Court Opinion

ID: 3187357
Source: CourtListenerOpinion
Date Created: 2016-03-21 20:03:36.527581+00
Date Added: 2024-06-11T07:39:03.106725
License: Public Domain

NOT FOR PUBLICATION

                    UNITED STATES COURT OF APPEALS
                                                                           FILED
                            FOR THE NINTH CIRCUIT
                                                                           MAR 21 2016
                                                                        MOLLY C. DWYER, CLERK
                                                                         U.S. COURT OF APPEALS
In re NAZIE AZAM,                                No. 14-55523

              Debtor,                            D.C. No. 8:13-cv-01485-JLS

NAZIE AZAM,                                      MEMORANDUM*

              Appellant,

 v.

U.S. BANK NATIONAL
ASSOCIATION, as Trustee, Successor in
Interest to Bank of America National
Association as Successor by Merger to La
Salle Bank NA as Trustee for Wamu
Mortgage Pass Through Certificates 2006-
AR Trust,

              Appellee.

                   Appeal from the United States District Court
                       for the Central District of California
                   Josephine L. Staton, District Judge, Presiding

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
                              Submitted March 10, 2016**
                                 Pasadena, California

Before: REINHARDT, MURGUIA, and OWENS, Circuit Judges.

       Nazie Azam appeals from the district court’s order affirming the decision of

the bankruptcy court, which dismissed Azam’s chapter 13 case. Independently

reviewing the bankruptcy court’s conclusions of law de novo and its factual

findings for clear error, Leavitt v. Soto (In re Leavitt), 171 F.3d 1219, 1222 (9th

Cir. 1999), we affirm.1

1.     Azam’s filing of two interlocutory appeals of matters related to the

automatic stay did not deprive the bankruptcy court of jurisdiction to dismiss her

bankruptcy case. While the bankruptcy court “may not finally adjudicate

substantial rights directly involved in the appeal,” Neary v. Padilla (In re Padilla),

222 F.3d 1184, 1190 (9th Cir. 2000) (citation omitted), “[t]he appeal of an order

does not . . . deprive the trial court of jurisdiction over issues not raised in that

order,” Wade v. State Bar of Ariz. (In re Wade), 115 B.R. 222, 230 (B.A.P. 9th Cir.

           **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
       1
        Azam’s requests for judicial notice are granted “to the extent that it is
compatible with Fed. R. Evid. 201 and does not require the acceptance of facts
subject to reasonable dispute.” Associated Gen. Contractors of Am., San Diego
Chapter, Inc. v. Cal. Dep’t of Transp., 713 F.3d 1187, 1190 n.1 (9th Cir. 2013)
(internal quotation marks and alteration omitted).

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1990), aff’d, 948 F.2d 1122 (9th Cir. 1991). Azam did not seek to stay the

proceedings pending the outcome of her appeals related to the bankruptcy stay, and

the appeals did not preclude the bankruptcy court from dismissing Azam’s

bankruptcy case. See Sherman v. SEC (In re Sherman), 491 F.3d 948, 967 (9th

Cir. 2007) (“If a party wants to stay all of the proceedings in bankruptcy court

while an appeal is pending, it must file a motion for a stay.”); Wade, 115 B.R. at

230 (holding that a bankruptcy court retained jurisdiction to dismiss a debtor’s

counterclaims related to alleged violations of the automatic stay despite an appeal

of matters related to the automatic stay).

2.    The bankruptcy court could dismiss Azam’s bankruptcy case regardless of

whether U.S. Bank had standing to request dismissal. See de la Salle v. U.S. Bank,

N.A. (In re de la Salle), 461 B.R. 593, 604 (B.A.P. 9th Cir. 2011) (noting that

whether a creditor had standing was “irrelevant” to the bankruptcy court’s ability

to convert or dismiss a debtor’s chapter 13 case). In any event, U.S. Bank did have

standing. Under 11 U.S.C. § 1307(c), a “party in interest” may request dismissal

for cause. But “a creditor does not need an allowed claim to be a party in interest

for purposes of § 1307(c).” de la Salle, 461 B.R. at 604. Rather, any creditor with

a right to payment has standing to request dismissal. Id. Here, U.S. Bank had a

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right to payment under Azam’s bankruptcy plan due to the unlawful detainer action

and therefore had standing to request dismissal.

3.    U.S. Bank had filed an objection to Azam’s proposed plan and a request for

dismissal for bad faith before the hearing. Azam responded to this motion in

writing. Azam also had ample opportunity to argue at the hearing why her case

should not be dismissed. She was therefore given “a meaningful opportunity to be

heard.” Rosson v. Fitzgerald (In re Rosson), 545 F.3d 764, 776 (9th Cir. 2008).

4.    The bankruptcy court made sufficient findings of fact to justify dismissal for

bad faith. It was evident throughout the hearing that the bankruptcy court saw no

legitimate purpose in Azam’s chapter 13 petition. Rather, the bankruptcy court

found that Azam’s case was brought for the improper purpose of seeking a more

favorable forum in which to litigate claims related to the foreclosure of her home

and to buy more time. This finding was not clearly erroneous, and it amply

supports dismissal for bad faith. See Leavitt, 171 F.3d at 1224 (noting that a

debtor’s unfair manipulation of the Bankruptcy Code, history of filings and

dismissals, intent to defeat state court litigation through the bankruptcy filing, and

egregious behavior are all factors supporting a finding of bad faith under the

totality of the circumstances). Azam’s present bankruptcy filing, her fourth,

proposed to pay her creditors only half of what they were owed. Yet she was

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statutorily ineligible for this sort of discharge because she had received a chapter 7

discharge three years before. See 11 U.S.C. § 1328(f). Thus her petition was

clearly not brought in good faith.

5.    The district court judge was not required to recuse herself. Because Azam

raises recusal for the first time on appeal, we review the issue for plain error.

United States v. Holland, 519 F.3d 909, 911 (9th Cir. 2008). A judge must

disqualify herself “in any proceeding in which [her] impartiality might reasonably

be questioned.” 28 U.S.C. § 455(a). Azam fails to make an intelligible argument

that “a reasonable person with knowledge of all the facts would conclude that the

judge’s impartiality might reasonably be questioned.” Holland, 519 F.3d at 913

(citation omitted).

AFFIRMED.

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