Kleibrink v. Kleibrink, et al


UNPUBLISHED OPINION FILED. [07-11190 Affirmed] Judge: WED , Judge: CES , Judge: JLD. Mandate pull date is 10/12/2010 [07-11190]

Download PDF
Kleibrink v. Kleibrink, et al Doc. 0 Case: 07-11190 Document: 00511240152 Page: 1 Date Filed: 09/21/2010 IN THE UNITED STATES COURT OF APPEALS United States Court of Appeals FOR THE FIFTH CIRCUIT Fifth Circuit FILED September 21, 2010 N o . 07-11190 Lyle W. Cayce Clerk I n The Matter Of: RICKY KLEIBRINK D ebtor ________________________________________________________________________ R I C K Y KLEIBRINK A p p e lla n t v. E L L E N KLEIBRINK; MID STATE TRUST VII A p p e lle e s A p p e a l from the United States District Court for the Northern District of Texas U S D C No. 3:07-CV-88 B e fo r e DAVIS, STEWART, and DENNIS, Circuit Judges. P E R CURIAM:* I n this bankruptcy appeal, debtor Ricky Kleibrink challenges the district c o u r t's affirmance of the bankruptcy court's ruling that creditor Mid State Trust V I I holds an enforceable security interest in a property of his, despite his having Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not be published and is not precedent except under the limited circumstances set forth in 5TH CIR. R. 47.5.4. * Dockets.Justia.com Case: 07-11190 Document: 00511240152 Page: 2 Date Filed: 09/21/2010 received a discharge in an earlier bankruptcy proceeding. The debtor filed the in s t a n t bankruptcy proceeding in order to avoid the creditor's attempt to fo r e c lo s e on the property. The bankruptcy court ruled that the earlier b a n k r u p t c y proceeding did not extinguish the creditor's lien against the p r o p e r t y , because the claim objection filed by the debtor in the earlier proceeding did not afford the creditor due process in two ways. First, the claim objection w a s not accompanied by clear notice that the debtor was challenging the v a lid it y , priority, or extent of the lien, and that the debtor sought to abrogate the c r e d it o r 's right to look to its collateral. Second, the debtor did not comply with t h e procedural safeguards set forth in Part VII of the Federal Rules of B a n k r u p t c y Procedure. Accordingly, the bankruptcy court concluded that the c la im objection filed by the debtor could not substitute for the adversary p r o c e e d in g that is ordinarily required by the bankruptcy rules for extinguishing a lien under the circumstances of the case. The debtor appealed to the district c o u r t, which affirmed for substantially the same reasons. In the time since the lower courts addressed the merits of this case, the S u p r e m e Court issued its decision in United Student Aid Funds, Inc. v. E s p in o s a , 130 S. Ct. 1367 (2010). Espinosa held that a judgment discharging d e b t in a bankruptcy proceeding is void under Rule 60(b)(4) where the creditor d id not receive notice that satisfied the requirements of due process. Id. at 1378. "`An elementary and fundamental requirement of due process in any proceeding w h i c h is to be accorded finality is notice reasonably calculated, under all the c ir c u m s t a n c e s , to apprise interested parties of the pendency of the action and a f f o r d them an opportunity to present their objections.'" Id. at 1378 (quoting M u lla n e v. Cent. Hanover Bank & Trust Co., 339 U.S. 306, 314 (1950)). Although the procedural posture of the instant case is different from that of E s p in o s a , the dispositive issue is the same: whether a creditor in a bankruptcy 2 Case: 07-11190 Document: 00511240152 Page: 3 Date Filed: 09/21/2010 proceeding received notice, satisfying the requirements of due process, that its in t e r e s t could be extinguished in that proceeding. H e r e , the lower courts explained in detail why the debtor's confusing claim o b je c t io n filings in the earlier bankruptcy proceeding did not give the creditor c le a r or sufficient notice that its lien could be extinguished. The district court s u m m a r iz e d its findings as follows: The Court agrees with the bankruptcy court's conclusion that . . . th e [debtor's] Claim Objection in the [earlier bankruptcy proceeding] d id not clearly notify [the creditor] that its secured claim was at r is k [, ] nor did the Claim Objection notify [the creditor] that [the d e b t o r ] sought to extinguish its ability to look to its collateral . . . . [T ]h e Claim Objection did not seek to "disallow" [the creditor's] c la im , but rather, it sought to allow the claim at a zero amount. Only after reading the [debtor's] "objection codes" does it become c le a r that [the debtor] sought to allow the claim only as an u n s e c u r e d claim, thereby arguably extinguishing the lien . . . . P a r t ic u la r ly in light of the fact that the confirmed Plan provided t h a t [the creditor] would retain its lien, the Court concludes that t h e bankruptcy court properly held that the Claim Objection did not p r o v id e adequate notice to [the creditor] that [the debtor] sought to e x t in g u is h its lien. I n re Kleibrink, 2007 WL 2438359 at *7 (N.D. Tex. 2007). We conclude that the n o tic e given to the creditor here did not satisfy the due process standard for n o tic e set forth in Mullane. Accordingly, we AFFIRM the district court's ju d g m e n t that the creditor's lien survived the earlier bankruptcy proceeding.1 The debtor fails to raise any argument appealing the district court's holding that the the lien is valid as to the debtor's former wife, his co-debtor. Therefore, that issue is waived. Fed. R. App. P. 28(a)(9)(A) (appellate briefs must contain "contentions and the reasons for them, with citations to the authorities and parts of the record on which the appellant relies"); United States v. Thames, 214 F.3d 608, 612 n.3 (5th Cir. 2000) (where a party fails to adequately brief an issue, the issue is waived). 1 3

Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.

Why Is My Information Online?