* District Judge of the Northern District of Ohio, sitting by designation.

1

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

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No. 00–60764

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In The Matter Of: DOUBLE J OPERATING COMPANY, INC.

 Debtor.

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DOUBLE J OPERATING COMPANY, INC. &

JOHN B. ECHOLS,

Appellants,

versus

MARY MAUDE BIRMINGHAM NICHOLS & 

MARY ASHLEY NICHOLS, Executrixes of the Estate

of Robert G. Nichols, Jr. & FIDELITY AND DEPOSIT 

COMPANY OF MARYLAND,

Appellees.

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Appeal from the United States District Court

for the Southern District of Mississippi

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May 13, 2002

Before HIGGINBOTHAM and EMILIO M. GARZA, Circuit Judges, and DOWD,

District Judge.*
** Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion

should not be published and is not precedent except under the limited

circumstances set forth in 5TH CIR. R. 47.5.4.

1 The district court’s opinion concluded as follows:

For the foregoing reasons, this Court finds that the

bankruptcy court correctly concluded that the debtor’s motion to

reopen was unnecessary; thus, the bankruptcy judge did not abuse his

discretion in denying the debtor’s motion to reopen its bankruptcy

case. Accordingly,

IT IS HEREBY ORDERED that the appellants’s [sic] appeal is

without merit and is hereby dismissed with prejudice.

(emphasis added). Sitting as a court of appeal, the district court should have

affirmed the bankruptcy court’s decision. When a court of appeal affirms a lower

court’s decision, the court of appeal affirms that the judgment of the lower

court is correct and should stand. Although a dismissal of an appeal acts as a

confirmation of the judgment below, it suggests that the merits of the appeal

were not considered.

2

PER CURIAM:**

Appellants Double J Operating Company and John B. Echols

(collectively the "Appellants") appealed an order of the Bankruptcy

Court for the Southern District of Mississippi denying their motion

to reopen the bankruptcy case in order to bring an adversarial

proceeding against the trustee and his surety on the trustee's bond

pursuant to Federal Rule of Bankruptcy Procedure 2010(b). The

district court affirmed the bankruptcy court’s decision, and an

appeal to this court followed.1 We REVERSE and REMAND with

instructions.

The bankruptcy and district court focused on the necessity of

the motion to reopen in order for Appellants to file their proposed

action against the trustee and his surety. In particular, the

bankruptcy court’s order provided:

For the reasons expressed orally in open Court

following the conclusion of the hearing, including the

Court’s findings that:
2 Although the bankruptcy court expressed its reasons for denying

Appellants’ motion in open court following a hearing, no record was made of that

hearing. Accordingly, all the district court had to rely upon in reviewing the

bankruptcy court’s decision was this two-page order.

3 See Faden v. Ins. Co. of N. Am. (In re Faden), 96 F.3d 792, 796 (5th

Cir. 1996).

4 See, e.g., Batstone v. Emmerling (In re Emmerling), 223 B.R. 860, 864–69

(B.A.P. 2d Cir. 1997) (stating various factors to be considered, including the

delay between the closing of the case and the motion to reopen, whether reopening

a case would prejudice the adversary, and other equitable concerns).

3

1) the Motion to Reopen the Bankruptcy Case was

filed unnecessarily as leave of the bankruptcy court is

not required to file a lawsuit against the trustee,

2) no benefit would be derived from reopening the

bankruptcy case as the Court could not afford the

substantive relief requested by plaintiff because the

two-year statute of limitations period for filing suit

against the trustee began to run on March 7, 1994, and

thereby expired on March 7, 1996, and 

3) the plaintiffs’ allegation that their Complaint

was "filed" on July 21, 1995, when it was submitted to

the Court as an Exhibit to the Motion to Reopen

Bankruptcy Case is unpersuasive,

the Court finds that the Motion to Reopen Bankruptcy Case

is not well taken and should be denied.2

On appeal, the district court reviewed the bankruptcy court’s

decision denying Appellants’ motion to reopen for an abuse of

discretion. The district court correctly stated the law with

regard to this standard of review, as the decision to reopen a

bankruptcy case is committed to the sound discretion of the

bankruptcy judge and will not be overturned absent abuse of

discretion.3 Well and good, but, in concluding that the motion to

reopen was not necessary, the bankruptcy court did not address the

merits of the motion to reopen or discuss factors often considered

with motions to reopen.4 Indeed, the bankruptcy court was not
4

called upon to exercise its discretion at all, because it decided

that the motion to reopen was unnecessary as a matter of law

because leave to file was not required to proceed with a suit on

the bond.

This conclusion misses the point of the decision required by

the motion that was filed--a motion to reopen, which 11 U.S.C. §

350(b) allows Appellants to file. The question of whether leave to

file was required or even whether Appellants could seek to recover

on the trustee's bond outside of an adversary proceeding on the

trustee's bond pursuant to Rule 2010(b) was not the question before

the bankruptcy court or the district court nor the question before

this court. The question presented is whether Appellants should be

allowed to proceed as they wished.

The bankruptcy court's consideration of the utility of

reopening never moved beyond the threshold decision that

Appellants' proposed suit on the bond was time-barred. Pursuant to

11 U.S.C. § 322(d), a proceeding to recover on a trustee’s bond

must be commenced within two years after the trustee has been

discharged. Appellants, however, argue that the statute of

limitations should have been tolled with the filing of their motion

to reopen, which attached, as an exhibit, their complaint against

the trustee and his surety on the trustee’s bond. 

The district court did not review the issue of whether the

bankruptcy court erred in finding that the statute of limitations

for Appellants’ suit against the trustee had run. Appellants,
5

however, saved this issue for appeal by raising it before the

district court. The questions of whether the statute of

limitations had run and whether equitable tolling applies to the

undisputed facts of this case present questions of law for the

court. Although this court could properly review the bankruptcy

court’s conclusion that the statute of limitations had run, we are

of the opinion that this issue should be remanded for the district

court to determine. 

The district court should consider the following procedural

history of this case. Appellants filed their motion to reopen on

July 21, 1995, and attached to this motion was their complaint

against the trustee and his surety on the trustee’s bond. Through

numerous discovery delays, due, in part, to the trustee’s illness,

discovery was not complete until November 5, 1997. Subsequently,

the trustee died, and a suggestion of death was filed on April 14,

1998. Nothing appears on the docket of the bankruptcy case until

October 8, 1998 when another suggestion of death was filed. On

November 30, 1998, Appellants then moved to substitute the

Executrixes of the trustee’s estate as the proper parties. This

motion was granted, and the case remained stagnant until December

of 1998 when Appellees moved for a hearing on the motion to reopen.

While we agree that the plaintiff bears some responsibility to keep

a case progressing, the district court should consider whether the

bankruptcy court should have initiated action, whether in the form

of holding a conference or scheduling the motion for hearing.
6

In sum, that reopening of the bankruptcy case was not the sole

avenue for the suit does not answer Appellants' motion to reopen.

Regardless of whether leave was required, Appellants sought to

bring suit against the trustee and his surety as an adversary

proceeding in an open bankruptcy case. That objective is supported

by practical considerations such as the necessity of reconstructing

the bankruptcy proceeding in order to prove Appellants' breach of

fiduciary obligations claim.

Whether the statute of limitations had run and whether the

doctrine of equitable tolling applies to the facts of this case are

for the district court to resolve. If the district court

determines that Appellants' proposed suit is not barred by

limitations, the district court should remand in turn to allow the

bankruptcy court to decide whether, in the exercise of its

discretion, it should reopen the bankruptcy case. Accordingly, we

reverse the decision of the district court affirming the bankruptcy

court's denial of the motion to reopen. 

REVERSED AND REMANDED.