Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_14-cv-03873/USCOURTS-cand-4_14-cv-03873-4/pdf.json

Parties Involved:
Paul Boschetti
Appellee
Daniel Everett
Appellant

Document Text:

United States District Court 

For the Northern District of California 

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IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF CALIFORNIA 

In re EVERETT, 

 

 Appellant. 

 

________________________________/ 

No. C 14-3873 CW 

ORDER AFFIRMING 

BANKRUPTCY COURT 

RULING 

 Appellant Daniel Everett has filed an appeal from a ruling of 

the United States Bankruptcy Court of the Northern District of 

California on the grounds that Creditor-Appellee Paul Boschetti 

and the San Francisco County Superior Court of California violated 

the automatic stay triggered by his Chapter 7 bankruptcy petition. 

Appellant has filed an opening brief, and Appellee has filed a 

response. Appellant has filed a reply brief.1 Having considered 

the papers filed by the parties, the Court AFFIRMS the Bankruptcy 

Court’s order. 

JURISDICTION AND STANDARD OF REVIEW 

 The district court has jurisdiction over this appeal under 28 

U.S.C. § 158(a). The bankruptcy court’s conclusions of law are 

reviewed de novo and its findings of fact under the clearly 

 1 On September 4, 2015, Appellant filed a request for 

judicial notice, asking that the Court take notice of the records 

and files from various related cases. Docket No. 28. To the 

extent Appellant asks the Court to take judicial notice of 

documents, the request is GRANTED. However, Appellant also asks 

the Court to “take Judicial Notice that California Superior Court 

Case No. 12-642905 (‘Boschetti v. O’Blenis, et al.’) had been 

removed from the California Superior Court, San Francisco on 

October 18, 2013.” Docket No. 28 at 3. This is a legal 

conclusion, not a document of which the Court can take legal 

notice. Accordingly, the request for judicial notice is DENIED IN 

PART. 

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erroneous standard. Fed. R. Bankr. 8013; In re Wegner, 839 F.2d 

533, 536 (9th Cir. 1988). 

BACKGROUND 

 Appellee owns Unit #5, an apartment at 261 Pierce Street in 

San Francisco, California. In June 2007, he rented the apartment 

to Appellant. In October 2012, Appellee filed an action for 

unlawful detainer in the San Francisco County Superior Court of 

California, see Docket No. 5-4 at 15-21, to which Appellant filed 

an answer, along with a fee waiver petition. On November 30, 

2012, the parties entered into a Settlement Agreement and 

Stipulation for Entry of Judgment (Settlement Agreement). See 

Docket No. 5-25 at 10-15. The parties agreed to a schedule by 

which Appellant would pay back-rent. Id. They also agreed that, 

if Appellant breached the Settlement Agreement, a stipulated 

judgment for possession and damages would be entered against him. 

Id. The agreement was filed on December 4, 2012. Id. 

 On January 2, 2013, citing a failure to pay court fees 

pursuant to the denial of his fee waiver request, the Superior 

Court struck Appellant’s answer and the Settlement Agreement from 

the state court record. See Docket No. 5-25 at 29. Appellant was 

prohibited from filing future documents until and unless he paid 

the filing fee. On January 3, 2013, Appellee applied ex parte for 

judgment due to failure of Appellant to comply with the Settlement 

Agreement, which the state court granted. See Docket No. 5-14 at 

28-29. The judgment was to be entered unless Appellant made a 

payment of $4,434.50 by January 10, 2013. Id. If Appellant 

failed to do so, he was advised, judgment would be entered against 

him for restitution and possession of the apartment, as well as 

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unlawful detainer damages, installment payments due under the 

Settlement Agreement, and attorney’s fees. Id. Appellant did not 

pay the required amount by January 10, 2013. 

 Between February and June 2013, Appellant attempted to remove 

the case from the Superior Court to federal district court three 

times. See Case No. 13-0628 (N.D. Cal.)(twice) and Case No. 13-

0667 (W.D. Wash.). Each time the case was remanded to state court 

or dismissed for failure to pay the filing fees. In August 2013, 

this Court again remanded the case to state court, entered a prefiling order against Appellant, and ordered sanctions. See Case 

No. 13-0628, Docket Nos. 23-24. 

 Also in August 2013, Appellant filed for bankruptcy under 

Chapter 7 in the Northern District of California Bankruptcy Court. 

In September 2013, he filed for Chapter 13 bankruptcy. On 

September 17, 2013, the Bankruptcy Court lifted the automatic stay 

in the Chapter 7 case, allowing Appellee to commence proceedings 

for Appellant’s eviction from the apartment. See Docket No. 5-4 

at 72-73. On October 15, 2013, the Bankruptcy Court lifted the 

automatic stay in the Chapter 13 case, again allowing Appellee to 

commence eviction proceedings against Appellant. See Docket No. 

5-10 at 1-2. The Bankruptcy Court further ordered that the stay 

be terminated, in rem, to allow Appellee to recover possession of 

the apartment. Id. at 2. 

 On October 18, 2013, Appellee appeared ex parte in Superior 

Court for entry of judgment as stipulated to in the parties’ 

December 4, 2012 Settlement Agreement. The court entered judgment 

for restitution and possession of the apartment, as well as 

monetary damages and attorney’s fees. See Docket No. 5-21 at 37-

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38. On the same day, Appellant again filed a notice of removal, 

this time to the Bankruptcy Court of the Northern District of 

California. In his notice, he argued that the state court case 

for unlawful detainer was a core proceeding in his Chapter 13 

petition. Also on October 18, 2013, Appellant’s Chapter 13 

petition was dismissed for failure to pay the filing fees. 

 On October 22, 2013, the Bankruptcy Court remanded the 

removed case to the Superior Court. On October 23, 2013, pursuant 

to an order allowing him to pay Appellant’s filing fee, Appellee 

paid $225 to satisfy Appellant’s obligation in state court. 

Appellant was evicted in November 2013. 

 In June 2014, Appellant brought an action in Bankruptcy Court 

for damages and voiding of judgments, for violation of the 

automatic stay against Appellee and the San Francisco County 

Superior Court. See Docket No. 5-22. In the complaint, he argued 

that Appellee and his counsel “moved beyond the scope of a 

bankruptcy court order which granted relief from stay.” Id. at 2. 

He alleged that Appellee violated the stay by “moving the state 

court for an order allowing him to exercise control over debt that 

[Appellant] had incurred pre-petition.” Id. at 2. In addition, 

he alleged that the state court, “in granting [Appellee’s] . . . 

motion to pay the debt, the state court continued its own debt 

collections efforts against [him] that began pre-petition.” Id. 

He asserted that he had “sole responsibility to pay the filing fee 

debt and therefore further collection action was needed before 

[Appellee] could proceed with the state court case.” Id. at 2. 

Lastly, he argued that Appellee was only allowed relief for 

possession, not monetary damages. 

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 On July 25, 2014, the Bankruptcy Court issued an order 

denying Appellant’s motion. In that order, the court found that 

neither [Appellee] nor Superior Court of California, County 

of San Francisco violated the automatic stay because payment 

of the state court appearance fee, the request for entry of 

the stipulated judgment, and the entry of that judgment in 

the state court were fairly contemplated by [Appellee’s] 

motion for relief from stay and the Court’s order thereon, 

and were discussed during [the October 18, 2013] oral 

argument at the hearing on the motion for relief from stay. 

Docket No. 5-28 at 1-2. It is that order from which Appellant 

appeals. 

DISCUSSION 

The crux of Appellant’s argument concerns the power of the 

Superior Court to enforce the Settlement Agreement: (1) after it 

struck Appellant’s Answer and the Settlement Agreement from the 

state court record due to Appellant’s failure to pay the filing 

fee and (2) when it entered judgment against him pursuant to the 

Bankruptcy Court’s lifting of the Chapter 13 stay. Furthermore, 

he argues that allowing Appellee to pay the filing fee on his 

behalf violated the automatic stay because the filing fee was the 

property of the bankruptcy estate. 

I. State Court Jurisdiction 

Appellant argues that the Bankruptcy Court erred when it held 

that the Superior Court had jurisdiction to enforce the Settlement 

Agreement if his filling fee was not paid. At the October 15, 

2013 hearing with regard to lifting the Chapter 13 stay, the 

Bankruptcy Court judge and Appellant had the following exchange: 

THE COURT: But how does that harm you, Mr. Everett? I mean, 

payment of that fee, as I see it, they did you a favor.2 

 2 The court was mistaken that the fee had already been paid. 

It was not paid until October 23, 2013. 

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MR. EVERETT: Well, the hardly -- it simply allowed the State 

Court to apply its jurisdiction to me. The case law I cited 

is uncontroverted in the sense that the State Court did not 

have jurisdiction otherwise. 

THE COURT: I strongly disagree with your assessment that 

payment of the fee was a necessary predicate to the State 

Court acquiring jurisdiction over you. You were served with 

process in that case. That’s when the court obtained 

jurisdiction over you. It had nothing whatsoever to do with 

that appearance fee. 

This Court agrees with the Bankruptcy Court’s determination. 

The State Court had jurisdiction as well as the power to enforce 

the Settlement Agreement. In Burnham v. Superior Court of 

California, Cnty. of Marin, 495 U.S. 604, 610-11 (1990), the 

Supreme Court endorsed the notion that “each State had the power 

to hale before its courts any individual who could be found within 

its borders, and that once having acquired jurisdiction over such 

a person by properly serving him with process, the State could 

retain jurisdiction to enter judgment against him[.]” Thus, it is 

clear that the Superior Court had jurisdiction over Appellant when 

he was served in the case. Failure to pay the fee did not divest 

the Superior Court of jurisdiction, and Appellant offers no 

relevant legal authority that states otherwise. 

Furthermore, the Superior Court had authority to enforce the 

Settlement Agreement. California Code of Civil Procedure section 

664.6 provides, “If parties to pending litigation stipulate, in a 

writing signed by the parties outside the presence of the court or 

orally before the court, for settlement of the case, or part 

thereof, the court, upon motion, may enter judgment pursuant to 

the terms of the settlement.” Appellant does not provide any 

relevant legal authority that this provision does not apply in 

this case. 

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Likewise, Appellant’s argument that the award of monetary 

damages violated the automatic stay is without merit. The 

Settlement Agreement itself provided for monetary damages in the 

case of default. See Docket No. 5-4 at 26. The Agreement states, 

“In the event defendant is in default with respect to any 

provision of this settlement agreement, the parties stipulate that 

plaintiff is entitled to . . . any unpaid rent and unlawful 

detainer damages in the amount of $11,837.00[.]” Id. Thus, 

because the Superior Court had the authority to enforce the 

Settlement Agreement, it also had authority to award monetary 

damages pursuant to the Settlement Agreement. Accordingly, the 

Court affirms the Bankruptcy Court’s July 24, 2014 order denying 

Appellant’s motion for damages and voiding of judgments. 

II. Notice of Removal 

In addition to the above argument, Appellant contends that, 

on October 18, 2013, he removed the Superior Court case to the 

Bankruptcy Court, and the Superior Court had no authority to enter 

judgment against him for that reason as well. 

Under Federal Rule of Bankruptcy Procedure 9027, a removal is 

not given effect until “[p]romptly after filing the notice of 

removal, the party filing the notice . . . files a copy of it 

with the clerk of the court from which the claim or cause of 

action is removed.” At the time he filed the notice of removal in 

Bankruptcy Court, Appellant was barred from filing a copy of the 

removal in state court because he did not pay the filing fee. 

Thus, he was not permitted to file the notice of removal in state 

court and he did not do so. He insists in his brief that the 

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state court “receiv[ed] notice of the removal,” but he does not -- 

and cannot -- show that the notice of removal was actually filed. 

The fact that the Bankruptcy Court did not remand the case 

until October 23, 2013 is irrelevant. A remand order is not a 

concession that removal was in effect. As the Ninth Circuit has 

held, “[t]he removal statute is strictly construed against removal 

jurisdiction. . . . The defendant bears the burden of 

establishing that removal is proper.” Provincial Gov’t of 

Marinduque v. Placer Dome, Inc., 582 F.3d 1083, 1087 (9th Cir. 

2009)(citing Syngenta Crop Prot., Inc. v. Henson, 537 U.S. 28, 32 

(2002); California ex rel. Lockyer v. Dynegy, Inc., 375 F.3d 831, 

838 (9th Cir. 2004)). Until a proper removal is effected, the 

case has not been removed. Appellant has failed to establish that 

the removal was in effect when the Superior Court entered judgment 

against him. 

 Accordingly, the Court affirms the Bankruptcy Court’s July 

24, 2014 order denying Appellant’s motion for damages and voiding 

of judgments for this reason as well. 

III. Filing Fee as Property of the Estate 

 In addition to the arguments discussed above, Appellant 

contends that the Superior Court violated the automatic stay by 

allowing Appellee to pay the filing fee because the filing fee was 

a debt and property of the estate. 

 Under the Bankruptcy Code, an automatic stay applies to “any 

act to collect, assess, or recover a claim against the debtor that 

arose before the commencement of the case under this title.” 11 

U.S.C. § 362. A “claim” is “right to payment,” i.e., a debt or a 

“right to an equitable remedy for breach of performance if such 

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breach gives rise to a right to payment.” Id. § 101(5). 

Appellant provides no support for his assertion that payment of 

the filing fee was a debt, and hence property of the estate. The 

Superior Court was not seeking payment from Appellant; it merely 

struck his pleadings from the docket for failure to pay the filing 

fee. Appellant was free not to pay the filing fee, unless he 

wanted to file documents on the state court docket. Thus, the 

filing fee was not a debt. Appellant did not owe the Superior 

Court anything. 

 Accordingly, the Court affirms the Bankruptcy Court’s July 

24, 2014 order denying Appellant’s motion for damages and voiding 

of judgments for this reason as well. 

CONCLUSION 

 For the foregoing reasons, the Court AFFIRMS the Bankruptcy 

Court’s July 24, 2014 Order Denying Motion for Damages and Voiding 

of Judgments in its entirety. See Docket No. 28. The Clerk of 

the Court shall close the file. Appellee shall recover his costs 

from Appellant. 

IT IS SO ORDERED. 

Dated: September 30, 2015 

CLAUDIA WILKEN 

United States District Judge 

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