Mantiply v. Horne et al

Filing 88

ORDER granting 77 Motion for stay of execution of judgment. The supersedeas bond previously filed by the Appellant shall remain in the bankruptcy court during the pendency of the appeal. If during the pendency of the appeal Appellant seeks to sel l, convey, transfer, mortgage, assign, or otherwise encumber the real property to which the judgment lien has attached, she shall be required to file an additional supersedeas bond equal to 105% of the attorney's fee judgment. Signed by Senior Judge Charles R. Butler, Jr on 5/22/2014. copies to parties. emailed USCA, Bankruptcy, Appeals Clerk, and Butler CRD. (sdb)

IN
 THE
 UNITED
 STATES
 DISTRICT
 COURT
 FOR
 THE

SOUTHERN
 DISTRICT
 OF
 ALABAMA

SOUTHERN
 DIVISION

In
 Re:

)

)

RICHARD
 D.
 HORNE
 and

)

PATRICIA
 NELSON
 HORNE,

)

)

Debtors,

)

)

MARY
 BETH
 MANTIPLY,

)

)

CIVIL
 ACTION
 NO.
 13-­‐00258-­‐CB-­‐B

Plaintiff/Appellant,

)

)

v.

)

)

RICHARD
 D.
 HORNE
 and

)

PATRICIA
 NELSON
 HORNE,

)

)

Defendants/Appellees.

)

ORDER

This
 matter
 is
 before
 the
 Court
 on
 a
 “Motion
 to
 Stay
 Proceedings
 to
 Enforce

Judgment”
 filed
 by
 Appellant
 Mary
 Beth
 Mantiply.

 (Doc.
 77.)

 The
 Appellees
 have

filed
 a
 reply
 brief.

 (Doc.
 83.)

 Upon
 careful
 review
 and
 consideration,
 the
 Court
 finds

that
 the
 motion
 to
 stay
 enforcement
 of
 the
 judgment
 during
 the
 pendency
 of
 the

appeal
 is
 due
 to
 be
 granted
 and
 that
 no
 additional
 security
 should
 be
 required
 at
 this

time.

A
 brief
 review
 of
 the
 pertinent
 facts
 is
 necessary.

 The
 bankruptcy
 court

below
 found
 that
 Mantiply
 had
 violated
 both
 the
 automatic
 stay
 and
 discharge

injunction
 by
 filing
 and
 pursuing
 a
 civil
 action
 against
 debtor
 Richard
 D.
 Horne.

 The

court
 also
 found
 that
 both
 debtors
 suffered
 emotional
 distress
 and
 mental
 anguish

as
 a
 result
 of
 these
 violations
 and
 imposed
 compensatory
 and
 punitive
 damages
 as

well
 as
 attorney’s
 fees
 totaling
 more
 than
 $80,000.

 Mantiply
 appealed
 and
 sought
 a

stay
 of
 the
 judgment
 from
 the
 bankruptcy
 court.

 Ultimately,
 Mantiply
 posted
 a
 cash

bond
 equal
 to
 105%
 of
 the
 judgment,
 and
 the
 stay
 was
 granted.

 On
 appeal,
 this

court
 affirmed
 the
 Magistrate
 Judge’s
 order
 and
 judgment
 and
 also
 granted

Appellees’
 motion
 for
 attorney’s
 fees
 on
 appeal,
 which
 totaled
 more
 than
 $34,000.

Appellees
 recorded
 the
 attorney’s
 fee
 judgment
 as
 a
 lien
 against
 real
 property

owned
 by
 Mantiply.1

 Mantiply
 has
 filed
 a
 notice
 of
 appeal,
 and
 seeks
 a
 stay
 of
 this

Court’s
 attorney’s
 fee
 judgment
 as
 well
 as
 the
 bankruptcy
 court’s
 judgment
 and

requests
 that
 no
 additional
 security
 be
 required.

 Appellees
 object,
 arguing
 that
 the

stay
 of
 judgment
 should
 be
 denied
 unless
 additional
 security
 is
 posted
 for
 the

amount
 of
 the
 attorney’s
 fee
 judgment
 plus
 an
 additional
 amount
 for
 projected

attorney’s
 fees
 to
 be
 incurred
 on
 appeal.

Thus,
 the
 issue
 now
 before
 this
 Court
 is
 whether
 the
 stay
 should
 be
 granted

without
 requiring
 additional
 security.
 Whether
 to
 grant
 a
 stay
 pending
 intermediate

appeal
 (i.e.,
 from
 the
 district
 court
 or
 bankruptcy
 appellate
 panel
 to
 the
 circuit

court),
 is
 governed
 by
 Rule
 8017.

 That
 rule
 sets
 out
 no
 specific
 criteria
 for
 granting

or
 denying
 a
 stay,
 stating
 only
 that
 a
 stay
 may
 be
 extended
 “for
 good
 cause
 shown”

and
 that
 “[a]
 bond
 or
 other
 security
 may
 be
 required
 as
 a
 condition
 to
 the
 grant
 or

continuation
 of
 a
 stay.”

 Fed.
 Bankr.
 R.
 8017(b).

Three
 types
 of
 stays
 may
 be
 applied
 to
 an
 intermediate
 appeal—one
 fully

secured
 by
 a
 supersedeas
 bond,
 another
 that
 is
 unsecured
 and
 discretionary,
 and
 “a

1
 Based
 on
 a
 search
 of
 the
 Baldwin
 County
 property
 records,
 this
 lien

(recorded
 January
 10,
 2014)
 remained
 in
 effect
 as
 of
 May
 19,
 2004.
 See
 Baldwin

County
 Probate
 Deeds
 &
 Records
 Ref.
 No.
 1436988,
 www.co.baldwin.al.us
 (search

Public
 Records,
 Probate
 Deeds
 &
 Records).

2

third
 that
 combines
 features
 of
 the
 first
 two.”

 In
 re
 Wymer,
 5
 B.R.
 802,
 804
 (9th
 Cir.

BAP
 1980).2

 A
 discretionary
 stay,
 which
 is
 part
 of
 the
 court’s
 inherent
 power
 to

preserve
 the
 status
 quo,
 is
 in
 the
 nature
 of
 a
 preliminary
 injunction.
 Id.
 at
 806.

 A

party
 seeking
 to
 a
 stay
 of
 judgment
 that
 cannot
 be
 secured
 by
 a
 supersedeas
 bond

must
 meet
 the
 criteria
 applicable
 to
 a
 motion
 for
 preliminary
 injunction.

 Cf.
 In
 re

First
 South
 Sav.
 Ass’n,
 820
 F.2d
 700,
 704
 (5th
 Cir.
 1987)
 (applying
 injunctive
 test
 to

motion
 for
 stay
 of
 bankruptcy
 court’s
 superpriority
 order).3

 When
 a
 monetary

judgment
 is
 fully
 secured
 by
 a
 supersedeas
 bond,
 the
 injunctive
 test
 is
 unnecessary

because
 the
 status
 quo
 is
 maintained.

 See
 In
 re
 Lambert
 Oil,
 375
 B.R.
 197,
 200
 (W.D.

Va.
 2007);
 see
 also
 In
 re
 Mirranne,
 94
 B.R.
 413,
 415
 (E.D.
 La
 1988).

The
 instant
 appeal
 falls
 into
 the
 middle
 ground
 because
 it
 involves
 a

partially-­‐secured
 monetary
 judgment.

 The
 supersedeas
 bond
 filed
 in
 the

bankruptcy
 court
 secures
 the
 amount
 of
 the
 bankruptcy
 court’s
 judgment;
 however,

no
 supersedeas
 bond
 has
 been
 posted
 to
 secure
 the
 attorney’s
 fee
 judgment
 issued

by
 this
 Court.

 Moreover,
 Mantiply
 contends
 that
 none
 is
 necessary
 because
 the

attorney’s
 fee
 judgment
 is
 adequately
 secured
 by
 the
 lien
 on
 her
 real
 property.

 The

Court
 agrees
 that
 Appellee’s
 judgment
 lien
 on
 Appellant’s
 real
 property
 provides

sufficient
 security
 for
 the
 attorney’s
 fee
 judgment.

 Therefore,
 pursuant
 to

Fed.Bankr.R.
 8017,
 the
 Court
 finds
 “good
 cause”
 for
 a
 stay
 pending
 appeal
 is
 satisfied

2At
 the
 time
 Wymer
 was
 decided,
 a
 different
 version
 of
 the
 Bankruptcy
 Rules

was
 in
 effect
 and
 Rule
 8017
 had
 not
 been
 adopted.
 The
 Wymer
 court

 interpreted

and
 applied
 Fed.
 R.
 Civ.
 P.
 62
 and
 Fed.
 R.
 App.
 P.
 41,
 the
 rules
 upon
 which
 Rule
 8017

was
 based.

 See
 Fed.
 Bankr.
 R.
 8017
 advisory
 committee’s
 note.

3
 The
 party
 seeking
 the
 stay
 must
 demonstrate
 the
 following:

 (1)
 a
 likelihood

of
 success
 on
 the
 merits;
 (2)
 irreparable
 injury
 to
 the
 movant
 if
 the
 stay
 is
 not

granted;
 (3)
 no
 substantial
 harm
 to
 the
 opposing
 party
 if
 a
 stay
 is
 granted;
 and
 (4)
 a

stay
 would
 serve
 the
 public
 interest.

 Id.
 at
 709.

3

by
 the
 supersedeas
 bond
 posted
 in
 the
 bankruptcy
 court
 and
 the
 judgment
 lien
 filed

against
 Appellant’s
 property.

For
 the
 reasons
 set
 forth
 above,
 the
 motion
 for
 stay
 of
 execution
 of
 judgment

is
 GRANTED.

 The
 supersedeas
 bond
 previously
 filed
 by
 the
 Appellant
 shall
 remain

in
 the
 bankruptcy
 court
 during
 the
 pendency
 of
 the
 appeal.

 If
 during
 the
 pendency

of
 the
 appeal
 Appellant
 seeks
 to
 sell,
 convey,
 transfer,
 mortgage,
 assign,
 or

otherwise
 encumber
 the
 real
 property
 to
 which
 the
 judgment
 lien
 has
 attached,
 she

shall
 be
 required
 to
 file
 an
 additional
 supersedeas
 bond
 equal
 to
 105
 %
 of
 the

attorney’s
 fee
 judgment.

DONE
 and
 ORDERED
 this
 the
 22nd
 day
 of
 May,
 2014.

s/Charles
 R.
 Butler,
 Jr.

Senior
 United
 States
 District
 Judge

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