Robinson v. Zakarin (In re Zakarin)
| Decision Date | 09 May 2019 |
| Docket Number | Case No.: 18-14226-RG,Adv. No.: 18-1272-RG |
| Citation | 602 B.R. 275 |
| Parties | IN RE: Eric A. ZAKARIN, Debtor. Liddle & Robinson, Plaintiff v. Eric A. Zakarin, Defendant. |
| Court | U.S. Bankruptcy Court — District of New Jersey |
Alex M. Rissmiller, Jeffrey L. Liddle, Matthew McCann, Liddle & Robinson, L.L.P., New York, NY, Henry M. Karwowski, Joshua H. Raymond, McManimon, Scotland & Baumann, LLC, Roseland, NJ, for Plaintiff.
Jeffrey W. Herrmann, Cohn Lifland Pearlman Herrmann, Saddle Brook, NJ, for Defendant.
Before the court is a Motion to Extend Time to File Complaint Objecting to Discharge, pursuant to Federal Bankruptcy Rule of Procedure 4007(c) (the "Motion"). Doc. No. 8. The plaintiff, the law firm of Liddle & Robinson, seeks to proceed with its adversary complaint despite filing it three days after the deadline. Eric A. Zakarin, the debtor, objected.
The court notes that this adversary proceeding is assigned to the docket of the Hon. Rosemary Gambardella. In her current absence however, and after all briefing and oral argument was complete, the proceeding was assigned to the undersigned for disposition. On March 26, 2019, the court sent a letter to counsel advising them of the same and gave them 14 days in which to object to the court's deciding the matter on the papers. As no objections were received, this matter is ripe for disposition. After review of the extensive briefing and the oral argument of March 5, 2019, this court determines that Rule 4007(c) may not be equitably tolled, and the Motion should be denied.
This matter before the court is a core proceeding pursuant to 28 U.S.C. § 157(b)(2)(A) and (O), and the court has jurisdiction pursuant to 28 U.S.C. § 1334, 28 U.S.C. § 157(a) and the Standing Order of Reference issued by the United States District Court for the District of New Jersey on July 23, 1984, as amended on September 18, 2012, referring all bankruptcy cases to the bankruptcy court. The following constitutes this court's findings of fact and conclusions of law as required by Federal Rule of Bankruptcy Procedure 7052.
The facts in this matter are generally undisputed.
On March 2, 2018, the debtor filed a voluntary petition for relief under chapter 7 of title 11 of the United States Code. Bankr. No. 18-14226, Doc. No. 1. On Schedule E/F, he acknowledged his debt to Liddle & Robinson for attorney's fees in the amount of $ 135,000. Id. at 20.
On March 3, 2018, the court set June 5, 2018 as the deadline for filing a complaint objecting to discharge or nondischargeability of a debt. Id. , Doc. No. 3, p. 2. On April 6, 2018, the chapter 7 trustee held the Section 341 Meeting of Creditors, which Liddle & Robinson attended through one of its attorneys. Adv. Proc. 18-1272, Doc. No. 11, p. 3.
In the evening of June 5, 2018, the last day to timely file an adversary complaint in this bankruptcy case, attorney Matthew McCann of Liddle & Robinson, a New York law firm, finished drafting a complaint asserting the nondischargeability of the debt owed by the debtor to the firm. Doc. No. 8-2, ¶ 4. But when he sought to file the complaint electronically via this court's CM/ECF system, he found he could not do so, as he was not registered for e-filing in New Jersey. Id. , ¶ 4. He then registered, and at 10:13 p.m. received confirmation of that registration. Id. But because Mr. McCann is not an admitted attorney in the U.S. District Court for New Jersey, that registration was limited and did not give him the ability to electronically file a complaint. Id. , Doc. 8, ex. 2.1
Trying to still make the deadline for filing, Mr. McCann sent an email to Judge Gambardella's chambers and to the court's CM/ECF Help Desk, attaching the summons and complaint and explaining his predicament as being that the registration "has yet to be processed." Id. , ¶ 4, Exh. 1. He stated in the email that he would follow up in the morning, electronically-filing and paying the filing fee then, once his registration was processed. Id. Notably, Liddle & Robinson did not also send a copy of that letter or the complaint to debtor's counsel. Doc. No. 11, p. 4.
The receipt Mr. McCann received from PACER, however, indicated that he had an active registration for "case search" only. The receipt reflected that status on June 6, 2016 of his registration request for the District of New Jersey was "unknown." Doc. No. 8-2, Exh. 1. It explained that there were three possible statuses: pending, processed, and active. Id. Only "active" would mean that he could electronically-file documents on the docket. What Mr. McCann seemed to not grasp at the time was that he was not granted that filing status because he is not an attorney admitted to practice in New Jersey.
The morning of June 6, 2018, Mr. McCann followed up with the court's CM/ECF Help Desk with the intent of resolving the registration delay and also e-filing and providing payment in connection with the filing of the Adversary Complaint and related documents. Id. , ¶ 6. He stated that the individual at the CM/ECF Help Desk advised him that the registration process would likely take another day and recommended that Liddle & Robinson send a courier to the Clerk's Office to file an original hard copy of the Adversary Complaint that day. Id. , ¶6.
Thus, that same day, Mr. McCann arranged with Keating & Walker Attorney Service, Inc., a legal support service, to file a hard copy of the original Adversary Complaint, the appropriate Summons and Notice, and a cover letter explaining the attempted e-filing of the night of June 5, 2018. Id. , ¶ 7. Mr. McCann alleged then that "due to confusion and/or misunderstanding on his part, the courier sent by Keating & Walker did not believe that he was able to leave the papers for filing with the Clerk of the court on June 6, 2018 and returned to his office without filing the Adversary Complaint." Id. In fact, the problem was that Mr. McCann had not supplied the courier with the filing fee, therefore the Clerk's Office rejected the attempted filing. Id. , Exh. 2 ().
The evening of June 6, 2018, Mr. McCann received from the court's employee, Sharon Purce, an email confirming his registration for access to the court's NextGen CM/ECF system. Id. , Exh. 2. Ms. Purce provided additional steps regarding CM/ECF registration, and Mr. McCann stated that he then completed the steps. Id. , ¶ 8. The email from Ms. Purce stated the following:
Again, Mr. McCann is not admitted to practice in New Jersey, nor is anyone in his firm. Id. , ¶ 3. Though his reply to Ms. Purce acknowledged that he was not admitted in New Jersey and asked for a Limited User Registration Form, the next day he told her that he would "call to follow up regarding what I need to do next to be able to file the Adversary Complaint via PACER." Id. , Exh. 2 (). On June 7, 2018 at 12:36 p.m., Ms. Purce advised Mr. McCann that she had updated his status (as a Limited User) and that his account should be activated within the hour. Id. , Exh. 2 (). In his certification, Mr. McCann wrongly characterized this message as stating that "filing should be possible with [sic] an hour." Id. , ¶ 9. He then stated that "When he was ultimately able to log on, however, there was no option to file an Adversary Complaint." Id. He continued "In a telephone conversation later that day, Ms. Purce explained that Mr. McCann's filing ‘user type’ did not permit electronic filing of an Adversary Complaint and that filing would have to be made in hard copy at the Clerk's Office." Id.
On June 8, 2018, Keating & Walker, on behalf of Liddle & Robinson, filed in person the Adversary Complaint, Summons and Notice, as well as a Motion for an Order Extending the Time Within Which to File the Adversary Complaint. See Doc. Nos. 1, 3. This time Mr. McCann included the filing fee. Doc. No. 8-2, ¶ 10. The debtor filed opposition to Liddle & Robinson's motion. Doc. No. 4.
On June 13, 2018, another attorney of Liddle & Robinson, James Halter, Esq., e-filed on the Claims Register associated with Mr. Zakarin's bankruptcy case as Proof of Claim #1-1 a letter dated June 12, 2018 similar in substance to Mr. McCann's June 7, 2018 Certification filed in connection with his improperly-filed June 8, 2018 Motion to Extend Time and his June 5, 2018 email to chambers.
On July 13, 2018, the court conducted a telephonic hearing during which it directed Liddle & Robinson to retain local counsel and the parties to submit supplemental briefing regarding the request for additional time to file the Adversary Complaint. Liddle & Robinson retained local counsel and filed the instant motion to extend the time to file an adversary complaint. Id. , Doc. No. 8. The debtor filed a brief in opposition and the plaintiff filed a response. Id. ¸ Doc. Nos. 11, 12. On August 29, 2018, the court granted the pro hac vice admission of Jeffrey L. Liddle, and on December 8, 2018, the pro hac vice admission of Alex. M. Rissmuller, both appearing for the plaintiff. Id. , Doc. Nos. 9, 12. On March 5, 2019, the court heard oral...
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