UNPUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

No. 10-1772

In Re: GINA ANASTI LEE,

Debtor.

----------------------

GINA ANASTI LEE, on behalf of the bankruptcy estate,

Plaintiff - Appellant,

v.

JAMES ANASTI,

Defendant – Appellee,

and

WILLIAM K. STEPHENSON, JR.,

Trustee.

No. 10-1774

In Re: GINA ANASTI LEE,

Debtor.

----------------------

GINA ANASTI LEE, on behalf of the bankruptcy estate,

Plaintiff - Appellant,
2

v.

JAMES ANASTI,

Defendant – Appellee,

and

WILLIAM K. STEPHENSON, JR.,

Trustee.

Appeals from the United States District Court for the District of 

South Carolina, at Columbia. Joseph F. Anderson, Jr., District 

Judge. (3:10-cv-00626-JFA; 3:10-cv-00196-JFA)

Submitted: October 17, 2011 Decided: January 6, 2012

Before SHEDD and DUNCAN, Circuit Judges, and William L. OSTEEN, 

Jr., United States District Judge for the Middle District of 

North Carolina, sitting by designation.

Affirmed in part; dismissed in part by unpublished per curiam 

opinion.

Tony R. Megna, Columbia, South Carolina, for Appellant. Steven 

B. Licata, LAW OFFICE OF STEVEN B. LICATA, PC, Columbia, South 

Carolina, for Appellee.

Unpublished opinions are not binding precedent in this circuit.
3

PER CURIAM:

Gina Anasti Lee (“Lee”) appeals the orders of the district 

court affirming two separate orders issued by the United States 

Bankruptcy Court for the District of South Carolina. Both 

orders arise from the same bankruptcy case, In re Lee, Ch. 13 

Case No. 09-02854 (Bankr. D.S.C. filed Apr. 16, 2009), but were 

addressed by the district court in two separate appeals from the 

bankruptcy court: (1) In re Lee, No. 3:10CV00196, 2010 U.S. 

Dist. LEXIS 44693 (D.S.C. May 6, 2010) (hereinafter “196 Case”)

and (2) In re Lee, No. 3:10CV00626, 432 B.R. 212 (D.S.C. 2010)

(hereinafter “626 Case”). In the 196 Case, Lee appeals the 

district court’s order affirming the bankruptcy court’s decision 

to grant appellee, James Anasti (“Anasti”), relief from the stay 

imposed by 11 U.S.C. § 362. In the 626 Case, Lee appeals the 

district court’s order affirming the bankruptcy court’s 

dismissal of Lee’s adversary complaint in which Anasti was named 

as a defendant. These two related appeals have been 

consolidated before this court. For the reasons set forth 

below, we affirm the grant of relief from the stay, affirm the 

dismissal of Lee’s avoidance action, and dismiss the remainder 

of the appeal.
4

I.

This appeal arises from what originally began as a real 

property dispute in South Carolina state court between a sister 

(Lee) and brother (Anasti) over real property located at 2325 

Two Notch Road in Columbia, South Carolina (“the Property”). In 

1978, the then-owner of the Property, Laura Corvi, deeded the 

Property to Anasti and the parties’ father, Albert Anasti, as 

tenants in common with right of survivorship. J.A. 56.

Although James Anasti held an interest in the Property by 

virtue of his right of survivorship, Albert Anasti devised the 

Property to Lee in his will. J.A. 62. Albert Anasti died in 

1995, and, subsequently, a South Carolina probate court found 

Lee to have inherited the Property in accordance with Albert 

Anasti’s will. Id.

In 2000, Lee sold the Property to Lance Wilson and Willis 

Goodwin1

 

 1 Wilson and Goodwin were named as defendants in the state 

court litigation, but are not parties to the adversary 

proceeding in bankruptcy court described hereinafter.

“by way of ‘owner financing.’” J.A. 57. A title 

dispute then arose between Lee and the purchasers; Anasti was 

not a party to that action. Following this dispute, and as a 

result of a related condemnation proceeding (see J.A. 55), 

Anasti filed a state court action in 2007 to quiet title to the 

Property. See Anasti v. Wilson, 2007-CP-40-0576 (S.C. Ct. 
5

Common Pleas Oct. 26, 2007) (the “state court action”) (order 

granting partial summary judgment) (J.A. 55); J.A. 182. In this 

state court action, Anasti asserted his interest to the Property 

through the original deed from Corvasi, while Lee claimed to 

have acquired superior title to the Property through adverse 

possession under color of title. J.A. 56, 59. The state trial 

court granted summary judgment in favor of Anasti on October 26, 

2007, finding that Lee had not acquired title through adverse 

possession and that the Property is “the exclusive real property 

of [Anasti].” J.A. 64. 

In January 2008, Lee appealed the trial court’s decision to 

the South Carolina Court of Appeals, which remanded the case to 

the trial court for a determination of whether Lee’s appeal was 

timely filed. See Anasti v. Wilson, 2011 S.C. App. Unpub. LEXIS 

204, at *1 (S.C. Ct. App. Apr. 28, 2011). The state trial court 

conducted an evidentiary hearing and thereafter held that Lee’s 

appeal was not timely filed. Id. Before the South Carolina 

Court of Appeals issued its final ruling, however, Lee filed for 

bankruptcy under Chapter 7. J.A. 190-91. After initially 

dismissing and then reinstating the appeal, the South Carolina 

Court of Appeals “issued an order holding the appeal in abeyance 

pending a final decision in the bankruptcy proceedings.” J.A. 

191. 
6

On June 22, 2009, the Chapter 7 trustee filed a “Report of 

No Distribution” in which she found that no property was 

available for distribution from the estate. J.A. 90. Lee then 

converted the bankruptcy case to Chapter 13. J.A. 45-46. 

Thereafter, Anasti moved the bankruptcy court pursuant to 11 

U.S.C. § 362(d)(1) to lift the automatic stay to permit the 

state appeals process to continue. J.A. 48. Concurrently, Lee 

filed an adversary proceeding under 11 U.S.C. §§ 1303 and 1306, 

seeking to recover the Property. See Compl., Lee v. Anasti, No. 

09-02854 (Bankr. D.S.C. Aug. 20, 2009) (J.A. 111). The claims 

set forth in Lee’s adversary complaint were similar to those 

asserted in the state court action; both cases were grounded in 

theories of adverse possession or related claims. See generally

Order Granting Partial Summ. J. (J.A. 55-64); Compl., Lee v. 

Anasti, No. 09-02854 (Bankr. D.S.C. Aug. 20, 2009) (J.A. 124-

28). Specifically, in her adversary complaint, Lee requested 

that the bankruptcy court declare that she held title to the 

Property based on claims of adverse possession, laches, 

estoppel, and staleness. J.A. 124-28. The complaint also 

included an avoidance action brought pursuant to 11 U.S.C. § 

544(a). J.A. 129. 

After Anasti filed his motion seeking relief from the stay 

and Lee filed her adversary complaint, the bankruptcy court 
7

issued the two separate orders that are the subject of this 

appeal. The first order granted Anasti’s motion for relief from 

the stay (J.A. 196); that order was appealed to the district 

court in the 196 case. The second order dismissed Lee’s 

adversary complaint (J.A. 228); that order was appealed to the 

district court in the 626 case.2

After the stay was lifted, the state court appeals process 

continued, and on April 28, 2011, the South Carolina Court of 

Appeals dismissed Lee’s appeal as untimely. Anasti v. Wilson, 

2011 S.C. App. Unpub. LEXIS 204, at *2 (S.C. Ct. App. Apr. 28, 

2011). The Supreme Court of South Carolina then denied Lee’s 

petition for writ of certiorari. Anasti v. Wilson, 2011 S.C. 

LEXIS 338, at *1 (S.C. Oct. 5, 2011). The state court 

litigation concluded while this appeal was pending; both parties 

acknowledged in supplemental pleadings the final order of the 

Supreme Court of South Carolina denying certiorari. See Supp. 

Br. of Appellant at 2; Supp. Br. of Appellee at 1. 

 The district court affirmed 

both of the bankruptcy court’s orders. J.A. 185, 217. 

In this appeal, Lee argues that the district court erred in 

affirming both the bankruptcy court’s decision to grant relief 

from the stay and its decision to dismiss her adversary 

 2 The bankruptcy court also denied Lee’s motion to amend her 

complaint in the adversary proceeding without prejudice to her 

right to renew the motion upon conclusion of the state court 

proceedings. J.A. 228 n.4. 
8

complaint. We first address the issue of whether the district 

court erred in affirming the bankruptcy court’s decision to 

grant relief from the stay.

II.

We have jurisdiction to hear this appeal pursuant to 28 

U.S.C. § 158(d), which “allows us to review ‘final decisions’ by

the district court when it acts in its bankruptcy appellate 

capacity.” Safety-Kleen, Inc. v. Wyche, 274 F.3d 846, 864 n.4 

(4th Cir. 2001). An order granting or denying relief from the 

automatic stay is final and appealable. See id. at 864 (“[T]he 

denial of relief from the automatic stay is a final, appealable 

order.”); Nat’l Envtl. Waste Corp. v. City of Riverside (In re 

Nat’l Envtl. Waste Corp.), 129 F.3d 1052, 1054 (9th Cir. 1997) 

(“Orders granting or denying relief from the automatic stay are 

deemed to be final orders.”); In re Sonnax Indus., 907 F.2d 

1280, 1283 (2d Cir. 1990) (“All seem to agree that orders 

lifting the automatic stay are final.”). 

a.

“We review the judgment of a district court sitting in 

review of a bankruptcy court de novo, applying the same 

standards of review that were applied in the district court.” 

Logan v. JKV Real Estate Servs. (In re Bogdan), 414 F.3d 507, 
9

510 (4th Cir. 2005) (citing Devan v. Phoenix Am. Life Ins. Co. 

(In re Merry-Go-Round Enters.), 400 F.3d 219, 224 (4th Cir. 

2005)). “Specifically, ‘we review the bankruptcy court's factual 

findings for clear error, while we review questions of law de 

novo.’” Id. (quoting Loudoun Leasing Dev. Co. v. Ford Motor 

Credit Co. (In re K & L Lakeland, Inc.), 128 F. 3d 203, 206 (4th 

Cir. 1997)). 

In this case, the district court, employing the same 

reasoning as the bankruptcy court below, found that the 

automatic stay was properly lifted under 11 U.S.C. § 362(d)(1). 

“A decision to lift the automatic stay under section 362 of the 

Code is within the discretion of the bankruptcy judge and this 

decision may be overturned on appeal only for abuse of 

discretion.” In re Robbins, 964 F.2d 342, 345 (4th Cir. 1992).

 11 U.S.C. § 362(d)(1) provides that a court shall grant 

relief from the stay “for cause, including the lack of adequate 

protection of an interest in property of such party in 

interest.” Because the statute does not define cause, “courts 

must determine when discretionary relief is appropriate on a 

case-by-case basis.” In re Robbins, 964 F.2d at 345. 

The court must balance potential prejudice to the 

bankruptcy debtor's estate against the hardships that 

will be incurred by the person seeking relief from the 

automatic stay if relief is denied . . . . The 

factors that courts consider in deciding whether to 

lift the automatic stay include (1) whether the issues 

in the pending litigation involve only state law, so
10

the expertise of the bankruptcy court is unnecessary; 

(2) whether modifying the stay will promote judicial 

economy and whether there would be greater 

interference with the bankruptcy case if the stay were 

not lifted because matters would have to be litigated 

in bankruptcy court; and (3) whether the estate can be 

protected properly by a requirement that creditors 

seek enforcement of any judgment through the 

bankruptcy court. 

Id. (citation omitted). 

In its order granting Anasti relief from the stay, the 

bankruptcy court identified the standards set forth in Robbins

and concluded that cause to grant relief existed under 11 U.S.C. 

§ 362(d)(1). J.A. 192-94. With regard to the first and second 

factors set forth in Robbins, the bankruptcy court found that 

“[t]he determination of title to the Property and the nature and 

extent of [Lee’s] interest is an issue of state law that has 

already been litigated in and addressed by the lower state 

court.” J.A. 195. The court also found that the third factor 

had been met, noting that Anasti did “not seek authority to 

pursue any action or liability against [Lee] beyond a 

determination of title to the Property in the state court 

proceedings.” Id. The court found that allowing the state 

court proceedings to continue would avoid “unnecessary 

duplication of efforts” and that the debtor would not be 

prejudiced by the court’s refusal to relitigate the issue. Id.
11

In affirming the bankruptcy court’s order granting relief 

from the stay, the district court also applied Robbins and held 

that “the bankruptcy court rightly deferred to the courts of 

South Carolina in abstaining, on grounds of comity . . . . 

South Carolina courts possess particular expertise in 

interpreting South Carolina property law.” J.A. 184. The court 

additionally noted that, because the quiet title action involved 

only the application of state law, the bankruptcy court’s 

expertise would not be utilized. Id. The court concluded that 

allowing Lee “to pursue identical litigation in the bankruptcy 

court would be highly duplicative.” Id.

b.

Lee does not challenge the facts found by the bankruptcy 

court. The findings of fact that both the bankruptcy court and 

district court relied upon accurately reflect the procedural and 

substantive history of the state court litigation and the 

bankruptcy proceedings. Instead, Lee’s objections are directed 

to the lower court’s application of 11 U.S.C. § 362(d) and 

Robbins to Anasti’s motion seeking relief from the stay. 

Bearing in mind that “Congress . . . has granted broad 

discretion to bankruptcy courts to lift the automatic stay to 

permit enforcement of rights against property of the estate” 

Claughton v. Mixson, 33 F.3d 4, 5 (4th Cir. 1994), we find that 
12

the bankruptcy court did not abuse its discretion in granting 

Anasti=s motion to lift the stay pursuant to 11 U.S.C. § 

362(d)(1). Each of the Robbins factors supports the bankruptcy 

court’s exercise of discretion. 

The first factor identified in Robbins, “whether the issues 

in the pending litigation involve only state law, so the 

expertise of the bankruptcy court is unnecessary,” clearly 

supports the decision to lift the stay. The state court 

litigation involved only issues of state real property law, 

rendering the expertise of the bankruptcy court unnecessary. 

Notably, real property law is an area in which federal courts 

are especially deferential to state courts. See Dayton & M. R. 

Co. v. Comm’r, 112 F.2d 627, 630 (4th Cir. 1940) (noting that 

even prior to Erie R. Co. v. Tompkins, it was “well settled that 

we were bound by state decisions as to rights of property and 

other matters of local law”); Warburton v. White, 176 U.S. 484, 

496 (1900). 

The second factor identified by Robbins, “whether modifying 

the stay will promote judicial economy and whether there would 

be greater interference with the bankruptcy case if the stay 

were not lifted because matters would have to be litigated in 

bankruptcy court,” also supports lifting the stay. The state 

court litigation had been ongoing for over two years and was 
13

near finality in the South Carolina Court of Appeals when Lee 

filed for bankruptcy under Chapter 7. Lifting the stay thus 

promoted judicial economy; the bankruptcy court’s order 

permitted the conclusion of an adjudication of real property 

issues in the South Carolina courts in lieu of relitigation of 

those same issues in bankruptcy court. 

With respect to the third Robbins factor, Lee was afforded 

adequate protection in the bankruptcy proceeding because of her 

ability to seek subsequent relief if she were to succeed on 

appeal in state court. J.A. 195. In summary, all three factors 

identified by Robbins heavily weigh in favor of lifting the 

stay. 

Lee argues that in granting Anasti’s motion to lift the 

stay, both the bankruptcy court and the district court 

improperly failed to consider that the bankruptcy estate was not 

a party to the state court proceeding. Lee contends that 

lifting the stay deprived the bankruptcy estate of due process 

because the estate has not been provided an opportunity to be 

heard on the issue of ownership of the Property. See

Appellant’s Br. at 43-45. Specifically, Lee argues, “If 

Appellee prevails in the state-court appeal, he has free and 

clear title - and the bankruptcy estate (as opposed to the 

individual Debtor) never has the opportunity to present its 
14

claims to the property, and is never heard by any court.” Id.

at 45 (emphasis in original). 

Lee’s arguments in this regard are not persuasive, as Lee 

misinterprets her position in relation to the bankruptcy estate 

and the Property. Any interest of the bankruptcy estate in the 

Property is derived from Lee’s right in the Property. The 

bankruptcy estate’s claim is not greater than Lee’s claim. Cf.

Old Republic Nat’l Title Ins. Co. v. Tyler (In re Dameron), 155 

F.3d 718, 721 (4th Cir. 1998) (noting that a trustee may “take 

no greater rights [in property] than the debtor himself had”)

(internal quotation marks omitted). Furthermore, 

[p]roperty interests are created and defined by state 

law. Unless some federal interest requires a 

different result, there is no reason why such 

interests should be analyzed differently simply 

because an interested party is involved in a 

bankruptcy proceeding. Uniform treatment of property 

interests by both state and federal courts within a 

State serves to reduce uncertainty, to discourage 

forum shopping, and to prevent a party from receiving 

a windfall merely by reason of the happenstance of 

bankruptcy.

Butner v. United States, 440 U.S. 48, 55 (1979). 

Lee does not offer any facts that suggest the bankruptcy 

estate held a better, or different, claim to the Property than 

Lee held. Nor does Lee point to any additional facts she would 

have presented in the bankruptcy court had the stay remained in 

effect. Instead, Lee contends that the order lifting the stay 
15

deprived the bankruptcy estate of any opportunity to be heard as 

to any claim it might have to the Property. The claims of Lee 

and the bankruptcy estate, however, are the same for the purpose 

of determining the parties’ respective rights to the Property, 

and “there is no reason why such interests should be analyzed 

differently simply because an interested party is involved in a 

bankruptcy proceeding.” Butner, 440 U.S. at 55. Because Lee’s 

interest in the Property is analyzed under the same standard 

whether the bankruptcy estate is a party in interest or not, 

Lee’s arguments fail to demonstrate why the bankruptcy estate’s 

interest, or its rights in the Property, are not effectively 

advanced by Lee individually, or more pointedly, why the 

bankruptcy estate should be required to relitigate those claims 

already asserted and litigated by Lee.

Regardless, even if due process did require that the estate 

be given an opportunity to state a claim to the Property, the 

estate has chosen not to do so after notice and an opportunity 

to be heard. The Chapter 7 trustee filed a Report of No 

Distribution stating that no property was available for 

distribution from the estate. J.A. 182-83. Additionally, the 

Chapter 13 trustee did not oppose modification of the stay to 

allow the state court appeals process to continue. J.A. 191. 

 
16

Finally, the fact that the bankruptcy estate chooses not to 

participate in, or pursue, Lee’s claim to the Property in the 

pending state court action does not pose a barrier to future 

enforcement of a final state court judgment as to all those in 

privity with Lee. A judgment in a prior case may properly act 

as a bar to relitigation in a later proceeding. See, e.g., 

First Union Commer. Corp. v. Nelson, Mullins, Riley, & 

Scarborough (In re Varat Enters.), 81 F.3d 1310, 1314-17 (4th 

Cir. 1996). 

Accordingly, we find that the bankruptcy court and the 

district court properly considered and applied the relevant 

factors under Robbins and provided a reasoned basis for finding 

that each factor had been met. The bankruptcy court did not 

abuse its discretion in granting Anasti relief from the stay 

pursuant to 11 U.S.C. § 362(d)(1). We therefore affirm the 

district court’s order affirming the bankruptcy court’s decision 

to grant relief from the stay.

III.

We now turn to Lee’s appeal of the district court’s order 

affirming the bankruptcy court’s dismissal of the adversary 

proceeding. Lee’s adversary complaint contains four causes of 

action. The first cause of action is a state-law adverse 
17

possession claim (J.A. 124-27); the second cause of action 

asserts the state-law doctrines of laches, estoppel, and 

staleness (J.A. 127-28); the third cause of action requests that 

the court issue an order demanding the sale of the Property for 

the benefit of the estate3

a.

(J.A. 129); and the fourth cause of 

action is an avoidance action under 11 U.S.C. § 544(a) (J.A. 

129-30). The bankruptcy court dismissed the avoidance action 

brought pursuant to 11 U.S.C. § 544(a) for lack of standing and 

dismissed the other state-law claims based on comity and 

judicial economy. J.A. 226-27. We will first address the § 

544(a) avoidance action before turning to the state-law claims.

The dismissal of an adversary proceeding is a final 

appealable order under 28 U.S.C. § 158(d). See In re Moody, 825 

F.2d 81, 85 (5th Cir. 1987) (“[I]t is generally held that a 

separate adversary proceeding within the framework of the 

overall bankruptcy case is an appropriate ‘judicial unit’ for 

determining finality.”). We thus have jurisdiction to review 

the dismissal of Lee’s avoidance action.

“To survive a motion to dismiss, a complaint must contain 

sufficient factual matter, accepted as true, to ‘state a claim 

 

 3 Because Lee may only succeed on this claim if she succeeds on 

at least one of the other claims, this cause of action must be 

dismissed if the first, second, and fourth claims are all 

dismissed. 
18

to relief that is plausible on its face.’” Ashcroft v. Iqbal, 

129 S. Ct. 1937, 1949 (2009) (quoting Bell Atlantic Corp. v. 

Twombly, 550 U.S. 544, 570 (2007)). A claim is facially 

plausible if the plaintiff provides enough factual content to 

enable the court to reasonably infer that the defendant is 

liable for the misconduct alleged. Id. A court may consider 

collateral estoppel at the motion to dismiss stage of 

litigation. See, e.g., Aliff v. Joy Mfg. Co., 914 F.2d 39, 44 

(4th Cir. 1990) (affirming a district court’s use of collateral 

estoppel in granting a motion to dismiss); see also Blue Tree 

Hotels v. Starwood Hotels & Resorts, 369 F.3d 212, 217 (2d Cir. 

2004) (stating that courts “may also look to public records, 

including complaints filed in state court, in deciding a motion 

to dismiss”).

Lee’s fourth cause of action was brought pursuant to 11 

U.S.C. § 544(a). The complaint alleges that the state court 

judgment in favor of Anasti was rendered unenforceable by the 

automatic stay provisions of 11 U.S.C. § 362(a). J.A. 129. The 

complaint also asserts in conclusory fashion that “Section 

544(a) creates a legal fiction of a transfer from the debtor to 

a bona fide purchaser on the date of filing, thereby clothing 

the trustee in whatever legal rights a bona fide purchaser would 
19

possess.” J.A. 130 (quoting In re Houston, 409 B.R. 799, 807 

(Bankr. D.S.C. 2009)). 

In dismissing Lee’s fourth cause of action, the bankruptcy 

court held that a Chapter 13 debtor lacks standing to pursue an 

avoidance action under 11 U.S.C. § 544(a). J.A. 226-27. Because 

the state court judgment has become final, however, collateral 

estoppel applies and Lee is now bound by that judgment.4

After the bankruptcy court dismissed Lee’s adversary 

complaint, and during the pendency of this appeal, the South 

Carolina Court of Appeals dismissed Lee’s state court appeal and 

the Supreme Court of South Carolina denied her writ of 

certiorari. The parties filed these judgments and have addressed 

their effect on this court in supplemental briefs. See Supp. Br. 

of Appellant at 2-3; Supp. Br. of Appellee at 1-2. We find that 

the state court judgment in favor of Anasti is now final and 

binding on Lee pursuant to 28 U.S.C. § 1738. 

 We 

therefore affirm the bankruptcy court’s dismissal of Lee’s 

avoidance action on the basis of collateral estoppel. 

 

 4 Neither the bankruptcy court nor the district court had the 

benefit of the final state court judgment and therefore neither 

addressed this issue. However, because we “can affirm on any 

basis fairly supported by the record,” Eisenberg v. Wachovia 

Bank, N.A., 301 F.3d 220, 222 (4th Cir. 2002), we can affirm the 

bankruptcy court’s dismissal of Lee’s avoidance action based on 

the final state court judgment.
20

“The Full Faith and Credit Act, 28 U.S.C. § 1738, requires 

federal courts . . . to give state judicial proceedings ‘the same 

full faith and credit . . . as they have by law or usage in the 

courts of such State . . . from which they are taken.’” Parsons 

Steel, Inc. v. First Alabama Bank, 474 U.S. 518, 519 (1986)

(quoting 28 U.S.C. § 1738). In determining the preclusive effect 

of a state court judgment under the Act, federal courts must look 

to the law of the state in which the judgment was entered. Id.

at 523; see Heckert v. Dotson (In re Heckert), 272 F.3d 253, 257 

(4th Cir. 2001) (“A federal court, as a matter of full faith and 

credit, under 28 U.S.C. § 1738, must give a state court judgment 

the same preclusive effect ‘as the courts of such State’ would 

give.”); Empire Funding Corp. v. Armor, No. 99-1529, 2000 U.S. 

App. LEXIS 26405, at *5-9 (4th Cir. Oct. 20, 2000) (applying this 

principle in the context of a bankruptcy proceeding filed after 

the entry of a final state court judgment). 

The Supreme Court of South Carolina has stated the following 

with regard to collateral estoppel: 

[W]hen an issue has been actually litigated and 

determined by a valid and final judgment, the 

determination is conclusive in a subsequent action 

whether on the same or a different claim. The doctrine 

may not be invoked unless the precluded party has had a 

full and fair opportunity to litigate the issue in the 

first action.
21

Zurcher v. Bilton, 379 S.C. 132, 135, 666 S.E.2d 224, 226 (S.C. 

2008) (citations omitted). 

All of the requirements under South Carolina law for the 

application of collateral estoppel are met in this case. The 

ownership of the Property was actually litigated and determined 

in the quiet title action. The state trial court granted partial 

summary judgment in favor of Anasti and held that the Property is 

“Confirmed and Ordered as belonging solely to [Anasti].” J.A. 

64. The judgment is final, and Lee has exhausted all of her 

state court appeals. See Supp. Br. of Appellee at 3-6. Finally, 

Lee had a full and fair opportunity to litigate the issue in the 

state trial court and did so. 

Lee argues that the bankruptcy estate will be prejudiced if 

not given its own full and fair opportunity to assert Lee’s right 

to the Property.5

 

 5 We note that both the Chapter 7 and the Chapter 13 trustees 

had the opportunity to assert claims to the Property and have 

chosen not to do so.

 As discussed above, however, any interest of 

the bankruptcy estate in the Property is derivative of Lee’s 

interest. See In re Dameron, 155 F.3d at 721. Neither the 

estate nor Lee has argued that the estate’s potential interest in 

the Property was not adequately represented by Lee in the state 

court action. The trustee would therefore be in privity with Lee 
22

for the purpose of determining the collateral estoppel effect of 

the state court judgment. See Richburg v. Baughman, 290 S.C. 

431, 434, 351 S.E.2d 164, 166 (1986) (“One in privity is one 

whose legal interests were litigated in the former proceeding.”). 

All of the requirements established by the South Carolina 

courts for the application of collateral estoppel have thus been 

met. Accordingly, pursuant to 28 U.S.C. § 1738, this court must 

grant full faith and credit to the final state court judgment.6

We turn now to the effect that final judgment has on this 

appeal. The South Carolina trial court held the Property “to be 

the exclusive real property of [Anasti]” and granted Anasti title 

to the Property. J.A. 64. The court’s findings of fact 

supporting this judgment explain why the avoidance action must be 

dismissed. The court stated: 

It is undisputed that in 1978 Laura Corvi deeded the 

Two Notch real property to Albert Anasti and his son 

James Anasti as tenants in common with a right of 

survivorship. . . . Future interest created by 

tenancy in common with right of survivorship vest on 

the death of the other party. Smith v. Cutler, 366 

S.C. 546, 623 S.E.2d 644. Upon the death of Albert 

Anasti the property passed immediately to his son, 

 

 6 Further, in affirming the bankruptcy court’s order granting 

relief from the stay, we recognized the state court to be an 

appropriate forum for the resolution of Lee’s state-law claims. 

It would be incongruous for us to now hold that the state court 

judgment, which reached finality because relief from the stay was 

granted, is not binding on Lee and, resultingly, the bankruptcy 

estate.
23

Plaintiff Anasti, as tenant in common with right of 

survivorship. Albert Anasti’s act of leaving the 

property to his daughter did not destroy the tenancy 

in common with right of survivorship. See Id. 

(“Future interests created by a tenancy in common with 

a right of survivorship are indestructible, i.e. not 

subject to defeat by the unilateral act of one 

cotenant”). Therefore, I find the Two Notch Road 

property was not part of the probate estate of Albert 

Anasti, but property of Plaintiff Anasti, when the 

probate court made its ruling. J.A. 62. 

The court went on to hold that “the probate court wrongfully 

distributed property that did not belong to a decedent, and the 

probate court’s ruling is void for lack of subject matter 

jurisdiction.” Id. at 63. Thus, under the state court ruling, 

Anasti’s sole ownership of the Property vested at the time of 

Albert Anasti’s death in 1995. 

Lee’s fourth cause of action was brought pursuant to 11 

U.S.C. § 544(a), which provides that: “The trustee shall have . . 

. the rights and powers of, or may avoid any transfer of property 

of the debtor . . . that is voidable by . . . (3) a bona fide 

purchaser of real property, other than fixtures, from the debtor, 

against whom applicable law permits such transfer to be 

perfected.” U.S.C. § 544(a). “Under section 544(a)(3) the 

trustee has the right and power, as of the date of the 

commencement of the case, to avoid any lien or transfer avoidable 

by a hypothetical bona fide purchaser of real property of the 
24

debtor.” Anderson v. Conine (In re Robertson), 203 F.3d 855, 864 

(5th Cir. 2000). We have previously noted that § 544 “confers on 

the trustee no ‘greater rights than those accorded by the 

applicable [state] law.’” Havee v. Belk, 775 F.2d 1209, 1219 

(4th Cir. 1985) (citation omitted); see Anderson, 203 F.3d at 864 

(“A hypothetical bona fide purchaser under section 544(a)(3) is a 

purchaser who under state law could have conducted a title 

search, paid value for the property and perfected his interest as 

a legal title holder as of the date of the commencement of the 

case.”).

Lee’s claim pursuant to § 544(a) is therefore subject to 

dismissal because there was no transfer of the Property to Anasti 

that Lee could seek to avoid. Instead, the state trial court 

entered a judgment recognizing Anasti as the record owner and 

finding that the probate court’s ruling in favor of Lee was void. 

J.A. 63-64. Furthermore, the estate did not accede to any claim 

to the Property as a hypothetical bona fide purchaser on the date 

of the bankruptcy filing because, under state law as determined 

by the South Carolina courts, Lee held no interest in the 

Property on the date of filing. Id. at 62-64; see In re Houston, 

409 B.R. 799, 807 (Bankr. D.S.C. 2009) (“Trustee acquired 

whatever interest the Debtor possessed on the date of filing.”); 
25

In re Granada, Inc., 92 B.R. 501, 504 (Bankr. D. Utah 1988)

(“[T]he debtor’s interest in the property (or lack thereof) may 

well limit the bona fide purchaser’s ‘rights and powers.’”). 

Lee’s avoidance action thus fails to state a claim upon which 

relief can be granted and must be dismissed. 

b.

 In dismissing the first, second, and third causes of action 

in Lee’s complaint (the “state law claims”) the bankruptcy court 

noted that it had “previously found in its [order granting relief 

from the stay] that these issues should be conclusively 

determined by the state appellate court and should not be 

relitigated via this adversary proceeding.” J.A. 227. The court 

cited “judicial economy” as a justification for its decision and 

dismissed the complaint without prejudice, stating that “should 

the state court find that [Lee] has an interest in the Property, 

the automatic stay shall apply and the parties may return to this 

[c]ourt.” Id.

In affirming the bankruptcy court’s order, the district 

court stated that the bankruptcy court’s dismissal of the statelaw claims “appear[ed] to be based on 28 U.S.C. § 1334, which 

allows a district court to abstain from hearing state-law claims 

related to bankruptcy cases in the interest of justice, in the 

 
26

interest of comity, or out of respect for state law.” J.A. 216. 

The district court upheld the bankruptcy court and dismissed the 

case “[b]ecause state law predominates, the state-court action 

has proceeded to the court of appeals, and the timing of the 

bankruptcy action gives rise to an inference of forum shopping.” 

J.A. 216-17. Although the district court did not specify which 

subsection of § 1334 it applied, neither party disputes that it 

applied § 1334(c)(1), which states: “[N]othing in this section 

prevents a district court in the interest of justice, or in the 

interest of comity with State courts or respect for State law, 

from abstaining from hearing a particular proceeding arising 

under title 11 or arising in or related to a case under title 

11.” 

We agree with the district court’s finding that the 

bankruptcy court applied 28 U.S.C. § 1334(c). Furthermore, the 

district court’s reference to the predominance of state-law, the 

presence of a related proceeding in state court, and the 

inference of forum shopping clearly invokes 28 U.S.C. § 

1334(c)(1) and the factors courts have utilized in applying it. 

See, e.g., New Eng. Power & Marine, Inc. v. Town of Tyngsborough 

(In re Middlesex Power Equip. & Marine, Inc.), 292 F.3d 61, 69 

(1st Cir. 2002) (noting that, in applying § 1334(c)(1), courts 
27

consider “the extent to which state law issues predominate over 

bankruptcy issues; the presence of a related proceeding commenced 

in state court or other nonbankruptcy court; and the likelihood 

that the commencement of the proceeding in bankruptcy court 

involves forum shopping by one of the parties”) (internal 

quotation marks omitted). The ability of this court to review a 

district court’s abstention decision made pursuant to 28 U.S.C. § 

1334(c)(1) is limited by 28 U.S.C. § 1334(d), which provides: 

Any decision to abstain or not to abstain made under 

subsection (c) (other than a decision not to abstain in 

a proceeding described in subsection (c)(2)) is not 

reviewable by appeal or otherwise by the court of 

appeals under section 158(d), 1291, or 1292 of this 

title . . . or by the Supreme Court of the United 

States under section 1254 of this title . . . .

28 U.S.C. § 1334(d). 

“[T]he current version of section 1334(d) permits appellate 

review only of refusals of mandatory abstention.” United States 

(IRS) v. Paolo (In re Paolo), 619 F.3d 100, 103 n.3 (1st Cir. 

2010); see also Baker v. Simpson, 613 F.3d 346, 352 (2d Cir. 

2010) (“[D]ecisions on permissive abstention, which lie within 

the discretion of the bankruptcy court, are not subject to review 

by the court of appeals. We therefore lack jurisdiction to 

decide whether the district court's decision on permissive 

abstention was correct.”); Geruschat v. Ernst Young LLP (In re 

Seven Fields Dev. Corp.), 505 F.3d 237, 249 (3d Cir. 2007) 
28

(“[A]ppeals of decisions involving permissive abstention, whether 

or not the court abstains, are barred.”). 

“We therefore lack jurisdiction to decide whether the 

district court’s decision on permissive abstention was correct,” 

Baker, 613 F.3d at 352, and dismiss Lee’s appeal to the extent it 

asks us to review the district court’s decision to affirm the 

bankruptcy court’s dismissal of the state-law claims based upon 

18 U.S.C. § 1334(c). Accordingly, we affirm the dismissal of 

Lee’s avoidance action brought pursuant to § 544(a), and we 

dismiss Lee’s appeal of the district court’s order affirming the 

bankruptcy court’s dismissal of the state-law claims based on 

abstention under 28 U.S.C. § 1334(c)(1).

Conclusion

For the foregoing reasons, we affirm the district court’s 

order affirming the bankruptcy court’s order granting relief 

from the stay, we affirm the district court’s order affirming 

the bankruptcy court’s dismissal of Lee’s avoidance action, and 

we dismiss the appeal of the district court’s order affirming 

the bankruptcy court’s decision to abstain from hearing the 

state-law claims.

AFFIRMED IN PART;

DISMISSED IN PART