In re Barkats, Case No. 14-00053

Decision Date02 July 2014
Docket NumberCase No. 14-00053
PartiesIn re PIERRE PHILIPPE BARKATS, Debtor.
CourtUnited States Bankruptcy Courts. District of Columbia Circuit

The document below is hereby signed.

__________

S. Martin Teel, Jr.

United States Bankruptcy Judge

(Chapter 7)

Not for Publication inWest's Bankruptcy Reporter
MEMORANDUM DECISION AND ORDER TENTATIVELY

VACATING ORDER FOR RELIEF, STRIKING AFFIDAVIT,

AND ADDRESSING APPROPRIATE SERVICE ADDRESS FOR DEBTOR

This case was commenced by the filing of an involuntary petition on January 30, 2014, and when the putative debtor failed timely to respond, the court entered the order for relief. The debtor has now filed a motion, through counsel, to vacate the order for relief on the grounds that he was not properly served with the involuntary petition and summons. In support of his motion, the debtor has filed an affidavit, which the petitioning creditors have moved to strike. As explained in more detail below, the court will strike the debtor's affidavit with leave to file an amended affidavit or unsworn declaration, and will tentatively vacate the order for relief due to a lack of proper service.

I

On February 4, 2014, the petitioning creditors served the summons and involuntary petition on the debtor by "delivery through owner and co-resident Sandy Jensen at 6702 Offutt Lane, Chevy Chase, MD 20815." The petitioning creditors chose to serve the debtor at this address after seeing that the debtor's attorney in the Superior Court, Jeffrey Hannon, listed this as the debtor's address on a notice of appeal he filed in the Superior Court for the District of Columbia. According to Hannon, the address belongs to a friend of the debtor, and Hannon listed it on the notice of appeal solely as a local address to receive mail for the debtor if sent by the D.C. Court of Appeals. Regardless of Hannon's intent when completing the form, the form, itself, instructs the filer to "[p]rovide the names, addresses, and telephone numbers of all parties to be served," and is silent on the question of whether the address provided serves as the individual's residence.

According to his affidavit, which was notarized in France and signed under "penalty of perjury," Mr. Barkats has resided in France since 2011, he does not reside at the service address used by the petitioning creditors, and he has never resided at or visited the service address used by the petitioning creditors. The petitioning creditors contend that the affidavit fails tocomply with the Hague Convention and should be stricken accordingly.

In their affidavits, the petitioning creditors contend that they did not know that Barkats does not live at the service address, that they relied, in good faith, upon the address provided by the debtor's attorney, Hannon, on the notice of appeal, and given prior misrepresentations allegedly made by Barkats about his whereabouts, the petitioning creditors cannot at this juncture say definitively whether Barkats does or does not reside at the service address. The petitioning creditors' affidavits contend that Barkats frequently travels, misrepresents his whereabouts, provides false addresses, and through this shell game is able to avoid service of process.

On February 10, 2014, the petitioning creditors contend that Barkats placed telephone calls to creditors Kalellis and Shekoyan. When those creditors returned his call, Barkats asked them to "take back" the petition, and indicated that his attorney could help them accomplish that. As such, the petitioning creditors take the position that the debtor had actual notice of the involuntary petition, and under the circumstances, and given that the petitioning creditors proceeded in good faith, that should suffice.

Aside from the fact that the service address was listed on the debtor's notice of appeal in the Superior Court, thepetitioning creditors have not offered evidence to support the contention that Mr. Barkats resides at or ever has resided at the service address. Instead, they take the position that they were entitled to rely upon the address because it was provided by Barkats's attorney as Barkats's address on a notice of appeal filed in the Superior Court.

II

The petitioning creditors have moved to strike the debtor's affidavit on the grounds that it fails to comply with the Hague Convention because it does not bear the requisite apostille.1 Their argument has merit. The United States is a party to the Hague Convention Abolishing the Requirement of Legalisation for Foreign Documents, Oct. 5, 1961, 1981 WL 375769 (U.S. Treaty). As between member countries, the treaty simplifies the procedures that must be followed to certify the authenticity of public documents executed in a foreign country, and among the documents considered public documents under the treaty are "notorial acts [and] official certificates which are placed on documents signed by persons in their private capacity, such as official certificates recording the registration of a document or the factthat it was in existence on a certain date and official and notarial authentications of signatures." As such, the provisions of the Hague Convention apply to an affidavit filed with this court that was executed and notarized in France. Articles 3 through 5 of the convention describe the content and procedure for obtaining and attaching an apostille, which is essentially an additional layer of notarization the debtor was required to obtain from French authorities if he wanted his notarized affidavit to be deemed authentic in a United States court.

While the court is required, in accordance with the Hague Convention, to accept such an apostille as proof of authenticity, a document that fails to bear such an apostille is not per se inadmissible. The apostille, however, renders an affidavit self-authenticating under Fed. R. Evid. 902, and dispenses with the legalisation procedures that might otherwise apply. The debtor has not sought to authenticate the affidavit under the Hague Convention or the more onerous legalisation procedures such as those described in Fed. R. Evid. 902(3). Likewise, although 28 U.S.C. § 1746(1) permits litigants to file unsworn declarations under penalty of perjury in lieu of affidavits, when executed outside of the United States, such a declaration must specify that the declaration is made "under penalty of perjury under the laws of the United States of America that the foregoing is true and correct." The debtor's affidavit was made simply "underpenalty of perjury," without reference to the laws of the United States of America, and as such, does not satisfy the requirements of § 1746(1). The court finds that the affidavit is inadmissible as evidence in this proceeding and will strike it accordingly.2

The question of authenticity and admissibility is largely academic, however. Even when excluding the debtor's affidavit, the court concludes, as explained in further detail below, that the petitioning creditors have failed to satisfy their burden to show that service at the disputed service address was effective, and as such, the court will, tentatively, vacate the order for relief.

III

The petitioning creditors contend that service made at the Offut Lane address should be treated as valid because it resulted in actual notice to the debtor of the involuntary petition filed against him. Even if the court finds that the debtor received prompt actual notice of the filing of the petition, "[a]ctual notice of [a proceeding] does not satisfy the requirement of proper service of a summons under Rule 4 . . . ." McGuire v. Sigma Coatings, Inc., 48 F.3d 902 (5th Cir. 1995). Thepetitioning creditors cite to Karlsson v. Rabinowitz, 318 F.2d 666, 668 (4th Cir. 1963), for the proposition that service that "successfully apprised the defendant of the action" is sufficient. That case is easily distinguishable on its facts. In that case, the defendant owned a house in Maryland and resided at that house with his family. After residing at that home with his family for some unspecified period of time, the defendant decided to take up permanent residence in Phoenix, Arizona. The defendant relocated to Phoenix ahead of his wife, who continued to reside at the Maryland house in order to wrap up loose ends and to be present for the closing on the sale of the house. After the defendant had already left for Phoenix, but before the sale of the house and while the wife was still residing at the house, the plaintiff attempted to serve the defendant by leaving a copy of the complaint at the Maryland home with the defendant's wife. The question before the court was whether the house, property still owned by the defendant and in which he had admittedly resided up until a short time before service was made and where his wife was present to receive the summons, qualified as the defendant's "dwelling house or usual place of abode" within the meaning of Rule 4. Reversing the District Court, the Fourth Circuit Court of Appeals found service sufficient, emphasizing that the question of whether a particular location is a party's "dwelling house or usual place of abode" is a fact-sensitive issue that must be reviewed on a case-by-case basis. The court found it significant that the house had clearly been the defendant's residence up until some time before service was made and the wife who received the summons was not an estranged spouse but, instead, someone who in fact informed the defendant of the summons. This combination of factors led the court to conclude that justice would be served by treating the service as valid, and it denied the defendant's motion to quash service of the summons and complaint accordingly.

The Rabinowitz case does not stand for the broad proposition that service that results in actual notice to a would-be defendant obviates the need to satisfy the requirement of Rule 4(e)(2)(B) that a copy of the summons and complaint be left at the defendant's "dwelling or usual place of abode. . . ." Instead,...

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