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My wife and I are in a Chapter 11 bankruptcy in the District

of Alaska and I am...
My wife and I are in a Chapter 11 bankruptcy in the District of Alaska and I am representing us pro se. Our largest asset is a subdivision project. The bank that financed asked that the automatic stay be removed. The District Court granted their Motion. We filed a Motion for Reconsideration that was denied. We then filed a Notice of Appeal (to the Bankruptcy Appeals Panel) and ask for a Stay of the Order by the Court granting Relief from the Automatic Stay Pending Appeal. The District Court has
denied our request for a Stay Pending Appeal. I need help with respect to the proper procedure to challenge the latter denial.

Do we file a Motion for Consideration on this as well or do we file an appeal to the BAP right away? If we do file an appeal do we go through the same process as our first Notice of Appeal or do we attach it to the first appeal? If so, what is the procedure for filing and how much time do we have? Do we buy time by filing the Motion for Reconsideration first or is it more practical to not bother the District judge with a second Motion for Reconsideration?

We received a courtesy copy by email from the judge today. We are worried that the bank will sell off the undeveloped portion of the project quickly to a bona fide purchaser and we might not be able to retrieve the property even if we win on appeal. As someone once said, time is of the essence.
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Answered in 44 minutes by:
9/6/2013
Elizabeth Prentice
Category: Bankruptcy Law
Satisfied Customers: 174
Experience: Managing Attorney for one of the largest consumer bankruptcy firms in America.
Verified

I am a bankruptcy attorney and I would be happy to assist you. Most jurisdictions have held that a district court and a bankruptcy court lack authority to grant a stay pending appeal. Bankruptcy Rule 8017(b) provides: “If before the expiration of a stay...there is an appeal to the court of appeals by the party who obtained the stay, the stay shall continue until final disposition by the court of appeals.” Some courts have held, on the basis of this language, as well as practical considerations and the interests of clarity and efficiency, that the filing of a notice of appeal to an appellate court divests the district court of jurisdiction to grant a stay pending appeal under Rule 8017(b). Thus, a district court or appellate panel arguably has authority to grant a stay only in the period before the filing of the appeal to the court of appeals. Since you already filed the notice of appeal, you are unable to request that the district court or bankruptcy court reconsider or do anything else regarding the stay. Therefore, based on the foregoing law, the District Court and Bankruptcy Court are precluded from ruling any further on the matter. The issue is now in the governance of the BAP. Since time is of the essence, you should complete your appeal to the BAP immediately. Under Section 8017(b), if you complete the filing of your appeal before the stay expires per the original court's order granting the creditor's motion for relief from stay, then the stay would extend until the appeal was heard by the BAP, as long as you posted a bond. However, if the stay has already been lifted, there is nothing you can do to prevent the creditor from moving forward with disposing of the property. But if you win on appeal, since the matter is involving real property, the creditor could potentially be ordered to return the property to you and would be responsible for any damages you incurred as a result of the creditor taking the property.

 

I hope my answer assisted you and that you will leave me a positive rating!

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Customer reply replied 4 years ago

I am a little confused. Neither the district judge or opposing counsel said anything about not having jurisdiction. They both made detailed arguments about the "four prongs" but said nothing about a lack of jurisdiction. The judge was only appointed last November but he was a bankruptcy attorney before that. We are in Alaska but I don't think that makes any difference.


 


Are you saying that if I complete the filing of my appeal within 14 days of the entry of the original Order to Provide Relief From Stay (and posted a bond) that the automatic stay would extend until the appeal is heard by the BAP? When you say complete the filing do you include filing the brief? Also, who decides the amount and terms of the bond?

The law gets a little bit confusing, so let me break it down a little simpler for you.

1) If you filed a notice of appeal, then you can not ask either the district court or bankruptcy court to extend the stay until the appeal is heard.

2) If you file the Appeal to the BAP before the original order which granted the creditor's motion to provide relief from stay goes fully into effect, then the stay will extend until the BAP rules on your appeal. Ex) if the order says, "the stay is lifted 14 days from entry of order" and you filed the actual appeal (not the "notice") on day 13, then the stay extends. However, I am not sure what the order says, so you need to review it. (I have seen some that say the stay is gone immediately once the judge signs it. If this is the case, then the stay is gone and you can't get it back until the BAP rules.)

3) The BAP Court can ask you to post a bond if the stay does extend per my answer in #2 above, if they feel it is necessary. You can also file a Motion to Extend the Stay in the BAP Court after you file the appeal. Since the matter is regarding commercial real property, they probably will. The amount will be determined by the Court and they will tell you how much it will be.

4) The filing of the appeal is the actual Appeal Brief and any other documents attached. The rules for filing your appeal are on the 9th circuit court, but the system is down tonight for maintenance. Check on there tomorrow if you need information on how to file your appeal.

5) Filing a BAP appeal is not easy. I would recommend you retain an attorney to assist you. The procedural rules in appeals can get very tricky. If you choose to continue on your own, make sure to read all the rules before you file. Failure to follow the rules will cause your appeal to denied.

I hope my answer has assisted you and that you will leave me a positive rating!
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Customer reply replied 4 years ago

What about Rule 8005. Stay Pending Appeal? My understanding is that I had to file with the District Court first (and wait for an answer) because that is where the case is being heard. Does that change anything about the time limit?


 


"A motion for a stay of the judgment, order, or decree of a bankruptcy judge, for approval of a supersedeas bond, or for other relief pending appeal must ordinarily be presented to the bankruptcy judge in the first instance. Notwithstanding Rule 7062 but subject to the power of the district court and the bankruptcy appellate panel reserved hereinafter, the bankruptcy judge may suspend or order the continuation of other proceedings in the case under the Code or make any other appropriate order during the pendency of an appeal on such terms as will protect the rights of all parties in interest. A motion for such relief, or for modification or termination of relief granted by a bankruptcy judge, may be made to the district court or the bankruptcy appellate panel, but the motion shall show why the relief, modification, or termination was not obtained from the bankruptcy judge. The district court or the bankruptcy appellate panel may condition the relief it grants under this rule on the filing of a bond or other appropriate security with the bankruptcy court."

Let me break it down to the cliff notes version for you:
You can't use 8005 at the lower court level, because 8017 says you can't cause you filed a Notice of Appeal. Once you file your appeal, if the stay is gone, then you can file a motion to extend the stay in the BAP appeals court using 8005. In other words, you can appeal it or not, but you have no other options in the lower courts.

Your choice to go to the District Court will not affect time limits, since you could have appealed directly to the BAP court.

Please remember to rate my answer a 3 or better, so that I may receive credit for my time assisting you! Good luck with your appeal!
Elizabeth Prentice
Category: Bankruptcy Law
Satisfied Customers: 174
Experience: Managing Attorney for one of the largest consumer bankruptcy firms in America.
Verified
Elizabeth Prentice and 87 other Bankruptcy Law Specialists are ready to help you
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Customer reply replied 4 years ago

Thanks for your help. I will give you a 4.

I appreciate it! Thanks!
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Elizabeth Prentice
Elizabeth Prentice
Elizabeth Prentice, Attorney
Category: Bankruptcy Law
Satisfied Customers: 174
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Experience: Managing Attorney for one of the largest consumer bankruptcy firms in America.

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