Court Opinion

ID: 9956962
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Date Created: 2024-04-03 15:02:21.913335+00
Date Added: 2024-06-11T08:18:01.324595
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USCA11 Case: 23-11817   Document: 20-1    Date Filed: 04/03/2024   Page: 1 of 13

                                                 [DO NOT PUBLISH]
                                 In the
                 United States Court of Appeals
                        For the Eleventh Circuit

                         ____________________

                               No. 23-11817
                         Non-Argument Calendar
                         ____________________

        In Re: EVA-DJINA GRANT-CARMACK,
                                                               Debtor,
        _________________________________________________
        EVA CARMACK,
        a.k.a. Eva-Dijna Grant,
        a.k.a Eva-Djina Grant-Carmack,
                                                    Plaintiﬀ-Appellant,
        versus
        GARY CARMACK,

                                                  Defendant-Appellee.
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        2                      Opinion of the Court                23-11817

                             ____________________

                   Appeal from the United States District Court
                        for the Middle District of Florida
                      D.C. Docket No. 6:22-cv-00731-RBD,
                           Bkcy No. 6:20-bk-02408-GER
                            ____________________

        Before ROSENBAUM, JILL PRYOR, and GRANT, Circuit Judges.
        PER CURIAM:
                Eva-Djina Grant-Carmack, proceeding pro se, sought sanc-
        tions in her bankruptcy case against her ex-husband, Gary Car-
        mack. The bankruptcy court refused to sanction Gary. Eva then
        appealed to the district court, which affirmed. Eva now appeals the
        district court’s decision. After careful consideration, we affirm.
                                         I.
               In Eva and Gary’s divorce proceedings, a Florida state court
        issued a “Final Judgment of Dissolution of Marriage.” The judg-
        ment addressed, among other things, the terms of Eva and Gary’s
        shared custody of their children. In post-judgment proceedings, the
        state court found that Eva failed to honor the judgment’s shared
        custody arrangement and held her in indirect civil contempt of
        court. The court awarded Gary additional time with the children
        as well as $15,350.10 for the attorney’s fees he incurred as a result
        of Eva’s contempt of court. Eva appealed the order awarding Gary
        attorney’s fees.
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        23-11817               Opinion of the Court                         3

               In April 2020, a few months after the state court awarded
        Gary attorney’s fees and while Eva’s appeal of that order was pend-
        ing, Eva filed a petition for Chapter 7 bankruptcy. On the schedules
        filed with her petition, Eva listed Gary as a creditor who had an
        unsecured claim for $15,350.10 but noted that she had appealed the
        fee award. In August 2020, the bankruptcy court granted Eva a dis-
        charge and closed her bankruptcy case.
               In April 2020, Gary filed his own petition for Chapter 7 bank-
        ruptcy. On the schedules filed with his petition, Gary listed his as-
        sets but did not include the debt that Eva owed him for attorney’s
        fees. At the meeting with his creditors, he disclosed Eva’s debt. He
        explained that he had not listed it on his bankruptcy schedules be-
        cause the award was on appeal and it was unclear whether Eva
        would be able to pay it. In July 2020, the bankruptcy court granted
        Gary a discharge.
                In April 2021, a Florida appellate court affirmed the state
        court’s order awarding Gary attorney’s fees. See Carmack v. Car-
        mack, 316 So. 3d 396, 398 (Fla. Dist. Ct. App. 2021). After this deci-
        sion issued, Gary tried to collect the attorney’s fee award from Eva.
        She refused to pay. Gary then filed a motion in state court to hold
        Eva in contempt for failing to pay the fee award.
              Eva, proceeding pro se, removed the state court case to bank-
        ruptcy court as an adversary proceeding in Gary’s bankruptcy case.
        Eva then filed a motion to dismiss the adversary proceeding, argu-
        ing that Gary could not collect the debt for the attorney’s fees
        award because it had been discharged in her bankruptcy. Gary
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        4                         Opinion of the Court                      23-11817

        moved to remand the case to state court. The bankruptcy court
        granted Gary’s motion, noting that the state court could determine
        whether Eva’s debt had been discharged in her bankruptcy.
               Eva also moved to reopen her bankruptcy case and filed a
        motion for sanctions against Gary.1 We liberally construe these fil-
        ings as raising three arguments why Gary should be sanctioned.
                First, Eva argued that Gary violated the discharge injunction
        in her bankruptcy case when he tried to collect the attorney’s fees
        award. She acknowledged that under the Bankruptcy Code a debt
        “for a domestic support obligation” or to a “former spouse . . . in
        connection with . . . a divorce decree” generally was not discharged
        in bankruptcy. See 11 U.S.C. § 523(a)(5), (15). But she took the po-
        sition that the debt for the attorney’s fees did not fall within either
        of these exceptions and thus had been discharged. She asserted that
        Gary should be sanctioned for violating the discharge injunction.
                Second, Eva argued that Gary should be sanctioned for vio-
        lating the automatic stay in her bankruptcy case. According to Eva,
        Gary violated the stay because he failed to notify the state appellate
        court about her bankruptcy.
              Third, Eva argued that even if her debt for attorney’s fees
        had not been discharged in her bankruptcy, Gary should be sanc-
        tioned because he no longer had a right to collect the debt. Because

        1 In addition, Eva filed an adversary proceeding against Gary in her bankruptcy

        case seeking a declaration that the debt she owed for the attorney’s fees had
        been discharged in her bankruptcy.
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        23-11817                   Opinion of the Court                         5

        Gary failed to disclose the debt for attorney’s fees on his bank-
        ruptcy schedules, Eva argued, he surrendered the claim to his bank-
        ruptcy estate and had “no standing . . . to pursue the claim.” Doc.
        4-8 at 3. 2
               The bankruptcy court reopened Eva’s bankruptcy case for
        the limited purpose of resolving her motion for sanctions. It ulti-
        mately denied that motion.
                The bankruptcy court considered Eva’s argument that Gary
        should be sanctioned for violating the discharge injunction. It ex-
        plained that he could be held in civil contempt for violating a dis-
        charge injunction only if (1) he attempted to collect a discharged
        debt, and (2) there was “no fair ground of doubt as to whether the
        [discharge] order barred [his] conduct.” Doc. 4-17 at 5 (emphasis
        omitted) (internal quotation marks omitted). The bankruptcy
        court did not address whether Eva’s debt for the attorney’s fees had
        been discharged in her bankruptcy. Instead, it refused to sanction
        Gary because, even assuming the debt had been discharged, he had
        an “objectively reasonable basis for concluding that his conduct
        might be lawful under the discharge order.” Id. at 6 (alteration
        adopted) (internal quotation marks omitted). The court explained
        that it was “arguable” that Eva’s debt was not discharged under the
        Bankruptcy Code because it was either a domestic support obliga-
        tion or incurred in the course of a divorce. Id. at 7 (citing 11 U.S.C.
        § 523(a)(5), (15)).

        2 “Doc.” numbers refer to the district court’s docket entries.
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        6                      Opinion of the Court                  23-11817

                The bankruptcy court also rejected Eva’s argument that
        Gary should be sanctioned for violating the automatic stay in her
        bankruptcy. It explained that the “automatic stay was terminated
        upon the entry of [Eva’s] discharge.” Id. Because Gary attempted
        to collect the attorney’s fees only after the entry of the discharge in
        Eva’s bankruptcy case, the bankruptcy court concluded that he had
        not violated the stay. In denying the motion for sanctions, the
        bankruptcy court did not expressly address Eva’s argument that
        Gary lacked “standing” to collect the debt for the attorney’s fees
        after failing to disclose it in his bankruptcy case.
               Eva moved for reconsideration of the order denying her mo-
        tion for sanctions. The bankruptcy court denied that motion, too.
               Eva then appealed to the district court, which affirmed the
        bankruptcy court. It began by addressing Eva’s argument seeking
        sanctions based on Gary’s purported violation of the discharge in-
        junction entered in her bankruptcy. Because Gary had “an objec-
        tively reasonable basis for believing that the fee award” had not
        been discharged, the district court concluded that the bankruptcy
        court did not err in denying the motion for sanctions. Doc. 21 at 4.
        The district court noted that it was not deciding the question of
        whether this debt had actually been discharged, saying that the
        state court had “concurrent jurisdiction” to address that issue. Id.
               The district court also considered Eva’s argument that Gary
        had violated the automatic stay in her bankruptcy when he tried to
        collect the fee award. The district court agreed with the bankruptcy
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        23-11817                   Opinion of the Court                                  7

        court that there was no violation because the stay had automati-
        cally terminated by the time Gary tried to collect.
                The district court also rejected Eva’s argument that Gary
        should be sanctioned because he lacked “standing” to collect the
        debt. The district court quickly disposed of this argument, saying
        that the standing question “was not germane to the bankruptcy
        court’s disposition of the motion for sanctions.” Id. at 5. After the
        district court issued its decision, Eva filed a motion for reconsider-
        ation, which the district court denied.
              Eva now appeals the district court’s decision affirming the
        bankruptcy court. 3
                                                II.
                In bankruptcy cases, we “sit[] as a second court of review
        and thus examine[] independently the factual and legal determina-
        tions of the bankruptcy court and employ[] the same standards of
        review as the district court.” In re Ocean Warrior, Inc., 835 F.3d 1310,
        1315 (11th Cir. 2016) (internal quotation marks omitted). When the
        district court, sitting as an appellate court, affirms a bankruptcy
        court’s order, we “review the bankruptcy court’s decision.” In re
        Fisher Island Invs., Inc., 778 F.3d 1172, 1189 (11th Cir. 2015). In doing
        so, “[w]e review the bankruptcy court’s factual findings for clear
        error and its legal conclusions de novo.” Id.

        3 Gary did not file a brief in this appeal. “When an appellee fails to file a brief

        by the due date . . . the appeal will be submitted to the court for decision with-
        out further delay.” 11th Cir. R. 42-2(f).
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        8                       Opinion of the Court                  23-11817

               We review a bankruptcy court’s denial of a motion for sanc-
        tions for abuse of discretion. In re Roth, 935 F.3d 1270, 1274 (11th
        Cir. 2019). Under this standard, we must affirm unless the bank-
        ruptcy court “made a clear error of judgment[] or has applied the
        wrong legal standard.” Ocean Warrior, 835 F.3d at 1315 (internal
        quotation marks omitted).
                 We liberally construe the pleadings of a pro se litigant. Camp-
        bell v. Air Jam. Ltd., 760 F.3d 1165, 1168 (11th Cir. 2014).
                                          III.
               On appeal, Eva challenges the bankruptcy court’s denial of
        her motion for sanctions. We liberally construe Eva’s filings as rais-
        ing three arguments about why Gary should have been sanctioned:
        (1) he violated the discharge injunction in her bankruptcy case;
        (2) he violated the automatic stay in her bankruptcy case; and (3) he
        could not collect the attorney’s fee award after he failed to disclose
        the debt in the schedules to his bankruptcy petition. We consider
        each argument in turn.
               We begin with Eva’s argument that Gary violated the dis-
        charge injunction in her bankruptcy case. A discharge in a Chapter
        7 case generally releases a debtor from personal liability for pre-
        petition debts. See 11 U.S.C. § 727(b). When a debt is discharged,
        the discharge order generally “operates as an injunction against the
        commencement or continuation of . . . an act[] to collect . . . any
        such debt as a personal liability of the debtor.” Id. § 524(a)(2). The
        discharge injunction plays an “important role in achieving the
        Bankruptcy Code’s overall policy aim of giving a debtor a fresh
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        23-11817               Opinion of the Court                          9

        start.” In re McLean, 794 F.3d 1313, 1321 (11th Cir. 2015) (internal
        quotation marks omitted).
               To ensure that a debtor receives a fresh start, a bankruptcy
        court may “impose civil contempt sanctions” on a creditor who
        “attempt[s] to collect a discharged debt when there is no objec-
        tively reasonable basis for concluding that the creditor’s conduct
        might be lawful under the discharge order.” Roth, 935 F.3d at 1275
        (alteration adopted) (internal quotation marks omitted). We have
        explained that to sanction a creditor for violating a discharge in-
        junction, the bankruptcy court must find that (1) the creditor at-
        tempted to collect a discharged debt and (2) “there was no fair
        ground of doubt as to whether the discharge order barred” the
        creditor’s conduct. Sellers v. Rushmore Loan Mgmt. Servs., LLC, 941
        F.3d 1031, 1041 n.6 (11th Cir. 2019) (internal quotation marks omit-
        ted).
               The bankruptcy court did not abuse its discretion when it
        declined to sanction Gary because there was a fair ground of doubt
        as to whether the discharge injunction in Eva’s bankruptcy case
        barred him from collecting the debt. Although a discharge releases
        a debtor from personal liability for many pre-petition debts, the
        Bankruptcy Code provides that certain types of debts are not dis-
        chargeable in bankruptcy. See 11 U.S.C. § 727(b). The types of debts
        that are not dischargeable include any debt for “a domestic support
        obligation” or a debt to a “former spouse . . . that is incurred by the
        debtor in the course of a divorce . . . or in connection with a . . .
        divorce decree.” Id. § 523(a)(5), (15).
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        10                        Opinion of the Court                     23-11817

               Here, Gary had an objectively reasonable basis to believe
        that he could collect the debt because it was non-dischargeable un-
        der § 523(a)(15). After all, Eva owed the debt to Gary, a former
        spouse. And the debt was arguably “in connection with . . . a di-
        vorce decree” because the state court awarded Gary attorney’s fees
        he incurred as a result of Eva’s violation of the terms of the divorce
        decree. See id. § 523(a)(15). Although this Court has not addressed
        whether such a debt falls within the exception for discharge set
        forth at § 523(a)(15), other courts have addressed the question and
        concluded that this type of debt is not dischargeable. See, e.g., In re
        Rackley, 502 B.R. 615, 625–26 (N.D. Ga. Bankr. 2013); In re Schen-
        kein, No. 09-14658, 2010 WL 3219464, at *5 (S.D.N.Y. Bankr. Aug.
        9, 2010). Given the plain language of § 523(a)(15) as well as the case
        law interpreting this provision, Gary had at least a fair ground of
        doubt as to whether Eva’s discharge injunction barred him from
        attempting to collect the attorney’s fee award. See Sellers, 941 F.3d
        at 1041 n.6.
                  To be clear, we do not decide today whether Eva’s debt for
        the attorney’s fees award was in fact discharged in her bankruptcy.
        We need not decide this issue because even assuming that the debt
        was discharged, Gary could not be sanctioned because he had a rea-
        sonable basis for believing that he could lawfully attempt to collect
        it. 4 See id.

        4 In denying Eva’s motion for sanctions, the bankruptcy court concluded that

        the state court could resolve the question of whether Eva’s debt had been dis-
        charged. Eva disagrees, arguing that the bankruptcy court alone may
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        23-11817                   Opinion of the Court                               11

               We next consider Eva’s argument that the bankruptcy court
        abused its discretion by failing to sanction Gary for violating the
        automatic stay in her bankruptcy. The filing of a bankruptcy peti-
        tion automatically stays all efforts outside of bankruptcy to collect
        debts from a debtor who is under the protection of the bankruptcy
        court. See 11 U.S.C. § 362(a)(6). When a Chapter 7 debtor receives
        a discharge, the automatic stay is terminated. Id. § 362(c)(2)(C).
                Eva argues that Gary violated the automatic stay when, after
        she filed bankruptcy, he “persisted” in the appeal in state court in
        which she challenged the fee award. Appellant’s Br. 28. Notably,
        Eva does not dispute that once the bankruptcy court entered the
        discharge order in August 2020 in her bankruptcy case, the auto-
        matic stay dissolved. Even if it’s true that the automatic stay barred
        the parties from litigating Eva’s appeal of the contempt award dur-
        ing the relatively short period between when she filed her bank-
        ruptcy petition and received her Chapter 7 discharge, we cannot
        say that the bankruptcy court abused its considerable discretion
        when it declined to sanction Gary for this violation, particularly be-
        cause it appears that both Gary and Eva violated the automatic stay
        by litigating Eva’s appeal of the contempt order. See Harris v.

        determine whether the debt was discharged. We agree with the bankruptcy
        court. Although the question of whether a particular debt can be discharged
        in bankruptcy is a question of federal law, see Grogan v. Garner, 498 U.S. 279,
        284 (1991), state courts generally may decide the issue, see Taggart v. Lorenzen,
        139 S. Ct. 1795, 1803 (2019); see also Cummings v. Cummings, 244 F.3d 1263, 1267
        (11th Cir. 2001) (recognizing that state courts generally have concurrent juris-
        diction to determine whether a debt was non-dischargeable under § 523(a)).
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        12                        Opinion of the Court                      23-11817

        Chapman, 97 F.3d 499, 506 (11th Cir. 1996) (discussing “wide discre-
        tion” afforded a judge when deciding whether a party’s conduct
        merits imposition of sanctions).
               We conclude with Eva’s argument that the bankruptcy
        court abused its discretion by failing to sanction Gary for attempt-
        ing to collect a debt that he did not list as an asset on his bankruptcy
        schedules. She says that when Gary petitioned for bankruptcy un-
        der Chapter 7, he forfeited all his prepetition assets, including Eva’s
        debt, to his bankruptcy estate. Because Gary failed to list the debt
        as an asset in his bankruptcy schedules, she asserts, the debt re-
        mained in Gary’s bankruptcy estate, and the Chapter 7 trustee
        alone is the real party in interest who may try to collect the debt.
        See Parker v. Wendy’s Int’l, Inc., 365 F.3d 1268, 1272 (11th Cir. 2004).
                Even assuming that Eva is correct the debt belongs to Gary’s
        bankruptcy estate and can be collected only by the Chapter 7 trus-
        tee, we again cannot say that the bankruptcy court abused its “wide
        discretion” when it declined to sanction Gary for this conduct. Har-
        ris, 97 F.3d at 506. 5

        5 When discussing that a Chapter 7 trustee is the real party in interest who

        may sue to collect a debt a debtor failed to disclose in his bankruptcy sched-
        ules, we have sometimes stated that the trustee is the person with “standing”
        to collect the debt. See Parker, 365 F.3d at 1272. Focusing on our use of the
        word “standing,” Eva argues at length that Gary’s attempt to collect a debt
        that belonged to his bankruptcy estate implicates subject matter jurisdiction.
        But in stating that a trustee has “standing” to collect a debt, we were not ad-
        dressing the constitutional requirement that a plaintiff must have Article III
        standing to pursue a claim. See Lujan v. Defs. of Wildlife, 504 U.S. 555, 560
        (1992). Instead, we were referring to what has sometimes been called
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        23-11817                   Opinion of the Court                               13

                                              IV.
                For the above reasons, we affirm the district court.
                AFFIRMED.

        “statutory standing” or “prudential standing,” the question of who has a
        “cause of action under [a] statute.” Lexmark Int’l, Inc. v. Static Control Compo-
        nents, Inc., 572 U.S. 118, 128 & n.4 (2014). To be clear, Eva’s argument that
        Gary could not collect the debt because he failed to disclose it in his bank-
        ruptcy does not implicate subject matter jurisdiction. See id. at 128; Highland
        Consulting Grp. v. Minjares, 74 F.4th 1352, 1359 (11th Cir. 2023).