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In re Naderi

United States District Court, Northern District of Alabama, Northeastern Division

February 27, 2015

IN RE MOHAMMAD ALI NADERI, DEBTOR.
v.
MICHAEL FORD, TRUSTEE, APPELLEE. MOHAMMAD ALI NADERI, APPELLANT, Bankruptcy Court No. 14-81030-JAC7

MEMORANDUM OPINION

VIRGINIA EMERSON HOPKINS UNITED STATES DISTRICT JUDGE

This matter is before the court as an appeal from the bankruptcy court, pursuant to 28 U.S.C. § 158. The parties have filed appellate briefs, which the court has reviewed. The court finds, in accordance in Fed.R.Bankr.P. 8012, that the facts and legal arguments are adequately presented in the briefs and record and the decisional process will not be significantly aided by oral argument.

The appellant appeals from the bankruptcy court’s Order converting his Chapter 13 Petition into a Chapter 7 proceeding. Under the Federal Rules of Bankruptcy Procedure, the bankruptcy court’s findings of fact will not be set aside unless they are clearly erroneous. Fed.R.Bankr.P. 8013.

Factual Background

This appeal challenges various rulings made by Bankruptcy Judge Jack Caddell, including the finding that confirmation of the Chapter 13 plan of plaintiff Mohammad Ali Naderi (“Naderi”) should be submitted on summary judgment, and culminating in the conversion of that plan into one under Chapter 7.

On August 19, 2014, Judge Caddell ruled that, in accordance with the instructions provided in open court the previous day, Naderi was to file a motion for summary judgment. (Doc. #1-1).[1]The Appellee, Trustee Michael Ford (“Trustee”), filed a motion to convert the case to Chapter 7, or in the alternative, a motion to dismiss. Judge Caddell granted the motion to convert the case to Chapter 7 on September 3, 2014, based on a September 2, 2014 hearing. (Doc. #1-2). Naderi filed a Notice of Appeal and an Amended Notice of Appeal from both those Orders on September 15 and 18, 2014, respectively. (Docs. # 1-3, #1-6). Naderi then filed a motion to alter, amend or vacate the Order of Conversion, which Judge Caddell denied. (Docs. #1-10, #1-11). Naderi filed a motion to correct or amend the Order denying his motion to alter, amend or vacate, and a correction motion for the same (docs. #1-12, #1-13), which were again denied by Judge Caddell on September 9, 2014. (Doc. # 1-14). This appeal followed on October 9, 2014. (Doc. # 1).

Standard of Review

This court reviews the bankruptcy court’s findings of fact under the clearly erroneous standard of review and conclusions of law under the de novo standard of review. In re Piazza, 719 F.3d 1253, 1260 (11th Cir. 2013), citing In re Englander, 95 F.3d 1028, 1030 (11th Cir. 1996). A finding is “clearly erroneous” when, in light of all of the evidence, the reviewing court is left with the definite and firm conviction that a mistake has been committed. In re Int’l Pharmacy & Discount, II, Inc., 443 F.3d 767, 770 (11th Cir. 2005). The proper construction of the Bankruptcy Code by the bankruptcy court is a matter of law; accordingly, such interpretations are subject to de novo review. In re Colortex Industries, Inc., 19 F.3d 1371, 1374 (11th Cir. 1994); In re Taylor, 3 F.3d 1512, 1514 (11th Cir. 1993).

Legal Analysis

Although Naderi lists five grounds for appeal, these arguments fall into two categories: (1) did the bankruptcy court commit error in ordering confirmation be submitted by motion for summary judgment; and (2) did the bankruptcy court commit error in ordering Naderi’s Chapter 13 petition be converted to Chapter 7? The court addresses each of these in turn.

I. Did the Bankruptcy Court Err in Ordering Confirmation Be Submitted by Way of Summary Judgment Motion?

Naderi argues that a bankruptcy court cannot use summary judgment motions to consider confirmation of a Chapter 13 Plan. (Doc. #5, p. 14). The Trustee responds that the court was wholly correct in ordering that confirmation and that the Trustee’s motion to convert or dismiss be submitted by summary judgment motion. (Doc. # 6, pp. 8-10). According to the Trustee, Rule 9014, “Contested Matters, ” Fed.R.Bankr.P., resolves this issue completely. That Rule states in relevant part:

(a) Motion. In a contested matter not otherwise governed by these rules, relief shall be requested by motion, and reasonable notice and opportunity for hearing shall be afforded the party against whom relief is sought. No response is required under this rule unless the court directs otherwise.
(b) Service. The motion shall be served in the manner provided for service of a summons and complaint by Rule 7004 and within the time determined under Rule 9006(d). Any written response to the motion shall be served within the time determined under Rule 9006(d). Any paper served after the motion shall be served in the manner provided by Rule 5(b) F. R. Civ. P.
(c) Application of Part VII rules. Except as otherwise provided in this rule, and unless the court directs otherwise, the following rules shall apply: 7009, 7017, 7021, 7025, 7026, 7028-7037, 7041, 7042, 7052, 7054-7056, 7064, 7069, and 7071 .... The court may at any stage in a particular matter direct that one or more of the other rules in Part VII shall apply. The court shall give the parties notice of any order issued under ...

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