Branch v. 30TH Dist. Court City of Highland Park (In re Branch)

• Decision Date: 06 February 2015
• Docket Number: Adv. Pro. No. 14–4654,Case No. 13–48710
• Citation: 525 B.R. 388
• Parties: In re: Robert Brian Branch, pro se, Debtor. Robert Brian Branch, pro se, Plaintiff, v. 30th District Court City of Highland Park, Defendant.
• Court: U.S. Bankruptcy Court — Eastern District of Michigan

525 B.R. 388

In re: Robert Brian Branch, pro se, Debtor.

Robert Brian Branch, pro se, Plaintiff,

v.30th District Court City of Highland Park, Defendant.

Case No. 13–48710

Adv. Pro. No. 14–4654

United States Bankruptcy Court,

E.D. Michigan, Southern Division.

Signed February 6, 2015

Robert Brian Branch, Detroit, MI, pro se, for Debtor.

Ethan D. Dunn, Maxwell Dunn, PLC, Huntington Woods, MI, Sean Perkins, Detroit, MI, for Defendant.

OPINION REGARDING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT

Thomas J. Tucker, United States Bankruptcy Judge

I. Introduction

In this adversary proceeding, Plaintiff Robert Brian Branch (the “Debtor”) is a Chapter 7 bankruptcy debtor who obtained a discharge. He seeks a judgment against Defendant, the 30th District Court for the City of Highland Park (“Defendant” or “30th District Court”), in the amount of $10,000.00, based on Defendant's alleged violations of the automatic stay and the discharge injunction.

This case is before the Court on Defendant's motion for summary judgment, ¹ seeking judgment on all claims in Debtor's first amended complaint, and an award of costs and attorney fees. Debtor filed a response objecting to the Motion, and Defendant filed a reply brief. The Court concludes that a hearing on the Motion is not necessary. For the reasons stated below, the Court will grant the Motion, to the extent it seeks judgment on all claims in Debtor's first amended complaint, but will deny the Motion to the extent it seeks costs and attorney fees.

II. Facts

The material facts are not in dispute. Sometime before March 27, 2013, the Michigan Secretary of State (“SOS”) suspended Debtor's driver's license. On March 27, 2013, Debtor received a traffic citation in the City of Highland Park, Michigan (the “Citation”),² for three offenses: disregarding a red light; driving while his driver's license was suspended (which is a criminal misdemeanor under Michigan law); and having no proof of insurance. The Citation required Debtor to appear at the 30th District Court “within 10 days.”³ Debtor failed to appear as required by the Citation.

On April 29, 2013, Debtor filed a voluntary bankruptcy petition under Chapter 7.⁴ Debtor listed Defendant as a creditor in his Schedule E, based on numerous traffic citations issued to Debtor in 2012 in the City of Highland Park.⁵

On June 20, 2013, Defendant issued a warrant for Debtor's arrest, due to his failure to appear at the 30th District Court as required by the Citation. ⁶ On August 29, 2013, Defendant sent Debtor a letter, acknowledging receipt of papers indicating that Debtor had filed a Chapter 7 petition and listed Defendant as a creditor. Defendant's letter also stated that: (1) Debtor “may not discharge traffic tickets due to [ 11 U.S.C. § 523(a)(7) ], which specifically states that fines and penalties owed to and for the benefit of governmental units are non-dischargeable;” (2) there was an outstanding criminal warrant for Debtor's arrest, for his “failure to appear to answer the charge of driving with a suspended license[;]” and (3) Debtor had been “defaulted on the civil infractions of ‘disregarding a red light’ and ‘no proof of insurance.’ ”⁷ The letter further stated that Debtor could “walk in on any Monday or Wednesday afternoon at 1:45 pm to request that [the criminal warrant] be set aside and request a hearing.” ⁸

On October 8, 2013, Debtor received a discharge under Chapter 7. ⁹

On July 1, 2014, Debtor filed this adversary proceeding against Defendant, seeking $10,000.00 in damages for alleged violations by the Defendant of the automatic stay. Debtor later amended his complaint, on August 22, 2014. ¹⁰ In Debtor's original complaint and his first amended complaint, Debtor stated that he is “not challenging dischargeability of this particular debt just as [he] did not challenge the [dischargeability] of other debts included in [the] bankruptcy from Detroit's 36th District Court, as well as the State of Michigan's fines/fees,” but rather is only complaining about Defendant's failure to cease all actions against him after the filing of his bankruptcy petition.

In Debtor's first amended complaint, Debtor alleged that post-petition, and with knowledge of Debtor's bankruptcy filing, Defendant issued a warrant for Debtor's arrest based on his failure to appear for an arraignment on the Citation, and that to date, Defendant has failed to cancel the arrest warrant. ¹¹

Debtor further alleges that post-petition, Defendant “again suspended” his driver's license, which the SOS had allegedly reinstated after Debtor informed it of his bankruptcy filing.¹² Debtor argues that these acts and omissions by Defendant violated the automatic stay and/or the discharge injunction and have caused him damages.¹³

Debtor alleges that Defendant's issuance of the warrant for his arrest, its failure to cancel the arrest warrant after Debtor filed for bankruptcy, and its actions leading to the suspension of his driver's license were in retaliation for Debtor filing his bankruptcy petition.¹⁴ Debtor requests that the Court hold Defendant in contempt and award him $10,000.00 in damages.¹⁵

On November 14, 2014, without leave of court and without Defendant's consent, Debtor filed a second amended complaint.¹⁶ In Debtor's second amended complaint, Debtor stated that he is “now challenging dischargeability of the three debts” in the Citation.¹⁷ Defendant objects to Debtor's filing of the second amended complaint.¹⁸ Defendant argues that such amended complaint must be stricken because Debtor filed it without leave of court; and Defendant never gave its consent to the Debtor to file it.¹⁹

III. Jurisdiction

This Court has subject matter jurisdiction over this adversary proceeding under 28 U.S.C. §§ 1334(b), 157(a) and (b)(1), and L.R. 83.50(a) (E.D. Mich.). This proceeding is a core proceeding under 28 U.S.C. § 157(b)(2)(I) and (O). It also is a core proceeding because it falls within the definition of a proceeding “arising under title 11” and of a proceeding “arising in” a case under title 11, within the meaning of 28 U.S.C. § 1334(b). Matters falling within either of these categories in § 1334(b) are deemed to be core proceedings. See Allard v. Coenen ( In re Trans–Industries, Inc.), 419 B.R. 21, 27 (Bankr.E.D.Mich.2009). This is a proceeding “arising under title 11” because it is “created or determined by a statutory provision of title 11,” id., namely, 11 U.S.C. §§ 362, 523, and 524. And this is a proceeding “arising in” a case under title 11, because it is a proceeding that “by [its] very nature, could arise only in bankruptcy cases.” Id.

IV. DiscussionA. The operative complaint and the dischargeability issue

As an initial matter, the Court must decide which complaint is the operative complaint. The Court construes the pro se Debtor's filing of the second amended complaint as an informal motion for leave to file the proposed second amended complaint, and the Defendant's Reply as an objection to the motion. The Court concludes that a hearing on such motion is unnecessary. The motion must be denied and the second amended complaint must be stricken from the record, because allowing that amendment to Debtor's complaint would be futile.

Fed. R. Civ. P. 15, made applicable to adversary proceedings by Fed. R. Bankr. P. 7015, provides:

(a) Amendments Before Trial.

(1) Amending as a Matter of Course. A party may amend its pleading once as a matter of course within:

(A) 21 days after serving it, or

(B) if the pleading is one to which a responsive pleading is required, 21 days after service of a responsive pleading or 21 days after service of a motion under Rule 12(b), (e), or (f), whichever is earlier.

(2) Other Amendments. In all other cases, a party may amend its pleading only with the opposing party's written consent or the court's leave. The court should freely give leave when justice so requires.

Because Debtor had no right to file his second amended complaint under Rule 15(a)(1), Rule 15(a)(2) governs whether Debtor can file his second amended complaint.

“Pursuant to Fed. R. Civ. P. 15(a)[ (2) ], a court should freely give leave to amend a complaint ‘when justice so requires.’ However, leave to amend may be denied where the amendment would be futile.” Yuhasz v. Brush Wellman, Inc., 341 F.3d 559, 569 (6th Cir.2003) (citing Foman v. Davis, 371 U.S. 178, 182, 83 S.Ct. 227, 9 L.Ed.2d 222 (1962)). An amendment is futile if the amended complaint would not survive a motion to dismiss for failure to state a claim under Fed. R. Civ.P. 12(b)(6).²⁰Kalasho v. Republic of Iraq, No. 06–11030, 2010 WL 4062212, at *1 (E.D.Mich. Oct. 14, 2010) (explaining that “despite the general rule of liberality with which leave to file amended complaints is to be granted, the Sixth Circuit has held that when a proposed amended complaint would not survive a motion to dismiss, the court may properly deny the amendment as futile.”) (citing Neighborhood Dev. Corp. v. Advisory Council on Historic Pres., 632 F.2d 21, 23 (6th Cir.1980) and Thiokol Corp. v. Dep't of Treasury, 987 F.2d 376 (6th Cir.1993)); United States ex rel. David Antoon v. Cleveland Clinic Found., 978 F.Supp.2d 880, 894 (S.D.Ohio 2013).

Here, Debtor filed a second amended complaint to seek a determination that any debt owed to the Defendant based on the Citation is dischargeable, and therefore has been discharged. The Court concludes that allowing the second amended complaint for this purpose would be futile, because such claim could not survive a motion to dismiss for failure to state a claim.

The Court concludes that under 11 U.S.C. § 523(a)(7), all debts owed to Defendant based on the Citation, or based on any of the 2012 traffic tickets listed in Debtor's Schedule E, are nondischargeable. Section 523(a)(7) states:

(a) A discharge under section 727, 1141, 1228(a), 1228(b), or 1328(b) of this title does not discharge an individual debtor from any debt—

...

(7) to the extent such debt is for a fine, penalty, or forfeiture...