In re Campfire Shop, Inc.
| Decision Date | 16 March 1987 |
| Docket Number | Bankruptcy No. 82-01969K,Adv. No. 85-0530K. |
| Parties | In re The CAMPFIRE SHOP, INC., Debtor. Anthony BARONE, Trustee, Plaintiff, v. STROUSE, GREENBERG MORTGAGE CO., INC., Strouse, Greenberg & Co., Strouse, Greenberg Financial Corporation and Administrator of the Small Business Administration and The Penn Mutual Life Insurance Company and Anna M. Ashworth, Paul Ronge and Nancy M. Ronge, as executors of the Estate of George E. Ashworth and Commonwealth of Pennsylvania, Department of Revenue, Personal Income Tax Bureau and David and Lynn Woolfenden and Brittain Signs, Inc. and Commonwealth of Pennsylvania, Department of Labor and Industry and George Becker Associates, Inc. and Commonwealth of Pennsylvania, Department of Revenue, Bureau of Accounts Settlement and United States of America, Treasury Department, Internal Revenue Service and Tax Claim Bureau of Bucks County, Pa. and William L. Leigh, Tax Collector, Bucks County, Pa. and Joseph W. McGinnis, Sr. and Joseph W. McGinnis, Sr., Inc. and Ray Leicht and Congress Abstract Corporation and First American Title Insurance Company and Russell Glass Company, Defendants. |
| Court | U.S. Bankruptcy Court — Eastern District of Pennsylvania |
Donald M. Collins, Philadelphia, Pa., for trustee.
David Kraut, Plymouth Meeting, Pa., for Congress Abstract Corp. and First American Title Insurance Co.
Paul R. Beckert, Jr., Bensalem, Pa., for Ray Leicht.
Michael Temin, Philadelphia, Pa., for Strouse, Greenberg.
William H.R. Casey, Doylestown, Pa., for Bucks County Tax Claim Bureau.
Anthony Barone, Philadelphia, Pa., Trustee/Plaintiff.
Virginia Powel, Ass't. U.S. Atty., Philadelphia, Pa., for Small Business Admin.
Robert K. Coulter, U.S. Dept. of Justice/Tax Div., Washington, D.C., for Internal Revenue Service.
John Brady, Langhorne, Pa., for Joseph W. McGinnis, Sr.
Joseph H. Masiuk, Barbara Lyons, Warrington, Pa., for George Becker Associates, Inc.
Nicholas Mancini, Fairless Hills, Pa., for debtor.
The procedural issues before the Court in this case are relatively simple ones concerning interpretation of Rules of Practice and Procedure in Bankruptcy (hereinafter referred to as "Bankr.R.") 9023, 9014, and 7052, and the corresponding Federal Rules of Civil Procedure () 59 and 52(a). However, because they are issues which recur in matters in our Court, we are drafting an Opinion rather than simply entering an Order setting forth our conclusions. We decide that Bankr.R. 9023 and F.R. Civ.P. 59 must be interpreted strictly, and Motions must be served upon opposing counsel within ten (10) days of the Order in question, or they must be summarily denied because of our absence of jurisdiction to consider them. We also decide that the press of our duties to decide a large volume of matters requires us to interpret Bankr.R. 9014 and 7052 and F.R.Civ.P. 52(a) narrowly, and allow us broad discretion in deciding whether it is necessary to issue any findings of fact and/or conclusions of law in deciding motions which come before us.
The decision of these questions arises in the disposition of a Motion of Plaintiff, Trustee for Reconsideration, Under Rule 7052(b) sic to Make Findings of Fact and Under Rule 9023 to Alter or Amend Judgment which was filed on May 23, 1986. The entire text of the Order of which "alteration or amendment" was sought is as follows:
/s/ William A. King, Jr.
The underlying bankruptcy case was filed under Chapter 11 of Title 11, U.S. Code, on April 30, 1982. In April, 1983, the Debtor, having ceased doing business, filed a Petition with this Court for permission to sell its principal asset, its former-business realty situated at 8333 Route 13, Levittown, Bucks County, Pennsylvania. On June 1, 1983, this Court granted the Petition, and the property was able to be sold free and clear, subject to distribution to the lienholders. Settlement, however, was not conducted until April 27, 1984. Unfortunately, distribution of the sale proceeds was effected in a manner inconsistent with the Order of June 1, 1983.
On December 10, 1984, the Debtor converted its bankruptcy to a case under Chapter 7. On December 11, 1984, Anthony Barone, the Plaintiff in this matter, was named as Trustee. On June 19, 1985, this adversarial proceeding was filed, naming as Defendants all parties who should have received distribution, all parties who erroneously did receive distribution, and Congress Abstract Corporation (hereinafter referred to as "Congress") and First American Title Insurance Company (hereinafter referred to as "First American"), who had been, respectively, the title agent at settlement and the title insurance underwriter, who were alleged to have been responsible for the errors made in distribution.
On September 12, 1985, the Trustee moved for partial summary judgment on the issue of his entitlement to compensatory damages of $108,407.66, the sum which was erroneously distributed, against Congress and First American. On October 14, 1985, Congress and First American answered this Motion and, in addition, filed a Cross-Motion for Summary Judgment of their own. These matters were resolved by Judge King in the Order of May 13, 1986, quoted supra.
The Trustee filed the instant Motion on May 23, 1986. The substance of the Motion was a request for the Court "to make findings of fact herein and alter the judgment" by denying the Motion of Congress and First American.
Congress and First American made two (2) responses to the Motion: (1) They were not served with it until June 4, 1986, and hence it was untimely, per Bankr.R. 9023 and F.R.Civ. 59(e); (2) It lacked substantive merit, because F.R.Civ.P. 52(a), made pertinent to bankruptcy proceedings per Bankr.R. 7052, specifically provides that "findings of fact and conclusions of law are unnecessary on decisions under Rules 12 or 56 or any other motion except as provided in Rule 41(b)." (emphasis added). We conclude that the Trustee's Motion must be denied, because both of the arguments of Congress and First American are clearly correct.
F.R.Civ.P. 59(e) provides that "a Motion to alter or amend the Judgment shall be served not later than ten (10) days after entry of the Judgment." (emphasis added). The Trustee argues that, per our local Motion Practice Rules, set forth in Local Rule 9014.1, service was not necessary until after the Court signed and remitted to it an Order Requiring Answer, per Local Rules 9014.1(b)(2) and (d)(2). Here, the Order Requiring Answer was not signed by former Chief Judge Emil F. Goldhaber of this Court until June 2, 1986. Thus, argues the Trustee, he was following local Court Rules and a Court Order in not serving Congress and First American until June 4, 1986.
We cannot accept this reasoning. While it is true that the Order Requiring Answer must be signed by the Court and served upon the Respondent to bring a Motion to issue per the above Local Rules, it does not follow that a moving party must wait until receipt of the Order Requiring Answer to serve his opponent with the Motion itself. We would, moreover, note that Bankr.R. 9013, which our local rules are empowered to supplement, but not contradict, requires that "every written motion shall be served by the moving party on the trustee or debtor in possession and on those persons specified by these rules." We believe that this rule could be read to require immediate service of Motions upon opposing interested parties, and we believe this to be the better practice uniformly. The service required by Local Rule 9014.1(d) would then be read as requiring supplemental service of the Motion and accompanying papers after execution of the Order Requiring Answer by the Court, not the exclusive manner of service.
Unfortunately for the Trustee, the date of service of a Motion pursuant to Bankr.R. 9023 and F.R.Civ.P. 59(e) is crucial. In the context of interpreting the specific directives of Bankr.R. 9023 and F.R.Civ.P. 59(e), we must apply the time strictures of those rules as opposed to the more general rules applicable to all motions in our Court set forth in Local Rule 9014.1.
It is well-established that de la Fuente v. Central Electric Cooperative, Inc., 703 F.2d 63, 65 (3d Cir.1983).
Moreover, it is equally well-established by local Court of Appeals precedent that the date of service is determinative in ascertaining whether a Rule 59(e) motion is timely, irrespective of the date of filing. In John E. Smith's Sons & Co. v. Lattimer Foundry & Machine Co., 239 F.2d 815 (3d Cir.1956), a judgment was rendered in favor of the plaintiff on June 1, 1954. The defendant filed a Rule 59 motion on June 5, 1954, but did not serve the motion upon counsel for the plaintiff until June 16, 1954. Id. at 816. The Court of Appeals affirmed a striking of the motion as untimely. Id. at 817. See also Kruse v. Zenith Radio Corp., 82 F.R.D. 66, 68-69 (W.D.Pa.1979); and Mroz v. Dravo Corp., 293 F.Supp. 499, 507 (W.D.Pa.1968).
We do note that, in one other instance, we granted a party relief despite its having filed an untimely Motion pursuant to Bankr.R. 9023 and F.R.Civ.P. 59. In re Daulerio, 71 B.R. 112, 114 (1987). However, we did so only because the error in question was a "clerical mistake" within the scope of Bankr.R. 9024 and F.R.Civ.P. 60(a), and hence one that we could correct on our own initiative at...
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