Glenn S. Morris & the Glenn S. Morris Trust v. Charron (In re Charron)

Decision Date25 November 2015
Docket NumberCase No: BG 14–07970,Adversary Proceeding No. 15–80086
Citation541 B.R. 822
PartiesIn re: David W. Charron, Debtor. Glenn S. Morris and The Glenn S. Morris Trust, Plaintiffs, v. David W. Charron, Defendant.
CourtU.S. Bankruptcy Court — Western District of Michigan

Ronald A. Spinner, Esq., Detroit, Michigan, attorney for Glenn S. Morris and the Glenn S. Morris Trust, Plaintiffs.

Perry G. Pastula, Esq., Wyoming, Michigan, attorney for David W. Charron, DebtorDefendant.

MEMORANDUM OPINION DENYING DEBTOR–DEFENDANT'S MOTIONS TO AMEND THE COURT'S FINDINGS UNDER RULE 52, AMEND JUDGMENT UNDER RULE 59, AND FOR RECONSIDERATION UNDER RULE 60

James W. Boyd, United States Bankruptcy Judge

I. FACTS AND PROCEDURAL BACKGROUND.

On September 30, 2015, this Court entered an Opinion and Order Denying Defendant's Motion for Summary Judgment and Granting Plaintiffs' Cross Motion for Summary Judgment in the above-captioned adversary proceeding. (AP Dkt. Nos. 15 & 16.) In the Opinion and Order, this Court held that various factual findings made by the Kent County Circuit Court when it imposed civil contempt sanctions against David W. Charron (the Debtor) were entitled to preclusive effect in this adversary proceeding under the doctrine of collateral estoppel. Because those factual findings established that the Debtor's actions were “willful” and “malicious” and resulted in injury to the Plaintiffs or their property, this Court concluded that the state court contempt sanctions were nondischargeable in the Debtor's bankruptcy case pursuant to 11 U.S.C. § 523(a)(6).

On October 14, 2015, the Debtor filed his Motion to Amend the Court's Findings under Rule 52 and Amend Judgment under Rule 59. (AP Dkt. No. 17.) Glenn S. Morris and the Glenn S. Morris Trust (the Plaintiffs) filed a response to the Debtor's Motion to Amend the Court's Findings under Rule 52 and Amend Judgment under Rule 59. (AP Dkt. No. 18.) On November 2, 2015, the Debtor filed his Motion for Reconsideration under Rule 60. (AP Dkt. No. 19.) The Plaintiffs filed a statement indicating that they would not file a substantive response to the Debtor's Rule 60 motion unless directed to do so by the Court. (AP Dkt. No. 20.) This memorandum opinion addresses the requests for relief asserted in both of the Debtor's motions.

II. DISCUSSION.
A. Request for Additional Factual Findings—Rule 52.

In his first request for relief, the Debtor asks this Court to make twenty-seven “additional fact findings for the purpose of assisting any future appellate review, and more fully depicting the facts of the case....” SeeDebtor's Motion to Amend the Court's Findings under Rule 52 and Amend Judgment under Rule 59, AP Dkt. No. 17, at 2. The Debtor bases this request on Bankruptcy Rule 7052, which makes Federal Rule of Civil Procedure 52applicable to adversary proceedings. Rule 52(b)provides:

On a party's motion filed no later than [14] days after the entry of judgment, the court may amend its findings—or make additional findings—and may amend the judgment accordingly. The motion may accompany a motion for a new trial under Rule 59.

Fed. R. Civ. P. 52(b); see alsoFed. R. Bankr. P. 7052(stating that motions under Rule 52(b)must be filed no later than 14 days after entry of judgment in bankruptcy adversary proceedings, rather than 28 days as provided in Rule 52(b)).

The main purpose of Rule 52(b)is “to create a record upon which the appellate court may obtain the necessary understanding of the issues to be determined on appeal.” SeeIn re St. Marie Development Corp. of Montana, Inc.,334 B.R. 663, 675 n. 3 (Bankr.D.Mont.2005); see also9C Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure§ 2582 (3d ed.2015). A motion to amend under Rule 52(b)may be used “to clarify essential findings or conclusions, correct errors of law or fact, or to present newly discovered evidence.” 10 Collier on Bankruptcy¶ 7052.03 (16th ed.2015) (citing Wal–Mart Stores, Inc. v. El–Amin (In re El–Amin),252 B.R. 652, 656 (Bankr.E.D.Va.2000)(the purpose of the rule is to correct an “egregious error of law or fact, not the resubmission of unsuccessful arguments”)) (additional citations omitted). Rule 52(b)motions are not to be used to obtain a re-hearing on the merits or to raise arguments that could have been made before the court's earlier ruling. In re Busch,369 B.R. 614, 621 (10th Cir. BAP 2007); Wilkerson v. Debaillon,2013 WL 3803972 at *7 (W.D.La. July 18, 2013)(unpublished opinion); MidWestOne Bank & Trust v. Commercial Fed. Bank,331 B.R. 802, 813 (S.D.Iowa 2005). Most importantly for purposes of the motion currently before the Court, motions to amend factual findings under Rule 52(b)are generally not appropriate when the matter was decided on summary judgment, because summary judgment does not entail finding facts. 9C Federal Practice and Procedureat § 2582(citing Trentadue v. Integrity Committee,501 F.3d 1215, 1237 (10th Cir.2007)(trial court did not abuse its discretion in denying motion for additional findings under Rule 52(b); the rule only applies to cases in which the trial court “issues factual findings following a trial on the merits” not those “terminated on summary judgment”)); Florham Park Chevron, Inc. v. Chevron U.S.A., Inc.,680 F.Supp. 159, 161 (D.N.J.1988)(the trial court “does notengage in fact-finding within the meaning of Fed. R. Civ. P. 52on a motion for summary judgment;” accordingly, a motion for amendment of findings made in connection with the summary judgment motion is procedurally inappropriate”) (emphasis in original)) (additional citations omitted).

In this adversary proceeding, the Court's prior opinion and order were issued on cross motions for summary judgment. Because this Court did not engage in fact-finding within the meaning of Rule 52in deciding the motions for summary judgment, the Debtor's motion for additional findings under Rule 52(b)is procedurally inappropriate and shall be denied. The Court has, however, considered the matters raised in the Debtor's Rule 52(b)motion in the context of Rule 59 and Rule 60.

B. Alteration or Amendment of the Judgment—Rule 59.

The Debtor also asks this Court to amend its prior opinion and order under Federal Rule of Bankruptcy Procedure 9023and Federal Rule of Civil Procedure 59. Bankruptcy Rule 9023makes Rule 59applicable in bankruptcy cases. Rule 59(e)provides that [a] motion to alter or amend a judgment must be filed no later than [14] days after the entry of the judgment.” Fed. R. Civ. P. 59(e); Fed. R. Bankr. P. 9023(requiring motions to alter or amend to be filed “no later than 14 days after entry of judgment” in bankruptcy cases). The Debtor's request was timely filed.

Alteration or amendment of a judgment under Rule 59(e)is only justified in instances where there is a clear error of law, newly discovered evidence, an intervening change in controlling law, or to prevent manifest injustice. See GenCorp. Inc. v. American Int'l Underwriters,178 F.3d 804, 834 (6th Cir.1999)(citations omitted). Motions for reconsideration are “not an opportunity to re-argue a case and should not be used by the parties to “raise arguments which could, and should, have been made before judgment issued.” Sault Ste. Marie Tribe of Chippewa Indians v. Engler,146 F.3d 367, 374 (6th Cir.1998); FDIC v. World Univ. Inc.,978 F.2d 10, 16 (1st Cir.1992).

As noted above, the Court has considered the Debtor's requests to amend the Court's prior “factual findings” under the standard that applies to motions brought pursuant to Rule 59(e). The issues raised in paragraphs one through twenty-seven of the Debtor's motion ask this Court to re-characterize its factual summary of the proceedings in the state trial and appellate courts, and to add additional “findings” based on the Debtor's view of the record in the state courts and in this adversary proceeding. Amending the Court's prior opinion and order to reflect the changes sought by the Debtor would not clarify essential findings or conclusions, correct errors of law or fact, or address newly discovered evidence. Accordingly, the Debtor's requests to alter or amend the judgment on these bases shall be denied. In addition, the issues raised in paragraphs twenty-five and twenty-seven of the Debtor's motion were also argued in the Debtor's Rule 60 motion, and are addressed in that context.

The Court has also reviewed the requests for relief set forth in paragraphs one and two of the Debtor's Rule 59motion in light of the state court record and the record in this adversary proceeding. These paragraphs of the Debtor's motion ask this Court to change two specific sentences in the prior opinion and order. Those sentences summarized proceedings before the state trial court that led to entry and extension of the Injunctive Order that the Debtor was ultimately found to have violated. The Debtor offers no newly-discovered evidence in support of these requests, and does not argue that there has been an intervening change in controlling law since entry of this Court's prior opinion and order. The Debtor's motion also fails to demonstrate that a clear error of law has been committed or that the language in the prior opinion must be set aside to avoid manifest injustice. Therefore, the Debtor's motion to alter or amend these portions of the Court's previous opinion shall be denied.

The relief requested in the third paragraph of the Debtor's Rule 59(e)motion—i.e., that the Court clarify the basis for the state trial court's contempt award—was also raised in the Debtor's motion to reconsider under Rule 60 and is addressed in that context below.

C. Motion for Relief from Judgment or OrderRule 60.

In his second motion, filed with the Court on November 2, 2015, the Debtor requests that the Court reconsider its prior opinion and order under Federal Rule of Bankruptcy Procedure 9024, which makes Federal Rule of Civil Procedure 60applicable to bankruptcy cases. The Debtor's motion to reconsider is specifically brought pursuant to Rule 60(b)(1)which...

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