881 F.2d 176 (5th Cir. 1989), 88-2160, Sikes v. Global Marine, Inc.

Docket Nº:88-2160.
Citation:881 F.2d 176
Party Name:Robert A. SIKES and Janice K. Sikes, Plaintiffs-Appellants, v. GLOBAL MARINE, INC., et al., Defendants-Appellees.
Case Date:August 25, 1989
Court:United States Courts of Appeals, Court of Appeals for the Fifth Circuit
 
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881 F.2d 176 (5th Cir. 1989)

Robert A. SIKES and Janice K. Sikes, Plaintiffs-Appellants,

v.

GLOBAL MARINE, INC., et al., Defendants-Appellees.

No. 88-2160.

United States Court of Appeals, Fifth Circuit

August 25, 1989

Rehearing and Rehearing En Banc Denied Oct. 11, 1989.

Page 177

Bruce W. Bain, Houston, Tex., for plaintiffs-appellants.

M. Susan Hardie, Marion E. McDaniel, Jr., Houston, Tex., for defendants-appellees.

Appeal from the United States District Court for the Southern District of Texas.

Before RUBIN, POLITZ, and JOHNSON, Circuit Judges.

POLITZ, Circuit Judge:

Robert A. Sikes and Janice K. Sikes appeal a judgment granting a Fed.R.Civ.P. 12(b)(6) dismissal of their demands against Global Marine, Inc. and Global Marine Drilling Company (collectively, Global) on the ground that their complaint was filed in violation of an automatic stay in bankruptcy, 11 U.S.C. Sec. 362(a). Concluding that the bankruptcy court validated the filing and authorized the Sikes to proceed with their complaint, we reverse and remand.

Background

On March 6, 1986 the Sikes filed suit against Global and other defendants for injuries allegedly sustained by Robert A. Sikes on April 12, 1983, while aboard the vessel M/V GLOMAR HIGH ISLAND III. Unbeknownst to the Sikes, on January 27, 1986 Global had filed voluntary petitions in bankruptcy under Chapter 11 of the Bankruptcy Code. As a consequence, their claim was automatically stayed by 11 U.S.C. Sec. 362(a). 1

The Sikes promptly sought relief from the automatic stay from the bankruptcy court, and an extension of the time for service of the complaint from the district court. Accrual of the three-year limitations was imminent. Global objected in district court to the extension of time for service, contending that the original complaint was null and void. In the bankruptcy court Global asked that the stay not be modified until resolution of a coverage dispute with their insurance carriers. Global further requested that the stay not be lifted pending their transition to debtor-in-possession status.

Approximately nine months later Global resolved the insurance dispute and agreed to a modification of the stay. On February 18, 1987, the bankruptcy court entered an order lifting the stay for 32 causes listed on Exhibit A attached to the order, all identified as matters for which motions to lift stay were pending. The order lifted the stay "for the limited purpose of allowing certain actions to be commenced against Global and allowing discovery to proceed in those actions." The Sikes' claim is listed as number 27 on Exhibit A. In a significant number of the other claims, suit had been filed after the Chapter 11 petitions were filed. Shortly thereafter the original complaint was served on Global.

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Global moved to dismiss the Sikes complaint, contending that the original complaint was filed in violation of the automatic stay and was thus null and void. The Sikes filed a new lawsuit and moved for consolidation. Global opposed consolidation on the grounds that the second complaint was barred by the statute of limitations.

On September 25, 1987 the bankruptcy court entered an agreed order, prepared by counsel for Global, modifying the automatic stay. The preamble to the order announced: "CAME ON FOR CONSIDERATION for hearing the various motions to lift the automatic stay to allow personal injury actions to go forward, as identified in Exhibit A attached hereto." The Sikes' claim is listed as number 26 on the exhibit, this time containing 45 claims. The order declared

that the automatic stay as provided by section 362 of the Bankruptcy Code be further modified with regard to those Motions to Lift Stay identified in Exhibit A for the limited purpose of allowing the personal injury actions identified therein to be commenced against Global, permitting personal injury actions that are pending against Global to proceed, allowing discovery to proceed in those actions, and allowing trials to proceed.

The...

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