Court Opinion

ID: 1007585
Source: CourtListenerOpinion
Date Created: 2013-07-04 19:27:36.97798+00
Date Added: 2024-06-11T15:12:21.474650
License: Public Domain

UNPUBLISHED

UNITED STATES COURT OF APPEALS
                 FOR THE FOURTH CIRCUIT

In Re: JACOB FRAIDIN,                   
                              Debtor.

JACOB FRAIDIN,
                 Plaintiff-Appellant,            No. 01-2309

                 v.
MICHAEL G. RINN,
               Defendant-Appellee.
                                        
          Appeal from the United States District Court
           for the District of Maryland, at Baltimore.
             William M. Nickerson, District Judge.
     (CA-01-1602-WMN, BK-92-5-2338-JS, AP-97-5223-JS)

                      Submitted: April 30, 2002

                        Decided: May 22, 2002

      Before WILKINS and MICHAEL, Circuit Judges, and
              HAMILTON, Senior Circuit Judge.

Vacated and remanded by unpublished per curiam opinion.

                             COUNSEL

Jacob Fraidin, Appellant Pro Se. Paul-Michael Justin Sweeney,
LINOWES & BLOCHER, L.L.P., Silver Spring, Maryland, for
Appellee.
2                           IN RE: FRAIDIN
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).

                             OPINION

PER CURIAM:

  Jacob Fraidin appeals from the district court’s order affirming the
bankruptcy court’s assessment of damages following the granting of
default judgment against Fraidin and in favor of the Trustee and
awarding attorneys’ fees.

  To the extent that Fraidin challenges the propriety of the bank-
ruptcy court’s January 5, 2001, order, which granted the Trustee’s
motion to compel discovery, found that Fraidin was in contempt, and
entered default judgment against Fraidin, these issues are not properly
before this court. Fraidin’s appeal from this order was dismissed with
prejudice by the district court when Fraidin failed to timely file his
designation of the record and his statement of issues. See Fed. R.
Bankr. P. 8006. Fraidin did not timely appeal that decision to this
court.

   Fraidin also challenges the bankruptcy court’s April 4, 2001, order
entering final judgment against him in the amount of $1,659,077 plus
interest and attorneys’ fees and costs in the amount of $4179. He con-
tends that he was denied due process when the bankruptcy court
scheduled, noticed, and held an ex parte hearing on damages. Follow-
ing the entry of default judgment, the bankruptcy court is not required
to hold a hearing to determine the amount of damages. See Fed. R.
Bankr. P. 7055 (adopting Fed. R. Civ. P. 55 in bankruptcy court
adversary proceedings); Transatlantic Marine Claims Agency, Inc. v.
Ace Shipping Corp., 109 F.3d 105, 111 (2d Cir. 1997); James v.
Frame, 6 F.3d 307, 310 (5th Cir. 1993). However, if the court does
hold a hearing, it must provide the parties with an opportunity to be
heard. See Transatlantic Marine Claims Agency, 109 F.3d at 111
(court could not merely accept plaintiff’s unsupported statement of
damages). Rather, "[a]n elementary and fundamental requirement of
due process in any proceeding which is to be accorded finality is
                            IN RE: FRAIDIN                            3
notice reasonably calculated, under all the circumstances, to apprise
interested parties of the pendency of the action and afford them an
opportunity to present their objections." Mullane v. Cent. Hanover
Bank & Trust Co., 339 U.S. 306, 314 (1950). An ex parte hearing,
such as that conducted by the bankruptcy court, violates a litigant’s
right to due process if the litigant was thereby denied the "opportunity
to participate in determination of the relevant issues" and suffered
unfair prejudice. Guenther v. Comm’r, 889 F.2d 882, 884 (9th Cir.
1989).

   Here, although Fraidin received notice of the scheduled hearing to
determine the amount of damages, the notice clearly stated that the
hearing was to be "ex parte." Thus, Fraidin was denied the opportu-
nity to challenge the Trustee’s evidence as to the amount of damages,
and he was thereby prejudiced. See id. Because he was not afforded
an opportunity to present contrary evidence, cross-examine the Trust-
ee’s witnesses and evidence, or challenge the determination or reason-
ableness of the attorneys’ fees awarded, we find that Fraidin was
denied due process. See Mullane, 339 U.S. at 314; see also Roadway
Express, Inc. v. Piper, 447 U.S. 752, 767 (1980) ("Like other sanc-
tions, attorney’s fees certainly should not be assessed lightly or with-
out fair notice and an opportunity for a hearing on the record.").

   Accordingly, we vacate the district court’s order and remand for
further remand of this case to the bankruptcy court with instructions
to afford Fraidin an opportunity to be heard prior to the determination
of the amount of damages due. We dispense with oral argument
because the facts and legal contentions are adequately presented in the
materials before the court and argument would not aid the decisional
process.

                                        VACATED AND REMANDED