In re Glass
| Decision Date | 25 October 1999 |
| Docket Number | Bankruptcy No. 99-1726-3P3. |
| Citation | 240 BR 782 |
| Parties | In re T. Brian GLASS, Debtor. |
| Court | U.S. Bankruptcy Court — Middle District of Florida |
Janet H. Thurston, Thurston & Cohen, Jacksonville, for Debtor.
Michael Weinstock, Weinstock & Scavo, P.C., Atlanta, GA, for defendant.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
This case came before the Court upon a motion for sanctions filed by T. Brian Glass ("Debtor") against his former wife, Angela G. Glass and the law firm of Weinstock & Scavo, P.C., for violations of the automatic stay provision of 11 U.S.C. § 362. After hearings on May 13, 1999, June 30, 1999, and July 22, 1999, the Court gave the parties sixty days to submit proposed findings of fact and conclusions of law, a brief, and a proposed order. (Doc. 33.) Upon the evidence and argument of counsel, the Court makes the following Findings of Fact and Conclusions of Law.
1. On December 21, 1998, a Final Judgment and Decree of Divorce (the "Decree") was entered by Judge Joel J. Fryer in the Fulton County Superior Court, Georgia, terminating the marriage of Debtor and Angela G. Glass ("Wife"). The Decree was entered pursuant to a jury verdict rendered in T. Brian Glass v. Angela Garrel Glass, Civil Action File No. E-54127 (the "Divorce Proceeding"). Wife was represented in the Divorce Proceeding by the law firm of Weintstock & Scavo, P.C. ("Weinstock & Scavo"). Wife is also represented by Weinstock & Scavo in the case at bar.
2. Pursuant to terms of the Decree, Debtor was required to pay to Wife,
3. Also, paragraph 3(B) of the Decree requires Debtor to pay Wife "additional periodic monthly alimony payments . . . in the amount of one thousand five hundred dollars ($1,500.00) each month until the entire lump sum alimony obligation has been paid . . ."
4. Subsequent to the entry of the Decree, Debtor filed a Motion for New Trial, and requested a supersedeas, which, under Georgia law, is equivalent to a stay pending appeal. On February 16, 1999, Judge Fryer denied the supersedeas. (Debtor's Ex. 7 at pp. 15-16.)
5. Following the denial of supersedeas, Debtor filed a Chapter 13 petition with this Court on March 11, 1999. (Doc. 1.)
6. Wife and Weinstock & Scavo were listed as potential general unsecured creditors on Debtor's Schedule F. (Debtor's Ex. 8.)
7. On March 16, 1999, Debtor filed an adversary complaint against Wife and Weinstock & Scavo, alleging that the monetary awards to Wife set out in the Decree are not "alimony, maintenance or support", and thus, are dischargeable in accordance with 11 U.S.C. § 1328(a)(2) and not entitled to priority pursuant to 11 U.S.C. § 1322(a)(2). (Adv.Doc. 1.) The adversary proceeding makes similar allegations with regard to Weinstock & Scavo's request for an award of $154,769.17 for legal services provided to Wife. (Id.)
8. In the months of January, February and March 1999, Debtor only paid Wife periodic alimony in the amount of $850.00 per month. Debtor did not pay any periodic alimony for the month of April 1999.
9. On April 9, 1999, Wife and Weinstock & Scavo filed a Petition for Citation for Contempt ("Petition for Contempt") in the Superior Court of Fulton County, Georgia. (Debtor's Ex. 2.)
10. The Certificate of Service attached to the Petition for Contempt indicates that service was made to the Atlanta office of Holland & Knight, Debtor's attorneys in the Divorce Proceeding. (Debtor's Ex. 2 at p. 5.) However, the Certificate of Service does not list Debtor. (Id.)
11. Wife and Weinstock & Scavo admit that they did not seek relief from the automatic stay prior to filing the Petition for Contempt.
12. On April 13, 1999, the Clerk, Superior Court of Fulton County, Georgia, entered a Rule Nisi, ordering Debtor to appear and show cause at a hearing scheduled for 9:30 a.m. on the 15th day of March, 1999.1 (Debtor's Ex. 6.)
13. On April 14, 1999, Debtor filed a motion for sanctions for violations of the automatic stay, seeking to recover attorney's fees, court reporter costs, and an award of punitive damages pursuant to 11 U.S.C. § 362(h). (Doc. 14.)
14. On April 15, 1999, at 9:30 a.m., Judge Fryer held a hearing on Wife's Petition for Contempt. Debtor was not present. Nonetheless, an attorney from the Atlanta office of Holland & Knight appeared and represented Debtor at the contempt hearing. Debtor's counsel argued that less than twenty-four hours notice of a hearing on a Petition for Contempt was not fair or reasonable and did not give Debtor, a Florida resident, a chance to prepare and attend. (Debtor's Ex. 1 at pp. 13-15.) Debtor's counsel also argued that the Petition for Contempt was brought in violation of the automatic stay of 11 U.S.C. § 362. (Id. at 16-30.)
14. Wife and Weinstock & Scavo contended that, in accordance with Georgia law, notice of the hearing was reasonable under the circumstances and, because they were only seeking to "establish" the current alimony arrearage due under the Decree, the Petition for Contempt was excepted from the automatic stay pursuant to 11 U.S.C. § 362(b)(2)(A)(ii). (Id. at 13-30.)
15. At the conclusion of the April 15, 1999 hearing, Judge Fryer found Debtor to be in willful contempt for failing to pay $3,450.00 to Wife and determined that the Petition for Contempt was excepted from the automatic stay provision pursuant to 11 U.S.C. § 362(b)(2)(A)(ii). (Id. at 30-48.)
16. The parties stipulated that Debtor received a bill from Holland & Knight regarding legal services for Debtor in connection with the Petition for Contempt. (Debtor's Ex. 9.)
Debtor contends that the actions of Wife and Weinstock & Scavo in filing the Petition for Contempt, in obtaining the entry of the Rule Nisi, and in attempting to liquidate the claim for attorney's fees, were actions taken in violation of the automatic stay of 11 U.S.C. § 362. Debtor also argues that an award of punitive damages is appropriate in this case because the stay violations were not only willful and knowing, but deliberately undertaken as part of a calculated legal strategy to thwart this Court's jurisdiction. Wife and Weinstock & Scavo maintain that the Petition for Contempt is excepted from the automatic stay pursuant to 11 U.S.C. § 362(b)(2)(A)(ii).2 (Resp't Br. at 4-8.) Wife and Weinstock & Scavo also suggest that the Rooker-Feldman3 doctrine deprives this Court of subject matter jurisdiction in this action because Judge Fryer has already adjudicated the applicability of the automatic stay. (Id. at 8-10.) Because the Court cannot entertain this action if subject matter jurisdiction is lacking, the Court will first address whether the Rooker-Feldman doctrine precludes the disposition of Debtor's motion in this Court.
I. Rooker-Feldman Doctrine
The Rooker-Feldman doctrine is derived from two Supreme Court cases decided nearly sixty years apart. See Feldman, 460 U.S. at 462, 103 S.Ct. 1303; Rooker, 263 U.S. at 413, 44 S.Ct. 149. According to the Rooker-Feldman doctrine, Powell v. Powell, 80 F.3d 464, 466 (11th Cir.1996) (citing Feldman, 460 U.S. at 482, 103 S.Ct. 1303). The doctrine expresses the principle that federal courts are courts of original jurisdiction that do not sit in an appellate capacity with respect to state courts. See 28 U.S.C. § 1331 (); 28 U.S.C. § 1257 (1999) ().
The Rooker-Feldman doctrine is grounded on federalism, comity and the premise that state courts are not inferior to federal courts. See Powell, 80 F.3d at 467. "In our federal system, a state trial court's interpretation of federal law is no less authoritative than that of the federal court of appeals in whose circuit the trial court is located." Id. (citing Lockhart v. Fretwell, 506 U.S. 364, 376, 113 S.Ct. 838, 122 L.Ed.2d 180 (1993) (Thomas J., concurring)). Accordingly, Rooker-Feldman precludes a federal action if the relief requested would effectively reverse the state court decision or void its ruling. See Charchenko v. City of Stillwater, 47 F.3d 981, 983 (8th Cir.1995); Bechtold v. City of Rosemount, 104 F.3d 1062, 1065 (8th Cir. 1997). Moreover, "the doctrine applies not only to claims actually raised in the state court, but also to claims that were not raised in the state court but are `inextricably intertwined' with the state court's judgment." Powell, 80 F.3d at 466 (citing Feldman, 460 U.S. at 482, n. 16, 103 S.Ct. 1303). "The federal claim is deemed `inextricably intertwined' with the state-court judgment if the federal claim succeeds only to the extent that the state court wrongly decided the issues before it." Singleton v. Fifth Third Bank of Western Ohio (In re Singleton), 230 B.R. 533, 537 (6th Cir. BAP 1999) (citations omitted). Thus, pursuant to Rooker-Feldman, federal courts (other than the Supreme Court) cannot review state court judgments for errors in construing federal law. Id.
However, there appear to be several exceptions to the hard and fast Rooker-Feldman rule of federal-state comity. These exceptions generally come into play when the state proceedings are considered a legal nullity, and thus, are void ab initio. See Kalb v. Feuerstein, 308 U.S. 433, 438-40, 60 S.Ct. 343, 84 L.Ed. 370 (1940) (); but see...
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