Toppin v. Williams (In re Toppin)
| Decision Date | 03 November 2022 |
| Docket Number | CIVIL ACTION NO. 21-cv-5144-WB |
| Citation | 645 B.R. 773 |
| Parties | IN RE: TOPPIN, Debtor. Lyndel Toppin, Appellant, v. Jewell Williams, Sheriff of the City of Philadelphia, Appellee. |
| Court | U.S. District Court — Eastern District of Pennsylvania |
Stephen Matthew Dunne, Dunne Law Offices PC, Philadelphia, PA, for Appellant.
Joshua Domer, City of Philadelphia, Philadelphia, PA, Megan N. Harper, Deputy City Solicitor, Philadelphia, PA, Meghan A. Byrnes, City of Philadelphia Law Department, Philadelphia, PA, for Appellee.
This matter, here on cross appeal from the Bankruptcy Court, arises from Lyndel Toppin's Chapter 13 bankruptcy and the violation of the subsequent automatic stay by Jewell Williams in his capacity as Sheriff of the City of Philadelphia (the "Sheriff"). Plaintiff alleges that the Sheriff's post-petition Notices to Vacate and Evict him from his home caused him to suffer actual and emotional damages. For the reasons that follow, the Bankruptcy Court's decision will be affirmed.
Toppin is deaf and unable to speak. At the time in question, he lived together with his nephew and caretaker, Barrington Whyte, at 146 S. 62nd Street in Philadelphia (the "Property"). To recover delinquent taxes, the Property was sold at a sheriff's sale to Abdeldayem Hassan who filed an ejectment action in the Philadelphia Court of Common Pleas on January 22, 2018 against "unknown occupants" of the Property and subsequently obtained a judgment of default for possession of the Property. The following day, Toppin filed a Chapter 13 Bankruptcy Petition (the "Petition"), 11 U.S.C. § 1321, and served notice of the Petition on the Sheriff's Real Estate Unit. Despite the notice, the Sheriff served a total of six notices to vacate and of eviction on Toppin (collectively, the "Notices") in quick succession. Over the course of a month, a sergeant from the Sheriff's office served a Notice to Vacate by knocking and taping it to the Property's front door as well as leaving another copy in the mail slot or inside the front door; the Sheriff mailed another copy of the Notice to Vacate to the Property giving occupants twenty-one days to leave before he issued an Eviction Notice; a sergeant from the Sheriff's office served an Eviction Notice ordering occupants to vacate by a date certain by taping it to the front door and leaving another copy in the mail slot or inside the front door; and, separately by mail, the Sheriff sent another copy of the Eviction Notice to the Property. On June 7, Toppin's counsel faxed the Sheriff's Civil Enforcement Unit a copy of Toppin's Chapter 13 Petition and thereafter the Sheriff stopped all enforcement efforts.
Toppin then brought suit in the Bankruptcy Court alleging that the Sheriff violated the automatic stay provision of the Bankruptcy Code, 11 U.S.C. §§ 101, et seq. and, in so doing, caused Toppin to suffer material and emotional distress. On a motion for summary judgment, the Sheriff argued that: (1) the case is barred on quasi-judicial immunity grounds as he was acting pursuant to a valid court order; (2) his actions are excusable under the ministerial acts exception to automatic stays; (3) Toppin's claims to emotional distress are barred pursuant to sovereign immunity; and (4) Toppin is owed no damages.1 The Bankruptcy Court held decision on the motion for summary judgment until after trial was concluded. After trial, the Sheriff again raised immunity issues in a motion for directed verdict as well as making arguments that Toppin had not proved a willful violation of the stay or that he had suffered damages from any stay violation that may have occurred.
On November 8, 2021 the Bankruptcy Court issued an opinion purporting to decide both the summary judgment and the directed verdict motions. In re Toppin , 637 B.R. 88 (Bankr. E.D. Pa. 2021).
Pursuant to 28 U.S.C. Section 158(a)(1), district courts serve an appellate role reviewing "the [B]ankruptcy [C]ourt's legal determinations de novo , its factual findings for clear error[,] and its exercise of discretion for abuse[.]" In re Trans World Airlines, Inc. , 145 F.3d 124, 131 (3d Cir. 1998) ; In re DeSeno , 17 F.3d 642, 643 (3d Cir. 1994) (). Where there are issues of mixed law and fact, District Courts "accept the trial court's finding of historical or narrative facts unless clearly erroneous, but exercise plenary review of the trial court's choice and interpretation of legal precepts and its application of those precepts to the historical facts." Mellon Bank, N.A. v. Metro Commc'ns, Inc. , 945 F.2d 635, 642 (3d Cir. 1991) (internal citations omitted).
As a preliminary matter, it should be noted that the Bankruptcy Court erred in waiting to decide the summary judgment motion after trial: Orders on summary judgment cannot be issued when the motion "has been overtaken by subsequent events, namely, a full-dress trial and [a] ... verdict." E. Mountain Platform Tennis, Inc. v. Sherwin-Williams Co. , 40 F.3d 492, 500 (1st Cir. 1994) ; see also Frank C. Pollara Grp., LLC v. Ocean View Inv. Holding, LLC , 784 F.3d 177, 185 (3d Cir. 2015) () (citing Ortiz v. Jordan , 562 U.S. 180, 183-84, 188, 131 S.Ct. 884, 178 L.Ed.2d 703 (2011) ). While there was no jury verdict here, the principle limiting summary judgment to pre-trial applies equally to non-jury trials.
As the Bankruptcy Court erred by determining sovereign immunity, quasi-judicial immunity, and the ministerial acts exception on summary judgment post-trial, these issues were not properly decided. However, when a lower court improperly reaches or "fail[s] to reach a question below that becomes critical[,]" it is "generally appropriate[,] when the factual record is developed and the issues provide purely legal questions," as is the case here, for "an appellate court [to] exercise[ ] plenary review" and "resolve the issue on appeal rather than remand to the [lower court]." Hudson United Bank v. LiTenda Mortg. Corp. , 142 F.3d 151, 159 (3d Cir. 1998) ; Comite’ De Apoyo A Los Trabajadores Agricolas v. Perez , 774 F.3d 173, 186 (3d Cir. 2014) (). Here, the questions of whether given the facts of this case: (1) sovereign immunity protects the Sheriff from suit; (2) quasi-judicial immunity protects the Sheriff from suit; and (3) the ministerial acts exception applies (which, although raised in the summary judgment motion, was not decided until after trial) are purely legal issues appropriate to resolve on appeal. The question of whether the evidence supports an award of actual or emotional damages to Toppin, which was raised in the motion for a directed verdict and decided by the Bankruptcy Court, is also properly before the Court.
The filing of a bankruptcy petition operates as an automatic stay of debt collection activities and related enforcement actions outside of bankruptcy proceedings, unless otherwise waived. 11 U.S.C. § 362(a). The "primary purpose[ ]" of an automatic stay is to "effectively stop all creditor collection efforts, stop all harassment of a debtor seeking relief, and to maintain the status quo between the debtor and [his] creditors" so as to "appropriately resolve competing economic interests in an orderly and effective way." Taylor v. Slick , 178 F.3d 698, 702 (3d Cir. 1999) (internal quotations and citations omitted). An automatic stay is willfully violated when a "defendant knew of the automatic stay and [the defendant's] actions which violated the stay were intentional[,]" indeed, "specific intent to violate the automatic stay" is not required. In re Atl. Bus. & Cmty. Corp. , 901 F.2d 325, 329 (3d Cir. 1990) ; In re Lansdale Fam. Restaurants, Inc. , 977 F.2d 826, 829 (3d Cir. 1992) ; see e.g., In re Wilson , 19 B.R. 45, 47 (Bankr. E.D. Pa. 1982) ().
When a stay is willfully violated, debtors "shall recover actual damages, including costs and attorneys’ fees, and, in appropriate circumstances, may recover punitive damages." 11 U.S.C. § 362(k)(1). "Congress intended the automatic stay to protect both financial and non-financial interests[,]" and as such the Third Circuit has "join[ed] a growing number of circuits by expressly concluding that ‘actual damages’ under § 362(k)(1) include[s] damages for emotional distress resulting from a willful violation of the automatic stay." In re Lansaw , 853 F.3d 657, 667 (3d Cir. 2017). To prove emotional damages, a debtor must "demonstrate, as required by the statute, that [he] suffered ‘actual’ emotional harm caused by the willful stay violation." Id. at 670.
Neither party disputes the Bankruptcy Court's decision that the Sheriff violated the automatic stay: Toppin filed the Petition and an automatic stay was triggered; Toppin gave notice of the Petition, and thus the stay, to the Sheriff when he faxed the Petition to the Sheriff's Real Estate Unit; the Sheriff willfully violated the stay when he served the Notices, despite his knowledge of the automatic stay. In re Toppin , 637 B.R. at 110-11.
Under the Eleventh Amendment, sovereign immunity protects states from suit in federal court, unless the immunity is specifically waived. U.S. Const. amend. XI ; Lombardo v. Pa., Dep't of Pub. Welfare , 540 F.3d 190, 194-95 (3d Cir. 2008). State officials sued in their official capacity, as is the case here, may fall under the aegis of sovereign immunity because a Will v. Michigan Dep't of State Police ,...
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