Mullin v. Orthwein
| Citation | 772 So.2d 30 |
| Decision Date | 13 September 2000 |
| Docket Number | No. 4D99-2888.,4D99-2888. |
| Court | Court of Appeal of Florida (US) |
| Parties | Jolie MULLIN, Appellant, v. James B. ORTHWEIN, Jr., and Percy J. Orthwein, Appellees. |
Susan B. Yoffee of Fleming, Haile & Shaw, P.A., North Palm Beach, for appellant.
Bard D. Rockenbach of Sellars, Marion & Bachi, P.A., West Palm Beach, for appellees.
We reverse the summary judgment entered in favor of appellees on the authority of R.L. LaRoche, Inc. v. Barnett Bank of South Florida, 661 So.2d 855 (Fla. 4th DCA 1995). Based on this record and the rules pertaining to summary judgment, the bankruptcy court did not consider the issue of a bad faith filing or damages, punitive or otherwise, associated with that issue. See Londono v. Turkey Creek, Inc., 609 So.2d 14, 18 (Fla.1992)
; Faircloth v. Garam, 525 So.2d 474, 476 (Fla. 5th DCA 1988).
GROSS, J., concurs specially with opinion.
I concur with the majority based on existing precedent. However, I believe that R.L. LaRoche, Inc. v. Barnett Bank of South Florida, 661 So.2d 855 (Fla. 4th DCA 1995), was wrongly decided so that this court should recede from that decision en banc.
This appeal arises from a final summary judgment rendered in favor of James and Percy Orthwein on Jolie Mullin's claims of malicious prosecution and intentional infliction of emotional distress. Absent LaRoche, I would agree with the trial court that Mullin's claims were preempted by the Bankruptcy Code.
On March 13, 1998, Mullin filed her complaint in this case seeking damages for malicious prosecution and intentional infliction of emotional distress. Her complaint followed the bankruptcy court's dismissal of the Orthweins' involuntary petition for bankruptcy against her. Mullin's malicious prosecution count stated, in part:
The Orthweins' motion for summary judgment, filed on June 16, 1999, asserted that the circuit court did not have jurisdiction due to preemption by "the U.S. Bankruptcy Court's exclusive jurisdiction over any claims arising out of the alleged improper filing of the involuntary bankruptcy petition." In opposition to the motion, the affidavit of James Telepman, Mullin's bankruptcy counsel, stated:
4. At no time did Plaintiff, in the Bankruptcy Court, request or plead for punitive damages or any other damages associated with the bad faith filing by the Orthweins of the involuntary petition for bankruptcy, other than for attorney's fees and costs.
A court should not grant a motion for summary judgment unless the moving party conclusively shows the absence of any genuine issue of material fact. See McDonald v. Florida Dep't of Transp., 655 So.2d 1164, 1167-68 (Fla. 4th DCA 1995)
. When reviewing a motion for summary judgment, the trial court must draw every possible inference in favor of the party against whom a summary judgment is sought. See Albelo v. Southern Bell, 682 So.2d 1126, 1129 (Fla. 4th DCA 1996). Summary judgment should not be granted "unless the facts are so crystallized that nothing remains but questions of law."
Sanzare v. Varesi, 681 So.2d 785, 786 (Fla. 4th DCA 1996) (citation omitted). This case presents a pure question of law.
The trial court based its final summary judgment on the finding that Mullin's "claims were available in the previous bankruptcy action pursuant to 11 U.S.C. § 303." Section 303(i) of Title 11 of the Bankruptcy Code provides:
The notes to section 303 provide that 11 U.S.C. § 303 (2000) ().
During the bankruptcy proceedings, Mullin sought a dismissal of the involuntary bankruptcy petition filed by the Orthweins, based in part on the Orthweins' failure to establish that she was not generally paying her debts as the debts became due. In the bankruptcy court, Mullin did not request or plead for punitive damages or any other damages associated with the bad faith filing by the Orthweins, other than for attorney's fees and costs. The Orthweins contend that since section 303(i) allows attorney's fees and costs as well as compensatory and punitive damages, Mullin's decision to seek only attorney's fees and costs in the bankruptcy court precludes her ability to seek punitive damages in state court.
In LaRoche, this court held that a Florida state circuit court has subject matter jurisdiction over a debtor's malicious prosecution claim against his or her creditor for a bad faith filing of an involuntary petition for bankruptcy. See 661 So.2d at 861. As LaRoche framed the issue:
The question directly raised here is whether either the district court and the bankruptcy court validly have any jurisdiction, after the dismissal of the bankruptcy case, to hear and determine a debtor's state law abuse of process and malicious prosecution action against a petitioning creditor for damages relating to the bad faith filing of a petition under § 303 of the Bankruptcy Code.
Id. (emphasis omitted).
After very extensive analysis, the LaRoche panel held that "because there is no express grant of exclusive jurisdiction for these claims to the bankruptcy court ... the causes of action asserted here may be brought as ordinary common law actions in a competent state court." Id. at 864 (footnote omitted). Under the decision in LaRoche, subsequent to the dismissal of an involuntary bankruptcy petition by the bankruptcy court, a debtor has the choice of pursuing in state court a malicious prosecution claim based on the creditor's bad faith filing of the petition or seeking relief in the federal forum under section 303 of the Bankruptcy code. See id. Thus, according to LaRoche, while Mullin could have sought punitive damages in the bankruptcy court, she was not required to do so; and once the bankruptcy court dismissed the involuntary petition, Mullin was free to pursue common law remedies in state court.
Significant to the decision in LaRoche was the recognition that "no clear authority [exists] in the federal courts directly on point." Id. at 859. Since we decided LaRoche, the judicial landscape in this area of law has considerably developed.
As recently recognized by the Superior Court of Pennsylvania in Shiner v. Moriarty, 706 A.2d 1228, 1238 (Pa.Super.Ct.1998), the few cases now holding that the Bankruptcy Code permits state law remedies for abuse of its provisions, "stand in stark contrast to the preponderance of federal and state decisions." (Citing MSR Exploration, Ltd. v. Meridian Oil, Inc., 74 F.3d 910 (9th Cir.1996); Gonzales v. Parks, 830 F.2d 1033 (9th Cir. 1987); Raymark Indus., Inc. v. Baron, No. 96-7625, 1997 WL 359333 (E.D.Pa. June 23, 1997); Koffman v. Osteoimplant Tech., Inc., 182 B.R. 115 (D.Md.1995); Mason v. Smith, 140 N.H. 696, 672 A.2d 705 (1996); Sarno v. Thermen, 239 Ill.App.3d 1034, 180 Ill.Dec. 889, 608 N.E.2d 11 (1992); Idell v. Goodman, 224 Cal.App.3d 262, 273 Cal.Rptr. 605 (1990)).
Shiner held that the plaintiffs' state tort claim for wrongful use of process arising from the filing of certain papers in the bankruptcy court was pre-empted by the remedies available under the Bankruptcy Code. See 706 A.2d at 1238. In reversing the lower court, and rejecting its reliance on LaRoche and Paradise Hotel Corp. v. Bank of Nova Scotia, 842 F.2d 47 (3d Cir.1988), Shiner held that "the Bankruptcy Code permits no state law remedies for abuse of its provisions" and the plaintiffs' claim "being based upon the defendants' conduct in the bankruptcy proceedings, is pre-empted by the Bankruptcy Code." Id. (citation omitted).
Having reviewed the law in this area, I believe it appropriate to recede from our opinion in LaRoche and adopt the ninth circuit's reasoning in MSR Exploration, 74 F.3d at 912. In that case, a debtor brought a tort action for malicious prosecution against a creditor in federal district court on the basis that the creditor maliciously pursued claims against the debtor in the underlying Chapter 11 bankruptcy proceeding. See id. The debtor did...
To continue reading
Request your trial
-
Satten v. Webb
...court does have jurisdiction and reverse the dismissal of the claim." This case has been followed in Florida (Mullin v. Orthwein (Fla.Dist.Ct.App. 2000) 772 So.2d 30), but not elsewhere. Its reasoning does not appear to comport with the majority view on malicious prosecution cases that are ......
-
Stone Crushed Partnership v. Kajo
...law tort claim based on creditor's filing of involuntary bankruptcy petition was not preempted by federal law); Mullin v. Orthwein, 772 So.2d 30 (Fla.Dist.Ct.App.2000) (affirming R.L. LaRoche, infra, and holding state law tort claims were not preempted by federal law); R.L. LaRoche, Inc. v.......
-
Graber v. Fuqua
...of the development of the law in this area and encouraged his court to recede from that position. Mullin v. Orthwein, 772 So.2d 30, 31 (Fla.Dist.Ct.App.2000) (Gross, J., concurring) (distinguishing other cases in line with it as not being based on conduct occurring in ...
-
Glannon v. Garrett & Associates, Inc.
...creditor's alleged bad faith filing of involuntary bankruptcy petition were not preempted by federal law). See also Mullin v. Orthwein, 772 So.2d 30 (Fla.Dist.Ct.App. 2000) (holding state law tort claims were not preempted by federal law solely on the rational of R.L. Lauraceae). But see Mu......