Sinue v. Gordon, Chapter 7 Trustee

Filing 9

OPINION AND ORDER denying 2 Motion for Leave to Appeal. The appeal is DISMISSED WITHOUT PREJUDICE. Signed by Judge Steven D. Grimberg on 12/02/2021. (jkb)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
In re MOSES SAMUEL WILLIAM SR. and
VICTORIA ZOR WILLIAM,
Debtors,

Bankruptcy Case
No. 15-55766-BEM
Adversary Proceeding
No. 19-5265-BEM

MAYBELLINE SINUE,
Appellant,

Civil Action No.
1:21-cv-03030-SDG

v.
NEIL C. GORDON, Chapter 7 Trustee, for the
Estates of Moses Samuel William and Victoria
Zor William,
Appellee.
OPINION AND ORDER

This matter is before the Court on Maybelline Sinue’s appeal [ECF 2] from
the July 13, 2021 order of the Northern District of Georgia Bankruptcy Court
denying Victoria Zor William and Sinue’s motion to dismiss an adversary
proceeding brought against them by Appellee Neil C. Gordon. After careful
review, the Court holds that there is no direct jurisdiction over Sinue’s appeal and
declines to permit appeal on an interlocutory basis. The appeal is therefore
DISMISSED WITHOUT PREJUDICE.

I.

BACKGROUND
Married debtors Moses Samuel William, Sr. and Victoria Zor William filed

for chapter 7 bankruptcy in case number 15-55766 on March 31, 2015, and received
a discharge on December 22, 2015.1 Neil Gordon (Trustee) initiated adversary
proceeding 19-05265 on July 31, 2019, against U.S. Bank National Association,
Maybelline Sinue, and Victoria Zor William.2 Count I of the Trustee’s Complaint
asserted a claim against U.S. Bank for turnover pursuant to 11 U.S.C. § 542; Count
II, which was pled in the alternative, asserted a claim against Sinue and William
under 11 U.S.C. § 363(h) for authority to sell certain real property; and Count III,
also pled in the alternative, asserted a claim against Sinue and William for
turnover of the property under 11 U.S.C. § 542.3
The real property at issue is a home located at 5501 The Vyne Avenue,
Atlanta, Georgia 30349, in which Sinue lives with her two children.4 William, who
is the mother of Sinue, purchased the home on April 14, 2009, and took out a loan

1

ECF 1-2, at 2, 10.

2

Id.

3

Id. Count I was dismissed by the Bankruptcy Court on the motion of U.S. Bank.
ECF 1-2, at 2.

4

ECF 1-3, at 3.

on the Property on June 19, 2009.5 William executed a quitclaim deed transferring
title to the property jointly to herself and Sinue on May 5, 2014.6
On March 30, 2021, Sinue and William (together Defendants) filed a motion
to dismiss Counts II and III of the adversary Complaint for failure to state a claim
under Federal Rule of Civil Procedure 12(b)(6), arguing that the claims are barred
by the doctrine of res judicata or are not plausible on their face.7 The Northern
District of Georgia Bankruptcy Court denied Defendants’ motion to dismiss on
July 13.8 It held that Counts II and III are not barred by res judicata because the
claims did not arise out of the same nucleus of operative facts as the previous
adversary proceedings, and that the Trustee’s allegations on both counts were
sufficient to survive the motion to dismiss.9

5

ECF 1-2, at 5–6.

6

Id.

7

Id. at 2, 10.

8

ECF 1-2.

9

Id. at 12—13, 18. The previous adversary proceedings relevant to the res
judicata issue, case numbers 15-05235 and 17-05088, are discussed in greater
detail in the Bankruptcy Court’s order on the motion to dismiss. ECF 1-2, at
7—9.

On July 26, 2021, Sinue appealed by filing a request to appeal the
Bankruptcy Court order denying the motion to dismiss.10 She argues that the
Trustee holds sufficient funds to pay the Debtors’ creditors in full without selling
the Property and that the harm to her and her family from a sale of the Property
would be substantial.11 On August 19, the Trustee filed a response to the request
to appeal.12
II.

DISCUSSION
Under 28 U.S.C. § 158(a)(1), this Court has jurisdiction to hear appeals from

final judgments and orders of the Bankruptcy Court. However, the Bankruptcy
Court’s order denying Defendants’ motion to dismiss was not a final order. “[A]
final order in a bankruptcy proceeding is one that ends the litigation on the merits
and leaves nothing for the court to do but execute its judgment.” Clay Cnty. Bank
v. Culton (In re Culton), 111 F.3d 92, 93 (11th Cir. 1997)) (citations omitted). Because
the order did not “completely resolve all of the issues pertaining to a discrete
claim, including issues as to the proper relief,” it is not a directly appealable final
order. Barben v. Donovan (In re Donovan), 532 F.3d 1134, 1137 (11th Cir. 2008)

10

ECF 2.

11

Id.

12

ECF 3.

(citation omitted) (holding that a bankruptcy court’s order denying a motion to
dismiss a chapter 7 case was not a final order because the court did not
conclusively resolve the bankruptcy case as a whole or any adversary proceeding
or claim); see also Yormak v. Yormak (In re Yormak), No. 17-13239-FF, 2017 WL
4857438, at *1 (11th Cir. Sept. 13, 2017) (“The bankruptcy court’s denial of
summary judgment does not resolve any claim, controversy, or adversary
proceeding, and therefore is not final.”).
A party may appeal an interlocutory order from a bankruptcy court if given
leave. 28 U.S.C. § 158(a)(3). To appeal an interlocutory order, a party must file a
notice of appeal with the bankruptcy court clerk within 14 days of the entry of the
order being appealed. Fed. R. Bankr. P. 8002(a)(1). The notice of appeal must
conform to the official form, be accompanied by the fee, be accompanied by the
order being appealed, and be accompanied by a motion for leave to appeal. Fed.
R. Bankr. P. 8003(a)(3), 8004(a)(2). Although Sinue’s filing does not conform to the
notice of appeal form, it was timely, the fee was paid, and the filing contains the
necessary contents of a motion for leave to appeal. See Fed. R. Bankr. P. 8004(b)(1)
(delineating contents of a motion for leave to appeal such as underlying facts, the
relief sought, and reasons to grant the motion for appeal). Further, the order being

appealed was included in the notice of appeal transmitted to this Court by the
Bankruptcy Court clerk.
Sinue filed the motion for appeal pro se and “the Court construes liberally
the pleadings of pro se litigants, [but] it does not excuse them from their duty to
abide by procedural rules.” In re Strickland & Davis Int’l, Inc., 612 F. App’x 971, 975
(11th Cir. 2015). Even excusing any defects in the form of the notice of appeal, the
Court denies Sinue’s request because she has not established that an interlocutory
appeal is appropriate.
District courts look to the standards governing interlocutory appeals under
28 U.S.C. § 1292(b) to determine whether to grant leave for an interlocutory appeal
of a bankruptcy court order. In re Allied Holdings, Inc., 376 B.R. 351, 357
(N.D. Ga. 2007) (citing In re Charter Co., 778 F.2d 617, 620 n.5 (11th Cir. 1985)). “The
standards set forth are: (1) whether the bankruptcy court’s decision involves a
controlling question of law, (2) as to which there is substantial ground for
difference of opinion and (3) where an immediate appeal from the order may
materially advance the ultimate termination of the litigation.” Id. at 358 (quoting
In re Auto Dealer Servs., Inc., 81 B.R. 94, 96 (M.D. Fla. 1987)).
With respect to the Bankruptcy Court’s decision that Counts II and III
survive a motion to dismiss for failure to state a claim, there is no controlling

question of law. As the Trustee points out, the denial of the motion to dismiss only
means that facts relating to whether the Trustee can sell the Property pursuant to
11 U.S.C. § 363(h) will be decided at a later date.13 A motion to dismiss for failure
to state a claim does present a legal question, Chudasama v. Mazda Motor Corp., 123
F.3d 1353, 1367 (11th Cir. 1997), but this is not the kind of “pure question of law . . .
the court can resolve ‘without having to delve beyond the surface of the record in
order to determine the facts,’” that 28 U.S.C. § 1292(b) contemplates for
interlocutory appeals. Mamani v. Berzain, 825 F.3d 1304, 1312 (11th Cir. 2016) (citing
McFarlin v. Conseco Servs., LLC, 381 F.3d 1251, 1259 (11th Cir. 2004)).
The Bankruptcy Court’s decision that the Trustee’s claims are not barred by
the doctrine of res judicata would also require this Court to delve into the facts of
the case because, as the Bankruptcy Court noted, the facts underlying the Trustee’s
claims have changed such that the Property has become unencumbered since the
time of the previous adversary proceedings.14 The Eleventh Circuit has noted that
“[interlocutory] appeals were intended for, and should be reserved for, situations
in which the [ ] court . . . can rule on a pure, controlling question of law without
having to delve beyond the surface of the record in order to determine the facts.”

13

ECF 3, at 3.

14

ECF 1-2, at 12, 13, 18.

McFarlin, 381 F.3d at 1259 (“The antithesis of a proper § 1292(b) appeal is one that
turns on whether there is a genuine issue of fact or whether the [trial] court
properly applied settled law to the facts or evidence of a particular case.”). Because
“there is no controlling question of law that can be determined without also
determining the facts,” this Court exercises its discretion to deny Sinue’s motion
to appeal. Hartnett v. Mustelier (In re Hartnett), No. 04-1197-BKC-RAM, 2004 WL
3019365, at *2 (S.D. Fla. Nov. 4, 2004) (holding that interlocutory appeal of a
bankruptcy court decision would be inappropriate where the appeal turned on the
facts of the case and a theory of res judicata).
Permitting an appeal here would also not advance the underlying litigation
because material facts remain to be decided with regard to the Trustee’s claim to
sell the Property. Sinue argues that the Trustee holds sufficient funds to pay the
creditors’ claims from the chapter 7 bankruptcy and that selling the Property
would result in substantial harm to Sinue and her family. These factual issues were
not decided at the motion to dismiss stage, and they are precisely the kind of issues
that the Bankruptcy Court will need to resolve at a later date in this litigation.

Sinue has not demonstrated that there is jurisdiction for a direct appeal or
that interlocutory review of the order of the Bankruptcy Court is appropriate.
Accordingly, Sinue’s motion for leave to appeal is DENIED and the appeal is
DISMISSED WITHOUT PREJUDICE.
SO ORDERED this the 2nd day of December, 2021.

Steven D. Grimberg
United States District Court Judge