1

The Honorable Warren K. Urbom, United States District Judge

for the District of Nebraska.

 2The Honorable John C. Minahan, Jr., United States Bankruptcy

Judge for the District of Nebraska.

___________

No. 96-1789

___________

In re: Stute Company, Inc. *

 *

Debtor. *

 *

--------------------- *

 * Appeal from the United States

State Bank of Benkelman, * District Court for the

 * District of Nebraska.

Appellee, *

 * [UNPUBLISHED]

v. *

 *

Stute Company, Inc., *

 *

Appellant. *

___________

 Submitted: December 6, 1996

 Filed: December 12, 1996 ___________

Before FAGG, WOLLMAN, and MURPHY, Circuit Judges. ___________

PER CURIAM.

Stute Company, Inc. ("Stute") appeals from an affirmance by

the district court1 of a bankruptcy court2 order granting State Bank

of Benkelman ("Bank") relief from an automatic stay, pursuant to 11

U.S.C. § 362(d)(1). We dismiss the appeal as moot. 

 
-2-

In 1988, Stute filed for bankruptcy under Chapter 12; a second

amended plan of reorganization was confirmed in 1989. In 1995, on

the Bank's motion, the bankruptcy court dismissed the Chapter 12

proceeding after finding that Stute had failed to make the payments

required by the plan. Following the dismissal, the Bank published

the required five-week notice of a foreclosure sale to be held on

Monday, April 17, 1995. Six days before the April 17 sale, Stute

filed a Chapter 11 bankruptcy petition and proposed plan of

reorganization. On Friday, April 14, the Bank received notice of

the Chapter 11 filing; and immediately filed a motion for relief

from the automatic stay, alleging this bankruptcy filing was solely

to delay the sale and was thus in bad faith, and a request for an

expedited hearing on its motion. On that same day, the court

granted the request for the hearing, notified Stute, and scheduled

a telephonic hearing for the following Monday. Both Stute and the

Bank participated in the hearing. 

At the telephonic hearing, the court lifted the automatic stay

for cause under section 362(d)(1), after concluding that notice of

the hearing was sufficient under the circumstances, and that

Stute's Chapter 11 petition had been filed in bad faith. With the

stay lifted, the foreclosure sale proceeded as planned, and the

collateral was sold to a third party. The court denied Stute's

subsequent motion to reconsider. The district court affirmed.

Stute timely appealed, contesting the adequacy and notice of the

hearing, and the lifting of the automatic stay. 

An appeal from a bankruptcy court's order setting aside an

automatic stay is rendered moot by the sale of the collateral to a

third party. Markstein v. Massey Assoc., Ltd., 763 F.2d 1325, 1327

(11th Cir. 1985) (court is powerless to rescind foreclosure sale

where debtor did not obtain stay of sale pending appeal); In re Van

Iperen, 819 F.2d 189, 191 (8th Cir. 1987) (per curiam) (citing

Markstein with approval and holding foreclosure sale of collateral

mooted debtor's appeal because once collateral is converted into
-3-

cash, no court is able to formulate relief). Because Stute did not

request a stay of the bankruptcy court's order and the collateral

was sold to a third party, we conclude this appeal is moot. We

decline to address Stute's argument otherwise. See In re Hanna,

912 F.2d 945, 948 (8th Cir. 1990) (declining to address debtor's

argument raised for the first time in appeal); Weiner v. Eastern

Arkansas Planting Co., 975 F.2d 1350, 1357 n.6 (8th Cir. 1992)

(refusing to consider argument raised for first time in reply

brief).

Moreover, we reject Stute's challenges to the notice and

adequacy of the hearing as without merit. See In re Fay, 155 B.R.

1009, 1011 (Bank. E.D. Mo. 1993) (holding notice on Friday of

Monday hearing on emergency motion to lift automatic stay satisfied

bankruptcy notice requirement).

A true copy.

Attest:

CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.