respect to J&M’s lease of commercial property from
Camel and denial of J&M’s motion to assume the lease nunc pro tunc. We have
jurisdiction under 28 U.S.C. § 158, and we affirm.
J&M did not file a written motion or make an oral motion to assume the
lease, and a debtor-in-possession cannot assume a lease absent such a motion. See
Sea Harvest Corp. v. Riviera Land Co., 868 F.2d 1077, 1079 (9th Cir. 1989); see
also 11 U.S.C. § 365(d)(4)(A); Fed. R. Bankr. P. 6006, 9013, 9014. J&M’s
statements before the bankruptcy court did not amount to an oral motion because
they did not “state with particularity the grounds” for the motion or “set forth the
relief or order sought.” Fed. R. Bankr. P. 9013. Therefore, J&M’s lease was
“deemed rejected” when the 120-day statutory deadline to assume or reject an
unexpired lease of nonresidential real property passed. 11 U.S.C. § 365(d)(4)(A).
Even assuming the equitable doctrines of waiver and estoppel can apply to
prevent the statutory rejection of a lease under § 365(d)(4)(A), see George v. City
of Morrow Bay (In re George), 177 F.3d 885, 889 (9th Cir. 1999), J&M did not
meet the conditions for those doctrines here. The bankruptcy court found that
Camel did not engage in any post-petition inequitable conduct in connection with
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its relationship with J&M. This finding was not clearly erroneous, and accordingly
the bankruptcy court did not err in declining to apply estoppel in this case. See id.
at 890. Further, Camel’s right to enforce rejection of the lease did not vest until the
lease was rejected, and Camel did not engage in any behavior that could support a
finding of waiver after the lease was rejected. See id. at 889. Because Camel did
not waive any “right, privilege, advantage or benefit,” the bankruptcy court did not
err in declining to apply waiver. See id. Accordingly, the bankruptcy court did not
err in granting Camel’s motion to lift the automatic stay and denying J&M’s
motion to assume the lease nunc pro tunc.
Finally, the bankruptcy court did not abuse its discretion in declining J&M’s
oral motion to compel additional discovery because the discovery would have had
no bearing on the outcome of J&M’s motion to assume. See Johnson v. Neilson
(In re Slatkin), 525 F.3d 805, 811 (9th Cir. 2008).
AFFIRMED.
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