Alper v. Eighth Jud. Dist. Ct. , 2015 NV 43 ( 2015 )

131 Nev., Advance Opinion 45
IN THE SUPREME COURT OF THE STATE OF NEVADA
ELIOT A. ALPER, TRUSTEE OF THE No. 64260
ELIOT A. ALPER REVOCABLE TRUST;
SPACEFINDERS REALTY, INC.; AND
THE ALPER LIMITED PARTNERSHIP,
Petitioners,
FILED
vs. JUN 2 5 2015
THE EIGHTH JUDICIAL DISTRICT
COURT OF THE STATE OF NEVADA, RI.
IN AND FOR THE COUNTY OF
CLARK; AND THE HONORABLE
CHARLES M. MCGEE, DISTRICT
JUDGE,
Respondents,
and
WILLIAM W. PLISE,
Real Party in Interest.
Original petition for a writ of prohibition or mandamus
challenging a district court order imposing contempt sanctions.
Petition granted.
Edward J. Hanigan, Henderson,
for Petitioners.
Cremen Law Offices and Frank J. Cremen, Las Vegas,
for Real Party in Interest.
BEFORE THE COURT EN BANC.
OPINION
By the Court, HARDESTY, C.J.:
A bankruptcy court entered an order lifting the automatic stay
to permit the district court to determine whether a judgment debtor's prior
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refusals to participate in debtor's examinations in the district court were
subject to criminal contempt. The automatic stay provisions of the
Bankruptcy Code do not stay "the commencement or continuation of a
criminal action or proceeding against the debtor." 11 U.S.C. § 362(b)(1)
(2012). In this writ proceeding, we must determine whether the
subsequent district court order finding the judgment debtor in contempt
but allowing him to avoid incarceration by participating in a debtor's
examination exceeded the scope of the bankruptcy court's lift stay order.
We conclude that it did because a contempt order that permits a judgment
debtor to purge incarceration is civil in nature. We, therefore, grant the
writ of prohibition.
FACTS AND PROCEDURAL HISTORY
In August 2010, the district court entered judgment in excess
of $16,000,000 against real party in interest William Plise and in favor of
petitioner Eliot Alper.' Thereafter, Alper obtained an order for
examination of Plise's assets and liabilities to satisfy the judgment.
Plise did not attend the first scheduled debtor's examination,
and Alper moved for an order to show cause why Elise should not be held
in contempt of court. The district court ordered Plise to appear, produce
documents, and fully comply with the order or he would be held in
contempt of court.
Plise appeared at the next scheduled exam, but asserted a
Fifth Amendment privilege in response to every question except his name
Alper filed a status report indicating Plise did not produce the documents
'Petitioners in this action are Eliot A. Alper, Trustee of the Eliot A.
Alper Revocable Trust; Spacefinders Realty, Inc.; and the Alper Limited
Partnership. We refer to the petitioners collectively as Alper.
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the court previously ordered him to produce, nor did he answer questions
during the exam. At a subsequent status hearing, the district court
ordered Plise to answer Alper's questions. Alper scheduled a new debtor's
examination, and Plise requested several continuances, but ultimately
Plise did not appear. Fifteen days later, Alper sought an order to show
cause why Plise should not be held in contempt of court. But, two days
before the hearing on that motion, Plise filed a bankruptcy petition.
Alper participated in the bankruptcy proceeding, and as a
result, obtained an order from the bankruptcy court granting relief from
the automatic stay and allowing the district court to "conduct a hearing
and enter an order with regard to the alleged criminal contempt" of Plise.
Alper again moved in district court for an order to show cause as to why
Plise should not be held in contempt for his failure to appear at the
debtor's examination. Plise opposed any order for contempt, arguing that,
based on its punishment, contempt is a misdemeanor and the statute of
limitations had run on any of Plise's alleged contemptuous conduct.
At the hearing, the district court found Plise guilty of
contempt of court and sentenced Plise to 21 days incarceration. However,
the district court also provided that Plise could purge his contempt and be
released from confinement if he fully participated in a judgment debtor
examination. In doing so, he could avoid serving the remainder of his
sentence.
Alper filed this petition arguing that the district court
exceeded the scope of the bankruptcy court's order granting relief from the
automatic stay, thereby violating 11 U.S.C. § 362(a) (2012), when it
conditionally allowed Plise to avoid criminal contempt punishment, thus
transforming the contempt proceeding from criminal to civil. Plise
responds by arguing that the statute of limitations had already run on any
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criminal contemptuous conduct. Plise also argues that Alper waived his
argument by not objecting during the sentencing. 2
DISCUSSION
Writ relief is appropriate
Alper petitions this court for a writ of prohibition, arguing
that the district court exceeded the scope of the order lifting the automatic
stay when it allowed Plise the opportunity to purge the contempt order.'
A writ of prohibition is appropriate when "the proceedings of any tribunal,
corporation, board or person exercising judicial functions. . are without
or in excess of the jurisdiction of such tribunal, corporation, board or
person." NRS 34.320. While an appeal is typically an adequate legal
remedy precluding writ relief, see Pan v. Eighth Judicial Dist. Court, 120
Nev. 222, 223-24, 88 P.3d 840, 840-41 (2004), because "[n] o rule or statute
2 Since the July 24, 2013, contempt hearing was not recorded, there
is no transcript available for review. When no trial transcript exists,
NRAP 9(c) provides the appropriate procedure for generating an accurate
record of what took place. Absent a transcript or properly submitted
statement, this court cannot determine what occurred during the hearing
in this case, and we, therefore, do not consider Plise's waiver argument.
See Carson Ready Mix, Inc. v. First Nat'l Bank of Nev., 97 Nev. 474, 476,
635 P.2d 276, 277 (1981) (observing that this court does not consider
matters not properly appearing in the district court record on appeal).
'In the alternative, Alper petitions for a writ of mandamus
compelling the district court to vacate that portion of its contempt order
giving Plise the opportunity to purge. However, a writ of prohibition is a
more appropriate remedy because at issue is whether the district court
exceeded the scope of the bankruptcy court order lifting the stay. See Int?
Game Tech., Inc. v. Second Judicial Dist. Court, 124 Nev. 193, 197, 179
P.3d 556, 558 (2008) ("A writ of mandamus is available to compel the
performance of an act that the law requires as a duty resulting from an
office, trust, or station or to control an arbitrary or capricious exercise of
discretion." (footnote omitted)).
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authorizes an appeal from an order of contempt [,1 ... contempt orders
must be challenged by an original petition pursuant to NRS Chapter 34."
Pengilly v. Rancho Santa Fe Homeowners Ass'n, 116 Nev. 646, 649, 5 P.3d
569, 571 (2000).
The opportunity to purge in the contempt order converted the criminal
sanction to civil and thus exceeded the authority granted by the bankruptcy
court's lift stay order
Generally, an automatic stay under § 362 of the United States
Bankruptcy Code stays the initiation or continuation of all state actions
against the debtor that precede the filing of the bankruptcy petition. 11
U.S.C. § 362 (2012). However, § 362(b)(1) provides that the filing of a
petition in bankruptcy "does not operate as a stay. . . of the
commencement or continuation of a criminal action or proceeding against
the debtor." The Bankruptcy Code does not define "criminal action," but
several bankruptcy courts have held that criminal contempt, but not civil
contempt, is included as a criminal action and these proceedings are not
subject to the stay. 4 See, e.g., In re Maloney, 204 B.R. 671, 674 (Bankr.
E.D.N.Y. 1996).
Here, the bankruptcy court granted relief from the automatic
stay, permitting the district court to "conduct a hearing and enter an order
with regard to [Plise's] alleged criminal contempt" in the state court
action. The district court did so, finding Plise's conduct contemptuous and
subject to criminal punishment in the form of confinement in the detention
center for 21 days. That punishment was conditional, however, because
4 Section 362(a) ordinarily stays a civil-contempt proceeding because,
by definition, such a proceeding is not criminal in nature. See In re Gindi,
642 F.3d 865, 871 (10th Cir. 2011) (citing In re Wiley, 315 B.R. 682, 687
(Bankr. E.D. La. 2004)), overruled on other grounds by TW Telecom
Holdings Inc. v. Carolina Internet Ltd., 661 F.3d 495 (10th Cir. 2011).
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the district court also allowed Plise to avoid confinement if he complied
with the debtor's examination at any time during the 21-day sentence.
Accordingly, we must determine whether the district court's contempt
order exceeded its authority because it became civil in nature, not
criminal.
The criminal/civil distinction in contempt sanctions
This court has previously explained that "[w]hether a
contempt proceeding is classified as criminal or civil in nature depends on
whether it is directed to punish the contemnor or, instead, coerce his
compliance with a court directive." Rodriguez v. Eighth Judicial Dist.
Court, 120 Nev. 798, 804, 102 P.3d 41, 45 (2004). Criminal sanctions
punish a party for past offensive behavior and are "unconditional or
determinate, intended as punishment for a party's past disobedience, with
the contemnor's future compliance having no effect on the duration of the
sentence imposed." Id. at 805, 102 P.3d at 46; see also Warner v. Second
Judicial Dist. Court, 111 Nev. 1379, 1383, 906 P.2d 707, 709 (1995)
(concluding that a contempt order of "a set term of eleven months
imprisonment" was punitive and criminal in nature). Civil sanctions, on
the other hand, are
remedial in nature, as the sanctions are intended
to benefit a party by coercing or compelling the
contemnor's future compliance, not punishing
them for past bad acts. Moreover, a civil contempt
order is indeterminate or conditional; the
contemnor's compliance is all that is sought and
with that compliance comes the termination of any
sanctions imposed.
Rodriguez, 120 Nev. at 805, 102 P.3d at 46 (footnote omitted); see also Int'l
Union, United Mine Workers of Am. v. Bagwell, 512 U.S. 821, 827 (1994)
(explaining that civil contempt sanctions "are considered to be coercive
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and avoidable through obedience"). Alper argues that the conditional
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provision of the contempt order allowing Plise to be released from
incarceration directly to a judgment debtor examination transforms the
sanction from criminal to civil. We agree.
The contempt sanction here is civil in nature because it was
intended to compel Plise's obedience with the district court's order
requiring him to submit to a debtor exam for the benefit of Alper, not as a
punishment for Plise's refusals to obey prior court orders. The district
court ordered Plise "sentenced to confinement in the Clark County
Detention Center for a period of twenty-one (21) days." This language
alone is a criminal sanction: it punishes Plise for past behavior with a set
term of imprisonment. See Warner, 111 Nev. at 1383, 906 P.2d at 709.
However, the order further stated that Plise "may be released directly to
an Examination of Judgment Debtor Hearing without serving the
remainder of the twenty-one day sentence." When the district court
included this opportunity to purge the imprisonment, it put a civil remedy
in the place of the punishment—Plise would only remain imprisoned until
he submitted to the judgment debtor examination. This opportunity to
purge is coercive, as it provides Plise an option to avoid incarceration or
obtain early release if he submits to the examination.
CONCLUSION
Because the district court's order is civil in nature, the district
court exceeded the scope of its authority granted by the bankruptcy court.
We therefore grant the petition and direct the clerk of this court to issue a
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writ instructing the district court to vacate its contempt order and conduct
further proceedings consistent with this opinion. 5
, C.J.
Hardesty
cur:
Parraguirre
Saitta
Aden tidy , J.
Pickering
5 Because we grant the petition and the contempt order will thus be vacated,
we do not address Plise's contention that any criminal order would violate the
statute of limitations. Thus, we leave this issue for the district court to resolve if
further proceedings are conducted in this case.
Determining the applicable statute of limitations for both criminal and civil
contempt is a matter of first impression in Nevada as no statute defines the statute
of limitations for contempt. A few state supreme courts have addressed the issue
regarding criminal contempt and, similar to Plise's argument, likened criminal
contempt to a misdemeanor based on its maximum punishment. Or. State Bar v.
Wright, 785 P.2d 340, 342 (Or. 1990) (likening the maximum punishment for
criminal contempt to a misdemeanor and analogizing that the statute of limitations
for criminal contempt is the same as other misdemeanors—two years); see also State
ex rel. Robinson v. Hartenbach, 754 S.W.2d 568, 570 (Mo. 1988) (Because contempt
is sui generis, it could be, and in this case is, controlled by the statute of limitations
applicable to misdemeanors although it is not a 'crime' within the meaning of the
criminal code:'). Other states have statutorily codified criminal contempt as a
misdemeanor. See, e.g., Cal. Penal Code § 166 (West Supp. 2015); Haw. Rev. Stat. §
710-1077(2) (2014); Mich. Comp. Laws Ann § 4.83 (West 2013).
On the other hand, there is little information in other jurisdictions regarding
the statute of limitations for civil contempt. At least one state supreme court has
concluded that no statute of limitations exists for civil contempt. State v. Schorzman,
924 P.2d 214, 216 (Idaho 1996). In addition, other courts have indicated that the
equitable defense of laches may apply. See, e.g., Adcor Indus., Inc. v. Bevcorp. LLC,
411 F. Supp. 2d 778, 803 (N.D. Ohio 2005).
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