Pettitt v. Baker, 88-1687
| Decision Date | 30 June 1989 |
| Docket Number | No. 88-1687,88-1687 |
| Citation | 876 F.2d 456 |
| Court | U.S. Court of Appeals — Fifth Circuit |
| Parties | , Bankr. L. Rep. P 73,006 Edwin William PETTITT, Jr. and Erwin Smith McGee, Plaintiffs-Appellants, v. Don BAKER, Geoffrey Price, and Baker & Price, P.C., Defendants-Appellees. |
Mark Cohen, Austin, Tex., for plaintiffs-appellants.
Broadus Autry Spivey, Paul E. Knisely, and Spivey, Grigg, Kelly & Knisely, Austin, Tex., for defendants-appellees.
Appeal from the United States District for the Western District of Texas.
Before REAVLEY and POLITZ, Circuit Judges, and HUNTER, * District Judge.
Edwin William Pettitt and his attorney, Erwin Smith McGee, seek damages from Don Baker, Geoffrey Price, and Baker & Price, P.C. for willful violations of an automatic stay in bankruptcy, 11 U.S.C Sec. 362(a). The district court granted summary judgment in favor of the defendants based on its determination that no private cause of action for such exists under the Bankruptcy Act of 1978. Concluding that 11 U.S.C. Sec. 362(h) creates a private remedy for a willful violation of a section 362(a) stay, we vacate and remand.
The law firm of Baker & Price represented Alushield Metal Corporation in a Texas state court suit against Pettitt in which Alushield Metal was granted a default judgment in the amount of $18,848.61. On January 30, 1985 Geoffrey Price, an attorney with Baker & Price, transmitted a writ of execution on property owned by Pettitt in Travis County. That property was sold at a constable's execution sale on March 5, 1985. On April 8, 1985 Price transmitted a writ of execution affecting property owned by Pettitt in Galveston County, and that property was sold at an execution sale. According to the pleadings, these properties were acquired either on behalf of Baker & Price or by someone associated with the firm.
On April 23, 1985 Pettitt filed a state court action against Alushield and Geoffrey Price seeking to recover his property and an award of damages. On October 29, 1986 Price and other creditors holding claims against Pettitt filed an involuntary bankruptcy petition against him pursuant to 11 U.S.C. Sec. 303.
On November 5, 1986, in the Alushield suit, Baker & Price filed an application for turnover of Pettitt's causes of action against Alushield and Geoffrey Price. Turnover was granted and the state court ordered the execution sale of those causes of action. Don Baker attended the constable's execution sale as attorney for Geoffrey Price and acquired the causes of action.
As attorney for Price, Baker filed several pleadings with respect to the causes of action Price had purchased at the execution sale, including one entitled "Plaintiff's Notice of Dismissal with Prejudice." Shortly thereafter, the state court ordered that all parties take no further action in the state court suit because of the stay in bankruptcy. Pettitt and McGee subsequently filed the instant suit against Baker, Price, and Baker & Price, invoking 11 U.S.C. Sec. 362(h) and alleging that the defendants willfully violated the automatic stay in bankruptcy, 11 U.S.C. Sec. 362(a).
Citing In re Stacy, 21 B.R. 49 (Bankr.W.D.Va.1982), the district court held that the Bankruptcy Code of 1978 does not provide a debtor with a private cause of action to seek monetary damages against a party who has violated an automatic stay. The district court's reliance on Stacy, decided prior to the 1984 amendments to the Bankruptcy Code, was misplaced. By Act of July 10, 1984, Congress amended the automatic stay provision of the Bankruptcy Code, adding subsection (h) to 11 U.S.C. Sec. 362, providing:
An individual injured by any willful violation of a stay provided by this section shall recover actual damages, including costs and attorneys' fees, and, in appropriate circumstances, may recover punitive damages.
Act of July 10, 1984, Pub.L. No. 98-353, 98 Stat. 392. We conclude that subsection (h) creates a private remedy for one injured by a willful violation of an automatic stay. See In re Bragg, 56 B.R. 46 (Bankr.M.D.Ala.1985); see also...
To continue reading
Request your trial
-
Scott v. Wells Fargo Home Mortg. Inc.
...in this Court. While § 362(h) arguably creates private right of action for willful violation of automatic stay, Pettitt v. Baker, 876 F.2d 456 (5th Cir.1989), 11 U.S.C. §§ 362 does not create a private cause of action outside of the Bankruptcy Court for violations of automatic stay. Dashner......
-
In re Sanchez
...U.S.C. § 362(h) does not create a private right of action would require us to ignore its plain and express language." Pettitt v. Baker, 876 F.2d 456, 457 (5th Cir.1989) (citations omitted). See also In re O'Connor, No. 01-2135, 2001 WL 1335883, at * 1 n. * (N.D.Tex. Oct. 25, 2001) (noting t......
-
In re Myles
...of action for violations of section 362. Its motion for judgment on the pleadings wisely abandoned this argument. See Pettitt v. Baker, 876 F.2d 456, 457-58 (5th Cir.1989), holding that Congress indeed created a private right of action for willful violation of the automatic stay when it ena......
-
In re Wills, Bankruptcy No. 89-11374 (MVB)
...stay. 11 U.S.C. § 362(h); See 3 COLLIER ON BANKRUPTCY ¶ 362.113 (Lawrence P. King et al., eds., 15th ed. rev.1997); Pettitt v. Baker, 876 F.2d 456, 457-58 (5th Cir.1989). The Eads court reviewed a claim for punitive damages under § 362(h). The court stated that though punitive damages provi......