Court Opinion

ID: 3043083
Source: CourtListenerOpinion
Date Created: 2015-10-13 23:10:39.755767+00
Date Added: 2024-06-11T11:49:02.609366
License: Public Domain

United States Bankruptcy Appellate Panel
                             FOR THE EIGHTH CIRCUIT

                                   No. 07-6012 EA

In re:                                     *
                                           *
Benjamin L. Eagle,                         *
                                           *
         Debtor.                           *
                                           *
Benjamin L. Eagle,                         *        Appeal from the United States
                                           *        Bankruptcy Court for the
         Debtor-Appellant,                 *        Eastern District of Arkansas
                                           *
              v.                           *
                                           *
Bank of America,                           *
                                           *
         Movant-Appellee.                  *

                               Submitted: July 10, 2007
                                Filed: August 10, 2007

Before SCHERMER, VENTERS, and MCDONALD, Bankruptcy Judges

SCHERMER, Bankruptcy Judge
       Benjamin L. Eagle (“Debtor”) appeals from two bankruptcy court1 orders. One
order granted an extension of time to file a complaint to seek a denial of the Debtor’s
discharge and to seek a determination of the dischargeability of a debt to Bank of
America, N.A. (“Creditor”). This order is interlocutory. Travers v. Dragul (In re
Travers), 202 B.R. 624, 626 (B.A.P. 9th Cir. 1996). The Debtor failed to obtain leave
of court to appeal such order. Absent leave of court, we lack jurisdiction over its
appeal. See 28 U.S.C. § 158(a)(3) and (b). The other order sustained the Creditor’s
objection to the Debtor’s homestead exemptions in property he transferred pre-
petition. We have jurisdiction over the appeal from such final order of the bankruptcy
court. See 28 U.S.C. § 158(a)(1) and (b). For the reasons set forth below, we affirm
the order sustaining the objection to the homestead exemption.

                                       ISSUES

       The first issue on appeal is whether the bankruptcy court erred in sustaining the
Creditor’s objection to the Debtor’s homestead exemptions in certain real property
which the Debtor transferred pre- petition. We conclude that the bankruptcy court did
not err in sustaining the objection to the Debtor’s homestead exemptions in the real
property.

       The second issue on appeal is whether the Debtor’s constitutional rights were
violated by the bankruptcy court’s failure to appoint counsel to represent the Debtor
in connection with his bankruptcy case. We conclude that the Debtor had no right to
counsel in connection with his bankruptcy case.

      In his briefs, the Debtor alleges that the Creditor violated the automatic stay.
No allegations regarding this matter were raised in connection with the order which

      1
       The Honorable James G. Mixon, United States Bankruptcy Judge for the
Eastern and Western Districts of Arkansas.
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is the subject of this appeal. Consequently such matter is not properly before this
tribunal. Alexander v. Jensen-Carter (In re Alexander), 236 F.3d 431, 433 (8th Cir.
2001).2

                                 BACKGROUND

       The Debtor purchased a cashier’s check from Bank of America with a check
drawn on an account which lacked sufficient funds to cover the check. The Debtor
used the cashier’s check to redeem certain real property located at 2606 South Battery
Street in Little Rock, Arkansas (“Property”) which had been foreclosed. The check
the Debtor used to purchase the cashier’s check was returned for insufficient funds.

       As of June 15, 2006, the Debtor was preparing to transfer the Property to
Olandis Moore. On June 15, 2006, the Creditor initiated a lawsuit against the Debtor
in connection with the insufficient funds check seeking a constructive trust or
equitable lien on the Property. The Creditor also filed a notice of lis pendens with
respect to the Property on June 15, 2006. In July or August of 2006, the Debtor
transferred the Property to Olandis Moore. The deed transferring the Property to
Mr. Moore was recorded on September 1, 2006.

      The Debtor filed a pro se voluntary petition for relief under Chapter 7 of the
United States Bankruptcy Code on September 8, 2006. Upon the filing of the
Debtor’s bankruptcy petition, the bankruptcy court issued a notice setting the first
meeting of creditors on October 12, 2006. The Debtor failed to file the necessary
schedules and the bankruptcy court dismissed his case on September 29, 2006, and
closed the case on October 11, 2006.

      2
        In his reply brief, the Debtor alleges the issue of the automatic stay was
raised at an April 20, 2007, hearing before the bankruptcy court. This appeal is
limited to an order entered in connection with a hearing conducted on January 19,
2007. Issues raised at a subsequent hearing are not relevant to this appeal.
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       On October 11, 2006, the Debtor filed a motion to reconsider the dismissal of
his case. The bankruptcy court reopened the Debtor’s case by order dated October 17,
2006, and held a hearing on the motion to reconsider the dismissal on October 27,
2006. The Debtor appeared at the October 27, 2006, hearing pro se. The Creditor
appeared through counsel. The judge asked the Debtor if he was representing himself
and the Debtor responded that he was. The court granted the motion to reinstate
despite the Creditor’s opposition.

      After agreeing to reinstate the case, the judge advised the Debtor to obtain
counsel. The transcript of the October 27, 2006, hearing reflects the following
discourse:

      THE COURT:          Mr. Eagles [sic], [Creditor’s counsel] is fixing to come after
                          you, so you better go get a good lawyer.
      MR. EAGLE:          [Creditor’s counsel] can bring everything she’s got. I’m
                          ready to fire away.
      THE COURT:          All right. You –
      MR. EAGLE:          Bring it on.
      THE COURT:          You’re going to need some help.
      MR. EAGLE:          Oh, I don’t think so, sir. That’s what the UALR law library
                          is for. Thank you.
      THE COURT:          God help you.

       The Debtor filed his schedules and statement of financial affairs on October 27,
2006. In his schedules, the Debtor identified the Property as his residence. He listed
his interest in the Property as that of a tenant and claimed homestead exemptions in
the Property in the amounts of $59,000 and $18,000. The bankruptcy court set aside
the dismissal of the Debtor’s bankruptcy case by order dated November 7, 2006. On
November 13, 2006, the bankruptcy court issued a notice setting the first meeting of
creditors on December 8, 2006.

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       On January 5, 2007, the Creditor filed an objection to the Debtor’s claimed
exemptions in the Property (“Exemption Objection”). The Debtor contested the
Exemption Objection. The bankruptcy court conducted a hearing on the Exemption
Objection on January 19, 2007. The Debtor appeared pro se at the hearing and the
Creditor appeared through counsel. At the outset of the hearing, the judge noted that
the Debtor was appearing pro se and asked him if he would like to obtain counsel.
The Debtor indicated that he would like to get an attorney. When the judge asked the
Creditor’s counsel if she had any objection to continuing the hearing she reminded the
court of the prior admonition to the Debtor to obtain counsel. The Debtor admitted
that he had already been advised by the court to obtain counsel and had not done so.
The court proceeded with the hearing. At the close of evidence the court sustained the
Exemption Objection. The Debtor appealed the order granting the Exemption
Objection.

                             STANDARD OF REVIEW

      The facts are not in dispute. We review the bankruptcy court’s conclusions of
law de novo. Alexander v. Jensen-Carter (In re Alexander), 239 B.R. 911, 913
(B.A.P. 8th Cir. 1999), aff’d 236 F.3d 431 (8th Cir. 2001).

                                    DISCUSSION

      I.     The Objection to Exemptions

      Pursuant to 11 U.S.C. § 522(l), a debtor shall file a list of property that the
debtor claims as exempt. A party in interest may file an objection to the debtor’s list
of property claimed as exempt within thirty days after the first meeting of creditors is
concluded or within thirty days after any amendment to the list or supplemental
schedule is filed. Fed. R. Bankr. P. 4003(b)(1). In the instant case, the Creditor
timely objected to the Debtor’s assertion of homestead exemptions in the Property on

                                           5
the basis that the Debtor had no ownership interest in the Property. The Debtor
transferred the Property prior to filing his bankruptcy petition. As of the petition date,
the Debtor’s only interest in the Property was that of a lessee. The Debtor is not
entitled to a homestead exemption in property which he does not own. First Bank of
Linden v. Sloma (In re Sloma), 43 F.3d 637, 640 (11th Cir. 1995); In re Moss, 258 B.R.
427, 430 (Bankr. W.D. Mo. 2001); Block v. Moss (In re Moss), 258 B.R. 405, 422
(Bankr. W.D. Mo. 2001); In re Thorpe, 251 B.R. 723, 725 (Bankr W.D. Mo. 2000).
The court did not err in disallowing the Debtor’s homestead exemption in the
Property.

      II.    Right to Counsel

        The right to counsel only exists in favor of an indigent whose physical liberty
is at stake. Lassiter v. Dep’t of Soc. Servs. of Durham County, 452 U.S. 18, 26-27
(1981). The Debtor’s physical liberty was not at issue in his bankruptcy case.
Accordingly, he had no right to counsel. Although it had no duty to do so, the court
advised the Debtor to obtain counsel. The Debtor emphatically rejected the court’s
suggestion. The Debtor may now regret his decision; however second-guessing his
decision to proceed pro se is not a valid reason to appeal a result he does not like.

                                    CONCLUSION

       The bankruptcy court did not err in disallowing a homestead exemption in
property the Debtor transferred pre-petition and did not own on the bankruptcy
petition date. The Debtor had no right to counsel in connection with his bankruptcy
case. Accordingly, we AFFIRM.

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