In re Caffey
| Decision Date | 28 January 2008 |
| Docket Number | Adversary No. 07-01091.,Bankruptcy No. 07-12132. |
| Citation | 384 B.R. 297 |
| Parties | In re Jason Andre CAFFEY, Debtor. Jason Andre Caffey, Plaintiff, v. Karen Russell, Defendant. |
| Court | U.S. Bankruptcy Court — Southern District of Alabama |
Irvin Grodsky, attorney for the Plaintiff/Debtor, Jason A. Caffey.
Patrice Blankenship, attorney for the Defendant, Karen Russell.
Lucien Blankenship, attorney for the Defendant, Karen Russell.
ORDER ENJOINING ENFORCEMENT OF CERTAIN STATE COURT ORDERS AND AWARDING DAMAGES TO PLAINTIFF FOR VIOLATION OF THE STAY
Before the Court is Plaintiff/Debtor's adversary case against Karen Russell for an injunction against enforcement of certain orders of the state court and for damages for Defendant's violation of the automatic stay. The Court has jurisdiction to hear this matter pursuant to 28 U.S.C. §§ 157 and 1334 and the Order of Reference of the District Court. This is a core proceeding pursuant to 28 U.S.C. § 157(b)(2)(I), and the Court has authority to enter a final order. For the reasons indicated below, the Court concludes that enforcement of certain state court orders should be enjoined and that Defendant violated the automatic stay and is liable to Plaintiff for damages.
Jason Andre Caffey ("Caffey" or "Debtor") filed a chapter 11 bankruptcy petition on August 3, 2007, primarily due to debts from numerous child support obligations. He played professional basketball for the Chicago Bulls from 1995 until approximately 2003. During those years he fathered several children and had child support obligations set at a high monthly amount based upon his then sizable NBA salary. After his NBA career ended, Caffey never got the owed child support obligations reset to a lower amount. His money ran out and that is when his problems arose.
One of the obligations owed is for the child of Ms. Karen Russell ("Ms. Russell" or "Defendant"). The debt to Ms. Russell is currently over $82,000. The Debtor states that his child support arrears have accrued due to the loss of the large income he was earning at the time the child support obligation was established. Ms. Russell filed a motion for writ of arrest in the Circuit Court of Tuscaloosa County, Alabama, on May 10, 2007 in attempt to collect the unpaid child support. It appears from various Tuscaloosa County court documents that both Mr. Lucien Blankenship and Ms. Patrice Blankenship represented and appeared on behalf of Ms. Russell in the domestic court proceedings. Debtor, through his domestic relations counsel, Mr. Edward Rowan, filed a motion or motions to modify the current child support obligation owed to Ms. Russell to a lower amount that was realistic based on his current circumstance. On July 12, 2007,1 in the Circuit Court of Tuscaloosa County, Alabama, the Honorable Herschel T. Hamner, Jr., heard the following motions: Caffey's Motion to Vacate Judgment, Motion to Modify, Caffey's counsel's Motion to Withdraw, and the Ms. Russell's Motion for Contempt. Present at the hearing were Rowan, Ms. Russell, and her counsel, Lucien Blankenship and Patrice Blankenship.
According" to the docket, at the hearing, Rowan's Motion to Withdraw was granted, the Motions to Vacate and Modify were denied, and Caffey was found in contempt for failure to pay child support. Judge Hamner announced in open court on July 13, 2007, that Caffey was found to be in contempt of court.2 The Final Judgment and Order for these (4) rulings was not signed by the Judge until August 8, 2007 and was not stamped as entered by the court until August 9, 2007.
On August 17; 2007, a Writ of Arrest for Debtor, Caffey, was executed by Judge Hamner. Mr. Blankenship testified that he and Ms. Blankenship took no further action after the July 12th hearing date that caused the creation or entry of the Writ of Arrest. On September 25, 2007, Caffey was arrested pursuant to the Tuscaloosa Circuit Court's order.3 He was held overnight at the Mobile County Metro Jail and then transported to Tuscaloosa, Alabama. He was incarcerated for nine days.
Caffey's new domestic relations counsel, Mr. John T. Fisher, negotiated the release of Caffey on October 4, 2007, by agreeing (1) to pay $10,000 to Ms. Russell in open court, (2) to mail $3,000 overnight to the Blankenships, (3) to pay $7,000 to the Blankenships by October 22, 2007, and (4) to pay $60,000 to the Blankenships by December 1, 2007 (Ms. Marita Hansberry secured this amount by conveying the deeds to two homes located in Pritchard, Alabama).
Meanwhile, after the July 12, 2007 hearing, but before the August 8, 2007 signing of the contempt order, and the September 25, 2007 arrest, Caffey filed his chapter 11 bankruptcy case. His bankruptcy petition was filed on August 3, 2007. Debtor testified at trial that he was not aware of any outstanding writ of arrest from Tuscaloosa County at the time he filed his chapter 11 case. He was aware of and does not dispute the debt owed to Ms. Russell, and Ms. Russell was listed as a creditor in Debtor's bankruptcy petition and schedules. The Certificate of Service from the Bankruptcy Noticing Center indicates that Ms. Russell and her counsel, Lucien Blankenship, were sent notice of Debtor's bankruptcy filing by U.S. first class mail on August 8, 2007. The notice sent to Blankenship was mailed to the office address listed for him and his firm on the Alabama State Bar website and on the pleadings filed on behalf of Ms. Russell in Tuscaloosa County.
Rowan also sent a copy of the petition via facsimile to Lucien Blankenship on August 8, 2007. The fax number that was used was confirmed by Mr. Blankenship at trial to be his fax number. It is also the fax number listed for him on the Alabama State Bar website. The fax consisted of a copy of the bankruptcy petition and contained a note stating the bankruptcy filing "should stay any proceeding on past due child support" The transaction report for the fax indicated a successful transmittal from Rowan to Blankenship. Rowan sent the same fax communication, the petition and the note, to Judge Hershel Hamner, Jr. The transaction report stated that the fax was successfully transmitted. Rowan called Judge Hamner's chambers after sending the fax and Judge Hamner's assistant confirmed the fax was received.
Debtor's bankruptcy counsel, Mr. Irvin Grodsky, also attempted to contact Mr. Blankenship regarding the filing of the chapter 11 bankruptcy case. On the morning of September 26, 2007 (the day after Caffey's arrest), Grodsky telephoned Mr. Blankenship during normal business hours at the number listed for him on the Alabama Bar Association website (in the member's directory).4 Mr. Blankenship did not answer this telephone call, so Grodsky left a voice mail message for him. After being unable to reach Mr. Blankenship by telephone, Grodsky also sent Mr. Blankenship an email notifying him of the Debtor's bankruptcy filing. He sent the email to the email address listed for Mr. Blankenship on the website of the Alabama State Bar. A copy of Grodsky's September 26, 2007, email to Mr. Blankenship also references the voice mail left for him. On November 19, 2007, Debtor filed an adversary complaint seeking to void the August 8, 2007 and October 4, 2007 Orders of the Circuit Court of Tuscaloosa County, Alabama and to hold the Defendant liable for damages pursuant to § 362(k) for violation of the automatic stay. A trial on the adversary case was held on January 11, 2007.
At trial, Rowan testified that he informed the court and the Blankenships at the July 12, 2007 hearing that Caffey was in the process of filing for bankruptcy. Fisher, who is Debtor's present domestic relations counsel in Tuscaloosa, testified that when he found out about Debtor's arrest he filed a motion to vacate the order, and he contacted Judge Hamner on Friday, September 29, 2007 to try and get an expedited hearing to have Debtor released as soon as possible. He stated at trial that he told Judge Hamner during the September 29, 2007 phone call that Debtor had a pending bankruptcy case and indicated that at some point the automatic stay of the bankruptcy would probably impact the domestic relations proceedings and potentially even stop them. However, he told the Judge he was not a bankruptcy attorney and would not be raising those issues himself; Caffey's bankruptcy counsel would do so when and where appropriate. Fisher also contacted the Blankenships on Friday, September 29, 2007, but testified he could not remember if he discussed the bankruptcy and the stay with them.
Debtor's release hearing was October 4, 2007. At the hearing, the terms of the Debtor's release were negotiated and put on the record. Fisher testified that at the release hearing, in Judge Hamner's chambers (or possibly in court), in the presence of Ms. Blankenship, he raised the issue of the automatic stay by questioning the interplay of the bankruptcy case with the arrest and release and commented on not knowing what "practical impact" the stay would have on what they had negotiated that day. He further testified that he was hired to get Debtor released from jail; he was not a bankruptcy attorney, and he was not going to allow his client, Debtor, to sit in jail while everyone figured out how the bankruptcy stay affected the situation. By this time, Grodsky had already telephoned and emailed Mr. Blankenship and Rowan had faxed the bankruptcy papers to the Blankenships.
Debtor testified at trial that being incarcerated financially hindered the growth of his business. Debtor currently owns a daycare facility and was in the process of opening up three more facilities when he was incarcerated. Due to the arrest and jailing, he was unable to get a license from the State of Alabama to open these three daycare centers. Debtor testified that his inability to gain the license has cost him $30,000 to date (that is the...
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