Hardin v. Womack et al

Filing 15

MEMORANDUM AND ORDER. Judge Kirscher's Order and Memorandum of Decision of 5/8/14 are AFFIRMED. Signed by Judge Sam E Haddon on 6/16/2015. (ELL, )

FILED
JUN 16 2015
Clerk, U.S. District Court
District Of Montana
Helena

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MONTANA
BUTTE DIVISION
In re:
Bankruptcy Case No. 13-60413
HARDIN & COMPANY, LTD.,
Debtor.

DENNIS HARDIN,
No. CV-14-41-BU-SEH
Appellant,

vs

MEMORANDUM AND
ORDER

JOSEPH V. WOMACK, et al.
Appellee.

BACKGROUND
Debtor, Hardin & Company, Ltd. is a real estate firm, owned by Dennis
Hardin ("Hardin"). Pre-bankruptcy, Hardin listed for sale property of two

veterinarians (Stafford and Longren, together "Veterinarians"). Hardin asserted it
marketed the property. The listing expired. The property was later sold. Hardin
sued the Veterinarians for a commission from the sale in Montana State Court.
The case was dismissed on summary judgment in favor of the Veterinarians. The
Veterinarians also were awarded fees by the State Court. No judgment was
entered. Hardin then filed Chapter 7 bankruptcy. The Trustee later negotiated a
settlement of the State Court commission litigation. Hardin opposed the
settlement as "without consideration." The Bankruptcy Court disagreed and
approved the settlement. This appeal followed. 1
JURISDICTION

This Court has appellate jurisdiction to review final orders of the
Bankruptcy Court under 28 U.S.C. § 158(a).
ISSUE ON APPEAL

This appeal raises a single issue: Did the Bankruptcy Court err by approving
a settlement agreement between a bankruptcy trustee and creditor? The answer is
"no."
1

The Notice of Appeal filed June 25, 2014, incorrectly identifies the appeal to be from
"the Order entered on the 21st day of March, 2014, ... denying Dennis Hardin's Motion to
Abandon filed January 28, 2014." Doc. 1. It is apparent from the briefs and arguments of
counsel the appeal was intended to be taken from the Bankruptcy Court's Order of May 8, 2014,
approving the "Stipulation Compromising and Settling Litigation." In re Hardin & Company,
Ltd, Bankr. Case No. 13-60413-7, Doc. 137. This opinion addresses the issue accordingly.
2

STANDARD OF REVIEW

A bankruptcy court's decision to approve a compromise is reviewed for
abuse of discretion. 2
DISCUSSION

A reviewing court reviews the compromise to ensure it is fair and equitable
and considers the factors listed in A & C Properties:
(a) The probability of success in the litigation; (b) the
difficulties, if any, to be encountered in the matter of
collection; (c) the complexity of the litigation involved,
and the expense, inconvenience and delay necessary
attending it; (d) the paramount interest of the creditors
and a proper deference to their reasonable views in the
premises. 3
The Bankruptcy Court did not abuse its discretion in approving the
settlement between the Trustee on behalf of the Debtor and the Veterinarians, a
creditor of the Debtor. The settlement agreement executed by the Trustee and the
Veterinarians detailing the terms and conditions of the settlement was before the
Bankruptcy Court and was fully considered at hearing on due notice before the
settlement was approved. Each party both gained and gave up certain rights and
2

See In re Mickey Thompson Entertainment Group, Inc., 292 B.R. 415, 420 (B.A.P. 9th
Cir. 2003) (citing Martin v. Kane (Jn re A & C Props.), 784 F.2d 1377, 1380 (9th Cir. 1986),
cert. denied, Martin v. Robinson, 479 U.S. 854 (1986); CAMIRPC Elecs. v. Robertson (Jn re
MGS Mktg.), 111 B.R. 264, 266-67 (B.A.P. 9th Cir. 1990)).
3

In re A & C Props., 784 F.2d at 1381 (citations omitted).
3

interests by the settlement, which brought an end to ongoing litigation. All of the
so called A & C Properties factors were met. 4 Any suggestion the settlement was
without consideration is wholly without merit.

CONCLUSION
The Bankruptcy Court did not abuse its discretion in approving the
settlement between the Trustee and the Partnership.

ORDER
Judge Kirscher's Order and Memorandum of Decision of May 8, 2014, are
AFFIRMED. 5
DATED this

t:J-

1~ day of June, 2015.

frJi't:fe/nt)
United States District Judge

4

See In re MGS Marketing, 111 B.R. at 267 (B.A.P. 9th Cir. 1990) (citing Woodson v.
Fireman's Fund Insur. Co., 839 F.2d 610, 620 (9th Cir. 1988)).
5

See In re Hardin & Company, Ltd, Bankr. Case No. 13-60413-7, Docs. 136 and 137.
4