In re Donald

• Decision Date: 19 July 2005
• Docket Number: Bankruptcy No. LA 04-24773-SB.,BAP No. CC-04-1570-KMAB.
• Citation: 328 B.R. 192
• Parties: In re Jeanette DONALD, Debtor. Jeanette Donald, Appellant, v. Nancy Curry, Chapter 13 Trustee; Wells Fargo Bank, N.A., Appellees.
• Court: U.S. Bankruptcy Appellate Panel, Ninth Circuit

328 B.R. 192

In re Jeanette DONALD, Debtor.

Jeanette Donald, Appellant, v. Nancy Curry, Chapter 13 Trustee; Wells Fargo Bank, N.A., Appellees.

BAP No. CC-04-1570-KMAB.

Bankruptcy No. LA 04-24773-SB.

United States Bankruptcy Appellate Panel of the Ninth Circuit.

Argued and Submitted February 23, 2005.

Filed July 19, 2005.

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Before: KLEIN, MARLAR, and BRANDT, Bankruptcy Judges.

OPINION

KLEIN, Bankruptcy Judge.

The debtor appeals from an order transferring her bankruptcy case from the Central District of California to the Northern District of Georgia under 28 U.S.C. § 1412 for improper venue. The debtor contends her domicile is California. We AFFIRM the factual determination that the debtor's domicile is in Georgia. Moreover, regardless of domicile, transfer was permissible.

FACTS

After living many years in California, the debtor, Jeanette Donald, moved to Georgia in 1999 with her spouse. She remained in Georgia after her spouse died in February 2001, maintaining a residence in Waleska, Georgia, which she mortgaged in 2003. The Social Security Administration sends payments to her Georgia residence.

In May 2004, Ms. Donald traveled to California for a contract job in Los Angeles that turned out to last about thirty days, after which she returned to Georgia. While in California she stayed with a friend and did not obtain her own residence.

On July 6, 2004, after returning to Georgia, Ms. Donald filed a chapter 13 bankruptcy case in the Central District of California for the apparent purpose of curing the mortgage default on her Georgia residence. Her petition used the address of her friend in Whittier, California, with whom she had stayed.

The chapter 13 plan proposed to cure the Georgia mortgage default, pay a Georgia tax collector, and pay the full $1,304.82 in general unsecured debt (owed mainly to national creditors).

At the meeting of creditors on August 24, 2004, Ms. Donald testified that her address was in Waleska, Georgia, that the Whittier address on her petition belonged to a friend, and that she had been back in California only temporarily. When questioned about venue, she said, "well maybe we can transfer."

The trustee announced an intention to object to venue and, three days later, filed an objection to plan confirmation on the grounds of improper venue under 28 U.S.C. § 1408(1) and of plan infeasibility under 11 U.S.C. § 1325(a)(6). Her mortgage creditor objected to confirmation on the basis that her schedules did not reveal income sufficient to fund the proposed plan.

On the day of the confirmation hearing, Ms. Donald amended her schedules to add $4,000 per month income from employment in Georgia that was obtained during the case. She also filed a memorandum of points and authorities in support of confirmation and her choice of venue based on domicile.

She argued, first, that the trustee waived the venue issue by not filing a separate transfer motion in addition to asserting improper venue as an objection to plan confirmation and, second, that venue was proper in California based on domicile.

In her declaration supporting her position regarding domicile, she averred that she did not relinquish her California domicile when she and her spouse moved to Georgia in 1999. She added that she always intended to return to California even though she remained in Georgia for three years after her husband's death.

During argument, the court inquired whether transfer would be an appropriate resolution. Debtor's counsel agreed that transfer was an option available to the court.

The court agreed that California was not a proper venue and ordered transfer to the Northern District of Georgia. Its written order unambiguously referred to lack of domicile. Its oral ruling also noted that "under the circumstances of the case," transfer would "be appropriate."

The transfer order was entered November 15, 2004. The notice of appeal was filed November 18, 2004, with a motion for stay pending appeal. The bankruptcy clerk transmitted the pleadings, transfer order, and copy of the docket to the Northern District of Georgia on November 18, 2004, which papers were docketed by the clerk of that court on November 23, 2004. The bankruptcy court granted a stay pending appeal on November 24, 2004. On December 17, 2004, our clerk's jurisdictional query about the apparent interlocutory nature of the appeal drew a responsive motion for leave to appeal, which we granted.

JURISDICTION

The bankruptcy court had jurisdiction via 28 U.S.C. §§ 1334 and 157(b)(1). As we shall explain, we have jurisdiction under 28 U.S.C. § 158(a)(3).

ISSUES

1. Whether appellate jurisdiction ended with delivery of the case files to, and docketing by, the transferee district.

2. Whether an objection to venue is waived when it is interposed as a defense to a contested matter under Federal Rule of Bankruptcy Procedure 9014, without making a separate motion to transfer or dismiss contemplated by Rule 1014(a).

3. Whether venue was properly laid in the Central District of California under 28 U.S.C. § 1408(1) on a theory of domicile.

4. Whether transfer was permissible under 28 U.S.C. § 1412.

STANDARD OF REVIEW

Our appellate jurisdiction is a question of law that we raise sua sponte and resolve de novo. Menk v. LaPaglia (In re Menk), 241 B.R. 896, 903 (9th Cir. BAP 1999). Domicile premised upon intent and presence involves mixed questions of law and fact reviewed for clear error. Lowenschuss v. Selnick (In re Lowenschuss), 171 F.3d 673, 684-85 (9th Cir.1999); Lew v. Moss, 797 F.2d 747, 750 (9th Cir.1986). A decision to transfer a case to another district is reviewed for abuse of discretion. Jones v. GNC Franchising, Inc., 211 F.3d 495, 498 (9th Cir.2000).

DISCUSSION

We must resolve the question of our jurisdiction before turning, in order, to the issues presented by the parties.

I

An order transferring a case to another district under the bankruptcy transfer statute, 28 U.S.C. § 1412, is interlocutory for the same reasons that transfer orders under 28 U.S.C. §§ 1404 and 1406 are interlocutory.¹ Varsic v. United States Dist. Ct., 607 F.2d 245, 251 (9th Cir.1979) (28 U.S.C. § 1406); United States Tr. v. Sorrells (In re Sorrells), 218 B.R. 580, 582 (10th Cir. BAP 1998); 17 JAMES WM. MOORE ET AL., MOORE'S FEDERAL PRACTICE § 111.60 (3d ed.2005) ("MOORE'S"); 15 CHARLES ALAN WRIGHT, ARTHUR R. MILLER & EDWARD H. COOPER, FEDERAL PRACTICE & PROCEDURE § 3855 (2d ed.1986) ("WRIGHT & MILLER"); 1 COLLIER ON BANKRUPTCY ¶ 4.05[2] (Alan N. Resnick & Henry J. Sommer eds. 15th ed. rev.2005) ("COLLIER").

Appeal of an interlocutory order transferring venue under 28 U.S.C. § 1412, which is regarded as doing double duty for both §§ 1404 and 1406, requires leave to appeal.² 28 U.S.C. § 158(a)(3).

A timely notice of appeal, however, may be the basis for granting leave to appeal an interlocutory order, even without a separate motion for leave to appeal. Fed. R. Bankr.P. 8003(c).

A timely notice of appeal was filed on November 18, 2004. We later issued a Clerk's Order questioning finality, which precipitated the filing of a motion for leave to appeal on December 17, 2004, which we granted. Our order granting leave to appeal related back to the timely filing of the notice of appeal.

The differentials in these various dates potentially make a difference because appellate jurisdiction ordinarily terminates when the transfer motion is granted and the papers are entered in the transferee court's docket. Lou v. Belzberg, 834 F.2d 730, 733 (9th Cir.1987) (28 U.S.C. § 1292); accord, e.g., In re Sosa, 712 F.2d 1479, 1480 (D.C.Cir.1983); In re Nine Mile Ltd., 673 F.2d 242, 243 (8th Cir.1982); In re SW Mobile Homes, Inc., 317 F.2d 65, 66 (5th Cir.1963).

Once the transferee court receives and dockets the case files, the transferor court generally loses jurisdiction over the case, as does the transferor court's appellate court. Lou, 834 F.2d at 733 (28 U.S.C. § 1404); accord, Wilson v. City of San Jose, 111 F.3d 688, 692 (9th Cir.1997).

There are two exceptions to this so-called "docketing rule." First, an appellate court's jurisdiction resulting from a timely notice of appeal filed before the transferee court dockets the matter is not terminated upon completion of the transfer. Lou, 834 F.2d at 733. Second, even after docketing in the transferee court, mandamus remains available to require the transferor court to vacate a transfer order if the transfer was too hasty. NBS Imaging Sys., Inc. v. United States Dist. Ct., 841 F.2d 297, 297-98 (9th Cir.1988). The first exception applies here.

We obtained jurisdiction over this appeal as of November 18, 2004, by virtue of the filing of the timely notice of appeal before the transferee court docketed the matter. It makes no difference that a motion for leave to appeal was not filed and granted until later. A bankruptcy appellate court is entitled to treat the timely notice of appeal as the equivalent of a motion for leave to appeal. Fed. R. Bankr.P. 8003(c).

Similarly, it is a red herring that the bankruptcy court granted the motion for stay pending appeal on November 24, 2004, after the papers were docketed in the transferee court. Appellate jurisdiction had attached when the timely notice of appeal was filed. Lou, 834 F.2d at 733. This makes it unnecessary to consider questions of mandamus over a too-hasty transfer. NBS Imaging Sys., Inc., 841 F.2d at 298.

Concluding we have jurisdiction under 28 U.S.C. § 158(a)(3), we proceed to consider the merits.

II

Appellant's first argument is that the venue objection was waived when the chapter 13 trustee did not file a separate motion to dismiss in addition to asserting improper venue as an objection to plan confirmation.

Specifically, it is contended that it is insufficient for the trustee to have asserted improper venue in an objection to plan confirmation filed three days after the meeting of creditors at which the debtor...