Planavsky v. Broome County

Filing 13

MEMORANDUM-DECISION and ORDER - That Planavsky's appeal is DENIED and DISMISSED. That the judgment of the bankruptcy court is AFFIRMED. Signed by Judge Gary L. Sharpe on 8/2/2011. (jel, )

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF NEW YORK
_________________________________
DANNY R. PLANAVSKY,
Appellant,

6:10-cv-1133
(GLS)

v.
BROOME COUNTY,
Appellee.
_________________________________
APPEARANCES:
OF COUNSEL:
FOR THE APPELLANT:
Reizes Law Firm, Chartered
1200 South Federal Highway
Suite 301
Boynton Beach, FL 33435

LESLIE N. REIZES, ESQ.

FOR THE APPELLEE:
Broome County Attorney’s Office
ROBERT G. BEHNKE, ESQ.
Edwin L. Crawford County Office Bldg.
P.O. Box 1766
Binghamton, NY 13902-1766
Gary L. Sharpe
District Court Judge

MEMORANDUM-DECISION AND ORDER
I. Introduction
On May 16, 2001, appellant Danny R. Planavsky filed a voluntary
petition for relief under chapter 11 of the Bankruptcy Code. (See

Appellant’s Designation, USBC Public Docket, Dkt. No. 2:27.) On August
3, 2010, the bankruptcy court issued an order converting Planavsky’s
chapter 11 case to a chapter 7 case pursuant to 11 U.S.C. § 1112(b), (Dkt.
No. 1:5), which this court subsequently affirmed, (see Planavsky v. U.S. Tr.
for Region 2, No. 6:10-cv-1126, Dkt. No. 15). In another order dated that
same day, the bankruptcy court granted Appellee Broome County’s motion
to lift the automatic stay regarding Planavsky’s Broome County properties.
(Dkt. No. 1:2.) Pending is Planavsky’s appeal of that order. (Dkt. No. 1.)
For the reasons that follow, the appeal is denied and the order is affirmed.
II. Standard of Review
The district court sits as an appellate court when a bankruptcy order
is appealed. See 28 U.S.C. § 1334. A bankruptcy court’s order granting or
denying a motion to lift an automatic stay is reviewed for abuse of
discretion. Case v. United States (In re Case), 384 F. App’x 43, 44 (2d Cir.
2010) (unpublished). A bankruptcy court abuses its discretion when its
decision rests on “an error of law or a clearly erroneous finding of fact, or a
decision that, though not necessarily the product of a legal error or a clearly
erroneous factual finding, cannot be located within the range of permissible
decisions.” Jasco Tools, Inc. v. Dana Corp. (In re Dana Corp.), 574 F.3d
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129, 145 (2d Cir. 2009) (internal quotation marks and citations omitted).
III. Discussion
Planavsky argues that the bankruptcy court erred in granting Broome
County’s motion to lift the automatic stay pursuant to 11 U.S.C. § 362
because it failed to make “any finding as to confirmability of the Debtor’s
Plan, as to which his Disclosure Statement had been approved and as to
which a confirmation hearing had not yet occurred.” (Appellant Br. at 2-3,
Dkt. No. 4.) Planavsky’s argument is misplaced.
In general, “[a] court may lift an automatic stay ... when the debtor
does not have an equity in the property and the property is not necessary
to an effective reorganization.” Powers v. Am. Honda Fin. Corp., 216 B.R.
95, 97 (N.D.N.Y 1997) (citation and internal quotation marks omitted).
However, in the context of “a Chapter 7 liquidation case, effective
reorganization is irrelevant.” Id. (citations omitted). Thus, to lift a stay in
such a case, the creditor must show only that “the debtor does not have
equity in the property.” Id. (citing 11 U.S.C. § 362(d)(2)).
In this case, prior to lifting the automatic stay against Planavsky’s
Broome County properties, the bankruptcy court, on motion of the United
States Trustee, converted Planavsky’s chapter 11 case to a chapter 7
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case. (See July 22, 2010 Hr’g at 16-17, Dkt. No. 12.) Thus, in assessing
the appropriateness of the bankruptcy court’s decision to lift the stay, this
court need only consider whether Planavsky retained any equity in the
subject properties, not whether Planavsky’s proposed plan was “patently
unconfirmable.” See Powers, 216 B.R. at 97. And in that regard, because
there is no basis to dispute Broome County’s contention that Planavsky did
not retain any equity in the subject properties—a contention not disputed
by Planavsky—the court discerns no error in the bankruptcy court’s
decision to lift the automatic stay. Accordingly, the bankruptcy court’s
order is affirmed.
IV. Conclusion
WHEREFORE, for the foregoing reasons, it is hereby
ORDERED that Planavsky’s appeal is DENIED and DISMISSED; and
it is further
ORDERED that the judgment of the bankruptcy court is AFFIRMED;
and it is further
ORDERED that the Clerk enter judgment and provide copies of this
Memorandum-Decision and Order to the parties.
IT IS SO ORDERED.
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August 2, 2011
Albany, New York

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