In re Greenberg
| Decision Date | 27 February 2015 |
| Docket Number | Case No. 13–44533 CEC |
| Citation | 526 B.R. 101 |
| Parties | In re : Jeffrey Greenberg, Debtor. |
| Court | U.S. Bankruptcy Court — Eastern District of New York |
Jeffrey Greenberg, 9511 Shore Road #301, Brooklyn, New York 11209, Pro-se Debtor
Richard A. Altman, Esq., Law Office of Richard A. Altman, 285 West Fourth
Street, New York, New York 10014, Counsel for Anthony Germano
DECISION
This matter comes before the Court on the motion of the debtor, Jeffrey Greenberg (the “Debtor”), to reopen his bankruptcy case to enforce his discharge and to hold creditor Anthony Germano (“Germano”) and his counsel, Richard A. Altman, Esq. (“Altman”), in contempt for violating the discharge injunction. Because Germano had notice of this case in time to file an adversary proceeding to determine the dischargeability of his claim, § 523(a)(3)(B) of the Bankruptcy Code is inapplicable. It follows that Germano's claim was discharged under § 727 of the Bankruptcy Code and, therefore, the Debtor's motion is granted.
This Court has jurisdiction of this core proceeding pursuant to 28 U.S.C. § 157(b)(2)(I) and (O), 28 U.S.C. § 1334, and the Eastern District of New York standing order of reference dated August 28, 1986, as amended by order dated December 5, 2012. This decision constitutes the Court's findings of fact and conclusions of law to the extent required by Federal Rule of Bankruptcy Procedure 7052.
The following facts are not in dispute, except as otherwise indicated.
The Debtor filed this case on July 24, 2013.1 (Chapter 7 Voluntary Petition, 13–44533–CEC, ECF No. 1.) The Debtor's schedules included a contingent, liquidated, and disputed unsecured claim by Germano valued at an unknown amount. (Schedule F, 13–44533–CEC, ECF No. 1.) Germano's claim is based on a state court action for fraud, breach of contract, breach of warranty, and unjust enrichment which was commenced in 2009 (the “State Court Action”). (Mot. to Reopen Chapter 7 Case to Enforce Discharge and Discharge Injunction, Ex. A, 13–44533–CEC, ECF No. 18 at 12–23.) On the Debtor's schedule F, Germano's address was listed as “Anthony Germano c/o John Gordon Nicol Esq, Seaman & wainwright [sic] LLP, 771 Third Avenue, Ste 1505, New york, N.Y. [sic] 10017.” (Schedule F, 13–44533–CEC, ECF No. 1.)
On September 3, 2013, the Debtor visited his counsel's office and notified his counsel that Mr. Nicol was no longer Germano's counsel and that Altman now represented Germano. (Affirmation, 13–44533–CEC, ECF No. 21 at ¶ 3.) On September 24, 2013, an amended schedule F was filed in this case (the “Amended Schedule F”). (Amended Schedule F, 13–44533–CEC, ECF No. 13.) The Amended Schedule F added the following names and addresses:
Id. The Debtor's counsel filed an affidavit of service on September 24, 2013 which stated that an amended schedule B was served on the above parties on the same day. (Aff./Certificate of Service, 13–44533–CEC, ECF No. 14.)2 On September 6, 2013, the chapter 7 trustee filed a no asset report in this case. The Debtor received his discharge on November 6, 2013 and notice of the Debtor's discharge was sent by the Bankruptcy Noticing Center to the above addresses on November 8, 2013. (Order Discharging Debtor and Final Decree, 13–44533–CEC, ECF No. 16; BNC Certificate of Mailing with Chapter 7 Discharge and Chapter 7 Final Decree, 13–44533–CEC, ECF No. 17.)
Germano and Altman admit that they each received a copy of the order granting the Debtor a discharge. (Decl. in Opp'n, 13–44533–CEC, ECF No. 20 at ¶ 4 of Germano Affidavit and ¶¶ 1, 6 of Altman Affidavit.) Both assert that this was the first notice of the bankruptcy filing they received. Id. Altman states that, after receiving notice of the discharge, he “reviewed the docket, the petition and applicable law, and determined that the lack of any timely notice or knowledge of the second petition did not bar me from continuing to litigate the debt in the New York Court County Supreme Court.” Id. at ¶ 10. Altman proceeded to file a motion for summary judgment in the State Court Action. (Mot. to Reopen Chapter 7 Case to Enforce Discharge and Discharge Inj., Ex. D, 13–44533–CEC, ECF No. 18 at 36–42.) Upon receiving the summary judgment motion, the Debtor's counsel contacted Altman and informed him that the continuing prosecution of the state court action violated the automatic stay and demanded that Altman withdraw the motion. (Decl. in Opp'n, 13–44533–CEC, ECF No. 20 at ¶ 11 of Altman Affidavit.) Altman refused to do so. Id.
On March 12, 2014, the Debtor filed a pro se motion to re-open his bankruptcy case to enforce the discharge injunction and hold Germano and Altman in contempt. (Mot. to Reopen Chapter 7 Case to Enforce Discharge and Discharge Injunction, 13–44533–CEC, ECF No. 18.) On April 15, 2014, Altman filed a Declaration in Opposition to the Motion (the “Opposition”). Following an evidentiary hearing on July 1, 2014, at which the Debtor and his counsel testified, Altman submitted a memorandum of law (the “Memorandum”) and the Debtor submitted a response to the Memorandum (the “Response”). (Mem. of Law, 13–44533–CEC, ECF No. 29; Debtor's Resp. to the Creditor Anthony Germano's Mem. of Law, 13–44533–CEC, ECF No. 30.)
11 U.S.C. § 523(a)(3). Because one of the asserted bases of Germano's claim is fraud (in addition to breach of contract, breach of warranty, and unjust enrichment), Germano's claim could potentially constitute a debt of the kind specified under § 523(a)(2) of the Bankruptcy Code (), making § 523(a)(3)(B) of the Bankruptcy Code applicable. To the extent that Germano's claim falls within the ambit of § 523(a)(2), the claim was not discharged if Germano did not have notice or actual knowledge of this bankruptcy case in time for him to file a timely request for a determination of dischargeability of the debt.3
The parties dispute whether Germano, or Altman on behalf of Germano, had notice of the Debtor's bankruptcy. The Debtor claims that service of the Amended Schedule F on Germano and Altman put Germano on notice of the bankruptcy case. Germano and Altman assert that they had no notice or actual knowledge of the Debtor's bankruptcy case until they received notice of the Debtor's discharge.
A debtor is not required to provide actual notice to every creditor; rather, a debtor is only required to provide “notice reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to [respond].” Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306, 314, 70 S.Ct. 652, 657, 94 L.Ed. 865 (1950), (“The means employed must be such as one desirous of actually informing the absentee might reasonably adopt to accomplish it.”). Reasonable notice—even to a known creditor—does not require actual receipt of notice by the creditor. Weigner v. City of New York, 852 F.2d 646, 651 (2d Cir.1988) ().
Service of notice upon an attorney that represents a creditor may constitute notice to that creditor. In re Herman, 737 F.3d 449, 454 (7th Cir.2013). For notice to a claimant's attorney in lieu of the claimant to be reasonable, there must be “a sufficient nexus between the creditor's retention of an attorney and the creditor's claim against the debtor.” Id. In re Najjar, No. 06–10895(AJG), 2007 WL 1395399, at *4 ). A sufficient nexus exists when the attorney is representing the creditor in an action to collect the debt sought to be discharged. In re Elias, No. 13–cv–01269 (CBA), 2014 WL 1248042, at *5 (E.D.N.Y. March 24, 2014) ; In re Linzer, 264 B.R. 243, 249 (Bankr.E.D.N.Y.2001) ().
It is well settled that “proof that a letter properly directed was placed in a post office creates a presumption that it...
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