Alderwoods Group, Inc. v. Garcia
| Decision Date | 25 November 2009 |
| Docket Number | Adversary No. 08-1266-BKC-RAM-A. |
| Parties | ALDERWOODS GROUP, INC., Osiris Holding of Florida, Inc., and Northstar Graceland, LLC, Plaintiffs, v. Reyvis GARCIA, Ramona Johnson, and Mercedes Woodberry, Defendants. |
| Court | United States Bankruptcy Courts. Eleventh Circuit. U.S. Bankruptcy Court — Southern District of Florida |
Andrew D. Zaron, Ted Craig, Hunton & Williams LLP, Miami, FL, Alan J. Perlman, Esq., Lauderdale, FL, for Plaintiffs.
Charles W. Throckmorton, Esq., Miami, FL, David Samole, Esq., Gables, FL, for Defendants.
The Plaintiffs in this adversary proceeding are the owners and former owners of a cemetery in Miami, Florida. The Defendants are relatives of family members buried in the cemetery. The relatives have sued the cemetery owners in state court for gross negligence, tortious interference with dead bodies, intentional or reckless infliction of emotional distress, and injunctive relief. The claims arise from the alleged failure of the cemetery to locate the bodies of the buried relatives and in one instance, from allegedly disturbing or desecrating the remains in an effort to locate the grave.
The cemetery owner and prior owners filed this adversary proceeding seeking declaratory relief, specifically, a declaration that all of the claims asserted in the state court case were discharged in a prior bankruptcy case. Cross motions for summary judgment are pending. The court finds that the publication notice given in the prior bankruptcy case did not comport with due process. Therefore, the pending state court claims were not discharged.
As described in the introduction, the key events underlying this proceeding occurred in a cemetery located in Miami, Florida, known as Graceland Memorial Park South ("Graceland") and in a bankruptcy case in the District of Delaware, which included the owner of Graceland. To better understand the players, it is useful to describe how each of the Plaintiffs in this proceeding are connected to ownership of the Graceland cemetery.
Plaintiff, Osiris Holding of Florida, Inc. ("Osiris") purchased Graceland on March 28, 1991. Four years later, on March 17, 1995, the Plaintiff, Alderwoods Group, Inc. ("Alderwoods"), acquired Osiris in a stock purchase. Alderwoods was then known as Loewen Group International, Inc. ("Loewen Group"). On December 19, 2006, after the bankruptcy case described below, Plaintiff, Northstar Graceland, LLC ("Northstar") acquired Graceland from Osiris.
Loewen Group, Osiris, and 814 other Loewen Group subsidiaries, filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code on June 1, 1999 in the United States Bankruptcy Court for the District of Delaware. These cases were administratively consolidated under Case No. 99-01244(PJW) .
On October 21, 1999 the Delaware bankruptcy court entered an Order Establishing Bar Dates for Filing Proofs of Claim and Approving Form and Manner of Notice Thereof (the "Bar Date Order") [CP# 46, Ex. D]. Specifically, the Bar Date Order approved the notice procedures to known creditors and authorized the Debtors to serve notice on unknown creditors via publication in the following national periodicals: The Wall Street Journal, The New York Times, USA Today, The Globe and The National Post. It further noted that "the form and manner of notice of the Bar dates approved hereby are deemed to fulfill the notice requirements of the Federal Rules of Bankruptcy Procedure." (Bar Date Order ¶ 3.) The approved form of publication notice only contained the name of one debtor, the parent company, Loewen Group. The Bar Date Order provides further that "any Entity that is required to file a proof of claim in these chapter 11 cases ... but that fails to do so in a timely manner, shall be forever barred, estopped and enjoined from ... asserting any Claim against any of the debtors that such entity has." (Bar Date Order ¶ 11.) Debtors complied with the Bar Date Order and published notice to all unknown creditors pursuant to the guidelines set forth in the Bar Date Order (the "Publication Notice") [CP# 46, Ex. E].
The Debtors filed their Fourth Amended Joint Plan of Reorganization on September 10, 2001 and the plan was confirmed on December 5, 2001. The plan became effective on January 2, 2002 ("Effective Date"). On the Effective Date, Loewen Group officially changed its name to Alderwoods.
On December 12, 2004, Revis Garcia ("Garcia") filed a complaint against Northstar and the Former Debtors in the Circuit Court, Miami-Dade County, Florida, Case No. 04-25646-CA-32 (the "State Court Case"). Some two years later Defendants Johnson and Woodbury joined the State Court Case as plaintiffs. The Fourth Amended Complaint (the "State Court Complaint") [CP# 46, Ex. K], filed on March 3, 2008, contains four bases for relief: (1) Tortious Interference with Dead Bodies; (2) Intentional or Reckless Infliction of Emotional Distress; (3) Gross Negligence; and (4) Equitable/Injunctive Relief.1 The crux of the complaint is that Graceland's mismanagement and poor record-keeping rendered Graceland unable to promptly and accurately locate thousands of remains buried in the old section of the cemetery.
The facts surrounding each of the state court plaintiffs' claims are fairly similar. All involve stories of families who lost their loved ones only to have their loved ones lost again (The state court plaintiffs, who are the named Defendants in this proceeding, will be referred to in this Opinion as the "Tort Claimants"). A more detailed summary of the facts alleged in the State Court Case follows.
Reyvis Garcia's mother, Eloisa Garcia, passed away in 1986 and was buried at Graceland. The plot was purchased by his aunt, Alicia Garcia, who was an original state court plaintiff until the time of her own passing. Due to the family's economic status at the time of Eloisa's death, they did not purchase a headstone for the grave site. Sometime in 2003, Reyvis and Alicia attempted to visit Eloisa's grave, but the employees at Graceland could not locate the site. The Garcias requested that Graceland promptly locate Eloisa's remains. However, because of the site's record keeping problems, the only method of locating and identifying remains involved digging up a series of grave sites in the vicinity, removing the vault lid with a backhoe and placing the lid on a burial space so that the coffin and remains within could be viewed and inspected to determine who was buried at that specific location. Because of the time and expense of conducting this process, it took several months to locate Eloisa's burial site.
In 1989, Mercedes Woodberry buried her stillborn child, Sacressida Constance Gilbert, at Graceland. At that time, no headstone was purchased for the baby's grave site. In 1994, Mercedes contacted Graceland about purchasing a headstone for the site, but was informed that the baby's burial site could not be located. In 1995, Ms. Woodberry went back to Graceland and was told that her child's remains were still missing. Ms. Woodberry visited Graceland again in 2000, but her stillborn child's grave site remained a mystery. In 2008, when Graceland inspected what they thought was Sacressida's final resting place, the remains were inconsistent with those of Sacressida Constance Gilbert.
Ramona Johnson's father, Robert Williams, Sr., passed away and was buried at Graceland in 1993. In Johnson's case, a temporary marker and burial card was placed on the site at the time of the burial. The family also purchased a burial marker from the Veterans Administration, but Graceland informed the family that without a granite headstone, they could not affix the military marker to the site. No headstone was ever purchased for Mr. Williams's grave site. The temporary marker had faded by 1995 and in 2001, Ms. Johnson was completely unable to find her father's final resting place.
On April 7, 2008, the Former Debtors and Northstar initiated this adversary proceeding seeking declaratory relief that all of the claims in the State Court Case, including the claim for injunctive relief, were claims under § 101(5) of the Bankruptcy Code that were discharged in the Prior Bankruptcy Case.
Northstar is separately named as a plaintiff in this proceeding since it is the current owner of Graceland and a defendant in the State Court Case. However, Northstar's right to relief in this adversary proceeding rises or falls with the rights of the Former Debtors.
On May 7, 2008, the Tort Claimants filed a Motion to Dismiss Amended Complaint or, in the Alternative, for Abstention and/or Remand ("Motion to Dismiss")[CP# 10]. The Court found that it had subject matter jurisdiction over the dispute and that neither abstention nor remand was required or appropriate [CP# 17]. The Court questioned whether venue was appropriate since the Prior Bankruptcy Case was filed and administered in the Delaware Bankruptcy Court. In response, the parties stipulated to maintaining venue in this Court. On June 9, 2008, Defendants filed their Answer and Affirmative Defenses to Amended Complaint [CP# 19], asserting that they did not receive adequate notice in the Prior Bankruptcy Case and therefore, their claims were not subject to the discharge. They also alleged that their State Court Case claims were not dischargeable § 101(5) claims. Thereafter, the parties both moved for summary judgment.
The Court conducted a hearing on the motions for summary judgment on October 3, 2008. The issues before the Court have been well briefed. In particular, the Court...
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