Court Opinion

ID: 4464948
Source: CourtListenerOpinion
Date Created: 2019-12-17 19:00:22.988787+00
Date Added: 2024-06-11T14:53:43.373584
License: Public Domain

Case: 19-50318       Document: 00515239620        Page: 1    Date Filed: 12/17/2019

           IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT   United States Court of Appeals
                                                     Fifth Circuit

                                                                              FILED
                                                                        December 17, 2019
                                    No. 19-50318
                                  Summary Calendar                         Lyle W. Cayce
                                                                                Clerk

In the Matter of: HELSON PACHECO,

               Debtor

PERMULA CORPORATION,

               Appellant

v.

HELSON PACHECO,

               Appellee

               Appeal from the United States District Court for the
                            Western District of Texas
                             USDC No. 3:18-CV-288

Before STEWART, HIGGINSON, and COSTA, Circuit Judges.
PER CURIAM:*
       Appellant Permula Corporation (“Permula”) appeals the district court’s
dismissal of its appeal from the Bankruptcy Court’s dismissal of its “Adversary

       * Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
    Case: 19-50318        Document: 00515239620       Page: 2      Date Filed: 12/17/2019

                                      No. 19-50318
Complaint to Determine Dischargeability” (“Complaint”) for want of
prosecution. For the reasons set forth herein, we AFFIRM.
                                  I. BACKGROUND
      Appellee Helson Pacheco (“Pacheco”) and his ex-wife, Wilma Luquis-
Aponte, borrowed approximately $800,000.00 from Permula which were used
to purchase a house in El Paso, Texas. 1 The house Pacheco and his ex-wife
purchased with the loan funds was later lost to El Paso county to recover
unpaid real property taxes. Pacheco eventually filed Chapter 7 bankruptcy in
the Western District of Texas. Permula objected to the dischargeability of this
debt. In the course of this bankruptcy proceeding, Permula experienced
struggles retaining counsel for the duration of the proceedings.
      Permula’s first attorney and Pacheco filed a joint motion to modify the
scheduling order to extend the deadlines for discovery. After the court granted
this motion at the end of January 2018, Permula’s first attorney orally
withdrew as Permula’s counsel. He did not file a motion to withdraw until
several months after Permula’s second attorney filed his designation as
counsel of record. Permula filed a motion seeking leave to amend its complaint
in order to include Pacheco’s ex-wife’s debt, under the guise of judicial economy,
as additional grounds to challenge the dischargeability of Pacheco’s debt. In
the motion, Permula conceded that the motion was filed after the discovery
deadline set in the modified scheduling order. Then, in April 2018, the parties
jointly moved to modify the scheduling order a second time, which the
bankruptcy court granted.
      The bankruptcy court denied Permula’s motion to amend the complaint.
Pacheco then filed his proposed pre-trial order a couple of months later on
August 8, 2018. On that same day, Permula’s second attorney filed a motion

      1   Wilma Luquis-Aponte was not a party to the bankruptcy.
                                            2
    Case: 19-50318     Document: 00515239620     Page: 3   Date Filed: 12/17/2019

                                  No. 19-50318
to withdraw as Permula’s counsel. He later provided the bankruptcy court
with Permula’s last known address on August 16, 2018. On that same day, the
bankruptcy court issued an order requiring Permula to do the following by
August 31, 2018: (1) retain a licensed attorney to represent Permula in the
adversary proceeding who had to file a notice of appearance in the proceeding;
(2) file a proposed pre-trial order with the court through said licensed attorney;
and (3) file proposed findings of fact and conclusions of law with the court,
through said licensed attorney. The court provided notice to Permula that the
adversary proceeding would be dismissed for Permula’s failure to comply with
any of those requirements. August 31, 2018 came and went with no pre-trial
order filed by Permula. On September 4, 2018, the bankruptcy court dismissed
the adversary proceeding for want of prosecution.
      After failed attempts to initiate a new proceeding in the bankruptcy
court, Permula’s third attorney filed a timely notice of appeal in the district
court on October 2, 2018. After a late filing of the “Designation of Contents of
the Record and Statement,” the district court clerk docketed the appeal on
November 30, 2018. Pacheco’s attorney filed a motion to dismiss the appeal on
January 25, 2019 because there was no appellate briefing for Permula filed on
record. The district court granted Pacheco’s motion to dismiss. Permula timely
appealed the district court’s grant of dismissal to this court.
                        II. STANDARD OF REVIEW
      We review a district court’s actions in its appellate role for an abuse of
discretion. In re Cleveland Imaging & Surgical Hospital, L.L.C., 690 F. App’x
283, 286–87 (5th Cir. 2017).
                               III. DISCUSSION
      The Federal Rules of Bankruptcy Procedure govern this appeal. Rule
8018(a)(1) states that, when appealing a bankruptcy decision to the district
court, an appellant has 30 days to serve and file its brief with the court after
                                        3
    Case: 19-50318     Document: 00515239620     Page: 4   Date Filed: 12/17/2019

                                  No. 19-50318
the record on appeal has been transmitted or made electronically available.
FED. R. BANKR. P. 8018(a)(1). In the event that the appellant fails to timely
file its brief, the appellee has the option to move for dismissal. FED. R. BANKR.
P. 8018(a)(4). As we have stated before, “[b]ankruptcy appeals have frequently
been dismissed for the appellant’s failure to comply with the duty of diligent
prosecution, and we have dismissed civil appeals for failure of prosecution
when the appellant’s brief was not timely filed.” In re Braniff Airways, Inc.,
774 F.2d 1303, 1305 (5th Cir. 1985) (footnotes and citations omitted); see also
In re Cleveland Imaging, 690 F. App’x at 287.
      Here, the appellant did not timely file its brief with the district court.
The bankruptcy rules allow the appellee to move for dismissal when this
occurs. See FED. R. BANKR. P. 8018(a)(4). It is clear that Permula struggled to
retain counsel for the duration of the bankruptcy proceedings.          However,
Permula retained counsel toward the end of those proceedings and for the
duration of the appeal to the district court. There was no reason for Permula
to miss the filing deadline. Furthermore, as the district court noted in its
opinion, it did not issue an order excusing the late filings. Thus, this appeal
was properly dismissed. Given those facts and the district court’s application
of the correct law, we hold that the district court did not abuse its discretion.
                              IV. CONCLUSION
      For the aforementioned reasons, we AFFIRM.

                                        4