Guerriero v. Rayhan et al

Filing 7

MEMORANDUM AND OPINION. For the reasons set forth in the attached Memorandum and Order, the Court affirms the Bankruptcy Court's July Order denying appellant's motion to dismiss the adversary complaint. The Clerk of Court shall enter judgment and close this case. SO ORDERED. Ordered by Judge Joseph F. Bianco on 9/19/2011. (Nagiel, Svetlana)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
_____________________
No 10-CV-4483 (JFB)
_____________________

CHARLES A. GUERRIERO
Appellant,
VERSUS

RAMIN RAYHAN, ESTHETIC PROCEDURES OF LONG ISLAND, LLC, RICHARD JARETT,
& MICHAEL KELLY,
Appellees.

___________________
MEMORANDUM AND ORDER
September 19, 2011
___________________

JOSEPH F. BIANCO, District Judge:
The instant case is an appeal by Charles
Guerriero (hereinafter AGuerriero@ or
Aappellant”), a debtor, from the July 23, 2010
Order (AJuly Order@) of the Honorable Alan
S. Trust, United States Bankruptcy Judge,
denying appellant’s motion to dismiss the
adversary
complaint
as
untimely.
Appellant, who voluntarily filed for
bankruptcy pursuant to Chapter 7 of the
Bankruptcy Code in the United States
Bankruptcy Court for the Eastern District of
New York (ABankruptcy Court@), appeals
from the judgment of the Bankruptcy Court,
arguing that: (1) the Bankruptcy Court=s
interpretation in its July Order of its June 2,
2010 Order (AJune Order@) was unreasonable
and in contravention of the clear and

unambiguous language of that Order; and (2)
appellant=s due process rights were violated
where appellees Ramin Rayhan, Esthetic
Procedures of Long Island, LLC, Richard
Jarett and Michael Kelly (hereinafter
Aappellees@) failed to serve appellant with the
June Order as it required.
As set forth below, the Court affirms the
Bankruptcy Court=s determination denying
appellant=s motion to dismiss the adversary
complaint. Specifically, the Bankruptcy
Court=s interpretation of its own order—
namely, that the grant of the extension of
time for appellees to file their adversary
proceeding was not contingent upon
compliance with the separate Apersonal
service@ provision in the same order—is
reasonable, and certainly not an abuse of

discretion. 1 Similarly, appellant=s related
due process argument has no merit.
Accordingly, the Bankruptcy Court=s Order
is affirmed.

they sought Ato compel compliance with the
2004 order that was served upon the debtor
and to extend the creditor=s time to object to
discharge and dischargeability.@ (Id. at
2:6-9.)
The Bankruptcy Court first
addressed the 2004 Order, stating that

I. BACKGROUND
A. Bankruptcy Proceeding

the Court will enter an order
directing the debtor to comply
with the 2004 order . . . That
order is going to need to be
personally served on the
debtor because if for any
reason he doesn=t comply with
this order I=m assuming I will
see you all back on a
contempt motion. So I want to
be certain of personal service.
. . . you may now unilaterally
pick the date, time and place
for both production and
examination [of the debtor] . .
..

On July 8, 2009 appellant filed a
voluntary petitioner for bankruptcy under
Chapter 7 of the Bankruptcy Code. (Docket
1-30 at 1; Docket 1-10 & 1.) Appellees
requested a number of extensions by which
to object to the dischargeability of appellant=s
debt. Central to the dispute at hand is
appellee=s motion dated April 21, 2010,
requesting an extension of time for the
creditors to file objections to the discharge of
appellant=s debt. (Docket 1-21.) In that
motion, appellees also sought an order
compelling appellant to comply with the
Bankruptcy Court=s March 9, 2010 Order
regarding the production of documents and
the examination of appellant under Rule
2004 of the Federal Rules of Bankruptcy
Procedure (A2004 Order@). (Id.; see also
Docket 1-23.)

(Id. at 2:19-25, 3:1-8.) With respect to the
extension request, the Bankruptcy Court
found that Acause exists to extend . . . [the]
request [] through June 21, 2010. . . .
Presumably you all will schedule the 2004
[production and examination] prior to that
time if possible.@ (Id. at 3:9-13.)

The Bankruptcy Court held a hearing on
appellees= motion on May 25, 2010.
(Docket 1-21 (June Order), 1-28 (Hearing
Transcript).) Appellant did not appear for
the hearing and did not file opposition papers
to appellees= motion. (Docket 1-28 at 2:9,
4:20-21.) At the hearing, appellees stated
1

This Court notes that it would reach the same
conclusion even under a de novo standard of
review, rather than an abuse of discretion
standard.

2

(adversary complaint).) On July 6, 2010
appellant filed a motion to dismiss the
adversary proceeding (Docket 1-30 at 3),
claiming that the action was time-barred
because: (1) service was inappropriately
made on appellant=s wife where the June
Order never made provisions for Asubstitute
service@; and (2) even if serving appellant=s
wife was appropriate, she was never served
with the June Order. (Docket 1-10 && 8-9,
15.) Appellees opposed appellant=s motion,
arguing that: (1) the Bankruptcy Court
granted appellees an extension of time to file
their adversary proceeding until June 21,
2010 and that the mandate to serve appellant
was referring to the 2004 Order; and (2) even
if appellees were required to serve appellant,
appellant waived or should be equitably
estopped from raising the timeliness of the
adversary complaint because he appeared for
his 2004 examination as required by the June
Order and did not raise any objections
regarding service at that time. (Docket 1-14
&& 5-7, 9-11.)

The Bankruptcy Court memorialized its
decision in the June Order, which, as noted
above, was issued on June 2, 2010. The
Bankruptcy Court Aextended through and
including June 21, 2010@ the creditors= time
to object to the discharge of appellant=s debt.
(Docket 1-21 & a.) In addition, the June
Order stated that:
(b) the Debtor is hereby
compelled to comply with the
2004 Order . . . thereby
requiring a turnover of
documents as set forth in the
2004 Order . . . .;
(c) the Debtor is hereby
required to appear at the
offices of [appellees= law
firm] on June 16, 2010 at
12:00 a.m. for an examination
pursuant to the 2004 Order
dated March 9, 2010, and
(d) personal service of this
Order on the Debtor is to be
effectuated on or before June
10, 2010.

On July 23, 2010, the Bankruptcy Court
denied appellant=s motion to dismiss the
adversary proceeding as timely. (Docket
1-3.) The Bankruptcy Court stated that the
June
Order
Acontained
several
non-interdependent decretal paragraphs to
address the various forms of relief sought in
the Motion . . . . @ and indicated that, Aas
correctly stated by [appellees], the provision
regarding service of the Order related to the
mode of service for the 2004 Order, and not
related to the relief extending time; therefore,
the adversary [complaint] was timely filed on
June 21, 2010.@ (Id. at 2.) In addition, the
Bankruptcy Court concluded that it Amakes
no determination as to the efficacy of service
of the Order as the issue of the Debtor=s

(Docket 1-21 && b-d.) An affidavit of
service filed with the Bankruptcy Court
indicated that the June Order was served in
person on June 9, 2010 on Frances Guerriero,
appellant=s wife, at her home address.
(Docket 1-12.) The Order was also served
by mail to appellant=s home address on June
11, 2010. (Id.)
On June 21, 2010 appellees filed an
adversary complaint against the debtor
challenging the dischargeability of his debt.
(Docket 1-30 at 2 (docket sheet); id. 1-4
3

bankruptcy court’s interpretation of its own
order is given deference on appeal and is
reviewed for abuse of discretion. See, e.g.,
In re The 1031 Tax Grp., LLC, No. 10 Civ.
2799 (RJH), 2011 WL 1158445, at *1
(S.D.N.Y. Mar. 29, 2011) (citing Deep v.
Copyright Creditors, 122 F. App’x 530, 531
(2d Cir. 2004) and Casse v. Key Bank Nat’l
Ass’n, 198 F.3d 327, 333 (2d Cir. 1999)); see
also In re Resource Tech. Corp., 624 F.3d
376, 386 (7th Cir. 2010) (AWe owe
substantial deference to the bankruptcy
court’s interpretation of its own orders and
will not overturn that interpretation unless we
are convinced that it amounts to an abuse of
discretion.@); JCB, Inc. v. Union Planters
Bank, N.A., 539 F.3d 862, 869 (8th Cir. 2008)
(AWhile we normally review a bankruptcy
court’s legal conclusions de novo, its
interpretation of the confirmed plan is
entitled to deference as an interpretation of
its own order and should be reviewed under
the abuse of discretion standard.@ (quotation
marks and citations omitted)).

compliance with the 2004 Order is not
presently before the Court.@ (Id. at 3.)
Appellant now appeals from this July Order.
B. Procedural History
Appellant filed a notice of appeal on
October 1, 2010, and filed his brief on April
22, 2011. Appellees filed their opposition
brief on June 10, 2011. Appellant did not
file a reply, which was due by June 27, 2011.
The Court has fully considered the
submissions and arguments of the parties.
II. STANDARD OF REVIEW
Rule 8013 of the Federal Rules of
Bankruptcy Procedure provides that a
reviewing court may Aaffirm, modify, or
reverse a bankruptcy judge=s judgment,
order, or decree,@ or it may remand with
instructions for further proceedings. See
Fed. R. Bankr. P. 8013.
The Court will review the Bankruptcy
Court=s legal conclusions de novo and its
factual findings for clear error. See Denton
v. Hyman (In re Hyman), 502 F.3d 61, 65 (2d
Cir. 2007); see also Lubow Mach. Co. v.
Bayshore Wire Prods. (In re Bayshore Wire
Prods.), 209 F.3d 100, 103 (2d Cir. 2000)
(ALike the District Court, we review the
Bankruptcy Court=s findings of fact for clear
error, . . . its conclusions of law de novo, . . .
its decision to award costs, attorney=s fees,
and damages for abuse of discretion.@
(internal citations omitted)); accord Shugrue
v. Air Line Pilots Ass’n, Int=l (In re
Ionosphere Clubs), 922 F.2d 984, 988-89 (2d
Cir. 1990) (citations omitted).
Moreover,

as

discussed

infra,

III. DISCUSSION
Appellant appeals the Bankruptcy
Court=s July Order denying his motion to
dismiss the adversary complaint. Appellant
argues that the adversary complaint was not
timely filed because the extension of time on
which appellees relyCgranted in the June
OrderCwas predicated on personal service of
the June Order on appellant by a specific
date, as that Order allegedly required.
Appellant contends that the Bankruptcy
Court=s interpretation of the June Order as
not requiring such service was inconsistent
with its plain language. (Appellant=s Br. at
8-10.) Appellant further argues that he Awas
deprived of his procedural due process of law

a
4

as guaranteed to him by the Fourteenth
Amendment@ because he was Anot provided
with notice that the Appellees= time to
commence@ the adversary proceeding was
extended despite the Aexpress and
unambiguous terms@ of the June Order. (Id.
at 12.)

June Order itself. (Appellees= Br. at 5-8.)
Appellees assert, in the alternative, that
appellant waived, or should be equitably
estopped from making, the argument that he
was not properly served where appellant
appeared for his 2004 examination on the
date and time designated by the June Order
without at that time raising any issues
regarding service or timeliness of the
adversary complaint. (Id. at 9-10.)

Appellees counter that no such service
was required and that the June Order
mandated service of the 2004 Order, not the
After full consideration of appellant=s
claims and a thorough examination of the
record below, the Court affirms the July
Order of the Bankruptcy Court in its entirety.
Specifically, the Court concludes that the
Bankruptcy Court=s interpretation of its June
Order was not an abuse of discretion based
on the record where the Bankruptcy Court
determined that the extension of time granted
to appellees was not contingent upon service
of the June Order.1

its own order, and the court=s interpretation of
its order will not be disturbed absent a clear
abuse of discretion.@ Truskoski v. ESPN,
Inc., 60 F.3d 74, 77 (2d Cir. 1995) (quotation
marks and citations omitted) (collecting
cases). Cf. Harvis Tvien & Beck P.C. v.
Fed. Home Loan Mortg. Corp. (In re
Blackwood Associates, L.P.), 153 F.3d 61, 66
(2d Cir. 1998) (AThe fundamental principle
underlying our holding in Truskoski is the
truism that the draftsman of a document is
uniquely situated to understand the intended
meaning of that document. In this case, this
principle does not apply. The bankruptcy
court did not draft the Stipulation, it merely
approved the Stipulation as it was required to
do by the Code and the Bankruptcy Rules.@).
In other words, A[a]bsent a compelling basis
to hold otherwise a court=s interpretation of
its own order in the decision appealed from is
entitled to great weight.@ Glenstone Lodge,
Inc. v. Buckhead Am. Corp. (In re Buckhead
Am. Corp.), 180 B.R. 83, 88 (D. Del. 1995)
(quotation marks omitted) (collecting cases).

As the Second Circuit has emphasized,
A[i]t is peculiarly within the province of the
district court . . . to determine the meaning of
1

The Court does not reach appellant=s argument
that service of the June Order was not properly
executed (Appellant=s Br. at 11) because, for the
reasons stated infra, the Court concludes that the
Bankruptcy Court=s interpretation of its June
Order was not an abuse of discretion so that
service of the June Order was not a contingent
requirement for the extension of time to be
granted. For the same reasons, the Court finds
meritless appellant=s argument that his due
process rights were violated because he was not
served with the June Order (id. at 12-14). In
short, the Court has reviewed the record de novo
and concludes that appellant’s due process rights
were not violated in any way in connection with
the June Order or the July Order.

The Bankruptcy Court=s interpretation of
the June Order is consistent with the
language of that Order, as well as with what
transpired at the March 25, 2010 hearing.
First, the Court addresses the language of the
June Order separate and apart from the
5

In addition, the transcript of the March
25, 2010 hearing, which concerned the very
motion addressed by the Bankruptcy Court in
its June Order, supports the Bankruptcy
Court=s interpretation.
The transcript
suggests that the Bankruptcy Court intended
the service provision in its June Order to
entail the service of the 2004 Order, not the
June Order. The Bankruptcy Court stated:

hearing. The last two provisions of that
Order are critical here and state as follows:
(c) the Debtor is hereby
required to appear at the
offices of [appellees= law
firm] . . . for an examination
pursuant to the 2004 Order
dated March 9, 2010, and

the Court will enter an order
directing the debtor to comply
with the 2004 order . . .
That order is going to need
to be personally served on
the debtor because if for any
reason he doesn=t comply with
this order I=m assuming I will
see you all back on a
contempt motion. So I want to
be certain of personal service.

(d) personal service of this
Order on the Debtor is to be
effectuated on or before June
10, 2010.
(Docket 1-21 && c-d (emphasis added).)
While the reference to Athis Order@ in
provision (d) requiring personal service is
somewhat ambiguous, it is consistent with
the Bankruptcy Court=s interpretation that
Athis Order@ is referring the 2004 Order
mentioned in the preceding sentence, in
provision (c). Thus, the language of the
June Order is itself consistent with the
Bankruptcy Court=s interpretation, which is a
reasonable one.
See, e.g., Brady v.
Mcallister (In re James A. Brady), 101 F.3d
1165, 1169 (6th Cir. 1996) (AAlthough the
order and the trustee=s motion are somewhat
ambiguous, they are able to bear the
interpretation of the Bankruptcy Court. . .
[and] [w]e therefore decline to contradict the
Bankruptcy Court=s interpretation of its own
order.@). Furthermore, as the Bankruptcy
Court pointed out in its July Order, the June
Order Acontained several non-interdependent
decretal paragraphs to address the various
forms of relief sought in the Motion,@ so that
the extension of time granted to appellees
was not contingent on service of the June
Order. (Docket 1-3 at 2.)

(Docket 1-28 at 2:19-25, 3:1-8 (emphasis
added).) This statement is consistent with
the Bankruptcy Court=s interpretation of the
service clause in the June Order as mandating
service of the 2004 Order. The Bankruptcy
Court never mentioned at the hearing service
of its June Order so as to notify appellant of
the extension of time granted to appellees,
nor was any mention made of making the
extension contingent on service of the June
Order on appellant.2
2

The Court notes that Abankruptcy courts may
enlarge the time to file complaints objecting to a
debtor=s discharge and/or the dischargeability of
debts . . . as the time limitations set forth in [the
Federal Rules of Bankruptcy Procedure] are not
jurisdictional.@ Pryer v. Barbara (In re Mario
Rodriguez), 283 B.R. 112, 119 (Bankr. E.D.N.Y.
2001).

6

IV. CONCLUSION

In short, the Bankruptcy Court=s
interpretation of its own order—namely, that
the extension of time granted to appellees in
the June Order to file their adversary
proceeding was not contingent upon the
Apersonal service@ provision in that June
Order (which, in any event, related to the
2004 order)—is reasonable and is supported
by the language of the June Order, as well as
the context in which it was issued.

For the foregoing reasons, the Court
affirms the Bankruptcy Court=s July Order
denying appellant=s motion to dismiss the
adversary complaint. The Clerk of Court
shall enter judgment and close this case.
SO ORDERED.

In sum, this Court concludes that the
Bankruptcy Court=s interpretation of its June
2010 Order was not an abuse of discretion
and is consistent with the record. Moreover,
as noted supra, this Court would reach the
same conclusion even under a de novo
standard of review, rather than the abuse of
discretion standard.3

__________________
JOSEPH F. BIANCO
United States District Judge
Dated: September 19, 2011
Central Islip, New York
*

*

*

The attorney for Appellant is: Fred S.
Kantrow, Esq., Law Offices of Avrum J.
Rosen, PLLC, 38 New Street, Huntington,
New York, 11743.
The attorney for
Appellees is: Kenneth A. Reynolds, Esq.,
McBreen & Kopko, 500 North Broadway,
Suite 129, Jericho, New York 11783.

3

In the alternative, the Court adopts appellees=
argument that appellant has waived and should be
equitably estopped from making the argument
that the adversary complaint was untimely. This
is so because appellant appeared on the date and
time designated in the June Order for the 2004
examination and proceeded with that
examination without raising as an issue the
timeliness of the complaint (nor any deficiencies
in service). (Appellees= Br. at 9; Docket 1-18 at
4 (2004 examination of appellant where appellant
indicated he was present Apursuant to@ the June
Order).)

7