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WO NOT FOR PUBLICATION 

IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF ARIZONA 

IN THE MATTER OF: 

Harry Delbert Dalton, 

Debtor. 

No. CV-17-04790-PHX-JJT

BAP NO. AZ-17-1310 

BK NO. 0:17-bk-06058-PS 

ORDER 

Harry Delbert Dalton, 

Appellant, 

v. 

Lawrence J. Warfield, 

Chapter 7 Trustee, 

Appellee. 

 At issue is the Motion to Withdraw the Reference from the United States 

Bankruptcy Appellate Panel of the Ninth Circuit (“BAP”) for the Limited Purpose of 

Ruling on Appellant/Debtor’s Motion to Proceed in Forma Pauperis, filed by way of 

BAP’s Order Transferring Motion to United States District Court for Limited Purpose of 

Ruling on Motion Under 28 U.S.C. § 1915 (Doc. 1). In an action before BAP, pro se 

Appellant Harry Delbert Dalton filed an Application to Proceed in Court Without 

Prepaying Fees or Costs (Doc. 1 at 3-7). Upon this Court’s review of the Application, see 

Perroton v. Gray (In re Perroton), 958 F.2d 889 (9th Cir. 1992), the Court finds that 

Appellant does not have the means to pay BAP’s fees and will therefore grant the 

Application. Furthermore, upon screening the Notice of Appeal (Doc. 1 at 8-67, “NOA”) 
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pursuant to 28 U.S.C. § 1915(e)(2), the Court cannot find that the appeal is frivolous or 

otherwise warrants dismissal at this juncture. 

For cases in which a party is permitted to proceed in forma pauperis—that is, the 

party lacks the means to pay court fees—Congress provided that a district court “shall 

dismiss the case at any time if the court determines” that the “allegation of poverty is 

untrue” or that the “action or appeal” is “frivolous or malicious,” “fails to state a claim on 

which relief may be granted,” or “seeks monetary relief against a defendant who is immune 

from such relief.” 28 U.S.C. § 1915(e)(2). Section 1915(e) applies to all in forma pauperis

proceedings. Lopez v. Smith, 203 F.3d 1122, 1129 (9th Cir. 2000). 

Here, Appellant, the Debtor in the underlying bankruptcy proceeding, appeals the 

Bankruptcy Court’s October 13, 2017 Order approving the Trustee’s Motion to Approve 

Compromise, over Appellant’s objections. (Doc. 1 at 68-69, Order.) The compromise was 

an effort to resolve Appellant’s claim against Wade Atchison, an Allstate Insurance agent, 

for failing to notify Appellant of possible risks in changing his insurance policy and 

subsequently of a lapse in policy coverage. The Bankruptcy Court concluded that the 

proposed compromise—Mr. Atchison’s payment of $5,000 to the Trustee—was a 

reasonable exercise of the Trustee’s business judgment, otherwise reasonable, and in the 

best interest of the bankruptcy estate. (Order at 1.) 

In the Notice of Appeal, Appellant takes issue with the fairness of the approved 

compromise. (NOA at 2.) Without the benefit of the entire procedural history and briefing 

by the parties, the Court cannot conclude from the face of the Notice of Appeal that it is 

devoid of merit. Accordingly, the Court declines to dismiss the appeal under 28 U.S.C. 

§ 1915(e)(2). 

IT IS THEREFORE ORDERED granting the Motion to Withdraw the Reference 

from the United States Bankruptcy Appellate Panel of the Ninth Circuit for the Limited 

Purpose of Ruling on Appellant/Debtor’s Motion to Proceed in Forma Pauperis (Doc. 1). 

. . . . 

. . . . 
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IT IS FURTHER ORDERED granting pro se Appellant Harry Delbert Dalton’s 

Application to Proceed in Court Without Prepaying Fees or Costs (Doc. 1 at 3-7). 

IT IS FURTHER ORDERED directing the Clerk of this Court to close this matter. 

 Dated this 4th day of January, 2018. 

Honorable John J. Tuchi

United States District Judge