In re Bryan Road, LLC, 07-17922-BKC-JKO.

• Citation: 389 B.R. 297
• Decision Date: 09 June 2008
• Docket Number: No. 07-17922-BKC-JKO.,07-17922-BKC-JKO.
• Parties: In re BRYAN ROAD, LLC, Debtor.
• Court: United States Bankruptcy Courts. Eleventh Circuit. U.S. Bankruptcy Court — Southern District of Florida

389 B.R. 297

In re BRYAN ROAD, LLC, Debtor.

No. 07-17922-BKC-JKO.

United States Bankruptcy Court, S.D. Florida, Fort Lauderdale Division.

June 9, 2008.

COPYRIGHT MATERIAL OMITTED

Andrew J. Nierenberg, Coral Gables, FL, for Debtor.

ORDER DENYING DEBTOR'S MOTION FOR RECONSIDERATION

JOHN K. OLSON, Bankruptcy Judge.

THIS CASE came before me on March 18, 2008, on Bryan Road, LLC's (the "Debtor") Motion for reconsideration (the "Motion for Reconsideration") [DE 148] filed February 26, 2008, which was in turn addressed to the Order (the "Stay Relief Order") [DE 142] entered February 12, 2008, which granted Florida Community Bank's (the "Creditor") motion for stay relief [DE 19].

On February 26, 2008, I entered an Order [DE 149] denying the Debtor's motion [DE 144] seeking entry of an order extending the time within which it might file a motion for reconsideration under Federal Rule of Bankruptcy Procedure 9023, applying Federal Rule of Civil Procedure 59. I did so because Bankruptcy Rule 9006(b)(2) expressly prohibits any extension of time for the filing of motions seeking relief under either Bankruptcy Rule 9023 or Bankruptcy Rule 9024. However, I also denied the Creditor's motion [DE 156] to strike the Motion for Reconsideration, finding that the Debtor could seek relief under Federal Rule of Bankruptcy Procedure 9024, applying Federal Rules of Civil Procedure 60(b), even though the Motion for Reconsideration was untimely under Bankruptcy Rule 9023. See [DE 158]. A hearing on the Motion for Reconsideration was held on March 18, 2008. As the Debtor has not met its burden of establishing any grounds for relief under Rule 60(b), the Motion for Reconsideration must be denied.

Relief from an order entered in a contested matter governed by Bankruptcy Rule 9014, such as an order regarding relief from the automatic stay, may be sought by satisfying the requirements set forth in Bankruptcy Rule 9024. Rule 9024, applying Federal Rule of Civil Procedure 60, allows for reconsideration of an order when there is: (1) mistake, inadvertence, surprise, or excusable neglect; (2) newly discovered evidence; (3) fraud, misrepresentation, or other misconduct of an adverse party; (4) the judgment is void; (5) a prior judgment upon which it is based has been reversed or otherwise vacated, or it is no longer equitable that the judgment should have prospective application; or (6) any other reason justifying relief from the operation of the judgment. Fed. R. Bankr.Pro. 9024 (applying Fed.R.Civ.P. 60(b)); Drake'v. Dennis, 209 B.R. 20, 25 (Bankr.S.D.Ga.1996). In addition, the "motion shall be made within a reasonable time, and for reasons (1), (2), and (3) not more than one year after the judgment, order, or proceeding was entered or taken." Fed. R. Bankr.Pro. 9024 (applying Fed.R.Civ.P. 60(b)). As the Motion for Reconsideration was filed 14 days after the entry of the Stay Relief Order, it is timely.

The Debtor moves for reconsideration on the grounds that the Court has "erred both as to the controlling legal principles and as to the material facts," such that "[t]he errors are so extreme as to rise to the level of an abuse of discretion." See 112 in the Motion for Reconsideration. It is evident that the grounds for reconsideration in this matter rest solely on the asserted legal and factual mistakes on the record. Because the Debtor moves for reconsideration based upon mistake, the movant cannot rely on Rule 60(b)(6)-the residual clause of this section. Rule 60(b)(6) applies only to "cases that do not fall into any of the other categories listed in parts (1)-(5)," United States v. Real Property & Residence Located at Route 1, Box 111, Firetower Rd., Semmes, Mobile County, Ala, 920 F.2d 788, 791 (11th Cir. 1991); See also Jansen v. Volute Enters. Inc. (In re Hancock Props. Mgmt. Inc.), 325 B.R. 662, 669 (Bankr.M.D.Fla.2005). Rule 60(b)(1) and Rule 60(b)(6) are mutually exclusive.

Substantive mistakes made by federal judges may be cured through reconsideration under Rule 60(b)(1). Meadows v. Cohen, 409 F.2d 750, 752 n. 4 (5th Cir.1969).¹ These include mistakes of fact as well as mistakes of law, Nisson v. Lundy, 975 F.2d 802, 806 (11th Cir.1992). Rule 60(b) seeks "preserve the delicate balance between the sanctity of final judgments ... and the incessant command of the court's conscience that justice be done in light of all the facts." Bankers Mortgage Co. v. United States, 423 F.2d 73, 77 (5th Cir.1970), cert, denied, 399 U.S. 927, 90 S.Ct. 2242, 26 L.Ed.2d 793 (1970).

For the Debtor to prevail on the Motion for Reconsideration it must demonstrate a justification so compelling that this Court will be required to vacate its order. See Thompson v. Hicks, 213 Fed. Appx. 939, 941 (11th Cir.2007), cert, denied, ___ U.S. ___, 128 S.Ct. 492, 169 L.Ed.2d 345(Oct. 29, 2007); Solaroll Shade & Shutter Corp. v. Bio-Energy Sys., Inc., 803 F.2d 1130, 1132 (11th Cir.1986). Where it is the court's misunderstanding or misapplication of the law that is asserted in a Rule 60(b)(1) motion, the moving party must demonstrate that the court's mistake involved "a `plain misconstruction' of the law and the erroneous application of that law to the facts." See Lundy, 975 F.2d at 806 (quoting Compton v. Alton Steamship Co., 608 F.2d 96, 104 (4th Cir. 1979)). In other words, this error must embroil a "fundamental misconception of the law or ... conflict with a clear statutory mandate" In re Grimland, Inc., 243 F.3d 228, 233 (5th Cir.2001). Typically the bankruptcy court is not required to grant relief unless the legal error is obvious. Fackelman v. Bell, 564 F.2d 734, 736 (5th Cir.1977).

At the outset, I note that the Debtor provides no new evidence, no new case authority, and no structured argument or analysis of the Rule 60(b) standards which govern its motion.

First, the Debtor questions my legal analysis of Florida Statutes § 718.121(1) and the Florida Supreme Court's ruling interpreting this provision in Bank One, Dayton, N.A. v. Sunshine Meadows Condominium Association, Inc., 641 So.2d 1333 (Fla.1994). The Debtor asserts precisely the same position on this matter as it put forth in its opposition to the Stay Relief Motion [DE 19]. The Debtor offers no new grounds to support its position that a fundamental misconception of law occurred. Boisterous and enthusiastic writing challenging my understanding of Fla. Stat. § 718.121(1) does not establish that I have plainly misconstrued the law. Instead, the arguments advanced in the Motion for Reconsideration provide no more than a different interpretation of the law. A divergence of opinion as to the legal implications of a statute and case law, absent a clear and fundamental misconception of law, is not what constitutes a "mistake" within the meaning of Rule 60(b)(1).

The Debtor also moves for reconsideration of my ruling that the Forbearance Agreement was enforceable in the bankruptcy case. I relied heavily on the Desai factors to reach this conclusion. See, In re Desai, 282 B.R. 527, 532 (Bankr. S.D.Ga.2002). The Debtor provides no new evidence or case law to support the allegations of abuse of discretion. The Debtor contends that the 60 day hiatus provided to the Debtor as consideration for the forbearance agreement was "nothing." This contention rests on a legal interpretation as to what constitutes reasonable consideration. The Debtor provides no legal basis to show that there was a misconstruction or faulty application of the law, only that it disagrees with my interpretation of the facts. Mere assertions, absent concrete legal support, are insufficient under Rule 60(b). The same is true for the Debtor's arguments as to the sophistication of the parties entering into the Forbearance Agreement and of their legal counsel, the issue as to the third parties² affected by the agreement in the...