Court Opinion

ID: 4192759
Source: CourtListenerOpinion
Date Created: 2017-08-03 17:02:32.779003+00
Date Added: 2024-06-11T14:40:28.157164
License: Public Domain

FILED
                                                                MAR 25 2016
 1                         NOT FOR PUBLICATION
                                                           SUSAN M. SPRAUL, CLERK
 2                                                             U.S. BKCY. APP. PANEL
                                                               OF THE NINTH CIRCUIT

 3                  UNITED STATES BANKRUPTCY APPELLATE PANEL
 4                            OF THE NINTH CIRCUIT
 5   In re:                        )      BAP No.     SC-15-1228-FJuKi
                                   )
 6   MARSHALL CASEY PFEIFFER,      )      Bk. No.     13-09062-CL13
                                   )
 7                  Debtor.        )
     _____________________________ )
 8                                 )
     MARSHALL CASEY PFEIFFER,      )
 9                                 )
                    Appellant,     )
10                                 )
     v.                            )      MEMORANDUM*
11                                 )
     DAVID SKELTON, Trustee,**     )
12                                 )
                    Appellee.      )
13   ______________________________)
14                      Submitted Without Oral Argument
                               on March 17, 2016
15
                             Filed – March 25, 2016
16
               Appeal from the United States Bankruptcy Court
17                 for the Southern District of California
18     Honorable Christopher B. Latham, Bankruptcy Judge, Presiding
19
     Appearances:     Appellant Marshall Casey Pfeiffer, pro se, on the
20                    brief.
21
     Before: FARIS, JURY, and KIRSCHER, Bankruptcy Judges.
22
23
24
          *
            This disposition is not appropriate for publication.
25   Although it may be cited for whatever persuasive value it may
26   have, see Fed. R. App. P. 32.1, it has no precedential value, see
     9th Cir. BAP Rule 8024-1.
27
          **
            Mr. Skelton did not file an answering brief or otherwise
28   make an appearance in this appeal.
 1                               INTRODUCTION
 2        Chapter 131 debtor Marshall Casey Pfeiffer appeals from the
 3   bankruptcy court’s order granting chapter 13 trustee David
 4   Skelton’s motion to dismiss.   The bankruptcy court determined
 5   that Mr. Pfeiffer had failed to make regular plan payments and
 6   could not pay off the plan by presenting the Trustee with an
 7   invalid promissory note.   Mr. Pfeiffer fails to identify any
 8   reversible error.   Accordingly, we AFFIRM.
 9                            FACTUAL BACKGROUND2
10        Mr. Pfeiffer’s chapter 13 plan (the “Plan”) required him to
11   make monthly payments of $1,435.       Mr. Pfeiffer made Plan payments
12   for approximately one year but then stopped.
13        The Trustee filed a motion to dismiss Mr. Pfeiffer’s case
14   for failure to make Plan payments (the “Motion to Dismiss”).      He
15   alleged that Mr. Pfeiffer materially defaulted under the Plan
16   pursuant to § 1307(c)(6) or (8).
17        In response, Mr. Pfeiffer attached an alleged promissory
18   note stub to his opposition.   He argued that the document
19   evidenced the delivery of a promissory note for $54,473.97 (the
20   “Promissory Note”) to the Trustee that satisfied his outstanding
21   debt.    Mr. Pfeiffer also stated that he transmitted a copy of the
22   Promissory Note receipt to the United States Treasury.
23        The Promissory Note, supposedly issued the same day as
24
          1
            Unless specified otherwise, all chapter and section
25   references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532.
26        2
            Mr. Pfeiffer presents us with a     limited record. We have
27   exercised our discretion to review the     bankruptcy court’s docket,
     as appropriate. See Woods & Erickson,      LLP v. Leonard (In re AVI,
28   Inc.), 389 B.R. 721, 725 n.2 (9th Cir.     BAP 2008).

                                        2
 1   Mr. Pfeiffer’s opposition, identifies the issuer as “Marshall
 2   Casey Pfeiffer” and the principal as “The United States of
 3   America.”   The Drawee is “United States in behalf of the United
 4   States of America,” and the Promissory Note is “payable” at “The
 5   United States Treasury or at a Bank in the United States.”         The
 6   Promissory Note is “redeemable” at the “Treasury Department of
 7   the United States, City of Washington, District of Columbia or at
 8   Any Federal Reserve Bank.”3
 9        At the hearing on the Motion to Dismiss,       Mr. Pfeiffer
10   argued that the Promissory Note is legal tender because it is
11   “legally the same as a check or a dollar bill.”       He contended
12   that he “sent the promissory note to the principal [the United
13   States of America] asking them to pay the debt because the
14   principal is responsible for the debt as the principal of the
15   agency.   The principal is the beneficiary and legally responsible
16   for all debts related to the agency that it created.”
17        On July 1, 2015, the court issued its order granting the
18   Motion to Dismiss (the “Order”).       It determined that the
19   Promissory Note is not legal tender.       It also held that the
20   Promissory Note is invalid, because “[t]here is no indication
21   that Debtor has any standing, capacity, or authority whatever to
22   draw upon the Federal Treasury or bind the United States in any
23   kind of contract.”   The court concluded that Mr. Pfeiffer failed
24   to make Plan payments, which constituted a material default under
25
          3
26          Mr. Pfeiffer also attached a document entitled     “Purpose of
     Promissory Note.” He stated that the Promissory Note      was meant
27   to pay off or discharge any debt as it relates to his     bankruptcy
     case. He contended that the United States of America      is the
28   principal liable for payment on the Promissory Note.

                                        3
 1   the Plan, and dismissed the case under § 1307(c)(6).
 2        Mr. Pfeiffer timely appealed the Order.
 3                               JURISDICTION
 4        The bankruptcy court had jurisdiction pursuant to 28 U.S.C.
 5   §§ 1334 and 157(b)(1).   We have jurisdiction under 28 U.S.C.
 6   § 158.
 7                                  ISSUE
 8        Whether the bankruptcy court erred in dismissing
 9   Mr. Pfeiffer’s chapter 13 case for failure to make plan payments.
10                            STANDARD OF REVIEW
11        “We review the bankruptcy court’s dismissal of a chapter 13
12   bankruptcy case under any of the enumerated paragraphs of
13   § 1307(c) for abuse of discretion.”    Schlegel v. Billingslea
14   (In re Schlegel), 526 B.R. 333, 338 (9th Cir. BAP 2015) (citing
15   Ellsworth v. Lifescape Med. Assocs., P.C. (In re Ellsworth),
16   455 B.R. 904, 914 (9th Cir. BAP 2011)).
17        To determine whether the bankruptcy court has abused its
18   discretion, we conduct a two-step inquiry: (1) we review de novo
19   whether the bankruptcy court “identified the correct legal rule
20   to apply to the relief requested” and (2) if it did, whether the
21   bankruptcy court’s application of the legal standard was
22   illogical, implausible, or “without support in inferences that
23   may be drawn from the facts in the record.”    United States v.
24   Hinkson, 585 F.3d 1247, 1261–62 & n.21 (9th Cir. 2009) (en banc).
25   “If the bankruptcy court did not identify the correct legal rule,
26   or its application of the correct legal standard to the facts was
27   illogical, implausible, or without support in inferences that may
28   be drawn from the facts in the record, then the bankruptcy court

                                      4
 1   has abused its discretion.”    USAA Fed. Sav. Bank v. Thacker
 2   (In re Taylor), 599 F.3d 880, 887–88 (9th Cir. 2010) (citing
 3   Hinkson, 585 F.3d at 1261–62).
 4                                 DISCUSSION
 5   A.   Section 1307 allows dismissal for cause.
 6        The bankruptcy court correctly identified the applicable
 7   legal rule.   Section 1307(c) allows the bankruptcy court to
 8   dismiss a case “for cause.”    In re Schlegel, 526 B.R. at 339.
 9   That section provides:
10        (c) Except as provided in subsection (f) of this
          section, . . . the court may convert a case under this
11        chapter to a case under chapter 7 of this title, or may
          dismiss a case under this chapter, whichever is in the
12        best interests of creditors and the estate, for cause,
          including -
13
               . . .
14
               (6) material default by the debtor with respect to
15             a term of a confirmed plan[.]
16   § 1307(c)(6).   “The decision to dismiss a chapter 13 case under
17   § 1307(c) is a discretionary decision of the trial court.”
18   In re Schlegel, 526 B.R. at 339 (citation omitted)).
19        “Dismissal under § 1307(c) is a two-step process.    Once the
20   court has determined that cause to dismiss exists, it still must
21   decide what remedial action — what form of dismissal — should be
22   taken. . . .”   In re Ellsworth, 455 B.R. at 922 (internal
23   citations omitted); see Nelson v. Meyer (In re Nelson), 343 B.R.
24   671, 675 (9th Cir. BAP 2006).
25   B.   The bankruptcy court did not abuse its discretion in
          dismissing Mr. Pfeiffer’s case for failure to make Plan
26        payments.
27        We hold that the court did not err in determining that
28   Mr. Pfeiffer failed to make his Plan payments and that his

                                       5
 1   default constituted cause for dismissal.
 2        Mr. Pfeiffer contends that the Promissory Note constituted
 3   legal tender that satisfied the Plan in full.    Mr. Pfeiffer is
 4   wrong on two counts.
 5        First, the Promissory Note is not legal tender.    As the
 6   bankruptcy court pointed out, legal tender for debts include
 7   “United States coins and currency (including Federal reserve
 8   notes and circulating notes of Federal reserve banks and national
 9   banks).”   31 U.S.C. § 5103.   Black’s Law Dictionary defines
10   “currency” as “[a]n item (such as a coin, government note, or
11   banknote) that circulates as a medium of exchange.”    Black’s Law
12   Dictionary (10th ed. 2014).    Mr. Pfeiffer’s Promissory Note fits
13   none of these definitions.     It is not coin or paper currency, nor
14   is it issued by a bank or the federal government.    Rather, it was
15   unilaterally created and executed by Mr. Pfeiffer.
16        Second, Mr. Pfeiffer presents no evidence that he is
17   entitled to draw upon the United States Treasury.    He identifies
18   himself as an “Agent” of Marshall Casey Pfeiffer, “in behalf of
19   for the Principal United States of America.”    He claims that “the
20   principal is responsible for the debt as the principal of the
21   agency.    The principal is the beneficiary and legally responsible
22   for all debts related to the agency it created.”    He fails to
23   offer any argument or authority explaining how he has become an
24   agent of the United States with the power to require the United
25   States to pay his debt.4
26
          4
27          Mr. Pfeiffer argues that the United States government and
     the California state government did not object to any of his acts
28                                                      (continued...)

                                        6
 1        Accordingly, the court did not abuse its discretion in
 2   holding that the Promissory Note cannot cure Mr. Pfeiffer’s Plan
 3   payment arrears.5   Due to Mr. Pfeiffer’s failure to make Plan
 4   payments, the court properly found cause to dismiss
 5   Mr. Pfeiffer’s case under § 1307(c)(6).6
 6                               CONCLUSION
 7        For the reasons set forth above, we conclude that the
 8   bankruptcy court did not abuse its discretion in dismissing
 9   Mr. Pfeiffer’s case.   Accordingly, we AFFIRM.
10
11
12
13
14
15
16
17
18
          4
19         (...continued)
     or otherwise challenge his argument. However, neither the
20   federal government nor state government is a party to this case.
21        5
            We further reject Mr. Pfeiffer’s argument that Judge
22   Christopher B. Latham either represented the Trustee or gave
     testimony at the hearing on the Motion to Dismiss. Nothing in
23   the record indicates that the judge either acted as counsel for
     the Trustee or testified at the hearing.
24
          6
            Neither the parties nor the bankruptcy court discussed the
25   second prong of the Ellsworth analysis, and Mr. Pfeiffer does not
26   raise any error concerning the second prong in his opening brief.
     As such, we do not address it on appeal. Cf. In re Ellsworth,
27   455 B.R. at 923 (“even though the bankruptcy court ordinarily
     would be expected to consider alternatives to dismissal with
28   prejudice, the [debtor’s] silence thwarted that task”).

                                      7