Court Opinion

ID: 217791
Source: CourtListenerOpinion
Date Created: 2011-06-01 00:01:21+00
Date Added: 2024-06-11T15:40:39.659413
License: Public Domain

FILED
                            NOT FOR PUBLICATION                             MAY 31 2011

                                                                        MOLLY C. DWYER, CLERK
                    UNITED STATES COURT OF APPEALS                       U .S. C O U R T OF APPE ALS

                            FOR THE NINTH CIRCUIT

PDG LOS ARCOS, LLC, an Arizona                   No. 10-15857
limited liability company; NATIONAL
RETAIL DEVELOPMENT PARTNERS                      D.C. No. 2:09-cv-01312-MHM
I, LLC, an Arizona limited liability
company,
                                                 MEMORANDUM *
              Appellants,

  v.

ROBERT M. ADAMS, Trustee, Schedule
B Property, under the R and C Adams
Family Trust dated December 27, 1994;
Schedule A Property under the R and C
Adams Family Trust; DELL REAL
ESTATE DEVELOPMENT, L.L.C., an
Arizona limited liability company; IRENE
RUTH AHEARN, Trustee of the Irene
Ruth Ahearn Revocable Trust dated
November 22, 2005 and any amendments
thereto; LISA M. BALL, wife of Ryan M.
Ball, as her sole and separate property;
TONY CHRISTENSEN, husband as
community property with right of
survivorship; JONNA CHRISTENSEN,
wife, as community property with right of
survivorship; RONALD L. COLEMAN,
Trustee of the Ronald L. Coleman and

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
Carole Coleman Revocable Land Trust
dated October 24, 2001 and any
amendments thereto; CAROLE
COLEMAN, Trustee of the Ronald L.
Coleman and Carole Coleman Revocable
Land trust dated October 24, 2001, and
any amendments thereto; DOROTHY
JEANNE DAVIS, Trustee of the Dorothy
Jeanne Davis Revocable Trust dated July
27, 2004, and any amendments thereto;
JODI FARBER, Custodian for Alexa
Farber Olds, under The Uniform Gift to
Minor Act; JOHN B. FOX, husband of
Joyce A. Fox, as his sole and separate
property, Trustee of the John B. Fox,
M.D., P.C. Profit Sharing Plan & Trust;
ADAM J. GILBURNE, husband, as joint
tenant with right of survivorship; RONDA
E. GILBURNE, wife, as joint tenant with
right of survivorship, Trustee of the Adam
Gilburne Irrevocable Trust for the Benefit
of Jillian Gilburne dated November 22,
1999, and any amendments thereto, AKA
Rhonda Gilburne; BRAXTON G. GLASS,
husband, as community joint tenant with
right of survivorship; KATIE L. GLASS,
wife, as community property with right of
survivorship; KEVIN GOFF, as joint
tenant with right of survivorship; KI NGO,
as joint tenant with right of survivorship;
GERALD GROSS, Trustee of the T&J
Gross Trust Agreement Dated May 20,
1993, and any amendments thereto and
Trustee of the Gerald Gross Family Trust
darted June 28, 1979; WILLIAM E.
HATHCOX, Trustee of the William E. and
Wanona E. Hathcox Family Trust dated

                                        2
April 26, 1988 and any amendments
thereto; WANONA E. HATHCOX,
Trustee of the William E. and Winona W.
Hathcox Family trust dated April 26, 1988;
JOSEPH LEE, Trustee under the Lee
Halliday Living trust, dated March 23,
1999 and any amendments thereto;
SHARON M. HALLIDAY, Trustee, under
the Lee Halliday Living Trust, dated
March 23, 1999 and any amendments
thereto; BEAR TOOTH MOUNTAIN
HOLDINGS LIMITED PARTNERSHIP,
an Arizona limited liability partnership; AJ
CHANDLER 25 ACRES, L.L.C., an
Arizona limited liability company;
QUEEN CREEK XVIII, L.L.C., an
Arizona limited liability company;
ROSENA M. MCKEE, Trustee (deceased)
Under Declaration of Trust dated
November 4, 1994 and amendments
thereto; DONALD C. HOOTS, Trustee of
the Donald C. Hoots Revocable trust dated
November 5, 1987 and any amendments
thereto; MORRIS A. KAPLAN, Trustee of
the Goldman and Kaplan Ltd., Defined
Benefit Plan-Morris A. Kaplan IRA
Rollover Account, Trustee of Carolyn’s
Interiors; FIRST TRUST COMPANY OF
ONAGA, Custodian FBO Marcy L.
Kaufman IRA #41021XXXXX, Custodian
FBO Lorinda A. McMullen IRA
#41021XXXXX, Custodian FBO Gina M.
LaMendola IRA #41021XXXXX;
WILLIAM C. LEWIS, Trustee of the
William C. Lewis Trust dated August 1,
1989 and any amendments thereto;
GERALD A. LIBLING, (deceased)

                                         3
Trustee of the Gerald A. Libling and Reisa
M. Libling Revocale Trust dated April 16,
1993 under community property
agreement dated May 11, 2006 and any
amendments thereto; REISA M.
LIBLING, Trustee of the Gerald A.
Libling and Reisa M. Libling Revocable
Trust dated April 16, 1993, under
community property agreement dated May
11, 1006 and amendments thereto; MARY
K. MARSHALL, un unmarried woman;
LAURA MARTINI, as joint tenant with
right of survivorship/Trustee of the Four
Paws Properties, L.L.C. Defined Benefit
Plan, dated January 1, 2004, and any
amendments thereto; LORINDA S.
MCMULLEN, Trustee of the Four Paws
Properties, L.L.C. Defined Benefit Plan,
dated January 1, 2004 and any
amendments thereto, Defined Benefit
Plan/joint tenant with right of
survivorship; WILLIAM A. MARSH,
Trustee, or their successors in trust, under
the Marsh Living trust dated September
27, 2007, and any amendments thereto
(Wife Separate Property); MARY L.
MARSH, Trustee, or their successors in
trust, under the Marsh Living Trust, dated
September 27, 2007, and any amendments
thereto (Wife Separate Property);
CHARLOTTE SNYDER MCCLUSKEY,
wife as joint tenant with right of
survivorship; BRETT M. MCFADDEN, a
single man; FIDUCIARY INVESTMENT
SERVICES, INC., an Arizona corporation;
CHRISTOPHER J. OLSON, Custodian for
Luke Ryan Schwartz-Olson under the

                                         4
Uniform Gift to Minor Act; ARIZONA
BANK & TRUST, Custodian FBO
Honeylou Reznik IRA #XXX248;
MORLEY ROSENFIELD, Trustee of The
Morley Rosenfield, M.D.P.C. restated
Profit Sharing Plan; ROBERT G. RODEN,
Trustee of the Robert G. Roden Living
trust dated October 1, 2004 and any
amendments thereto; WMS FIXED
INCOME FUND, L.L.C., an Arizona
limited liability company; MORTON M.
SCULT, Trustee of the Morton M. Scult,
P.C. Money Purchase Pension Plan dated
September 1, 1979; RANDI F.
SHERMAN, an unmarried woman;
LITCHFIELD ROAD ASSOCATES,
LTD., an Arizona limited partnership;
BASELINE AND VAL VISTA LIMITED
PARTNERSHIP, an Arizona limited
partnership; VERMA KATARIA
MORTGAGE INVESTMENT L.L.C., an
Arizona limited company; MARK
ANDRE WEST, Trustee of the MEW
Trust I effective July 9, 1991, and any
amendments thereto; ELAINA W. WEST,
Trustee of the MEW Trust I effective July
9, 1991, and any amendments thereto;
MORTGAGE LTD. OPPORTUNITY
FUND MP-12 L.L.C.; MORTGAGES
LTD. OPPORTUNITY FUND MP-13
L.L.C.; MORTGAGES LTD.
OPPORTUNITY FUND MP-14 L.L.C.;
MORTGAGES LTD. OPPORTUNITY
FUND MP-15 L.L.C.; MORTGAGES
LTD. OPPORTUNITY FUND MP-16
L.L.C.; MORTGAGES LTD.
OPPORTUNITY FUND MP-17, L.L.C.;

                                      5
MP062011 L.L.C.; MP122009 L.L.C.;
MP122030 L.L.C.; CORNERSTONE
REALTY AND DEVELOPMENT, INC.,
Defined Benefit Plan and Trust dated
January 1, 2004 and any amendments
thereto; RICHARD J. SODJA, husband;
MOLLY L. SODJA, wife; CHRISTINE K.
ADAMS, Schedule A Property, under the
R and C Adams Family Trust; PERRY
ARENSON, husband; SUSAN
ARENSON, wife; VINCENT BARBUTO,
Trustee of the Vincent Barbuto Revocable
Trust; ROBERT L. BARNES, Jr., a single
man; RAY R. BERMAN, Trustee of the
Ray R. Berman Revocable Trust;
EDWARD J. BERMINGHAM, III,
husband; SARAH E. BERMINGHAM,
wife; SILVIA BIGHI, Trustee of the Bighi
Family Bypass Irrevocable Trust; BIGHI
& ASSOCIATES, an Arizona limited
partnership; GEORGE BURNHAM, Sr.;
ALICE DWORKIN, Trustee of the Alice
Dworkin Revocable Trust; EQUITY
TRUST COMPANY, Custodian FBO
Bruce D Buckley IRA Acct #3XXXX;
MARY JANE L. EVERETTE, Trustee of
GEME Revocable Trust; ANN H.
FLAHERTY, trustee of the Ann H.
Flaherty Trust; NANCY GRANADOS, a
single woman; HAROLD J. CHRIST,
LTD., an Arizona corporation; KENNETH
P. JOHNSON, Trustee of the Kenneth P.
johnson Family Trust; JAMES L.
KAPLAN, husband; KAREN L.
KAPLAN, wife; DAVID J. LOTTES,
Trustee of the WGC Retirement Plan;
LIZHU LU; LOIS H. MACLEOD, Trustee

                                     6
of the Lois H. MacLeod Trust; BARNEY
L. MALLETT, Trustee of the Barney L.
Mallett Living Trust; ALAN J. MANESS,
un unmarried man; LESLIE HOWARD
MARGOLIN, un unmarried man;
GABRIEL MARTINI, as joint tenant with
right of survivorship; ERNEST W.
PURCELL; FRANCOISE J. REYNS,
Trustee of the Philippe Y. and Francoise J.
Reyns Revocable Trust; PHILLIPPE Y.
REYNS, Trustee of the Phillippe Y. and
Francoise J. Reyns Revocable Trust; EVA
A. SPERBER-PORTER; CLEMENT M.
TANG, husband; SHEILA F. TOUHEY,
wife of Andrew Touhey; LARRY
TUSCANO; RANEE TUSCANO, wife;
CHRIS WELSH, husband; TRACEY
WELSH, wife; KIMBERLY WESTBERG,
Trustee of the Westberg Family Trust;
LAVERNE WESTBERG, Trustee of the
Westberg Family Trust; YI YANG, wife;
GEORGE A. EVERETTE; GEORGE
BURNHAM; UNKNOWN STENMOEN,

             Appellees,

MORTGAGES LTD.,

             Debtor - Appellee.

                 Appeal from the United States District Court
                          for the District of Arizona
                 Mary H. MURGUIA, District Judge, Presiding

                                        7
                        Argued and Submitted May 13, 2011

                              San Francisco, California

Before:        W. FLETCHER and N.R. SMITH, Circuit Judges, and MILLS,
               Senior District Judge.**

      PDG Los Arcos, LLC (“PDG”) and National Retail Development Partners,

LLC (“NRDP”) appeal the district court’s order affirming the bankruptcy court’s

dismissal of their breach of contract actions against “the investors” for failure to

state a claim. We have jurisdiction pursuant to 28 U.S.C. § 158(d)(1) and we

affirm.

      The district court had removal jurisdiction pursuant to 28 U.S.C. §§ 1334(b)

and 1452(a). Section 1334(b) confers jurisdiction over actions “related to”

bankruptcy. These are actions that “could conceivably have any effect on the estate

being administered in bankruptcy.” In re Fietz, 852 F.2d 455, 457 (9th Cir. 1988)

(emphasis deleted). If PDG and NRDP had prevailed in their breach of contract

actions, the investors could have sought contribution or indemnification from

Mortgages Ltd. In addition, the investors could have counterclaimed against PDG

and NRDP for the unpaid principal balances on their loans, assets that the bankrupt

          **
             The Honorable Richard Mills, Senior District Judge for the U.S.
District Court for Central Illinois, Springfield, sitting by designation.

                                           8
estate was also pursuing. Either claim could have affected the assets or

administration of the bankrupt estate.

      On the merits, dismissal for failure to state a claim was proper. Under

Arizona law, “the assignment of a contract . . . cannot shift the assignor’s liabilities

to the assignee, because it is a well-established rule that a party to a contract cannot

relieve himself of his obligations by assigning the contract. Neither does it have the

effect of creating a new liability on the part of the assignee to the other party to the

contract assigned.” Grant v. Harner, 239 P. 296, 296-97 (Ariz. 1925). See also

Norton v. First Fed. Sav., 624 P.2d 854, 859 (Ariz. 1981). The investors did not

expressly assume the funding obligations of Mortgages Ltd. Nor, even were we to

consider the surrounding circumstances, would we infer an assumption of funding

obligations by passive investors.

      The district court did not abuse its discretion by declining to withdraw the

reference. Even if a party is entitled to a jury trial in a noncore proceeding, the

bankruptcy court may retain jurisdiction and decide a dispositive pretrial motion

such as a motion to dismiss. Sigma Micro Corp. v. Healthcentral.com (In re

Healthcentral.com), 504 F.3d 775, 787-88 (9th Cir. 2007).

                                            9
      The MP Fund Appellees request attorneys’ fees on appeal but have not filed

the supporting documentation required by Ninth Circuit Rule 39-1.6(b). We deny

the request without prejudice to refiling in compliance with the Rule.1

      AFFIRMED

      1
       The MP Fund Appellees’ unopposed motion for judicial notice of the
bankruptcy court docket is granted.

                                         10