Lovitt, In re
| Decision Date | 10 May 1985 |
| Docket Number | Nos. 84-4057,84-4103 and 84-4267,s. 84-4057 |
| Citation | 757 F.2d 1035 |
| Parties | 12 Collier Bankr.Cas.2d 845, Bankr. L. Rep. P 70,371 In re Edward Hill LOVITT, wwi Ermie Lovitt, Debtor. Gordon H. CHEADLE and Patricia J. Cheadle, husband and wife, Appellants, v. APPLEATCHEE RIDERS ASSOCIATION; Cyprus Mines Corporation, and Asamera Minerals (U.S.), Inc., Appellees. APPLEATCHEE RIDERS ASSOCIATION; Cyprus Mines Corporation; and Asamera Minerals (U.S.), Inc., Cross-Appellants, v. Gordon H. CHEADLE and Patricia J. Cheadle, husband and wife, Cross-Appellees. Sheena R. AEBIG, Successor-Trustee of Lovitt Bankruptcy Estate, Appellant, v. Gordon H. CHEADLE and Patricia J. Cheadle, husband and wife; Appleatchee Riders Association; Cyprus Mines Corporation; and Asamera Minerals (U.S.), Inc., Appellees. |
| Court | U.S. Court of Appeals — Ninth Circuit |
Patrick W. Crowley, Siderius, Lonergran & Crowley, Seattle, Wash., for appellants.
Michael A. Small, Preston, Thorgrimson, Ellis & Holman, Seattle, Wash., for appellees.
Appeal from the United States District Court for the Western District of Washington.
Before FARRIS, ALARCON, and FERGUSON, Circuit Judges.
Appellants Gordon H. Cheadle (hereinafter Cheadle) and Patricia J. Cheadle appeal from the district court's order vacating the trustee sale to Cheadle of two mining leases previously owned by the debtor-in-bankruptcy, Edward Hill Lovitt. Appellant Sheena R. Aebig joins the Cheadles' appeal and further appeals from the portion of the district court's order which requires her, as successor trustee of Lovitt's estate, to return the consideration paid by Cheadle for the leaseholds. Appellees Appleatchee Riders Association (hereinafter Appleatchee), Cyprus Mines Corporation (hereinafter Cyprus), and Asamera Minerals (U.S.), Inc. (hereinafter Asamera), who have ownership interests in the property covered by the leases, 1 cross-appeal from the district court's ruling striking the affidavit of Michael A. Small containing excerpts of the deposition testimony of Cheadle and Aebig. Appellees also move to strike Aebig's appeal on the ground that it was not timely filed.
Edward Hill Lovitt filed for bankruptcy under Chapter 7 on behalf of himself and his wife on September 21, 1973, in the Bankruptcy Court for the Western District of Washington. This appeal concerns the fate of two mineral leases which named Lovitt as lessee. The first was executed on March 5, 1964 by Lovitt and lessors Stanley and Zena Chappelle and Maggie Riggs (hereinafter the Chappelle/Riggs lease). The second was executed on March 19, 1964 by Lovitt and lessors Mark and Mabel Leavers (hereinafter the Leavers lease). Both leases were unexpired on the date that Lovitt filed for bankruptcy, but Lovitt failed to list either lease on his schedule of assets.
On October 11, 1973, the bankruptcy court appointed Fred Galer as Lovitt's trustee-in-bankruptcy. Although both leases had been duly recorded under Lovitt's name in Wenatchee, Washington (where the property was located and where Galer's investigation of Lovitt's affairs occurred), Galer took no action to assume the leases, nor did he tender payment of the accrued and unpaid back rentals owing on the leases. Lovitt's estate was closed on January 30, 1978.
Cheadle, who had been involved in the Lovitt bankruptcy from its inception as a creditor and as a purchaser of assets, filed an ex parte petition to reopen the bankruptcy on November 21, 1980, on the ground that unscheduled assets belonging to Lovitt had been discovered after the close of his estate. The petition did not list the two subject leases. Service of the petition to reopen was not made upon Appleatchee or Cyprus, who had by then succeeded to interests in the property covered by the leases.
The bankruptcy was reopened and Sheena Aebig was appointed successor trustee on November 25, 1980. On February 2, 1981, Cheadle provided Aebig with copies of both leases. Aebig took no action to assume the leases or to pay the accrued rentals. Instead, on July 30, 1981, Aebig obtained an ex parte order from the bankruptcy court authorizing her to sell without warranty her rights to the leases.
A notice of sale was filed on August 6, 1981, but was not served on Appleatchee or Cyprus. The sale was held on September 24, 1981. There were two bidders: Cheadle and Asamera. Aebig accepted Cheadle's bid and obtained ex parte orders confirming the sale of the leases to Cheadle on September 29, 1981, and October 22, 1981.
In September 1982, Cheadle commenced quiet title actions pertaining to the leaseholds in state court against Appleatchee, Cyprus and Asamera. On January 26, 1984, appellees moved to vacate the bankruptcy court's order confirming the sale of the leases to Cheadle. The bankruptcy court denied the motion to set aside the sale by order dated February 27, 1984.
Appellees appealed to the district court, and on July 11, 1984, the district court reversed the decision of the bankruptcy court and vacated the order confirming sale. The district court also ordered trustee Aebig to return the consideration paid by Cheadle for the leases. Cheadle's motion for reconsideration was denied by the court's order on September 7, 1984.
Cheadle filed a notice of appeal from the district court's original order on August 6, 1984, and an amended notice of appeal from both the original order and the order on the motion for reconsideration on September 21, 1984. Appellees filed a timely cross-appeal from the district court's order striking the affidavit of Michael A. Small. Trustee Aebig filed a notice of appeal from the court's ruling on the motion for reconsideration on October 3, 1984. Appellees filed a motion to dismiss Aebig's appeal as untimely on October 31, 1984. All appeals were consolidated by order of this court on November 29, 1984.
Appellees contend that Aebig's appeal is untimely because it was not filed within thirty days from entry of the district court's July 11, 1984 order. Aebig argues that Cheadle's motion for reconsideration extended the time to file her notice of appeal until thirty days from entry of the district court's September 7, 1984 order.
Federal Rule of Appellate Procedure 4(a)(4) provides that the thirty day period for the filing of a notice of appeal does not begin to run until after the disposition of certain enumerated post-judgment motions. Cheadle's motion for reconsideration does not fit within any of the categories singled out in the Rule for special treatment. As appellees point out, Cheadle's motion is most properly characterized as a motion for rehearing under Bankruptcy Rule 8015. The Advisory Committee's note to Rule 8015 observes that the filing of a motion for rehearing does not toll the time for taking an appeal from a district court's judgment. See also Wayne United Gas Co. v. Owens-Illinois Glass Co., 300 U.S. 131, 137, 57 S.Ct. 382, 385, 81 L.Ed. 557 (1937) ().
The time limits for filing a notice of appeal are "mandatory and jurisdictional." United States v. Robinson, 361 U.S. 220, 224, 80 S.Ct. 282, 285, 4 L.Ed.2d 259 (1960). Because Cheadle's motion for reconsideration did not extend the time for appeal from the district court's July 11 order, Aebig's failure to file her appeal within thirty days of July 12, 1984, the date of entry of the district court's order, deprives this court of jurisdiction to hear her appeal.
Cheadle challenges appellees' standing to invoke the bankruptcy court's jurisdiction, arguing that (1) appellees are strangers to the sale of the leaseholds, and (2) Asamera cannot attack the validity of the judicial sale because it was an unsuccessful bidder for the leases. We reject both challenges.
In Allen v. Wright, --- U.S. ----, 104 S.Ct. 3315, 82 L.Ed.2d 556 (1984), the Supreme Court reaffirmed the essential constitutional component of standing: the plaintiff must allege personal injury "fairly traceable to the defendant's allegedly unlawful conduct" which is "likely to be redressed by the requested relief." Id. at 3325 (citing Valley Forge Christian College v. Americans United for Separation of Church and State, Inc., 454 U.S. 464, 472, 102 S.Ct. 752, 758, 70 L.Ed.2d 700 (1982)). The injury alleged must be actual or threatened injury suffered personally by the plaintiff. Valley Forge, supra, at 472, 102 S.Ct. at 758.
In the present case, appellees plainly are aggrieved parties with standing to challenge the bankruptcy court's order. Their alleged injury is the cloud cast upon their title to the property covered by the leases. Such injury is a direct result of the bankruptcy court's order confirming title in Cheadle, and could be remedied by an order vacating the sale. 2
Furthermore, where a non-party claims an interest in property which is affected by a judgment between others, the non-party may seek a determination that the judgment does not cloud his title. This principle is clearly set forth in the Restatement (Second) of Judgments Sec. 76 (1980), and the Reporter's comment thereto:
[A] person who is not bound by a judgment under the rules of res judicata may obtain a determination that the judgment is ineffective as to him ... when:
(1) the existence of the judgment jeopardizes a protectible interest of his; and
(2) the character of his interest warrants his being given relief forthwith.
....
The plainest case is a judgment between others that determines interests in property in which the non-party claims an interest. The judgment suggests that the party in whose favor it runs has some sort of valid interest in the property. This may cloud the...
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