Parker v. South Carolina (In re Parker)
| Decision Date | 30 October 2019 |
| Docket Number | Adv. Pro. No. 19-80062-HB,C/A No. 19-04309-HB |
| Court | U.S. Bankruptcy Court — District of South Carolina |
| Parties | In re, Shwanda Julie Parker and Fred Parker III, Debtor(s). Fred Parker III, Shwanda Julie Parker, Plaintiff(s), v. State of South Carolina, South Carolina Department of Social Services, Palmetto Automated Child Support System State Disbursement Unit, Lynn W. Lancaster, in her capacity as Clerk of Court for Laurens County, Honorable Joseph C. Smithdeal, Betty Wyatt, Catina Smith, Lindy Meece, Defendant(s). |
THIS MATTER is before the Court for consideration of the Motions to Dismiss pursuant to Fed. R. Civ. P. 12(b)(1) and (6)1 filed by: (1) Lynn W. Lancaster, in her capacity as Clerk of Court for Laurens County, Betty Wyatt, and Lindy Meece;2 (2) the State of South Carolina and the Honorable Joseph C. Smithdeal;3 and (3) South Carolina Department of Social Services and Palmetto Automated Child Support System State Disbursement Unit.4 Plaintiffs Fred Parker III and Shwanda Julie Parker filed Responses.5 This case involves aprepetition debt owed by Fred Parker to Defendant Catina Smith for child support arrearages. The Court previously ruled on a portion of the relief requested in the Complaint.6 The remaining causes of action as titled in the Complaint are: (1) willful violation of 11 U.S.C. § 362; (2) lack of jurisdiction; (3) unauthorized practice of law;7 (4) failure to supervise; (5) negligence; (6) violation of 15 U.S.C. § 1692 (Fair Debt Collection Practices Act); and (7) violation of the South Carolina Consumer Protection Code. Plaintiffs seek actual and punitive damages as well as attorney's fees.
Plaintiffs name eight Defendants8 in this action and allege they are agents of each other. The allegations against the Defendants are frequently grouped together. Relevant allegations gleaned from the Complaint are summarized below.9
Defendant Smith is the recipient of the prepetition child support arrearage from Fred Parker. The Complaint alleges "Defendants" caused a Rule to Show Cause hearing to be scheduled before Defendant the Honorable Joseph C. Smithdeal ("Judge") for August 28, 2019, in state court in Laurens County, South Carolina on the child support arrearage due to Smith. On August 14, 2019, after the hearing was scheduled, Plaintiffs filed for Chapter 13 bankruptcy relief. The case was initially filed pro se, for the primary purpose of saving Plaintiffs' home. Defendant Department of Social Services ("DSS") was listed as "a creditor"by Plaintiffs and given notice of the bankruptcy. On August 27, 2019, Plaintiffs hired Jane H. Downey as bankruptcy counsel.
The Complaint alleges the bankruptcy divested "the Defendants" of jurisdiction over the collection of child support. Plaintiffs also named Lancaster (the Clerk of Court for Laurens County), Wyatt (the Deputy Clerk), and Meece (a member of the Clerk's staff) (collectively, "Court Employees"), the State of South Carolina ("State"), and Palmetto Automated Child Support System State Disbursement Unit ("Palmetto")10 as additional Defendants.
Plaintiffs and Downey communicated unsuccessfully with various Defendants, including the Court Employees and the Judge, to assert the automatic stay of § 362 and stop the Rule to Show Cause hearing. When Downey first contacted the state court and asked that the Rule to Show Cause be removed from the hearing calendar, Meece informed her that Mr. Parker was required to attend the hearing to show proof of his bankruptcy. Downey asked to fax to the state court proof of the bankruptcy, but Meece insisted the bankruptcy would not stop the Rule to Show Cause hearing, called Downey "sugar," and advised her to "stop throwing around [her] law license" before abruptly hanging up the phone. As a result of this unproductive communication, Downey advised Lancaster in writing of the bankruptcy and transmitted case law demonstrating that any order entered as a result of the Rule to Show Cause hearing would be void. Despite these efforts, Plaintiffs allege "Defendants" held or caused the state court collection hearing to be held and participated as a whole in the Rule to Show Cause hearing.
Thereafter, Meece informed Mrs. Parker that the Rule to Show Cause hearing was held on August 28, 2019 and a bench warrant for Mr. Parker's arrest was to be issued. Mrs. Parker and Downey also spoke on a joint telephone call with Meece that day and asked for a copy of the state court order. Meece informed them that the order had not been signed and Mr. Parker should have hired a family law attorney rather than a bankruptcy attorney because the order would be signed later that day.
Additionally, Wyatt informed Mr. Parker that he could ask the Judge to allow him to pay a portion of the child support arrears to avoid the arrest warrant from being issued. Mr. Parker also contacted DSS to determine if a bench warrant had been entered against him. He was instructed to turn himself into the sheriff's office or detention center and "agents for DSS" asked him for his address and whereabouts.
The next day, Downey again asked Meece for a copy of the state court order, but was informed that because Downey was not a party to the suit, Meece could not provide her with a copy of the order and Mr. Parker could come to the court in person to obtain a copy. Concurrently, Wyatt contacted Mr. Parker informing him that no warrant had been issued and asked that he come to the court to sign a document indicating he would appear at the next hearing. Wyatt also asked Mr. Parker to have Downey cease contacting the Clerk's office.
Downey then spoke directly with Lancaster, who researched this matter and concluded that the Judge held the Rule to Show Cause hearing and, from the bench, verbally held Mr. Parker in contempt and ordered an arrest warrant be issued. However, the Judge later changed his mind and ordered the Rule to Show Cause hearing be continued to September 25, 2019. Lancaster informed Downey her office was instructed that child support is an obligation asopposed to a debt and, therefore, is not stayed by a bankruptcy filing. As a result, the Court Employees believed the Rule to Show Cause hearing could proceed.
Plaintiffs feared for Mr. Parker's safety and suffered damages as a result the foregoing events. Plaintiffs incurred additional costs and attorney's fees. Mr. Parker did not stay at his home for fear of being arrested and incurred costs to stay elsewhere outside Laurens County.
On August 29, 2019, Downey filed this Summons and Complaint and a request for an emergency hearing to stop the Rule to Show Cause hearing in state court that was continued to September 25, 2019. An emergency hearing was held in this Court on September 20, 2019, resulting in an order pursuant to 11 U.S.C. §§ 105 and 362 prohibiting Smith and anyone acting on her behalf or in her interest from proceeding with efforts to collect the prepetition debt at issue here. The other causes of action identified above remain for consideration and are addressed by the Motions to Dismiss.
"A Rule 12(b)(1) motion for lack of subject matter jurisdiction raises the fundamental question of whether a court has jurisdiction to adjudicate the matter before it." S.C. Elec. & Gas Co. v. Randall, 331 F. Supp. 3d 485, 491 (D.S.C. 2018) (citing Fed. R. Civ. P. 12(b)(1)). "Federal courts are courts of limited subject matter jurisdiction, and as such there is no presumption that the court has jurisdiction." Id. (quoting Pinkley, Inc. v. City of Frederick, Md., 191 F.3d 394, 399 (4th Cir. 1999)). "A Rule 12(b)(1) motion to dismiss should be granted 'only if the material jurisdictional facts are not in dispute and the moving party is entitled to prevail as a matter of law.'" Balfour Beatty Infrastructure, Inc. v. Mayor & City Council of Baltimore, 855 F.3d 247, 251 (4th Cir. 2017) (quoting Evans v. B.F. Perkins Co., a Div. of Standex Int'l Corp., 166 F.3d 642, 647 (4th Cir. 1999)).
A motion filed under Rule 12(b)(6) challenges the legal sufficiency of the complaint and provides that a party may move to dismiss for failure to state a claim upon which relief can be granted. The legal sufficiency of the complaint is measured by whether it meets the standards for a pleading set forth in Rule 8, which provides the general rules of pleading, and Rule 12(b)(6), which requires a complaint to state a claim upon which relief can be granted. Francis v. Giacomelli, 588 F.3d 186, 192 (4th Cir. 2009). Rule 8 provides that a complaint must contain "a short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2). While Rule 8 may have previously been accepted as setting forth a "notice pleading" standard, the Supreme Court has since amplified this standard.
In order to survive a motion to dismiss, "a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting in Bell Atl. Corp. v. Twombly, 550 U.S. 554, 570 (2007)). A complaint meets the plausibility standard when it "articulate[s] facts, when accepted as true, that 'show' that the plaintiff has stated a claim entitling him to relief, i.e., the 'plausibility of entitlement to relief.'" Giacomelli, 588 F.3d at 193 (quoting Iqbal, 556 U.S. at 678). The pleader must provide more than mere "labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Twombly, 550 U.S. at 555 (citations omitted). In reviewing claims for failure to state a claim, a court must construe the allegations in the light most favorable to the plaintiff.
After careful review of the allegations of the Complaint, the Court finds the following causes of action must be dismissed pursuant to Fed. R. Civ. P. 12(b)(6): (1) lack of jurisdiction; (2) failure to...
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