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*

This disposition is not appropriate for publication. 

Although it may be cited for whatever persuasive value it may

have (see Fed. R. App. P. 32.1), it has no precedential value. 

See 9th Cir. BAP Rule 8013-1.

**Hon. Laura S. Taylor, United States Bankruptcy Judge for

the Southern District of California, sitting by designation.

UNITED STATES BANKRUPTCY APPELLATE PANEL

OF THE NINTH CIRCUIT

In re: ) BAP No. CC-11-1483-MkHTa

 )

CHARLENE GRUNTZ, ) Bk. No. RS 08-18585-MJ

 )

Debtor. )

_______________________________)

 )

ROBERT GRUNTZ, )

 )

Appellant, )

 )

v. ) MEMORANDUM*

 )

P.J. ZIMMERMAN, Chapter 7 )

Trustee; UNITED STATES TRUSTEE,)

 )

Appellees. )

_______________________________)

Argued and Submitted on September 21, 2012

at Pasadena, California

Filed – October 15, 2012

Appeal from the United States Bankruptcy Court

for the Central District of California

Honorable Meredith A. Jury, Bankruptcy Judge, Presiding 

Appearances: Appellant Robert Gruntz argued on his own behalf;

Appellee P.J. Zimmerman argued on her own behalf. 

Before: MARKELL, HOLLOWELL and TAYLOR,** Bankruptcy Judges.

FILED

OCT 15 2012

SUSAN M SPRAUL, CLERK

U.S. BKCY. APP. PANEL

OF THE NINTH CIRCUIT
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1Because some of the key players in this appeal share the

same surname, we refer to them by their first name for ease of

reference. No disrespect is intended.

2Some of the facts we rely upon are drawn from documents

that the parties have provided to us in their excerpts of record. 

But many other facts are drawn from the bankruptcy court’s

electronic docket and the imaged documents attached thereto. We

may take judicial notice of the filing and contents of these

items. See Atwood v. Chase Manhattan Mortg. Co. (In re Atwood),

293 B.R. 227, 233 n.9 (9th Cir. BAP 2003) (citing O’Rourke v.

Seaboard Sur. Co. (In re E.R. Fegert, Inc.), 887 F.2d 955, 957-58

(9th Cir. 1989)).

3

Unless specified otherwise, all chapter and section

references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532, and

all “Rule” references are to the Federal Rules of Bankruptcy

Procedure, Rules 1001-9037. All “Civil Rule” references are to

the Federal Rules of Civil Procedure.

2

INTRODUCTION

Robert Gruntz (“Robert”)1

 appeals from an order granting the

motion of chapter 7 trustee P.J. Zimmerman (“Trustee”) to

compensate her duly-employed field agent Jack Pope (“Pope”). 

Robert also appeals from an order denying a motion for

reconsideration of the compensation order. We AFFIRM both

orders.

FACTS2

This appeal arises from the bankruptcy case of Robert’s

former wife Charlene Gruntz (“Charlene”). Robert and Charlene

filed for divorce in 2004. Charlene filed her chapter 73

bankruptcy case on July 14, 2008, and the Trustee was appointed

to serve as chapter 7 trustee. At the time of Charlene’s

bankruptcy filing, Robert’s and Charlene’s divorce proceedings

were still pending. Robert has admitted that no final property

division had been made as of that time. 
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3

In her Schedules, Charlene claimed ownership of three

parcels of real property: (1) a ranch located on Kirby Street in

San Jacinto, California (“Kirby Ranch”), (2) a residence located

on Eaton Avenue in Hemet, California (“Eaton Residence”), and

(3) a residence located on Jeffrey Circle in Hemet, California

(“Jeffrey Circle Residence”).

Charlene’s schedules suggested that each parcel might have

some value to the estate, but ultimately the Trustee determined

that each parcel was burdensome or of no value to the estate. 

Accordingly, she obtained authorization to abandon them. 

Even though the Trustee no longer claims any interest in

these three parcels, the bankruptcy estate’s previously-claimed

interest in two of these three parcels – the Kirby Ranch and the

Jeffrey Circle Residence – is central to our resolution of this

appeal. We will discuss each of these two parcels in turn.

1. Kirby Ranch

Shortly after Charlene’s bankruptcy filing, in August 2008,

the Trustee filed an emergency motion in the bankruptcy court

seeking authorization to take immediate action concerning the

Kirby Ranch. As set forth in the emergency motion, the Trustee

and her associates had conducted a preliminary investigation of

the Kirby Ranch, which revealed the following:

• Charlene was the title holder of record of the Kirby Ranch;

• Nothing in Charlene’s Schedules or in her Statement of

Financial Affairs indicated that she was at the time running

any business located on the Kirby Ranch;

• A physical inspection of the Kirby Ranch indicated that

someone was boarding roughly eighty horses on the property; 
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4

• A woman at the property claimed that she and her husband

managed a horse boarding business on the property for

someone by the name of “Bob”;

• The physical inspection also suggested that there was

insufficient food and shelter on the premises for eighty

horses;

• In the pending state court dissolution proceeding between

Charlene and Robert, a receiver by the name of Steven Speier

(“Speier”) had been appointed to take possession of the

Kirby Ranch;

• Speier advised the Trustee that he also was aware of the

horses being boarded on the property but did not know who

owned the horses or who was running the business located on

the Kirby Ranch;

• Speier also advised the Trustee that he had not collected

any income that might have been generated from the horse

boarding business;

• The physical condition of the Kirby Ranch was poor, with

large amounts of garbage and old motor vehicles covering a

significant portion of the property; and

• No one had stepped forward with either proof of insurance or

claiming ownership of the business.

Based on these circumstances, the Trustee sought court

approval to take immediate possession and control of the Kirby

Ranch, to immediately terminate all business operations taking

place on the property, and to return all horses to their owners.

A hearing was set on the emergency motion, and the Trustee

gave notice of the hearing and the motion to, among others,
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4

The proofs and declarations of service filed in conjunction

with the emergency motion indicate that Robert and his state

court counsel Geoff S. Morris (“Morris”) were each served with

notice. A lawyer by the name of Lazaro E. Fernandez

(“Fernandez”) also was served. Fernandez had appeared in the

bankruptcy case on behalf of Robert in July 2008. The entered

order granting the emergency motion also was served on the same

three people.

5According to the Trustee, nearly all of the horses were

claimed by and turned over to Robert.

5

Robert and two lawyers who represented Robert in other matters.4

No opposition was ever filed in response to the emergency motion,

and it was ultimately granted. 

Neither Robert nor anyone else ever sought any relief from

the order granting the emergency motion. Notably, the order

granting the emergency motion identified the Kirby Ranch as

property of Charlene’s bankruptcy estate. There is no indication

in the record provided, or in our independent review of the

bankruptcy case docket, that anyone attempted to dispute the

identification of the Kirby Ranch as estate property at or around

the time of the emergency motion.

In October 2008, the Trustee sought and obtained the court’s

permission to employ Pope as her field agent to provide services

on behalf of the bankruptcy estate concerning the Kirby Ranch. 

In the employment application, the Trustee stated that, prior to

filing the employment application, Pope had secured the property

for the Trustee, and had arranged for the return of all of the

horses formerly being boarded on the property.5 The Trustee

further stated that she needed to employ Pope because his future

services might be needed to secure, supervise and clean up the
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6

Both the employment application and the entered order

granting the employment application were served on Morris and

Fernandez. However, unlike the emergency motion, the Trustee did

not separately serve on Robert the employment application and the

employment order.

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Kirby Ranch. The Trustee asserted: “The Kirby Property (in

particular) contains a staggering quantity of garbage on the

premises.” Employment Application (Oct 2, 2008) at 2:22.

Like the August 2008 emergency motion, the Trustee’s

employment application once again refers to the Kirby Ranch as

estate property. And once again, neither Robert nor anyone else

objected to the employment application.6 It was thus granted. 

No one has since sought relief from the order granting the

employment application.

In the numerous filings in Charlene’s case, Robert has made

a number of statements in in which he claims the he and Charlene

own or owned the Kirby Ranch as community property. The

statements contained in a motion he filed in the bankruptcy court

in December 2008 are representative. In that motion, Robert’s

counsel stated on his behalf: “Robert Gruntz has always

maintained that the ‘Kirby Property’ is community property as

well as several other properties in the name(s) of Robert Gruntz

and/or Charlene Gruntz.” Notice of Motion and Motion of Robert

Gruntz for reconsideration, etc. (Dec. 1, 2008) at 3:14-16. In

the same motion, his counsel also states: “Mr. Johnson [Trustee’s

counsel] is correct the ‘Kirby Property’ is community property

and therefore is liable for community debts.” Id. at 6:11-12. 

From these statements it is obvious that it apparently served

Robert’s interests at the time to assert that he and Charlene
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7For her part, Charlene has claimed that she owns 100% of

the Kirby Ranch, as her separate property.

7

jointly owned the Kirby Ranch as community property. 

At other times, however, Robert has filed papers with the

bankruptcy court alluding to the claims of others that, if

proven, would establish that neither he nor Charlene own the

Kirby Ranch.7

 These third-party ownership claims were the

subject of an adversary proceeding commenced in May 2009 and

dismissed without prejudice in October 2009.

While Robert now points to myriad disputes and settlements

involving numerous parties potentially calling into doubt the

estate’s formerly-claimed interest in the Kirby Ranch, we

reiterate that no one ever sought either to oppose or to obtain

relief from the two orders which authorized the Trustee to act

and to employ a field agent in order to safeguard and maintain

the Kirby Ranch, a parcel that the Trustee had reason to believe

at the time: (1) was valuable property of the estate, and

(2) needed to be secured and maintained in order to reduce the

risk of liability to the estate.

2. Jeffrey Circle Residence, and the rents derived therefrom

According to the Trustee, while being examined at her

§ 341(a) meeting of creditors, Charlene disclosed that she had

lived in the Jeffrey Circle Residence until 2007. Charlene

apparently further disclosed at her § 341(a) meeting that she had

been renting the property since 2007 and that she was delinquent

on both mortgage payments and taxes owed on the property.

In April 2009, Downey Savings and Loan Association
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8

(“Downey”), the holder of the first deed of trust against the

Jeffrey Circle Residence, sought and obtained relief from the

automatic stay so that it could proceed with a foreclosure of the

Jeffrey Circle Residence. Downey also claimed that it was

entitled to the rents the Trustee had collected pursuant to the

terms of its deed of trust and an accompanying rental property

rider. 

The Trustee filed a response in which she stated that she

had reached an agreement with Downey in which she consented to

its relief from stay motion, and agreed to abandon the estate’s

interest in the property. In return, Downey agreed to let the

Trustee keep the roughly $12,200 in rents that the Trustee had

collected from Charlene and the tenants renting the property. 

The bankruptcy court entered orders in May 2009 granting

Downey’s relief from stay motion and authorizing the Trustee to

abandon the Jeffrey Circle Residence. Robert’s counsel was served

with notice of the relief from stay motion, the Trustee’s

response thereto and the Trustee’s abandonment notice. Robert

never objected to or sought relief from any of these matters. 

3. Compensation Motion

On May 6, 2011, the Trustee filed her motion for

authorization to compensate Pope for his services in connection

with the safeguarding and maintaining of the Kirby Ranch. 

Although Pope claimed roughly $45,000 in aggregate for his

services and expenses incurred while acting as the Trustee’s

field agent, the only funds the estate had on hand to pay

compensation was the roughly $12,200 (plus accrued interest) that

the Trustee had collected in rents from the Jeffrey Circle
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Residence. Accordingly, Pope indicated his willingness to accept

that amount in full satisfaction for his services and expenses. 

Moreover, the Trustee indicated in the compensation motion that

her other duly-employed professionals, her accountant and her

attorney, were willing to forego any compensation in light of the

insufficient funds in the estate and in light of the Trustee’s

desire to use the funds to cover at least some of Pope’s

out-of-pocket expenses.

In addition to his efforts to initially secure the Kirby

Ranch and to ensure that the horses were transferred off the

property, Pope also needed to board up three buildings, cut weeds

and remove a “staggering amount of trash on the 20 acres” as

required by the Trustee’s insurance carrier and various city and

county government offices. It is not clear from the compensation

motion or Pope’s accompanying declaration precisely when

particular services were rendered or expenses incurred, but Pope

claimed, among other things, out-of-pocket expenses of over

$22,000 for dump fees and for bobcat and truck rental.

The Trustee further stated in the compensation motion that,

at one point she had a prospective purchaser interested in buying

the Kirby Ranch, but that ongoing disputes regarding ownership of

the property and ongoing County demands that the property be

further maintained prevented her from realizing any value from

the property and forced her to abandon the estate’s interest in 

the property.

Robert filed an opposition to the compensation motion on

May 23, 2011. Among other things, Robert claimed: (1) the

Trustee and the court were told at the outset of the case that
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8Robert offered no evidence to support this assertion, nor

have we found any evidence corroborating this assertion during

our independent review of the docket and its contents.

9

Robert never obtained the transcript from this hearing, so

we do not know specifically what facts the court found or relied

upon in granting the compensation motion.

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Charlene did not own the Kirby Ranch;8 (2) because Charlene did

not own the Kirby Ranch, the court lacked jurisdiction and/or

authority to issue any orders relating in any way to that

property; (3) the rents from the Jeffrey Circle Residence were

community property jointly owned by Charlene and Robert;

(4) because the rents were 50% his community property, that 50%

could not be used to pay Pope for his services, which were

Charlene’s separate debt; and (5) no funds should be distributed

from the estate unless and until ownership of the rents and

ownership of the Kirby Ranch and the Jeffrey Circle Residence

were finally determined. In her reply to Robert’s opposition,

the Trustee pointed out that the rents were the proceeds of the

settlement between the Trustee and Downey, and hence were estate

property.

After holding a hearing on the motion,9

 the bankruptcy court

overruled Robert’s objection and granted the compensation motion,

by order entered June 9, 2011.

4. The reconsideration motion.

On June 20, 2011, a motion for reconsideration was filed by

two people by the name of John Martin and Linda Martin. At the

end of the motion, there is a signature for Linda Martin, “in pro

per.” Attached to the motion for reconsideration is a memorandum

of points and authorities. At the end of the memorandum of
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10Even though Robert’s notice of appeal only referenced the

order denying the reconsideration motion, we will treat his

appeal as also requesting review of the underlying compensation

order. We may do so because the parties have fully briefed the

issues arising from the underlying compensation order. See Lolli

v. County of Orange, 351 F.3d 410, 414-15 (9th Cir. 2003); Wash.

State Health Facilities Ass’n v. Wash. Dept. of Soc. & Health

Servs., 879 F.2d 677, 681 (9th Cir. 1989); McCarthy v. Mayo,

827 F.2d 1310, 1313–1314 (9th Cir. 1987).

11

points and authorities, there are signatures of a number of

additional parties, including one for Robert. Parties other than

Robert complained that they had inadequate notice of the

compensation motion and that the court improperly prohibited them

from appearing and presenting oral argument at the hearing on the

compensation motion. But Robert is the only person who filed a

notice of appeal, and as far as he is concerned, the

reconsideration motion merely reiterates some of the same points

he made in his opposition to the compensation motion.

After a hearing on the reconsideration motion, the

bankruptcy court entered an order denying the reconsideration

motion on August 18, 2011, and Robert timely filed a notice of

appeal on August 31, 2011.10

JURISDICTION

The bankruptcy court had jurisdiction pursuant to 28 U.S.C.

§§ 1334 and 157(b)(2)(A) and (B). We have jurisdiction under

28 U.S.C. § 158.

ISSUES

1. Did Robert provide us with a sufficient record?

2. Did the bankruptcy court abuse its discretion in granting

the Trustee’s compensation motion and awarding roughly
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$12,200 to Pope?

3. Did the bankruptcy court abuse its discretion in denying the

reconsideration motion?

STANDARDS OF REVIEW

A bankruptcy court order awarding compensation under § 330

is reviewed for abuse of discretion. Leichty v. Neary (In re

Strand), 375 F.3d 854, 857 (9th Cir. 2004). Under the abuse of

discretion standard of review, we first “determine de novo

whether the [bankruptcy] court identified the correct legal rule

to apply to the relief requested.” United States v. Hinkson,

585 F.3d 1247, 1262 (9th Cir. 2009) (en banc). And if the

bankruptcy court identified the correct legal rule, we then

determine under the clearly erroneous standard whether its

factual findings and its application of the facts to the relevant

law were: “(1) illogical, (2) implausible, or (3) without support

in inferences that may be drawn from the facts in the record.” 

Id. (internal quotation marks omitted).

If a “motion for reconsideration” is filed within 14 days of

the entry of the order to which it relates, it is treated as a

motion to alter or amend judgment under Civil Rule 59(e). 

Am. Ironworks & Erectors, Inc. v. N. Am. Constr. Corp., 248 F.3d

892, 898–99 (9th Cir. 2001). If the reconsideration motion is

filed beyond that time period, it is treated as a motion for

relief from judgment under Civil Rule 60(b). Either way, the

denial of such motions is reviewed for abuse of discretion. Id.;

see also First Ave. W. Bldg., LLC v. James (In re OneCast Media,

Inc.), 439 F.3d 558, 561 (9th Cir. 2006); Far Out Prods., Inc. v.

Oskar, 247 F.3d 986, 992 (9th Cir. 2001); Clinton v. Deutsche
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11While the en banc decision did not mention it, one of the

Ninth Circuit’s other decisions notes that Robert has a law

degree, but is not a member of the state bar. See Gruntz v.

Cnty. of Los Angeles (In re Gruntz), 166 F.3d 1020, 1023, amended

and superseded, 177 F.3d 728, rehr’g en banc granted and opn.

withdrawn, 177 F.3d 729 (9th Cir. 2000).

13

Bank Nat’l Trust Co. (In re Clinton), 449 B.R. 79, 82 (9th Cir.

BAP 2011).

DISCUSSION

A. Robert did not provide us with essential transcripts.

While Robert has appeared in this appeal in pro per, he is

no stranger either to the bankruptcy courts or the federal

appellate courts. In fact, he was the appellant in a seminal

Ninth Circuit Court of Appeals case involving the scope of the

automatic stay, Gruntz v. Cnty. of Los Angeles (In re Gruntz),

202 F.3d 1074 (9th Cir. 2000) (en banc). That appeal arose from

Robert’s bankruptcy case, which he filed many years ago, in 1988

(Bankr. C.D. Cal. Case No. RS-88-08310-MG). In his bankruptcy

case, Robert filed an adversary proceeding seeking relief from a

state court criminal conviction for nonpayment of child support,

claiming that the criminal proceedings against him violated the

automatic stay. See In re Gruntz, 202 F.3d at 1077-78. An en

banc panel of the Ninth Circuit ultimately determined that the

automatic stay did not apply to the criminal proceedings. Id. at

1088. 

Robert not only has significant personal bankruptcy and

appellate experience, but he also has had formal legal

training.11 Moreover, he knows how to order transcripts when he

is so inclined. See Adv. No. RS-09-01223-MS, Doc. No. 41.
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However, the bankruptcy court’s adversary and case dockets

reflect that Robert never ordered nor obtained the transcripts

from either the hearing on the compensation motion or the hearing

on the reconsideration motion. By not ordering these

transcripts, he has hamstrung our ability to review the

bankruptcy court’s orders for abuse of discretion.

Failure to order necessary transcripts may be grounds for

dismissal of an appeal or summary affirmance. Kyle v. Dye

(In re Kyle), 317 B.R. 390, 393 (9th Cir. BAP 2004), aff’d,

170 Fed. Appx. 457 (9th Cir. 2006); see also Syncom Capital Corp.

v. Wade, 924 F.2d 167, 169 (9th Cir. 1991). But we also have

discretion, when practicable and appropriate, to proceed with

whatever review the absence of the requisite transcripts allows. 

See, e.g., In re Kyle, 317 B.R. at 393-94.

We will exercise our discretion here to proceed as best we

can without the requisite transcripts. At the same time, we are

entitled to infer, based on Robert’s failure to provide them,

that there would be nothing in the transcripts that would help

Robert’s arguments on appeal. Gionis v. Wayne (In re Gionis),

170 B.R. 675, 680-81 (9th Cir. BAP 1994).

B. None of Robert’s arguments on appeal have any merit.

Robert makes the same arguments on appeal that he made in

the bankruptcy court in opposition to the Trustee’s compensation

motion. First and foremost, Robert claims that the Kirby Ranch

might not have been estate property because other people have

asserted competing ownership claims thereto. According to

Robert, unless and until there is a final judicial determination

that Charlene owns some or all of the Kirby Ranch, the bankruptcy
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court should not have authorized the Trustee either to employ or

to compensate Pope for work done on behalf of the bankruptcy

estate with respect to the Kirby Ranch.

Robert claims that his argument regarding ownership of the

Kirby Ranch is jurisdictional. We disagree. There is nothing in

the main bankruptcy jurisdiction statutes, 28 U.S.C. §§ 157 and

1334, stating or suggesting that bankruptcy courts lack authority

to hear matters and issue orders otherwise affecting

administration of the bankruptcy estate unless and until a final

determination is made that property potentially impacted by the

matters and orders is estate property. The Supreme Court has

counseled that care must be taken to avoid transmuting

substantive arguments into jurisdictional arguments. As it has

stated: “ . . . when Congress does not rank a statutory

limitation on coverage as jurisdictional, courts should treat the

restriction as nonjurisdictional in character.” Arbaugh v. Y & H

Corp., 546 U.S. 500, 516, 126 S.Ct. 1235, 1245 (2006), cited with

approval in, United Student Aid Funds, Inc. v. Espinosa, --- U.S.

---, 130 S.Ct. 1367, 1377-78 (2010).

Furthermore, Robert’s attempt to characterize this argument

as jurisdictional defies common sense. If litigants could

undermine the bankruptcy court’s jurisdiction to enter § 327

employment orders and § 330 compensation orders by merely

alleging that property potentially impacted by those orders might

not be property of the estate, bankruptcy courts seldom if ever

would be able to enter such orders over the objection of any

interested party. This in turn would jeopardize the ability of 

bankruptcy trustees to expeditiously administer bankruptcy
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12Garcia lists all of the factors as follows:

(a) Were the services authorized?

(b) Were the services necessary or beneficial to the

administration of the estate at the time they were

rendered?

(c) Are the services adequately documented?

(d) Are the fees required reasonable, taking into

consideration the factors set forth in section

330(a)(3)?

(e) In making the determination, the court must

consider whether the professional exercised reasonable

billing judgment.

Id. (citing Roberts, Sheridan & Kotel, P.C. v. Bergen Brunswig

Drug Co. (In re Mednet), 251 B.R. 103, 108 (9th Cir. BAP 2000),

and In re Strand, 375 F.3d at 860).

16

estates.

At most, Robert’s issue regarding the estate’s interest in

the Kirby Ranch goes to whether the services Pope performed were

necessary or beneficial to the estate at the time they were

rendered. This is among the factors the bankruptcy court must

consider when ruling on a § 330 compensation request. See Garcia

v. U.S. Trustee (In re Garcia), 335 B.R. 717, 724 (9th Cir. BAP

2005).12 

The necessity and benefit of the services rendered is

measured based on circumstances as they existed at the time they

were rendered and not based on the benefit of hindsight. See

In re Garcia, 335 B.R. at 724; In re Mednet, 251 B.R. at 107. 

Here, we find it instructive that no one filed an objection when

the Trustee proposed to employ Pope for precisely the same tasks

that Pope later sought compensation for: the security and

maintenance of the Kirby Ranch. Only when the Trustee later

sought to pay Pope did Robert file an objection.
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In any event, at the time she sought authorization to employ

Pope, the Trustee offered a sufficient showing of the necessity

of securing and maintaining the Kirby Ranch. The Trustee feared

she otherwise would expose the bankruptcy estate to a risk of

liability unless the Kirby Ranch was properly secured and

maintained. While Robert (and others) later alleged that

Charlene might not actually own the Kirby Ranch, we were unable

to find any paper filed in Charlene’s bankruptcy case during the

first several months of that case calling into question whether

Charlene had any interest in the Kirby Ranch. In fact, as

mentioned above, Robert asserted in his own early bankruptcy

court filings that he and Charlene jointly owned the Kirby Ranch

as community property, and Charlene claimed that the Kirby Ranch

was her separate property. Regardless of whether the Kirby Ranch

was Charlene’s community or separate property, either type of

ownership interest would have been sufficient to establish the

Kirby Ranch as property of her bankruptcy estate. See

§ 541(a)(1) and (2).

Under these circumstances, Robert’s belated raising of the

issue regarding ownership of the Kirby Ranch does not establish

that the bankruptcy court abused its discretion in authorizing

the Trustee to compensate Pope in the approximate amount of

$12,200.

Robert also argues that he and Charlene jointly owned the

Jeffrey Circle Residence as community property, and that he thus

had a 50% community property interest in the rents collected

therefrom. According to Robert, the bankruptcy court should not

have used his 50% share of the rents to pay Pope because the
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obligation to pay Pope was Charlene’s separate, post-dissolution

debt.

Robert’s rents argument ignores the fact that the court,

without any objection from him, granted Downey’s relief from stay

motion concerning the Jeffrey Circle Residence. In conjunction

with that motion, the Trustee had agreed to the relief Downey was

seeking in exchange for Downey’s agreement to let the Trustee

keep the roughly $12,200 in rents she had collected. According

to Downey, the rents collected otherwise would have been part of

Downey’s collateral under its first deed of trust against the

Jeffrey Circle Residence.

But even if we were to disregard Downey’s relief from stay

motion and Downey’s transfer to the Trustee of its interest in

the rents, Robert still could not prevail on his rents argument. 

Assuming without deciding that Robert had a 50% community

property interest in the rents, they still were property of

Charlene’s bankruptcy estate, 11 U.S.C. § 541(a)(2), and as such

could be used to pay allowed administrative expenses of the

estate, including the compensation awarded to Pope. The explicit

language of the Bankruptcy Code supports this result.

Under § 541(a)(2), the non-debtor spouse’s share of

community property is classified as estate property, so long as

that property is subject to the “sole, equal or joint management

and control of the debtor” or is liable for allowable claims

against the debtor. Even when dissolution proceedings are

pending at the time of the debtor’s bankruptcy filing, the nondebtor spouse’s share of community property is property of the

debtor’s bankruptcy estate, unless the state court made a final
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property division before the bankruptcy case was commenced. See

Dumas v. Mantle (In re Mantle), 153 F.3d 1082, 1085 (9th Cir.

1998) (applying California law and holding that “until division,

all community property of the divorcing couple is property of the

bankruptcy estate pursuant to § 541(a)(2).”).

In California, community property generally is subject to

the equal management and control of either spouse. See Cal. Fam.

Code § 1100(a); see also Teel v. Teel (In re Teel), 34 B.R. 762,

764 (9th Cir. BAP 1983) (“In California, with exceptions not here

relevant, each spouse has management and control of community

property . . . . Therefore, the community property of appellant

and the debtor is property of the estate under both

§ 541(a)(2)(A) and (B).”). Moreover, the record here indicates

that, if either spouse had sole management and control of the

Jeffrey Circle Residence and the rents derived therefrom, it

would have been Charlene. Robert has not disputed that Charlene

held legal title to the Jeffrey Circle Residence as her sole and

separate property, that she encumbered the Jeffrey Circle

Residence by executing the first deed of trust held by Downey,

and that she rented out the Jeffrey Circle Residence, which led

to the accrual of the rents collected by the Trustee.

In any event, regardless of whether the rents were equally

controlled by Robert and Charlene or solely controlled by

Charlene, the entire amount of the rents constituted property of

Charlene’s bankruptcy estate under § 541(a)(2)(A), even if Robert

held a 50% community property interest in the rents.

Having established that all of the rents were estate

property, it also is beyond cavil that the bankruptcy court
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properly could authorize the Trustee to use all of the rents to

compensate Pope. Compensation awarded under § 330 qualifies as

an allowed § 503(b)(2) administrative expense, which is subject

to payment from all estate assets, including § 541(a)(2) estate

property. See § 726(c)(1) (“Claims allowed under section 503 of

this title shall be paid either from property of the kind

specified in section 541(a)(2) of this title, or from other

property of the estate, as the interest of justice requires.”).

Nor can it seriously be doubted that the interest of justice

permitted the bankruptcy court to authorize the Trustee to

compensate Pope from the rents. The rents were the only funds

available to provide any compensation. The Trustee duly obtained

authorization to employ Pope, without any written opposition

thereto. Additionally, the Trustee had sufficient grounds for

believing at the time that the best interests of the estate would

be served by employing Pope. Only after Pope had performed his

services and sought payment did Robert file a written objection,

questioning for the first time the necessity and benefit to the

estate of Pope’s employment and services. Moreover, the record

here supports the conclusion that Pope’s services were necessary

and beneficial to the estate at the time of his employment, as

discussed above. Finally, payment of all of the rents to Pope

defrayed only a portion of his out-of-pocket expenses and

constituted only a small fraction of the total compensation he

claimed entitlement to. 

In sum, Robert’s rents argument is based on a false premise:

that his alleged 50% community property interest in the rents

prohibited the bankruptcy court from authorizing use of all of
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13Robert’s rents argument suggests he believes that, under

California law, his 50% share of community property could not be

used to pay a separate debt of Charlene’s, including any

compensation owed to Pope. Assuming without deciding that this

is a correct statement of California law, it would be preempted

to extent it conflicted with the Bankruptcy Code provisions

explicitly permitting the court to authorize payment of

administrative expense claims from § 541(a)(2) estate property. 

See 6 Collier on Bankruptcy ¶ 726.05[1] (Alan N. Resnick and

Henry J. Sommer, eds., 16th ed. 2012) (citing In re Teel, 34 B.R.

at 764 and stating: “ . . . where there are differences between

the bankruptcy distribution scheme and state law, the state law

scheme is preempted.”).

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the rents to pay compensation to Pope. As explained above, the

Bankruptcy Code explicitly permits such use of § 541(a)(2) estate

property.13 Because Robert’s rents argument is fatally flawed,

it does not support reversal of the bankruptcy court’s

compensation order.

As for the bankruptcy court’s denial of the reconsideration

motion, Robert has not focused on that ruling in his appeal

briefs. Moreover, to the extent it pertained to Robert, the

reconsideration motion merely reiterated the same types of

arguments Robert had made in his opposition to the Trustee’s

compensation motion. Accordingly, for the same reasons we affirm

the bankruptcy court’s compensation order, we may affirm its

denial of the motion for reconsideration. See Am. Ironworks &

Erectors, Inc., 248 F.3d at 899 (holding that, when the

appellants’ motion for reconsideration merely reargued their

original position, trial court did not abuse its discretion in

denying the reconsideration motion).

Robert’s appeal briefs contain other complaints regarding

the bankruptcy court’s rulings and the Trustee’s actions. These
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additional complaints can be categorized as: (1) irrelevant to

the orders on appeal, (2) incomprehensible, and/or (3) patently

inconsistent with the record. It suffices for us to say that

none of these other complaints justify reversal of the orders on

appeal.

CONCLUSION

For all of the reasons set forth above, we AFFIRM the

bankruptcy court’s orders granting the Trustee’s compensation

motion and denying the reconsideration motion.