Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_07-cv-01013/USCOURTS-caed-1_07-cv-01013-1/pdf.json

Nature of Suit Code: 422
Nature of Suit: Bankruptcy Appeals Rule 28 USC 158
Cause of Action: 28:0158 Notice of Appeal re Bankruptcy Matter (BAP)

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The appeal of the Bankruptcy Order denying 1

Plaintiff/Appellant leave to file a late appeal was previously

Case No. 1:07-cv-01336-OWW. It was consolidated pursuant to

Federal Rule of Civil Procedure 42(a), on June 8, 2008. See

Court Order Consolidating Actions and Scheduling Oral Argument

(“Order to Consolidate”), Doc. 23, filed in Case No. 1:07-cv01336-OWW.

1

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

CADLEROCK, LLC,

Plaintiff/Appellant,

v.

JENNIE MARIE BECAS,

Defendant/Appellee.

1:07-CV-01013-OWW

MEMORANDUM AND DECISION RE:

DENYING PLAINTIFF/APPELLANT’S

MOTION FOR APPEAL OF THE

BANKRUPTCY ORDER DENYING LATEFILED APPEAL

Plaintiff/Appellant Cadlerock, LLC (“Cadlerock”) pursuant to

28 U.S.C. § 158(a)(1) appeals the Bankruptcy Court Order of

August 31, 2007 (“Aug 31 Order”), which denied Plaintiff’s motion

to file a late appeal. The Aug 31 Order was entered by the

Honorable Whitney Rimel of the United States Bankruptcy Court for

the Eastern District of California, in Bankruptcy Case No. 06-

11069-A-7, Adversary Proceeding No. 06-1303. See Doc. 1, Notice

of Appeal, Filed September 13, 2007. “The district courts of the

United States shall have jurisdiction to hear appeals (1) from

final judgments, orders, and decrees.” 28 U.S.C. § 158(a)(1). 1

Cadlerock also filed, in this Court, an appeal of the 

Case 1:07-cv-01013-OWW Document 26 Filed 07/09/08 Page 1 of 13
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“The notice of appeal shall be filed with the clerk within 2

10 days of the date of the entry of the judgment, order, or

decree appealed from.” Fed. R. Bankr. P. 8002(a).

2

Bankruptcy Court Order entered on June 22, 2007 (“June 22 Order”)

in which judgment was entered in favor of Defendant/Appellee

Jennie Marie Becas (“Becas”) and against Plaintiff/Appellant

Cadlerock, which addresses the merits of the Bankruptcy

proceeding. By order of June 9, 2008, the two appeals were

consolidated under Fed. R. Civ. P. 42(a). Oral argument was set

for the appeal of the Aug 31 Order, by which the Bankruptcy Court

denied Cadlerock’s motion for an extension of time to file a

late-appeal of the June 22 Order. The appeal on the merits,

reviewing the June 22 Order, cannot be heard until it is

determined if the District Court has jurisdiction to hear the

appeal of the June 22 Order. The Bankruptcy Court denied

Plaintiff/Appellant’s late-file appeal of the June 22 Order. See

Doc. 24, Order to Consolidate. 

1. Background

The appeal of the Aug 31 Order asserts the Bankruptcy Court

abused its discretion in denying Plaintiff/Appellants’ motion to

late-file the appeal, finding no showing of excusable neglect by

Plaintiff/Appellant. See In re Warrick, 278 B.R. 182, 184 (9th

Cir. 2002). A notice of appeal generally must be filed within

ten days. Fed. R. Bankr. P. 8001-02. The ten-day period is 2

jurisdictional and strictly construed. “Failure to file within

the time limit divests the appellate court of jurisdiction.” 

Preblich v. Battley, 181 F.3d 1048, 1056 (9th Cir. 1999), citing

In re Souza, 795 F.2d 855, 857 (9th Cir. 1986).

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3

The Bankruptcy adversary proceeding was initially filed by

Cadlerock pursuant to 11 U.S.C. Section 523. The trial of the

adversary proceeding concluded on May 16, 2007. At the

conclusion of the trial, the Bankruptcy Court stated that it

would decide the case on the June Calendar. Defendant/Appellee’s

counsel advised that he would be gone during the month of June,

which prompted the court to state:

Alright. Well, I may do them in writing. If not,

we’ll put them on the record on the July Bakersfield

calendar, which would be July 26th. And if you get

them in writing, you’ll know; and otherwise we’ll

advise you about the date they’ll be put on the record. 

Thank you.

Doc. 17, Excerpts to Appellant’s Opening Brief on Appeal of

Denial of Motion: Index of Exhibits (“Excerpts”), Exh. B, 5/16

Bankr. Hr’g Tr., Bankruptcy Case No. 06-11069-A-7, Adversary

Proceeding No. 06-1303 (emphasis added). 

Two weeks later, on May 31, 2007, the Bankruptcy Court filed

its written Findings of Fact and Conclusions of Law with the

Clerk. Id., Exh. H, Bankruptcy Court Docket, No. 18. Counsel

for Defendant/Appellee Becas was ordered to prepare a judgment,

which was prepared. Defendant/Appellee Becas put Plaintiff

Cadlerock’s counsel on notice as of June 20, 2007 by filing the

proposed judgment. The proposed judgment was received by the

Bankruptcy Court, corrected, signed by Judge Rimel and filed by

the Clerk on June 22, 2007. It was entered by the Clerk on June

25, 2007. Id., Exh. D, Judgment, and Exh. E, Notice of Entry to

Order/Judgment In An Adversary Proceeding (“Notice of Entry of

Judgment”). 

On June 28, 2007, three days after the Judgment was entered,

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4

Plaintiff Cadlerock’s counsel filed an objection to the proposed

judgment, bearing a date of service of June 26, 2007. See Id.,

Exh. H, Bankruptcy Docket, No. 21, Opposition. 

Counsel for Cadlerock, James R. Knoles, claims in his

declaration that he left on vacation from June 29 through July 4,

and did not see the Notice of Entry of Judgment until July 6,

2007 when he returned. Doc. 17, Excerpts, Exh. C, Decl. Knoles,

p. 2:2-4. A notice of appeal was required to be filed within 10

days, the deadline was July 5, 2007, after Plaintiff/Appellant’s

counsel returned from vacation. Fed. R. Bankr. P. 8002(a). 

Plaintiff’s counsel provides no explanation why he filed

objections to the proposed judgment on June 28, 2007, three days

after the Judgment was entered by the Bankruptcy Clerk (June 25,

2007), he was served with that notice, and failed to check or

review the docket to see the filed Judgment. Plaintiff served

its objections to the proposed judgment on June 26, 2007, one day

after the Judgment was entered by the Bankruptcy Clerk. 

Plaintiff’s counsel provides no explanation for its oversight in

not reviewing the filed and served Judgment of the Bankruptcy

Court. Plaintiff’s counsel does not explain the failure to check

the docket or to review the filed and served Judgment before he

left for vacation or upon his return from his vacation on July 5,

2007. 

Plaintiff’s counsel claims that upon return from vacation on

July 5, 2007, “he had a great deal of back paperwork to go

through, and he did not look for or expect to see that a Judgment

had been entered long before the Court indicated it would so do

... Mr. Knoles did not come across the notice that the Judgment

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had been entered until late the next day, Friday, June 6.” Doc.

16, Appellant’s Br., p. 5. Mr. Knoles was not able to contact

his client until Monday, July 9, 2007, regarding whether to

appeal the Judgment, and received consent on July 10, 2007. Mr.

Knoles then filed his Notice of Appeal on July 11, 2007, six days

late. Doc. 17, Excerpts, Exhibit C, Notice of Appeal. Plaintiff

Cadlerock argues that just because it had notice of the proposed

judgment (i.e. had been served a copy of the proposed judgment by

counsel) and filed an objection, that it “had notice that the

‘court was going to change its mind’ about not deciding until the

July docket.” 

The Bankruptcy Court did not mislead counsel, despite

Plaintiff’s counsel assertion that the Judgment was to be

definitively entered on the July Calendar. The Bankruptcy Court

explictly stated, as to timing and delivery of the decision, that

either a written decision would be entered before the July

Calendar, or it would be announced orally on the July Calendar. 

Plaintiff’s counsel had sufficient notice that the Judgment would

either be entered by written order before the July Calendar, or

at the July Calendar hearing. 

After receiving notice from the Bankruptcy Court that the

appeal was filed late, the appeal was forwarded to the District

Court and a case file was opened on July 16, 2007, (Doc. 1,

Notice of Appeal, Filed July 16, 2007), Plaintiff/Appellant then

filed a motion for an extension of time to file a late-appeal on

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That the Clerk of the Court accepted Plaintiff Cadlerock’s 3

appeal filings is irrelevant. The Clerk of the Court is not

charged with the task of determining whether a particular filing

is proper or whether a particular court has jurisdiction over a

case or appeal.

6

July 25, 2007. 

3

Bankruptcy Rule 8002(c) provides that the “bankruptcy judge

may extend the time for filing the notice of appeal by any

party...” Fed. R. Bankr. P. 8002(c)(1)(emphasis added). The

time to file a motion to extend the time for filing a notice of

appeal is “no later than 20 days after the expiration of the time

for filing a notice of appeal...” Fed. R. Bankr. P. 8002(c)(2). 

Plaintiff filed its Motion/Application to Extend Time to Appeal

under Rule 8002(c) within the required twenty days. Such an

extension to file a late-appeal under Fed. R. Bankr. P. 8002(c)

may be granted on a showing of “excusable neglect.” Id. The

matter was set for hearing on August 29, 2007. At the hearing,

the Bankruptcy Court denied Plaintiff/Appellant’s motion, finding

no excusable neglect, and no basis to extend the time for appeal. 

A minute order was entered to that effect on August 31, 2007.

2. Standard of Review

On appeal, the question is whether the Bankruptcy Court

abused its discretion in denying Plaintiff/Appellant’s motion for

an extension of time to file a late-appeal. Matter of Estate of

Butler's Tire & Battery Co., Inc., 592 F.2d 1028, 1032-33 (9th

Cir. 1979). This, then depends on whether the Bankruptcy Court

was justified in finding that Plaintiff/Appellant failed to show

“excusable neglect” in connection with its failure to file its

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See also Pincay v. Andrews, 389 F.3d 853, 860 (9th Cir. 4

2004)(In an appeal case on motion brought under Fed. R. Civ. P.

4(a) stated that “we leave the weighing of Pioneer's equitable

factors to the discretion of the ... court in every case”.)

7

notice of appeal within the normal 10-day period. Fed. R. Bankr.

P. 8002(c); In re Donnell, 639 F.2d 535, 539 (9th Cir. 1981). 

The Supreme Court in Pioneer Inv. Services Co. v. Brunswick

Associates, 507 U.S. 380 (1993), analyzed excusable neglect,

expressly adopted in the Ninth Circuit. See In re Warrick, 278

B.R. 182, 185 (9th Cir. 2002). Whether admitted neglect can be

excused is an equitable determination that incorporates all

relevant factors, including (1) danger of prejudice to the

non-movant; (2) length of 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. Pioneer, 507 U.S. at

395. The factors identified in Pioneer are non-exclusive, and

“the court is permitted to take ‘account of all relevant

circumstances surrounding the party's omission’ in making an

equitable determination.” In re Rebel Rents, Inc., 326 B.R. 791,

803 (C.D. Cal. 2005) (citation omitted).4

3. Analysis

The Bankruptcy Court’s decision, issued on the record at the

August 29, 2007 hearing, was followed by a short minute order

denying the motion, filed on August 31, 2007, after the court

conducted an analysis of the four factors in deciding whether

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“Courts have set forth the standards for a finding of 5

excusable neglect in four parts. First, is there a danger of

prejudice to the nonmoving party; second, what’s the length of

delay and the impact on the parties; third, what’s the reason for

delay, was it in the reasonable control of the moving party; and

fourth, was the moving party in good faith.” 8/29 Bankr. Hr’g Tr. 

5:25-6:1-6.

8

excusable neglect was present. The Bankruptcy Court determined 5

that the second and fourth points, are not applicable here

because the length of delay was minimal and there was no

indication that Plaintiff was not proceeding in good faith. The

first and third factors weighed in favor of the Bankruptcy

Court’s decision. 

a. Danger of Prejudice to the Debtor

The Bankruptcy Court evaluated the prejudice to the

nonmoving party, Defendant/Appellee Becas. Becas had litigated a

nondischargeability action in which the court found in her favor. 

The Bankruptcy case was filed in 2006, two years earlier. 

Further delay of dischargeability of this debt would be

prejudicial. The court found that because of the above, “there

is prejudice to the nonmoving party in extending the time to

appeal.” 8/29 Bankr. Hr’g Tr. 6:17-18. Today, the delay would

be extended to more than two years if the Bankruptcy Court’s

decision is not affirmed.

The Ninth Circuit recognizes that strict enforcement of the

10-day appeal period under Rule 8002(a) “is justified by the

‘peculiar demands of a bankruptcy proceeding,’ primarily the need

for expedient administration of the [b]ankruptcy estate aided by

certain finality of orders issued by the [c]ourt in the course of

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administration.” In re Nucorp Energy, Inc., 812 F.2d 582, 584

(9th Cir. 1987), quoting Matter of Thomas, 67 B.R. 61, 62

(Bankr.M.D.Fla. 1986). The abbreviated time constraints for

filing a notice of appeal in bankruptcy which are jurisdictional

in nature serve to “[assure] prompt appellate review, often

important to the administration of a case under the Code.”

Advisory Committee Note (1983). The timing also provides a

definite point, in the absence of a notice of appeal, that

litigation will come to an end. Here, while the delay in filing

the appeal was less than a week, the Bankruptcy Court found that

the impact of permitting such an appeal of an adversary

proceeding that began in 2006, would run contrary to the policy

to provide a definite ending point for the debtor in the

bankruptcy proceeding. The court noted in conclusion:

the fact that bankruptcy courts are, perhaps, unique in

having such a quick and fast time to appeal, ten days,

that’s not a very long time ... the reason for that

there is the prejudice of delay, and in this instance,

I don’t believe the moving party has met his burden of

proof to overcome that.

8/29 Bankr. Hr’g Tr. 7:8-14. 

b. Length of the Delay and Its Potential Impact on

Judicial Proceedings

The delay was six days, which the Bankruptcy Court

acknowledged was minimal. But the Bankruptcy Court viewed the

policy of providing finality of the discharge decision to weigh

more in favor of denying the late-filed appeal.

c. Reason for the Delay, Including Whether It Was Within

The Reasonable Control of the Movant

The Bankruptcy Court addressed the third factor and found

that this factor was largely determinative of denying the motion

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to late-file an appeal. This factor concerns the reason for

delay and whether it was within the reasonable control of the

moving party. The Bankruptcy Court noted that Cadlerock had

notice of the proposed judgment, filed an objection to the

proposed judgment, and its attorney had reasonable notice that

the Judgment was going to be entered quickly. The Bankruptcy

Court did not find Mr. Knoles’ vacation excuse persuasive because

he was on notice when he received the proposed judgment. 

It is undisputed that the sole reason for the delay was the

negligence and inattention of Plaintiff Cadlerock’s counsel. The

delay was squarely within his control. Cadlerock’s counsel did

not miss the appeal deadline due to ill health or disability, a

delay in the mail, a miscommunication or failure to communicate

with his client, a misguided instruction from a court clerk or

judicial officer, or a “dramatic ambiguity” between relevant

procedural rules. Cadlerock’s counsel, an attorney with many

years of experience, failed to pay attention to the plain,

unambiguous language of the Bankruptcy Court’s ruling and Rule

8002(a).

d. Whether the Movant Acted in Good Faith 

There is no evidence that Mr. Knoles acted with bad faith in

filing his motion. The Bankruptcy Court found the motion was

brought in good faith. 

But shortness in delay for filing a bankruptcy appeal and

the existence of good faith do not trump the prejudice of undue

delay of the administration of the bankruptcy proceeding, nor the

attorney's unjustified failure to understand the Bankruptcy

Court’s announcement of the timing of the decision, nor the

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attorney’s obligation to check the docket for the filed decision. 

While two factors narrowly favor Plaintiff/Appellant Cadlerock

(shortness in delay and good faith of Cadlerock), the Bankruptcy

Court balanced the totality of the Pioneer factors in favor of

Defendant/Appellee Becas and found that Cadlerock did not

discharge its burden to establish that its failure to timely file

a notice of appeal was the result of excusable neglect. 

Before reversal is proper under the abuse of discretion

standard, the Court must be definitely and firmly convinced that

the bankruptcy court committed a clear error of judgment, AT & T

Universal Card Servs. v. Black (In re Black), 222 B.R. 896, 899

(9th Cir. BAP 1998), or relied on an incorrect legal standard. 

Miller v. Los Angeles County Bd. of Educ., 827 F.2d 617, 619 (9th

Cir. 1987); see also In re Warrick, 278 B.R. 182, 184 (9th Cir.

BAP 2002)(“A bankruptcy court necessarily abuses its discretion

if it bases its decision on an erroneous view of the law or

clearly erroneous factual findings.”) Neither of these grounds

is present here. Notwithstanding Cadlerock counsel’s claim that

he relied on the Bankruptcy Judge’s comments, Mr. Knoles concedes

that he filed an objection with a service date of June 26, 2007,

which was filed on June 28, 2007. Mr. Knoles provides no

explanation why he failed to check the docket on either of these

dates nor why he did not check the docket or his mail for the

Judgment on July 5, 2008, when he returned from his vacation. If

he had done so, he would have seen the filed Judgment. 

The Bankruptcy Court found that “plaintiff certainly had

notice that there was a form of judgment that had been submitted

to the Court that either had been entered or was about to be

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entered.” 8/29 Bankr. Hr’g Tr. 5:4-7. The Judgment was filed on

June 22, 2007 and entered on June 26, 2007, it is counsel’s

responsibility based on the Bankruptcy Judge’s statements to be

diligent about checking the docket, especially considering the

proposed judgment was sent by Becas’ counsel on June 20, 2007 and

the Bankruptcy Court indicated that it would issue its decision

either in writing before the July Calendar or on the July

Calendar date. Mr. Knoles’ failure to timely file the notice of

appeal was due solely to his failure to follow unambiguous rules,

check the docket after the proposed judgment was sent, and his

unjustified mistake in not recognizing the Bankruptcy Court’s

stated intentions of filing either a written decision earlier or

entering a judgment on the July Calendar. No explanation is

offered how this is excusable and the Bankruptcy Court did not

abuse its discretion in denying his motion to extend the time for

appeal. Cadlerock’s counsel has not presented a legally

sufficient justification for his misunderstanding of the

Bankruptcy Court’s statements on the timing of entering the

judgment, nor his failure to check the docket or review his mail

in a timely manner upon his return from vacation. Counsel’s

absence due to vacation is not a legally sufficient justification

considering the other Pioneer factors.

CONCLUSION

For the reasons stated above, the Bankruptcy Court’s denial

of Plaintiff/Appellant’s motion to appeal the Aug 31 Order of the

Bankruptcy Court denying late-filed appeal is AFFIRMED. The

Court lacks jurisdiction to hear the appeal on the June 22 Order. 

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See In re Joseph C. Souza, 795 F.2d 855, 858 (9th Cir. 1986)

(stating that district court does not have jurisdiction over a

bankruptcy appeal where the notice of appeal was not timely filed

under Federal Rule of Bankruptcy Procedure 8002). The hearing on

the appeal of the Bankruptcy Court’s June 22 Order, currently set

for August 4, 2008 at 10:00 a.m. is vacated. The case is

concluded. Counsel for Defendant/Appellee Becas shall prepare

and lodge a form of order and judgment consistent with this

Memorandum Decision within 5 days following the date of service

of this Memorandum Decision.

IT IS SO ORDERED.

Dated: July 8, 2008 /s/ Oliver W. Wanger 

bb4ed UNITED STATES DISTRICT JUDGE

Case 1:07-cv-01013-OWW Document 26 Filed 07/09/08 Page 13 of 13