Cole v. James B. Nutter & Company et al

Filing 6

ORDER denying 3 Pro Se Emergency MOTION to Stay Pending Appeal. Signed by Senior Judge Graham Mullen on 1/19/2017. (Pro se litigant served by US Mail.)(eef)

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF NORTH CAROLINA
CHARLOTTE DIVISION
CIVIL ACTION NO. 3:16-CV-00728-GCM
ELIZABETH COLE,
Plaintiff,
v.
JAMES B. NUTTER & COMPANY
WARREN L. TADLOCK
Defendant.

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ORDER

THIS MATTER is before the court on the Pro Se Emergency Motion to Stay Pending
Appeal (Doc. No. 3) and Response in Opposition to Motion to Stay (Doc. No. 4).
BACKGROUND
An order granting the appellee, James B. Nutter & Company, relief from the automatic
stay to proceed with eviction was entered by the bankruptcy court on October 11, 2016. (Doc.
No. 1-1 at 1). This order lifted the automatic stay to allow the appellee “to exercise its legal
rights to obtain possession of the Debtor’s [Cole’s] property located at 7120B Somerset Springs
Drive, Charlotte, NC.” (Id.). The order found that James B. Nutter & Company was entitled to
relief of the automatic stay that had been imposed by Cole’s voluntary petition under Chapter 13
of Title 11 of the U.S. Code because Cole’s interest in the property “is not adequately protected”
and Cole’s “ownership interest in the Property has previously been terminated.” (Id. at 2).
The Appellant, Elizabeth Cole, then filed a motion to stay the Bankruptcy Court’s order
under Bankruptcy Rule 8007. (Doc. No. 3 at 1).

LEGAL STANDARD
Federal Rule of Bankruptcy Procedure 8007 provides that a party may request a stay
pending appeal. “[A] party seeking a stay [in the district court] must show (1) that he will likely
prevail on the merits of the appeal, (2) that he will suffer irreparable injury if the stay is denied,
(3) that other parties will not be substantially harmed by the stay, and (4) that the public interest
will be served by granting the stay.” Long v. Robinson, 432 F.2d 977, 979 (4th Cir. 1970).
DISCUSSION
A. Failure to Comply with Rule 8007
Appellee asserts that Appellant cannot obtain relief from this Court because Appellant has
failed to comply with the presentation requirement of Rule 8007. (Doc. No. 4 at 2).
Rule 8007 provides that “[o]rdinarily, a party must move first in the bankruptcy court for ... a
stay of a judgment, order, or decree of the bankruptcy court pending appeal.” Fed. R. Bankr. P.
8007(a)(1)(A). If a motion for stay is then made in the district court on direct review of the
bankruptcy court, the movant must “either state that the court has not yet ruled on the motion [for
stay], or state that the court has ruled and set out any reasons given for the ruling.” Fed. R.
Bankr. P. 8007(b)(2). But, if the movant did not first make a motion for stay in the bankruptcy
court, the movant must “show that moving first in the bankruptcy court would be impracticable.”
Id.
“A failure to seek emergency relief in the bankruptcy court is a critical defect and not often
overlooked.” In re Rivera, 2015 WL 6847973, at *2 (N.D. Cal. Nov. 9, 2015). This is because
“[t]he reviewing court should have the benefit of the learning of the lower court, which is more
familiar with the parties, facts and legal issues.” Id. (internal quotation marks omitted).

“[D]istrict courts routinely dismiss motions for a stay pending appeal when stay relief is not first
sought from the bankruptcy judge and the failure to do so is not adequately explained.” Id.
(quoting In re BGI, Inc., 504 B.R. 754, 761 (S.D.N.Y. 2014)).
Appellant’s stay application does not satisfy the presentation requirement. The Appellant
stated that they did not request a stay of judgment from the bankruptcy court “because the
Appellant filed a Notice of Removal of the state court action to the United States District Court”
and “due to the fact that an Adversary Proceeding . . . hearing was conducted” on November 8,
2016 in which the bankruptcy court granted the Defendants Motion to Dismiss and denied
Plaintiff Cole’s Motion for Joinder. (Doc. No. 1 at 1-2). While the Appellant has given reasons
for not making a motion to stay in bankruptcy court, the Court does not find such reasons
persuasive that seeking a ruling from the bankruptcy court would have been impracticable.
B. Failure to Demonstrate Likelihood of Success
In addition, this motion fails on its merits because Appellant has not demonstrated that she
will likely succeed on the merits of her appeal.
The “Order Granting Relief from the Automatic Stay to Proceed with Eviction” entered by
the bankruptcy court allowed the Appellee to proceed with eviction proceedings stemming from
a foreclosure proceeding initiated on June 24, 2015 and the eventual foreclosure sale of the
property conducted March 29, 2016. (Doc. No. 101 at 2). The Bankruptcy Court found that while
the Appellant resided in the condominium on the date the Appellant filed her petition in the
Bankruptcy Court (June 9, 2016), the Appellee had foreclosed its lien against the condominium
at confirmed sale held March 29, 2016. Therefore, the Bankruptcy Court found the Appellant’s
interests in the condominium had terminated prior to the filing of the bankruptcy case, but that

the Appellee was stayed by the bankruptcy filing from obtaining possession of property it now
owned but was denied possession. Absent protection for its ownership interests in the
condominium, the automatic stay protecting the Appellant was lifted.
Appellant’s motion identifies six (6) issues on appeal. These are each presented as questions,
so whether any of these “issues” are actually facts presented to the court is questionable.
However, none of the issues are relevant to an allegation of error by the Bankruptcy Court in
granting the Appellee stay relief.
The bankruptcy court found that the Appellant has no lawful right of possession of the
condominium and the Appellant has articulated no assignment of error in the bankruptcy court
which demonstrates a likeliness that her appeal will succeed in reversing the bankruptcy court’s
grant of relief from the automatic stay.
IT IS THEREFORE ORDERED that Appellant’s motion for a stay pending appeal (Doc.
No. 3) is DENIED.

Signed: January 19, 2017