Aubrey et al v. Whinery et al

Filing 18

ORDER DISMISSING Bankruptcy Appeal. Signed by Judge James C. Mahan on 5/22/12. (Copies have been distributed pursuant to the NEF - ASB)

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UNITED STATES DISTRICT COURT
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DISTRICT OF NEVADA
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In re:
LODGEBUILDER, INC.,

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Case No. 09-14360-lbr
Chapter 7

Debtor.
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WILLIAM H. AUBREY, et al,,

2:11-CV-1476 JCM (GWF)

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Appellants,

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v.

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BRENDA MOODY WHINERY, et al.,

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Appellees.

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ORDER

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Presently before the court is pro se appellants William H. Aubrey and Brenda Todd’s appeal

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of bankruptcy case In re Lodgebuilder, Inc., 09-14103-lbr. Appellants filed an opening brief. (Doc.

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#13). Appellee Brenda Moody Whinery then filed an answering brief. (Doc. #15). Appellants did

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not file a reply brief. This court has jurisdiction pursuant to 28 U.S.C. § 158(a).

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The United States Bankruptcy Court for the District of Nevada entered orders approving

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settlement agreements between Brenda Moody Whinery and James Lisowski, the chapter 7 trustee,

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in three bankruptcy cases: (1) In re Lodgebuilder, Inc., 09-14103-lbr; (2) In re Aubrey, 09-14360-lbr;

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and (3) In re Todd, 09-14362-lbr. Aubrey and Todd filed a notice of appeal in the Lodgebuilder

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case; Lodgebuilder, Inc. did not file a notice of appeal. Further, appellants did not file notices of

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James C. Mahan
U.S. District Judge

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appeal in the Todd or Aubrey cases.

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Appellants argue that the bankruptcy court made several errors relating to the approval of the

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settlement agreements. (Doc. #13). In response, appellee argues that Lodgebuilder, Inc. cannot

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proceed pro se, and appellants Todd and Aubrey lack standing to pursue this appeal individually or

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on behalf of the corporation. (Doc. #15). Accordingly, appellee asserts that the instant appeal

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should be dismissed. (Doc. #15).

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Pursuant to Federal Rule of Bankruptcy Procedure 8002(a), a party must file a notice of

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appeal “within 14 days of the date of the entry of the judgment, order, or decree appealed from.”

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FED. R. BANKR. P. 8002(a). Appellants have not filed notices of appeal in the Aubrey and Todd

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cases (case numbers 09-14360-lbr and 09-14362-lbr). Accordingly, these cases are not properly

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before this court, and must be dismissed. See In re Schimmels, 85 F.3d 416, 422 (9th Cir. 1996).

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Standing

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“It is a longstanding rule that corporations and other unincorporated associations must appear

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in court through an attorney.” D-Beam Ltd. Partnership v. Roller Derby Skates, Inc., 366 F.3d 972,

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973-74 (9th Cir. 2004) (internal quotations omitted); see also In re Highley, 459 F.2d 554, 555-56

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(9th Cir. 1972). In this case, appellant Lodgebuilder, Inc. is not represented by counsel. Further,

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Lodgebuilder, Inc. did not file a notice of appeal; only pro se appellants Aubrey and Todd filed

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notices of appeal. Therefore, Lodgebuilder, Inc. cannot appear in this matter to appeal the

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bankruptcy court’s settlement order. In re Highley, 459 at 555-56.

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Appellate standing in bankruptcy cases is analyzed under the “person aggrieved” test. Matter

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of Fondiller, 707 F.2d 441, 443 (9th Cir. 1983). “Only those persons who are directly and adversely

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affected pecuniarily by an order of the bankruptcy court have . . . standing to appeal that order.” Id.

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at 442.

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Prior to seeking bankruptcy relief in Nevada, appellants were defendants in an adversary

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proceeding in Arizona bankruptcy court. (Adversary case number 2:06-ap-00911-RTB). On March

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9, 2009, the Arizona bankruptcy court entered a judgment against Lodgebuilder, Inc., Aubrey, and

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Todd, jointly and severally, for $18,500,883.00. (Doc. #16, Ex. 4). Here, Lodgebuilder, Inc.’s

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James C. Mahan
U.S. District Judge

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bankruptcy schedules indicate total estate assets of approximately $2,823,966.09. (Doc. #16, Ex.

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16).

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Debtors/appellants Aubrey and Todd cannot receive payment ahead of secured and unsecured

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creditors such as the creditor trustee. 11 U.S.C. § 726(a). Therefore, there is no possibility that any

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portion of the Lodgebuilder bankruptcy estate could go to debtors/appellants Aubrey and Todd. See

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In re C.W. Mining Co., 636 F.3d at 1260. Thus, Aubrey and Todd lack standing to appeal because

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their pecuniary interests are not directly and adversely affected. Matter of Fondiller, 707 F.2d at

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443.

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Accordingly,

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IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that the appeal of bankruptcy

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case number 09-14103-lbr, Aubrey, et. al. v. Whinery, et. al., 2:11-cv-1476-JCM-GWF, be, and the

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same hereby is, DISMISSED.

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DATED May 22, 2012.

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UNITED STATES DISTRICT JUDGE
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James C. Mahan
U.S. District Judge

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