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Nature of Suit Code: 422
Nature of Suit: Bankruptcy Appeals Rule 28 USC 158
Cause of Action: 

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FOR THE TENTH CIRCUIT .. 

IN RE: REXOTECH CALIFORNIA, INC., doing) 

business as Rexotech, Inc., and ) 

IN RE: ABEK, SCIENTIFIC, INC., doing ) 

business as Rexotech, Inc., ) 

Debtors. 

GENERAL SIGN.AL CORPORATION, 

Appellant, 

v. 

JOSEPH G. ROSANIA, Chapter 7 Trustee 

for the Estate of Rexotech California, 

Inc., 

Appellee. 

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ORDER AND JUDGMENT* 

JULl 71992 

nnRE_RT :L, HOECKEE t-~~.~ ~ Clerk 

Nos. 91-1323 

& 

91-1324 

(D.C. Nos. 90-S-478 

& 

90-S-528) 

(D. Colo.) 

Before LOGAN, EBEL, and KELLY, Circuit Judges. 

Appellant General Signal Corporation appeals from an order of 

the district court reversing and remanding two appeals from the 

bankruptcy court. Appellee, the Chapter 7 Trustee for Debtor 

* This order and judgment has no precedential value and shall 

not be cited, or used by any court within the Tenth Circuit, 

except for purposes of establishing the doctrines of the law of 

the case, res judicata, or collateral estoppal. 10th Cir. R. 

36.3. 

Appellate Case: 91-1324 Document: 010110270437 Date Filed: 07/17/1992 Page: 1
Rexotech California, Inc., has filed a motion to dismiss for lack 

of appellate jurisdiction. Because we agree that this court lacks 

jurisdiction to consider the merits of these appeals, we grant the 

t . t d 0 

• 

1 

mo ion o ismiss. 

Background 

In 1988, Debtor executed a secured promissory note in favor 

of General Signal for $10,000,000. Debtor filed for bankruptcy 

protection in February 1989. General Signal moved for relief from 

the automatic stay in order to foreclose on collateral securing 

the promissory note. Debtor argued General Signal's security 

interest was not perfected properly. The bankruptcy court granted 

General Signal relief from stay. The order contained a conclusion 

of law which provided that "[t]he Financing Statement filed by GS 

appears to comply with the requirements of California Commercial 

Code § 9402 and was effective to perfect GS' security .... " 

Aplt. App. at 40. 

While General Signal's motion was pending, Debtor filed an 

adversary proceeding seeking to avoid General Signal ' s security 

interest on the ground that it was unperfected. A different 

bankruptcy judge was assigned to the adversary proceeding. 

Debtor's bankruptcy was subsequently converted to a Chapter 7 

proceeding. In the adversary proceeding, General Signal moved for 

1 After examining the briefs and appellate record, this panel 

has determined unanimously that oral argument would not materially 

assist the determination of these appeals. See Fed. R. App. P. 

34(a); 10th Cir. R. 34.1.9. The cases are therefore ordered 

submitted without oral argument. 

2 

Appellate Case: 91-1324 Document: 010110270437 Date Filed: 07/17/1992 Page: 2
summary judgment, asserting the Trustee was collaterally estopped 

from challenging the perfection of its security interest. 

Specifically, the company maintained that the bankruptcy court had 

resolved the issue in granting General Signal relief from the 

automatic stay. 

The adversary proceeding judge ruled on the summary judgment 

motion. The court noted that relief from stay proceedings are 

usually "expedited proceedings" in which the secured party need 

only make a prima facie case to obtain relief. Aplt. App. at 94. 

Thus, collateral estoppel normally would not apply. The court 

observed, howev.er, that "the parties ... chose not to follow 

that procedure. Rather both sides fully explored the issue and 

submitted extensive briefs thereon." Id. 

The adversary proceeding judge concluded that General Signal 

was entitled to summary judgment on collateral estoppel grounds, 

but did not enter judgment because the bankruptcy court never 

entered a separate document constituting a judgment in the stay 

proceeding. See Fed. R. Civ. P. 58. The court stayed the 

adversary proceeding pending a formal entry of judgment by the 

bankruptcy court. 

The Trustee then sought clarification from the bankruptcy 

court on whether it intended its order on the stay to have 

collateral estoppel effect. Aplt. App. at 49-50. The bankruptcy 

court ruled in a clarification order that the findings in the 

September 18 order were limited to the stay issue. 

The adversary proceeding judge responded to the bankruptcy 

court order by vacating his earlier summary judgment ruling. 

3 

Appellate Case: 91-1324 Document: 010110270437 Date Filed: 07/17/1992 Page: 3
Aplt. App. at 96-97. General Signal unsuccessfully sought 

reconsideration of the bankruptcy court order and the adversary 

proceeding order. General Signal appealed to the district court. 

The district court reversed the bankruptcy court's 

clarification order and remanded the entire proceeding to the 

bankruptcy court for findings. The district court stated 

[i]t seems clear that in light of the dictates of, above 

all, common sense, the only logical outcome of this 

appeal must consist of the remand to the bankruptcy 

court with the purpose in mind of starting with a clean 

slate by allowing [the bankruptcy court] to clearly 

articulate in [its] order on the stay motion the exact 

extent and nature of [its] findings .... The Court 

concludes that, standing alone, the September 18, 1989 

order raises questions as to whether it is of a standard 

or exceptional nature, as it undoubtedly raised 

substantial questions in light of the consequences it 

produced in subsequent orders. 

Aplt. App. at 200. Subsequently, General Signal appealed. 

Discussion 

The Trustee contends that we do not have jurisdiction because 

the district court's order is not a final decision under 28 u.s.c. 

§ 158(d). If, in considering a bankruptcy appeal, the "district 

court remands for significant further proceedings, its order is 

not final and appealable for purposes of § 158(d)." Cascade 

Energy & Metals v. Banks (In re Cascade Energy & Metals Corp.), 

956 F.2d 935, 937 (10th Cir. 1992); Homa Ltd. v. Stone (In re 

Commercial Contractors, Inc.), 771 F.2d 1373, 1375 (10th Cir. 

1985). On the other hand, where the purpose of the remand is to 

effectuate a ministerial task, or conduct additional proceedings 

involving little judicial discretion, the district court's order 

will be considered final. State Bank of Spring Hill v. Anderson 

4 

Appellate Case: 91-1324 Document: 010110270437 Date Filed: 07/17/1992 Page: 4
(In re Bucyrus Grain Co.), 905 F.2d 1362, 1366 (10th Cir. 1990). 

If the remanded matter is unlikely to spawn another appeal or 

affect the issue on appeal, a district court's remand order may be 

considered final. Id. 

Here, the district court remanded the proceedings for further 

findings and conclusions of law concerning the bankruptcy court's 

granting relief from the automatic stay. In particular, the 

district court directed the bankruptcy court to determine whether 

its ruling on the perfection issue was "standard or exceptional." 

This inquiry requires the bankruptcy court to make a legal 

determination regarding the extent and nature of its findings. 

Normally, consideration of a motion to lift the bankruptcy 

court's automatic stay is limited in scope . In re Vitreous Steel 

Prods. Co., 911 F.2d 1223, 1234 (7th Cir. 1990). The party 

seeking relief need only show a "colorable claim of a lien." Id. 

See also In re Quality Elecs. Ctrs .• Inc., 57 B.R. 288 (Bankr. 

D.N.M. 1986)(inquiry of court on stay matter should be limited to 

a determination that the moving creditor has "a colorable claim to 

a perfected security interest"). Using this procedure, a decision 

on relief from stay would not be a full adjudication of the merits 

of the lien interest. See In re Vitreous Steel Prods. Co., 911 

F.2d at 1234 (decision on relief from stay would not be res 

judicata as to all lien issues where hearing on stay was limited 

in scope). But see Pollack v. FDIC (In re Monument Record Corp.), 

71 B.R. 853, 857-64 (Bankr. M.D. Tenn. 1987)(order granting relief 

from stay and recognizing security interest was final judgment for 

issue preclusion purposes). 

5 

Appellate Case: 91-1324 Document: 010110270437 Date Filed: 07/17/1992 Page: 5
Conversely, the collateral estoppel doctrine bars 

relitigation only when the parties have had a prior opportunity to 

fully and fairly litigate an issue. Smith Mach. Co. v. Hesston 

Corp., 878 F.2d 1290, 1293 (10th Cir. 1989), cert. denied, 493 

U.S. 1073 (1990). Consequently, if the hearing on the stay matter 

did not provide an opportunity to "fully and fairly" litigate the 

lien perfection issue, collateral estoppel may not apply. See id. 

The remand which the district court ordered will clarify the 

confusion surrounding the bankruptcy court's previous rulings. 

This clarification is not, as General Signal suggests, 

ministerial. I-t will involve significant judicial discretion and 

will require the bankruptcy court to reevaluate the procedures it 

followed in reviewing the stay matter. Thus, the remand involves 

significant further proceedings and is not final. Nor is this an 

appropriate case for 28 U.S.C. § 1292(b) jurisdiction given the 

nature of the issue involved. See Temex Energy, Inc. v. 

Underwood, Wilson, Berry. Stein & Johnson, No. 91-6069, 1992 WL 

143741, *2 (10th Cir. June 25, 1992). Accordingly, the Trustee's 

Motion to Dismiss is GRANTED. The appeal is DISMISSED for lack of 

jurisdiction. 

Entered for the Court 

Paul J. Kelly, Jr. 

Circuit Judge 

6 

Appellate Case: 91-1324 Document: 010110270437 Date Filed: 07/17/1992 Page: 6