1996 Decisions

Opinions of the United

States Court of Appeals

for the Third Circuit

7-29-1996

In Re: Coffin

Precedential or Non-Precedential:

Docket 96-1007

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Recommended Citation

"In Re: Coffin" (1996). 1996 Decisions. Paper 124.

http://digitalcommons.law.villanova.edu/thirdcircuit_1996/124
 UNITED STATES COURT OF APPEALS 

 FOR THE THIRD CIRCUIT 

 ____________ 

 No. 96-1007 

 ____________ 

 IN RE: TRISTAM COFFIN, 

 Appellant, 

 vs. 

 MALVERN FEDERAL SAVINGS BANK 

 ____________ 

 Appeal from the United States District Court 

 for the Eastern District of Pennsylvania 

 (D.C. 95-cv-03143) 

 ____________ 

 Argued: June 6, 1996 

 Before: BECKER and MANSMANN, Circuit Judges, and 

SCHWARZER, District Judge 

 (Filed: July 29, 1996) 

 JEFFREY S. WILSON, ESQUIRE 

 (ARGUED) 

 BENSON ZION, ESQUIRE

 Benson Zion and Associates 

 919 Conestoga Road 

 Building Three, Suite 214 

 Rosemont, PA 19010 

 Attorney for Tristam Coffin, 

 Appellant 

 MARK D. PHILLIPS, ESQUIRE 

 (ARGUED) 

 Malvern Federal Savings Bank 

 24 North New Street 

 West Chester, PA 19380 

 Attorney for Malvern Federal 

 Savings 

 Bank, Appellee 
 

 _____________________________ 

 OPINION OF THE COURT 

 ______________________________ 

SCHWARZER, District Judge. 

 This is an appeal by Tristram Coffin, the debtor, from an order 

of the district court 

affirming an order of the bankruptcy court. The bankruptcy court's order 

denied the debtor's 

motion styled as one "to reconsider lien avoidance." Because we and the 

district court lack 

jurisdiction of this appeal, we remand with directions. 

 Coffin was the owner of three parcels of real property on which 

Malvern Federal 

Savings Bank held mortgages to secure loans it had made to Coffin. When 

Coffin fell in arrears, 

the Bank foreclosed on one of the mortgages. Coffin then filed a 

voluntary petition in the 

bankruptcy court under Chapter 13 of the Bankruptcy Code. The Bank filed 

a proof of claim 

which set forth the arrearages on the three mortgages. Coffin then filed 

an Amended Chapter 13 

Plan which provided for some of the arrearages. Without objection from 

the Bank, the bankruptcy 

court on October 19, 1993, confirmed the Plan. 

 Nine months later, on June 23, 1994, the Bank moved "for an Order 

granting relief 

from the automatic stay provided by 11 U.S.C. Section 362 in order that 

said creditor may pursue 

its state foreclosure remedies to enforce its lien against real property 

of the debtor . . . ." On 

September 1, 1994, following a hearing, the court (1) directed Coffin to 

make payments to the 

Bank in addition to those made under the Plan; (2) directed Coffin to file 

an amended Plan to 

provide adequately for the Bank's secured claim; and (3) ordered the 

automatic stay to remain in 

place pending further hearing on the motion. In opposition to the Bank's 

motion, Coffin then filed 

his motion to dismiss as res judicata the Bank's motion for relief from 

the automatic stay. 

Following a hearing held on December 1, 1994, the bankruptcy court issued 

an opinion and order, 

denying the Bank's motion for relief from automatic stay and granting 

Coffin's motion to dismiss 

to that extent. The court found that 

 [the Bank] is bound by the Debtor's Confirmed Plan with respect 

to 
 the distribution to it provided thereunder and therefore relief 

from 

 stay is not appropriate, there being no default under the Plan. 

(Op. 

 7.) 

The court then added: 

 However, we further find that [the Bank's] lien on the Gay Street 

 Property is not discharged by this Chapter 13 proceeding and that 

 upon lifting of the stay at the conclusion of this case or 

sooner, [the 

 Bank] will be free to exercise its state law remedies under its 

 mortgage and applicable law. (Ibid.) 

 The Bank did not appeal from the order denying relief from the 

automatic stay. 

Coffin, however, although the prevailing party on the motion (the court 

having granted his 

dismissal motion and having entered no order adverse to him), filed a 

motion styled as one "to 

reconsider lien avoidance." The court, describing this motion as "framed 

in a somewhat cryptic 

manner since it suggests that a motion for lien avoidance was the subject 

of the motions that are at 

the heart of this request for reconsideration" interpreted the motion as 

"challeng[ing] this Court's 

legal conclusion that the Bank's liens . . . survive the bankruptcy 

discharge . . . ." (Op. 1. n.1) The 

motion was denied. Coffin then appealed to the district court which, 

stating "the issue in this 

appeal . . . [to] concern[] whether certain liens survive a bankruptcy 

proceeding," (Op.1.) affirmed. 

 It is not necessary for present purposes to examine the 

bankruptcy court's reasoning 

that led to its "finding" that the Bank's mortgage lien had not been 

discharged by the confirmed 

Chapter 13 Plan. The threshold question is whether that "finding," and, 

in turn, the order denying 

reconsideration and the district court's order affirming it, constitute 

appealable orders. 28 U.S.C. 

 158(a)(1), 1291, 1292(a). 

 While the analysis takes us outside of conventional appealable 

order jurisprudence, 

it is nonetheless firmly grounded on principles of justiciability and 

ripeness. The bankruptcy 

court's "finding"--that the Bank's lien was not discharged and that at the 

end of the case it would 

be free to exercise its state law remedies under its mortgage--was an 

advisory opinion. Its order 

denying Coffin's "cryptic" motion for reconsideration decided no actual 

controversy between the 

parties: Coffin had not moved for an order of lien avoidance (it is 

doubtful that he could have done 
so in any event, see 11 U.S.C.  522(f)); the issue of whether the lien 

survived was not before the 

court for adjudication; and the "finding" it made did not determine 

whether the Bank would 

succeed in a subsequent foreclosure action in state court. If the lien 

survived, it survived by reason 

of the prior proceedings, including the confirmed Plan, not because of the 

court's "finding." Were 

the Bank to go to state court to foreclose on its mortgage, its right to 

do so would have to be 

determined by that court in light of its interpretation of the terms of 

the Confirmed Plan, as well as 

the terms of the mortgage, applicable state law and, of course, that 

court's findings of fact. To put 

it differently, had the bankruptcy court made a "finding" that the Bank's 

lien did not survive, the 

state court in the foreclosure proceeding would clearly not be precluded 

from ordering a 

foreclosure, if under applicable law the lien remained enforceable; such a 

finding, not being 

necessary to the decision, would be mere dictum and not give rise to res 

judicata or collateral 

estoppel. 

 "The oldest and most consistent thread in the federal law of 

justiciability is that 

federal courts will not give advisory opinions." 13 Wright, Miller, 

Cooper, Federal Practice and 

Procedure,  3529.1, p. 293 (2d ed. 1984). We have addressed the question 

when a justiciable 

controversy exists--although under the rubric of ripeness--in the context 

of suits for declaratory 

relief. Although the parties did not invoke the declaratory relief 

statute, 28 U.S.C.  2201, the case 

before us in its present posture is somewhat analogous to one seeking a 

declaration of rights. In 

Step-Saver Data Systems, Inc. v. Wyse Technology, 912 F.2d 643 (3rd Cir. 

1990), plaintiff sought 

a declaration that its suppliers are responsible for any liability that 

plaintiff may have to its 

customers as a result of the pending customers' suits. The district court 

dismissed the complaint 

and this court affirmed. It defined certain basic principles guiding the 

determination whether an 

actual controversy exists, "[t]he most important of . . . [which] are the 

adversity of the interest of 

the parties, the conclusiveness of the judicial judgment and the practical 

help, or utility of that 

judgment." Id. at 647. Here, while there is no question of the adversity 

of the interest of the 

parties, conclusiveness of judicial judgment and any utility of that 

judgment are totally lacking. 

The determination of whether the Bank's lien is enforceable will 

eventually have to be made by 
another court in foreclosure proceedings and the bankruptcy court's advice 

will have no legal 

effect. See Id. at 649 n.9. 

 That the Bank may have asked the bankruptcy court to interpret 

the Plan with 

respect to the question of the survival of its lien, and that the parties 

advanced opposing positions, 

does not alter the conclusion that what the court said in this respect was 

an advisory opinion. That 

seems clear under Step-Saver, where plaintiff asked for a declaration of 

non-liability but the 

complaint was dismissed for lack of a ripe controversy. Nor does it 

matter that foreclosure may be 

imminent since the fact remains that the "finding" of the bankruptcy court 

is an advisory opinion 

that will not have a judicial effect on the outcome of the future 

foreclosure proceedings. 

 Both parties urge us to take jurisdiction to resolve matters that 

would help them 

move on, but jurisdiction cannot be conferred by consent. While we are 

sympathetic to their 

plight, it is of their own making, resulting from the parties' lack of 

care and attention given the 

Chapter 13 proceedings, including the formulation of the Plan. The 

present problem could and 

should have been anticipated by appropriate provision in the Plan. The 

bankruptcy court retains 

jurisdiction of the case, however, and it is the proper forum to resolve 

post-confirmation problems 

in appropriate proceedings. See 11 U.S.C.  1328, 1329. Presumably the 

court will now grant a 

discharge, close the case, and thereby free the Bank to test the 

continuing validity of its lien by 

bringing a foreclosure action. 

 Accordingly, we remand the matter to the district court and 

direct it to remand it to 

the bankruptcy court. That court should enter an order vacating so much 

of its opinions as purports 

to find that the Bank's lien survived.