Court Opinion

ID: 4246633
Source: CourtListenerOpinion
Date Created: 2018-02-20 22:00:43.258175+00
Date Added: 2024-06-11T14:44:06.713341
License: Public Domain

FILED
                                                               FEB 02 2018
 1                         NOT FOR PUBLICATION
                                                         SUSAN M. SPRAUL, CLERK
                                                           U.S. BKCY. APP. PANEL
 2                                                         OF THE NINTH CIRCUIT

 3                  UNITED STATES BANKRUPTCY APPELLATE PANEL
                              OF THE NINTH CIRCUIT
 4
 5   In re:                        )      BAP No. CC-17-1029-LKuF
                                   )
 6   SHARON KAY KING,              )      Bk. No. 2:15-bk-20254-BR
                                   )
 7                  Debtor.        )      Adv. No. 2:16-ap-01544-BR
     ______________________________)
 8                                 )
     SHARON KAY KING,              )
 9                                 )
                    Appellant,     )
10                                 )
     v.                            )      M E M O R A N D U M*
11                                 )
     HSBC BANK USA, N.A. as Trustee)
12   for Fremont Home Loan Trust   )
     2006-C, Mortgage-Backed       )
13   Certificates, Series 2006-C; )
     OCWEN LOAN SERVICING, LLC;    )
14   PLATINUM HOLDING GROUP,       )
                                   )
15                  Appellees.     )
     ______________________________)
16
                 Submitted Without Argument on January 25, 2018
17
                            Filed - February 2, 2018
18
                 Appeal from the United States Bankruptcy Court
19                   for the Central District of California
20            Honorable Barry Russell, Bankruptcy Judge, Presiding
                            _________________________
21
     Appearances:     Appellant Sharon Kay King, pro se on brief; Robert
22                    W. Norman, Jr. and Kaitlyn Q. Chang of Houser &
                      Allison, APC on brief for Appellees HSBC Bank USA,
23                    N.A. as Trustee for Fremont Home Loan Trust 2006-
                      C, Mortgage-Backed Certificates, Series 2006-C and
24                    Ocwen Loan Servicing, LLC.
                           _________________________
25
26        *
           This disposition is not appropriate for publication.
27   Although it may be cited for whatever persuasive value it may
     have (see Fed. R. App. P. 32.1), it has no precedential value.
28   See 9th Cir. BAP Rule 8024-1.
 1
 2   Before: LAFFERTY, KURTZ, and FARIS, Bankruptcy Judges.
 3
 4        Debtor appeals the bankruptcy court’s order remanding a
 5   removed superior court action.   The bankruptcy court remanded the
 6   action because Debtor’s chapter 71 case was closed.   On appeal,
 7   Debtor offers no argument relevant to the order on appeal, and we
 8   discern no abuse of discretion in the bankruptcy court’s ruling.
 9   Therefore, we AFFIRM.
10                                  FACTS2
11        Debtor filed the subject chapter 7 case on June 26, 2015.
12   This was Debtor’s second chapter 7 filing and her sixth
13   bankruptcy filing; the four chapter 13 cases she filed were all
14   dismissed before completion.   Debtor had previously owned real
15   property in Long Beach, California (the “Property”), but the
16   Property was sold at a trustee’s sale on June 1, 2011, during a
17   period when no automatic stay was in effect.
18        Both before and after she filed the 2015 chapter 7 case,
19   Debtor initiated numerous court proceedings, including state
20
          1
           Unless specified otherwise, all chapter and section
21   references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532.
22   “Rule” references are to the Federal Rules of Bankruptcy
     Procedure.
23
          2
           In her excerpts of record, Debtor submitted no documents
24   relevant to the order on appeal. Appellees provided relevant
     excerpts, and we have also exercised our discretion to review
25   independently relevant imaged documents from the bankruptcy
26   court’s electronic docket in the bankruptcy case and related
     adversary proceedings. See O’Rourke v. Seaboard Sur. Co.
27   (In re E.R. Fegert, Inc.), 887 F.2d 955, 957–58 (9th Cir. 1989);
     Atwood v. Chase Manhattan Mortg. Co. (In re Atwood), 293 B.R.
28   227, 233 n.9 (9th Cir. BAP 2003).

                                      -2-
 1   court cases, appeals, bankruptcies, and bankruptcy adversary
 2   proceedings related to issues involving the loan against the
 3   Property.   During this bankruptcy, Debtor attempted to sue the
 4   original lender, Fremont Home Loan Trust 2006-C, and its
 5   successors, HSBC Bank USA National Association as Trustee
 6   Under the Pooling and Service Agreement Dated as of September 1,
 7   2006 (“HSBC”) and Litton Loan Servicing LP, for fraud, deceit,
 8   and unjust enrichment in asserting in Debtor’s 2010 bankruptcy
 9   that she was obligated on a loan and deed of trust encumbering
10   the Property.   Debtor sought to quiet title and prayed for
11   injunctive relief requiring defendants to reconvey the Property
12   to her; she also sought compensatory and punitive damages.     For
13   reasons that are not reflected in the record, Debtor voluntarily
14   dismissed the complaint without prejudice.
15        A discharge was issued on November 2, 2015, and the case was
16   closed.   In July 2016, Debtor moved to reopen her case so that
17   she could file an adversary proceeding identical to the one
18   Debtor had voluntarily dismissed.     The bankruptcy court denied
19   the motion to reopen and dismissed the adversary proceeding on
20   grounds that the Debtor had had multiple opportunities to have
21   her claims litigated and heard in bankruptcy and non-bankruptcy
22   forums.   The court found that there was no purpose in reopening
23   the bankruptcy case because Debtor could seek relief in
24   non-bankruptcy fora.   Debtor moved for reconsideration, which the
25   bankruptcy court denied.   She then appealed both orders to this
26   Panel, but the appeals were dismissed for lack of prosecution.
27        On December 12, 2016, without concurrently moving to reopen
28   the main bankruptcy case, Debtor filed a notice of removal of an

                                     -3-
 1   unlawful detainer action brought against her by HSBC in
 2   Los Angeles County Superior Court in August 2016.    The next day,
 3   without a hearing, the bankruptcy court entered an order
 4   remanding the action to superior court.    The order stated:
 5             [D]ebtor states in the pleading that she wants to
          remove a Superior Court action to the United States
 6        Bankruptcy Appellate Panel of the Ninth Circuit
          Court. At the Intake window, she filed this notice of
 7        removal at the United States Bankruptcy Court.
 8             On August 3, 2016, the debtor’s motion to reopen
          her bankruptcy case was denied and an order denying the
 9        motion for reconsideration was denied on November 2,
          2016. The debtor’s bankruptcy case has been closed
10        since November 3, 2015.
11             Given that the bankruptcy case is closed, the
          Court remands the removed action back to the Superior
12        Court of the State of California, County of Long Beach
          because the Superior Court action cannot be removed in
13        a closed case.
14        Debtor timely appealed the remand order.
15                               JURISDICTION
16        The bankruptcy court had jurisdiction pursuant to 28 U.S.C.
17   §§ 1334 and 157(b)(1).   We have jurisdiction under 28 U.S.C.
18   § 158.
19                                    ISSUE
20        Whether the bankruptcy court abused its discretion in
21   remanding the unlawful detainer action to the state court.
22                            STANDARD OF REVIEW
23        We review the bankruptcy court’s remand order for abuse of
24   discretion.   United Nat’l Ins. Co. v. R & D Latex Corp., 242 F.3d
25   1102, 1111–12 (9th Cir. 2001).    A bankruptcy court abuses its
26   discretion if it applies the wrong legal standard or misapplies
27   the correct legal standard, or if its factual findings are
28

                                       -4-
 1   clearly erroneous.    TrafficSchool.com, Inc. v. Edriver Inc.,
 2   653 F.3d 820, 832 (9th Cir. 2011).
 3                                 DISCUSSION
 4   A.   Appellees’ Request for Judicial Notice
 5        Appellees request that the Panel take judicial notice of 21
 6   documents.    These include recorded documents relating to the
 7   disputed loan and foreclosure as well as documents and dockets
 8   related to the extensive litigation between the parties.
 9        These documents may be helpful in understanding the history
10   between the parties, but they are not necessary to the Panel’s
11   disposition of this appeal.    Accordingly, the Request for
12   Judicial Notice is DENIED.
13   B.   Merits
14        Removal of claims related to bankruptcy cases is governed by
15   28 U.S.C. § 1452, which provides:
16        (a) A party may remove any claim or cause of action in
          a civil action other than a proceeding before the
17        United States Tax Court or a civil action by a
          governmental unit to enforce such governmental unit’s
18        police or regulatory power, to the district court for
          the district where such civil action is pending, if
19        such district court has jurisdiction of such claim or
          cause of action under section 1334 of this title.
20
          (b) The court to which such claim or cause of action is
21        removed may remand such claim or cause of action on any
          equitable ground. An order entered under this
22        subsection remanding a claim or cause of action, or a
          decision to not remand, is not reviewable by appeal or
23        otherwise by the court of appeals under section 158(d),
          1291, or 1292 of this title or by the Supreme Court of
24        the United States under section 1254 of this title.
25   28 U.S.C. § 1452.
26        Rule 9027 sets forth the procedural requirements for
27   removal.   Under that rule, a notice of removal of a civil action
28   initiated after the commencement of a bankruptcy case must be

                                      -5-
 1   filed within the shorter of 30 days after receipt of the initial
 2   pleading or 30 days after receipt of the summons.
 3        One may remove a state court action only into an open
 4   bankruptcy case.    See Miller v. Cardinale (In re Deville),
 5   280 B.R. 483, 496 (9th Cir. BAP 2002), aff’d, 361 F.3d 539 (9th
 6   Cir. 2004) (“The filing of a bankruptcy petition is a condition
 7   precedent for proper removal of an action to bankruptcy court.”).
 8   See also Poole v. Money Mortg. Corp. of Am. (In re Hofmann),
 9   248 B.R. 79, 86 (Bankr. W.D. Tex. 2000) (noting that defendant
10   could have moved to reopen closed bankruptcy case to accomplish
11   the removal within the Rule 9027 deadline); In re Iannacone,
12   21 B.R. 153, 155 (Bankr. D. Mass. 1982) (removal is not possible
13   absent a reopening); In re McNeil, 13 B.R. 743, 747 (Bankr.
14   S.D.N.Y. 1981) (removal may only be had during the pendency of a
15   bankruptcy case).
16        A bankruptcy court may remand a removed action sua sponte.
17   AEG Liquidation Tr. on behalf of Am. Equities Grp., Inc. v.
18   Toobro N.Y. LLC (In re Am. Equities Grp., Inc.), 460 B.R. 123,
19   128 (Bankr. S.D.N.Y. 2011).
20        Given that the bankruptcy case was closed, the bankruptcy
21   court did not abuse its discretion in remanding the removed
22   action.3   Debtor does not address the propriety of the bankruptcy
23
          3
24         Even if the bankruptcy case had been open, Debtor’s notice
     of removal would have been untimely. Debtor states in paragraph
25   2 of her notice of removal that she received a copy of the
26   summons and complaint on August 6, 2016. Under Rule 9027, she
     would have had no more than 30 days after that to file her notice
27   of removal. She did not file the notice of removal until
     December 12, 2016, more than three months after she received the
28                                                      (continued...)

                                      -6-
 1   court’s remand order in her opening brief.    Rather, she cites the
 2   July 29, 2016 order denying her motion to reopen and the
 3   October 28, 2016 order denying her motion for reconsideration,
 4   and she seems to be arguing that the bankruptcy court erred in
 5   not giving her an opportunity to present her claims.    However,
 6   these matters have been finally disposed and bear no relation to
 7   the order from which Debtor appeals.    In short, Debtor has
 8   presented no basis for the Panel to find error in the bankruptcy
 9   court’s remand order.
10                              CONCLUSION
11        For these reasons, we AFFIRM.
12
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20
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24
25        3
           (...continued)
26   summons and complaint.

27        Also, it is difficult to imagine on what basis the
     bankruptcy court could have exercised jurisdiction to hear the
28   unlawful detainer action.

                                    -7-