In re Swiontek, Bankruptcy No. 04-bk-48014.

• Decision Date: 03 October 2007
• Docket Number: Bankruptcy No. 04-bk-48014.,Adversary No. 05-ap-01624.
• Citation: 376 B.R. 851
• Parties: In re Leo F. SWIONTEK Debtor. Andrew J. Maxwell, Trustee, Plaintiff, v. Demetra Barounis, Defendant.
• Court: U.S. Bankruptcy Court — Northern District of Illinois

376 B.R. 851

In re Leo F. SWIONTEK Debtor Andrew J. Maxwell, Trustee, Plaintiff, v. Demetra Barounis, Defendant.

Bankruptcy No. 04-bk-48014.

Adversary No. 05-ap-01624.

United States Bankruptcy Court, N.D. Illinois, Eastern Division.

October 3, 2007.

COPYRIGHT MATERIAL OMITTED

Vikram R. Barad, Andrew J. Maxwell, Esq., Maxwell & Potts, LLC, Chicago, IL, for Plaintiff.

Xiaoming Wu, Ledford & Wu, Chicago, IL, for Defendant.

MEMORANDUM OPINION ON TRUSTEE'S MOTION FOR SUMMARY JUDGMENT AND DEFENDANT'S MOTION FOR SUMMARY JUDGMENT¹

JACQUELINE P. COX, Bankruptcy Judge.

Before the court in this adversary proceeding are cross motions for summary judgment filed by the Plaintiff, Andrew J. Maxwell, the chapter 7 trustee in Leo F. Swiontek's (the "Debtor") chapter 7 bankruptcy case and the Defendant, Demetra Barounis. The complaint consists of two counts: Count 1 alleges fraudulent transfer of real estate by the Debtor to the Defendant; Count 2 requests authority to sell the real estate in issue. For the reasons articulated herein, the court grants the Trustee's motion for summary judgment as to each count of the Complaint and denies the Defendant's motion for summary judgment.

JURISDICTION

This court has jurisdiction over this matter pursuant to 28 U.S.C. §§ 1334, 157(a) and the Internal Operating Procedures of the United States District Court for the Northern District of Illinois 15(a). This matter is a core proceeding under 28 U.S.C. § 157(b)(2)(A), (H) and (N). Venue in this district is proper under 28 U.S.C. § 1409.

PROCEDURAL HISTORY

On December 30, 2004, Debtor Leo F. Swiontek filed for relief under chapter 7 of the Bankruptcy Code ("Code"). See 04-bk-48014, Doc. I. Andrew J. Maxwell ("Trustee" or "Plaintiff') was appointed to serve as the trustee in the Debtor's case. See 04-bk-48014, Doc. 5. On June 14, 2005, the Trustee filed an "Initial Report of Assets" that stated that the "Trustee has found assets in this estate to be administered for the benefit of creditors, or believes there is a likelihood that such assets will be recovered within a reasonable period of time." See 04-bk-48014, Doc. 10.

On July 19, 2005, the Trustee filed an adversary complaint against Demetra Barounis seeking to avoid the Debtor's allegedly fraudulent transfer of property commonly known as "6927 West Fargo Avenue, Niles, Illinois" to Barounis under § 544 of the Code and the Illinois Uniform Fraudulent Transfer Act (the "IUFTA"). See 05-ap-01624, Doc. 1. The complaint also seeks a court order pursuant to § 363(h) of the Code authorizing the sale of the estate's interest in the real estate as well as the interest of the co-owner, the Defendant.

On February 27, 2007, the Trustee filed a motion for summary judgment in favor of himself, in his capacity as the trustee for the estate, and against the Defendant on all counts in his complaint. See 05-ap-01624, Doc. 31. Attached to the motion is the "Memorandum in Support of Motion For Summary Judgment" and the "Trustee's Statement of Uncontested Facts in Support of Motion for Summary Judgment" as required by Local Bankruptcy Rule 7056-1. See id.

On May 14, 2007, the Debtor filed a motion to convert his chapter 7 liquidation case to a chapter 13 reorganization case. See 04-bk-48014, Doc. 16. The Debtor filed amended Schedules I and J along with a chapter 13 plan to support his motion to convert. See 04-bk-48014, Does. 20, 21 & 23. On August 1, 2007, the Debtor withdrew his motion to convert his bankruptcy case. See 04-bk-48014, Doc. 24.

In lieu of filing a response to the Trustee's motion, the Defendant filed "Defendant's Motion for Summary Judgment" on July 31, 2007. See 05-ap-01624, Doc. 43. The Defendant also filed "Defendant's Statement of Uncontroverted Facts in Support of Motion for Summary Judgment" ("Defendant's Statement"), "Defendant's Memorandum of Law in Support of Motion for Summary Judgment" (the "Defendant's Memorandum") and an "Affidavit in Support of Defendant's Motion for Summary Judgment." See 05-ap-01624, Does. 44, 45 & 46.

The court held a hearing regarding these matters on August 14, 2007 and ordered that the Defendant's motion for summary judgment would be accepted as a response to the Trustee's motion for summary judgment. See 05-ap-01624, Doc. 47. The Defendant was given until August 21, 2007 to comply with applicable local rules and to respond to the Trustee's Statement of Uncontroverted Facts.² See id. The order further provided the Trustee an opportunity to file a reply to the Defendant's response. See id.

In compliance with the August 14, 2007 order, the Defendant tiled "Defendant's Response to Plaintiffs Statement of Uncontroverted Facts" ("Defendant's Statement"), which is the Defendant's response to the Trustee's Statement, on August 22, 2007. See 05-ap-01624, Docs. 49. The Trustee filed a reply to the Defendant's Statement on September 4, 2007. See 05-ap-01624, Doc. 52. On September 10, 2007, the Trustee filed a reply to the Defendant's Memorandum. See 05-ap-01624, Doc. 53.

The court heard oral argument on the two motions for summary judgment on September 13, 2007. The court took the matters under advisement.

STANDARDS FOR SUMMARY JUDGMENT

Under Rule 56(c) of the Federal Rules of Civil Procedure, made applicable to adversary proceedings by Rule 7056 of the Federal Rules of Bankruptcy Procedure, a party seeking to recover on a claim may move, with or without supporting affidavits, for summary judgment in the party's favor. Summary judgment is only proper when there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. Pro. 56(c). See also Nebraska v. Wyoming, 507 U.S. 584, 590, 113 S.Ct. 1689, 123 L.Ed.2d 317 (1993); Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Indiana Ins. Co. v. Pana Cmty. Unit Sch. Dist., 314 F.3d 895, 900 (7th Cir.2002). The primary purpose of summary judgment is to avoid a useless trial and dispose of claims in which there is no genuine issue of any material fact. See Vukadinovich v. Board of Sch. Trustees of N. Newton Sch. Corp., 278 F.3d 693, 699 (7th Cir.2002); Flynn v. Sandahl, 58 F.3d 283, 288 (7th Cir.1995); Mintz v. Mothers Fund, Inc., 463 F.2d 495, 498 (7th Cir.1972). The party moving for summary judgment bears the initial burden of establishing that there is no genuine issue of material fact and that summary judgment should be granted in the movant's favor as a matter of law. See Celotex, 477 U.S. at 323, 106 S.Ct. 2548. In determining whether summary judgment is warranted, a court reviews the record in the light most favorable to the non-moving party and draws all reasonable inferences in a light most favorable to the non-movant. See Schneiker v. Fortis Ins. Co., 200 F.3d 1055, 1057 (7th Cir.2000); Filipovic v. K & R Express Sys., Inc., 176 F.3d 390, 395 (7th Cir.1999).

Factual disputes are genuine only when there is "sufficient evidence favoring the nonmoving party for a [fact finder] to return a verdict for that party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). See also Eiland v. Trinity Hosp., 150 F.3d 747, 750 (7th Cir.1998)("An issue is genuine if it must be resolved at trial because the evidence, seen in the light most favorable to [the non-movant], would permit a reasonable factfinder to decide the issue in favor of [the non-movant]."). Factual disputes that are colorable, not significantly probative, or speculative are not genuine. See Anderson, 477 U.S. at 249-50, 106 S.Ct. 2505. Applicable substantive law will determine what facts are material to the claims at issue and a fact is deemed material if it raises "disputes that could affect the outcome of the suit under governing law...." See id. at 242, 106 S.Ct. 2505. See also Hoffman-Dombrowski v. Arlington Int'l Racecourse, Inc., 254 F.3d 644, 650 (7th Cir.2001); Employers Ins. of Wausau v. James McHugh Cond. Co., 144 F.3d 1097, 1100 (7th Cir.1998). "Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment. Factual disputes that are irrelevant or unnecessary will not be counted." Fritcher v. Health Care Serv. Corp., 301 F.3d 811, 815 (7th Cir.2002) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986)). "Where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no `genuine issue for trial.'" Matsushita Elec. Industrial Co. v. Zenith. Radio Corp., 475 U.S. 574, 586-587, 106 S.Ct. 1348, 89 L.Ed.2d 538(1986).

To survive a motion for summary judgment, a non-movant must make a sufficient showing of evidence, for each essential element of its case on which it bears the burden at trial. See Celotex Corp., 477 U.S. at 322-23, 106 S.Ct. 2548; Salas v. Wisconsin Dep't of Corrections, 493 F.3d 913, 921 (7th Cir.2007); Fed. R. Civ. Pro. 56(e). The non-movant "may not rest upon the mere allegations or denials of [its] pleading, but [its] response, by affidavits or as otherwise provided in [Rule 56], must set forth specific facts showing that there is a genuine issue for trial." Celotex Corp., 477 U.S. at 322 n. 3, 106 S.Ct. 2548 (citing Fed. R. Civ. Pro. 56(e)); First Commodity Traders Inc. v. Heinold Commodities, Inc., 766 F.2d 1007, 1011 (7th Cir. 1985). The non-movant must show that a genuine factual issue exists and is "material". See Logan v. Commercial Union Ins. Co., 96 F.3d 971, 978 (7th Cir.1996). "[T]he mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact." Scott v. Harris, ___ U.S. ___, ___, 127 S.Ct. 1769, 1776, 167 L.Ed.2d 686 (2007)(quoting Anderson, 477 U.S. at 247-48, 106 S.Ct. 2505).

When cross motions for summary judgment are presented, a "[court] look[...