in re: guido yarol cruz, 9th cir. bap (2014)

7/25/2019 In re: Guido Yarol Cruz, 9th Cir. BAP (2014)

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UNITED STATES BANKRUPTCY APPELLATE PANEL

OF THE NINTH CIRCUIT

I n r e: ) BAP No. CC- 13- 1554- Ki TaD)

GUI DO YAROL CRUZ, ) Bk. No. 06: 13- 20368- MH)

Debt or . ) )

)GUI DO YAROL CRUZ, )

)Appel l ant , )

)v. ) O P I N I O N

)STEI N STRAUSS TRUST #1361, )PDQ I NVESTMENTS, LLC, )

)Appel l ee. )

______________________________)

Submi t t ed Wi t hout Or al Ar gumenton J une 26, 2014

Fi l ed - August 29, 2014

Appeal f r om t he Uni t ed St at es Bankrupt cy Cour tf or t he Cent r al Di str i ct of Cal i f or ni a

Honor abl e Mar k D. Houl e, Bankrupt cy J udge, Presi di ng

Appear ances: Appel l ant Gui do Yar ol Cr uz appear ed pr o se onbr i ef ; J oseph C. Del mot t e, Esq. of Pi t e Duncan, LLPappear ed on br i ef f or appel l ee, St ei n St r auss Trust#1361, PDQ I nvest ment s, LLC.

Bef or e: KI RSCHER, TAYLOR and DUNN, Bankr upt cy J udges.

FILEDAUG 29 2014

SUSAN M. SPRAUL, CU.S. BKCY. APP. PANOF THE NINTH CIRCU


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KI RSCHER, Bankr upt cy J udge:

Gui do Yar ol Cr uz ( Cr uz) appeal s t he or der gr ant i ng t he

mot i on of PDQ I nvest ment s, LLC as t r ust ee f or t he St ei n St r auss

Tr ust #1361 ( SS Tr ust ) t o annul r et r oact i vel y t he aut omat i c st ay

or , i n t he al t er nat i ve, t o conf i r m t hat no st ay was i n ef f ect , and

he appeal s t he or der denyi ng r econsi der at i on of t he pr i or or der .

We AFFI RM.

I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY

A. Prepetition events

Mr . Doo Ko obt ai ned a l oan f r om I ndyMac Bank, FSB ( I ndyMac)t o pur chase a r esi dence l ocat ed on St ei n St r auss St r eet i n

Ful l er t on, Cal i f or ni a ( Pr oper t y) . The deed of t r ust i n f avor of

I ndyMac was r ecorded on J une 8, 2007. On J une 25, 2007, Mr . Ko

t r ansf er r ed hi s 100% i nt er est i n t he Pr oper t y to a Ms. Eun H. Ko

by way of a gr ant deed f or no consi der at i on. The gr ant deed was

r ecor ded on J une 28, 2007.

Ul t i mat el y, t he l oan went i nt o def aul t , and a Not i ce of

Def aul t was r ecorded agai nst t he Proper t y on Febr uar y 9, 2009. A

Not i ce of Sal e was r ecor ded some thr ee years l ater on Sept ember

25, 2012. A t r ust ee s sal e was set f or Oct ober 24, 2012.

The par t i es have not expl ai ned why i t t ook over t hree years

bef or e t he Not i ce of Sal e was r ecor ded. We di scover ed i n

r evi ewi ng the bankrupt cy cour t docket , however , t hat Ms. Ko, under

t he names Eun H. Ko and Eun Ko ( same Soci al Secur i t y Number ) ,

f i l ed no l ess t han si x bankr upt cy cases i n t he Cent r al Di st r i ct of

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Cal i f orni a bet ween November 2009 and Febr uar y 2013. 1 Al l cases

wer e skel et al f i l i ngs and di smi ssed f or ei t her f ai l i ng t o f i l e

document s or t o appear at t he 341( a) 2 meet i ng of cr edi t or s af t er

mul t i pl e cont i nuances. Mr . Ko f i l ed t hr ee bankrupt cy cases i n

2009, al l of whi ch wer e skel et al f i l i ngs and di smi ssed f or f ai l i ng

t o f i l e document s.

Not abl y, i n Ms. Ko s t hi r d case f i l ed on November 5, 2010,

t he ser vi cer f or I ndyMac sought r el i ef f r om st ay agai nst t he

Propert y. The movi ng papers r ef erenced a gr ant deed ( not not ed i n

t hi s case) execut ed on J anuary 20, 2010, and r ecor ded on J anuary

22, 2010, wher ei n Ms. Ko pur por t ed t o t r ansf er a 5% i nt er est i nt he Pr oper t y back t o Mr . Ko and a 5% i nt er est t o a Mr . Tae Hoon

Ko. Mr . Tae Hoon Ko f i l ed one skel etal chapt er 13 bankr upt cy case

on J anuary 4, 2010, whi ch was conver t ed t o chapt er 7 and

ul t i mat el y di smi ssed f or f ai l i ng t o appear at t he 341( a)

meet i ng. I ndyMac was gr ant ed st ay r el i ef on May 31, 2011, and t he

or der i ncl uded a bad f ai t h f i ndi ng under 362( d) ( 4) . The t wo-

year i n r em bar cont ai ned i n t hat or der pr esumabl y expi r ed on or

about May 31, 2013, whi ch i s about t wo weeks bef ore Cr uz f i l ed hi s

chapt er 7 case. 3

1 We have t aken j udi ci al not i ce of Ms. Ko s mul t i pl e casesf i l ed wi t h t he bankr upt cy cour t t hr ough i t s el ect r oni c docket i ngsyst em. See O Rour ke v. Seaboar d Sur . Co. ( I n r e E. R. Feger t ,I nc. ) , 887 F. 2d 955, 957- 58 ( 9t h Ci r . 1989) ; At wood v. ChaseManhat t an Mor t g. Co. ( I n r e At wood) , 293 B. R. 227, 233 n. 9 ( 9t h

Ci r . BAP 2003) .2 Unl ess speci f i ed ot her wi se, al l chapt er , code and r ul e

r ef er ences ar e t o t he Bankrupt cy Code, 11 U. S. C. 101- 1532, andt he Federal Rul es of Bankr upt cy Procedur e, Rul es 1001- 9037. TheFeder al Rul es of Ci vi l Pr ocedur e ar e r ef er r ed t o as Ci vi l Rul es.

3 Cl ear l y, Ms. Ko has a hi st or y of f i l i ng mul t i pl ebankr upt cy cases and t r ansf er r i ng f r act i onal i nt er est s i n t he

( cont i nued. . . )

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B. Postpetition events

Cr uz, pr o se, f i l ed a skel et al chapt er 7 bankrupt cy case on

J une 13, 2013. Pursuant t o Rul e 1007( c) , Cr uz was or der ed t o f i l e

hi s schedul es and other r equi si t e document s by J une 27. On J une

27, Cr uz sought an extensi on t o J ul y 11 t o f i l e al l document s,

whi ch was gr ant ed. Cr uz f ai l ed t o f i l e al l r equi r ed document s by

J ul y 11, no f ur t her ext ensi ons wer e r equest ed, and hi s bankr upt cy

case was di smi ssed on J ul y 17, 2013 ( Di smi ssal Or der ) . 4 I n t he

Di smi ssal Or der , t he bankrupt cy cour t r et ai ned j ur i sdi ct i on on

al l i ssues ar i si ng under Bankrupt cy Code 110, 329 and 362.

Cr uz di d not appeal t he Di smi ssal Or der .5

1. SS Trusts motion for relief from stay

On J ul y 15, 2013, Ms. Ko, who now hel d onl y an 80% i nt erest

i n t he Pr oper t y, execut ed a gr ant deed pur por t i ng t o t r ansf er a 5%

i nt er est i n t he Proper t y t o Cr uz ( t he Cr uz Deed) . The Cr uz Deed

was r ecor ded at 12: 52 p. m. on J ul y 15, 2013. On t hat same day at

appr oxi mat el y 2: 18 p. m. , t he Proper t y was sol d by the l ender at a

t r ust ee s sal e t o SS Tr ust , who was t he hi ghest bi dder at

3( . . . cont i nued)Proper t y to per sons i n bankrupt cy i n an at t empt t o subver t t hef orecl osure pr ocess. We have no doubt Cr uz, who now cl ai ms t ol i ve wi t h Ms. Ko at t he Pr oper t y, i s yet anot her par t i ci pant i nher ongoi ng scheme.

4 Cr uz di d, however , f i l e some document s unt i mel y on J ul y 15at 2: 13 p. m. , whi ch i s t he same day he acqui r ed hi s 5% i nt er est i nt he Proper t y and about one hour af t er t he Cr uz Deed was r ecor ded.He di d not cl ai m an i nt er est i n t he Pr oper t y i n hi s Schedul e A.

5 Cr uz f i l ed a mot i on t o r econsi der t he Di smi ssal Or derunder Ci vi l Rul e 60( b) ( 1) about t wo mont hs af t er t he or der sent r y. The bankr upt cy cour t deni ed i t . Because t he mot i on t or econsi der was not f i l ed wi t hi n 14 days of t he ent r y of t heDi smi ssal Or der , t he t i me to appeal t he Di smi ssal Or der was nott ol l ed. Rul e 8002( b) . Ther ef or e, Cr uz s ar gument s about t hemer i t s of t he Di smi ssal Or der ar e unt i mel y, and we l ackj ur i sdi ct i on t o consi der t hem.

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$711, 000. SS Tr ust est abl i shed t hat i t had no knowl edge of t he

Cr uz Deed or of Cr uz s bankrupt cy case at t he t i me of t he sal e.

Shor t l y t her eaf t er , SS Tr ust became awar e of Cr uz s

bankr upt cy. On August 13, 2013, af t er Cr uz s case had been

di smi ssed, SS Tr ust moved t o annul t he aut omat i c st ay t o val i dat e

t he sal e or , i n t he al t er nat i ve, t o conf i r m t hat no st ay was i n

ef f ect at t he t i me of t he sal e ( St ay Rel i ef Mot i on) . SS Tr ust

al so sought a f i ndi ng t hat Cr uz s bankrupt cy case was f i l ed as

par t of a bad f ai t h scheme to del ay, hi nder and def r aud cr edi t or s

under 362( d) ( 4) . 6

Speci f i cal l y, SS Tr ust ar gued t hat because Cr uz, a chapt er 7debt or , di d not acqui r e hi s i nt er est i n t he Pr oper t y unt i l af t er

he f i l ed f or bankrupt cy, t he Pr oper t y was never pr oper t y of t he

est at e. Consequent l y, hi s bankrupt cy f i l i ng had no ef f ect on t he

val i di t y of t he sal e. Al t er nat i vel y, SS Tr ust ar gued t hat even i f

t he Pr oper t y was est at e pr oper t y and t he sal e vi ol at ed t he

aut omat i c st ay, cause exi st ed t o annul t he st ay because: ( 1) SS

Tr ust was a bona f i de pur chaser who pur chased t he Pr oper t y wi t hout

any knowl edge of Cr uz s bankr upt cy or of t he Cr uz Deed r ecor ded

t he day of t he sal e; ( 2) SS Tr ust t ook i mmedi at e act i on t o annul

6 SS Trust used t he mandatory l ocal f orm,F 4001- 1. RFS. RP. MOTI ON, r equi r ed by bankr upt cy cour t , whi ch i ncompl i ance wi t h amendment s of t he Bankr upt cy Abuse Prevent i on andConsumer Prot ect i on Act of 2005, cont ai ned the st at ut or y l anguageof del ay, hi nder , and def r aud[ , ] as r equi r ed by 362( d) ( 4) .The mandat or y or der , F 4001- 1. RFS. RP. ORDER, r equi r ed by t he l ocalf orms and i ssued by the bankr upt cy cour t , cont ai ned t hi s samest at ut or y l anguage. The Bankrupt cy Techni cal Cor r ect i ons Act of2010 amended t he st atut ory l anguage t o read del ay, hi nder , ordef r aud[ . ] The st atut ory amendment changed t he pr oof of t her equi r ed el ement s f r om t he conj unct i ve t o t he di sj unct i ve.Subsequent t o t he f i l i ng of t hi s appeal , t he bankrupt cy cour t hasamended i t s mandat ory f orms t o cont ai n t he 2010 amended st at utoryl anguage. See Bankrupt cy Techni cal Cor r ect i ons Act of 2010, Pub.L. No. 111- 327, 124 St at 3557.

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t he st ay once i t l ear ned of Cr uz s bankrupt cy f i l i ng, wher eas Cr uz

had not t aken any act i on t o set t he sal e asi de; ( 3) t he f act s and

ci r cumst ances suggest ed Cr uz s bankr upt cy case was f i l ed as par t

of a bad f ai t h scheme t o del ay and/ or hi nder t he sal e; and ( 4)

both SS Tr ust and the l ender who sol d the Pr opert y woul d be

pr ej udi ced i f t he sal e wer e deemed voi d.

I n suppor t of t he St ay Rel i ef Mot i on, SS Tr ust of f er ed copi es

of t he var i ous grant deeds and t he recor ded Not i ce of Def aul t and

Not i ce of Sal e. SS Tr ust di d not submi t a t r ust ee s deed, but i t

di d submi t a copy of a document ent i t l ed Trust ee s Sal e Resul t s

t hat showed SS Trust was t he wi nni ng bi dder at t he J ul y 15 sal e.Cr uz opposed t he St ay Rel i ef Mot i on, cont endi ng t hat SS Tr ust

had f ai l ed t o pr ove i t was t he new owner of t he Pr oper t y; no

t r ust ee s deed had been shown or r ecor ded. He f ur t her argued SS

Tr ust was not a BFP. I n hi s suppor t i ng decl ar at i on, Cr uz st at ed

t hat he had not i f i ed t he sal e t r ust ee by f ax at 1: 03 p. m. on J ul y

15, 2013, about t hi r t y mi nut es bef or e t he schedul ed sal e, of hi s

bankrupt cy f i l i ng on J une 13, 2013. Nonet hel ess, t he sal e t r ust ee

i gnor ed [ hi s] bankrupt cy st ay and sol d t o an unknown t hi r d par t y

i nvest or . Cr uz al so st at ed t hat even t hough hi s par al egal f r i end

hel ped hi m f i l l out hi s unt i mel y f i l ed schedul es, he di d not know

wher e i n t he schedul es t o l i st hi s i nt er est i n t he Pr oper t y. Cr uz

f ur t her st at ed t hat t he l ender was l ooki ng i nt o t he al l eged

i mpr oper t r ust ee s sal e.

At t ached t o Cr uz s opposi t i on was a copy of t he Not i ce of

Bankrupt cy Case Fi l i ng Cr uz asser t ed he f axed t o t he l ender j ust

mi nut es bef or e the t r ust ee s sal e and t he cover sheet t o a

compl ai nt Cr uz f i l ed i n st at e cour t on August 26, 2013, agai nst

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t he l ender and SS Tr ust t o set asi de t he sal e.

I n r epl y, SS Tr ust ar gued t hat i t was a BFP wi t hout not i ce of

Cr uz s bankrupt cy. SS Tr ust al so ar gued t hat i t had st andi ng t o

br i ng t he St ay Rel i ef Mot i on despi t e t he l ack of a recor ded

t r ust ee s deed; i t became t he benef i ci ar y of t he t r ust ee s deed by

bei ng t he successf ul bi dder at t he sal e.

The bankrupt cy cour t i ssued a t ent at i ve r ul i ng on t he Stay

Rel i ef Mot i on on Sept ember 9, 2013, whi ch i t adopt ed as i t s f i nal

r ul i ng at t he r el at ed hear i ng on Sept ember 10, 2013. Cr uz di d not

appear . The bankr upt cy cour t f ound t hat t he aut omat i c st ay never

t ook ef f ect as t o t he Pr oper t y and t hat i t was never pr oper t y oft he est at e because Cr uz acqui r ed hi s i nt er est i n i t post pet i t i on.

Al t er nat i vel y, cause exi st ed t o annul t he st ay based on t he

post pet i t i on t r ansf er of a f r act i onal i zed i nt er est t o Cr uz on t he

day of t he f or ecl osur e sal e. I n addi t i on, t he cour t f ound t hat

Cr uz s bankr upt cy was part of a scheme to hi nder , del ay and7

def r aud credi t or s because: ( 1) he f i l ed a skel et al pet i t i on; ( 2)

a par t i al i nt er est i n t he Pr oper t y was t r ansf er r ed t o hi m

post pet i t i on; ( 3) he f ai l ed t o l i st t he Pr oper t y on Schedul e A or

amend i t af t er obt ai ni ng an i nt er est ; and ( 4) despi t e r ecei vi ng an

ext ensi on t o f i l e al l necessar y bankrupt cy document s, he st i l l

f ai l ed t o cur e t he def i ci enci es and t he case was di smi ssed.

The bankrupt cy cour t ent er ed an or der grant i ng t he Stay

Rel i ef Mot i on under 362( d) ( 1) and ( d) ( 4) on Sept ember 25, 2013

7 At al l t i mes rel evant t o t hi s appeal , 362( d) ( 4) r equi r eda f i ndi ng t hat t he f i l i ng of debt or s pet i t i on was par t of ascheme t o del ay, hi nder or def r aud cr edi t or s. The bankrupt cycour t s or der f ound t hat Cr uz s pet i t i on was f i l ed as par t of ascheme t o del ay, hi nder and def r aud cr edi t or s. Cr uz does notassi gn any er r or by t he bankrupt cy cour t on t hi s speci f i c i ssue.I n any event , i t has no bear i ng on t he out come of t hi s appeal .

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( St ay Rel i ef Or der ) .

2. Cruzs motion to reconsider

Cr uz t i mel y moved f or r econsi der at i on of t he St ay Rel i ef

Or der under Ci vi l Rul e 60( b) ( 1) ( Mot i on t o Reconsi der ) . Cr uz

cont ended t he St ay Rel i ef Or der shoul d be vacat ed due t o excusabl e

negl ect because hi s counsel f ai l ed t o appear at t he hear i ng and

because he had new evi dence est abl i shi ng the cour t shoul d not

have gr ant ed i t . Cr uz reasser t ed hi s ar gument t hat SS Trust

l acked st andi ng t o br i ng t he St ay Rel i ef Mot i on and he rai sed a

new argument , wi t hout any support i ng evi dence, t hat t he sal e was

voi d because t he t r ust ee was not aut hor i zed t o conduct i t .SS Trust opposed t he Mot i on t o Reconsi der , cont endi ng t hat

t he f ai l ur e of Cr uz s al l eged at t or ney t o at t end t he hear i ng on

t he St ay Rel i ef Mot i on di d not est abl i sh excusabl e negl ect under

Ci vi l Rul e 60( b) ( 1) . Cr uz had no at t or ney of r ecor d; no evi dence

f r omany at t orney was of f ered t o expl ai n why he or she was not

t her e. Al t hough not r ai sed by Cr uz, SS Tr ust al so ar gued he was

not ent i t l ed t o r el i ef under Ci vi l Rul e 60( b) ( 6) .

Cr uz s r epl y rei t er at ed hi s pr i or ar gument s and he ar gued f or

t he f i r st t i me: t hat SS Tr ust l acked st andi ng t o seek r el i ef f r om

st ay because i t was not r egi st er ed wi t h t he Cal i f or ni a Secr et ar y

of St at e; t hat t he Cr uz Deed was val i d upon del i ver y; and t hat t he

f or ecl osur e sal e was bei ng l i t i gat ed i n st at e cour t . Fi nal l y,

Cr uz cont ended that hi s at t or ney, J essi ca De Anda Leon, appear ed

f or t he st ay r el i ef hear i ng, al bei t , t hi r t y mi nut es l at e.

At t ached t o Cr uz s r epl y was a phot o copy of a busi ness car d

f r om Ms. De Anda Leon. At t ached al so was a copy of a demur r er

dat ed Sept ember 9, 2013, f i l ed i n st at e cour t by t he Pr oper t y

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l ender ( OneWest Bank, FSB) i n r esponse t o Ms. Ko s compl ai nt t o

set asi de t he sal e. Cur i ousl y, t he l ender s demur r er st at ed t hat

t he f or ecl osur e sal e had not yet t aken pl ace.

The bankrupt cy cour t i ssued i t s t ent at i ve r ul i ng denyi ng t he

Mot i on t o Reconsi der , whi ch i t adopt ed as i t s f i nal r ul i ng at t he

r el at ed hear i ng. Pur suant t o Local Bankrupt cy Rul e 9013- 1( g) ( 1) ,

t he cour t r ef used t o consi der new argument s r ai sed by Cr uz t hat

wer e not r esponsi ve t o SS Tr ust s opposi t i on, such as t he

f or ecl osur e sal e was bei ng l i t i gat ed, t hat SS Tr ust was not

r egi st er ed wi t h t he Cal i f or ni a Secret ar y of St at e, and t hat t he

Cr uz Deed was a l awf ul t r ansf er . I n r evi ewi ng t he f act or s setf or t h i n Pi oneer I nv. Ser vs. Co. v. Br unswi ck Assocs. Lt d. P shi p,

507 U. S. 380, 385 (1993) , t he bankr upt cy cour t determi ned Cr uz had

f ai l ed t o est abl i sh excusabl e negl ect because: ( 1) he pr ovi ded no

evi dence t hat he was unabl e t o at t end t he st ay rel i ef hear i ng; ( 2)

t he Mot i on t o Reconsi der di d not i ncl ude a decl ar at i on f r om Ms. De

Anda Leon; and (3) Cr uz had no at t orney of r ecor d.

The bankrupt cy cour t al so f ound Cr uz had f ai l ed t o est abl i sh

ent i t l ement t o r el i ef under Ci vi l Rul e 60( b) ( 2) , because even

t hough he cl ai med he had new evi dence, he f ai l ed t o st ate what

t hat evi dence was.

Last l y, t he bankrupt cy cour t det er mi ned r el i ef al so was not

war r ant ed under Ci vi l Rul e 60( b) ( 6) . Cr uz had not of f er ed any

aut hor i t y f or a r ever sal of t he bad f ai t h f i ndi ng, and, i n any

event , vacat i on of a bad f ai t h f i ndi ng was not gr ounds f or

r econsi der at i on under Ci vi l Rul e 60( b) . Fur t her , despi t e Cr uz s

ar gument s t o t he cont r ar y, SS Tr ust had est abl i shed a col or abl e

cl ai m t o t he Pr oper t y wi t h t he Tr ust ee s Sal e Resul t s document .

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Fi nal l y, t he st ay was never i n ef f ect as t o t he Pr oper t y because

Cr uz acqui r ed hi s 5% i nt er est i n i t post pet i t i on.

At t he hear i ng on t he Mot i on t o Reconsi der , at t or ney Rober t

L. Bachman speci al l y appear ed f or Cr uz. Mr . Bachman expl ai ned

t hat Cr uz s new evi dence was t he demur r er f i l ed by the l ender i n

t he st at e cour t act i on, i n whi ch t he l ender had asser t ed t hat t he

f or ecl osur e sal e had not yet t aken pl ace. I n r esponse, t he

bankr upt cy cour t opi ned, and Mr . Bachman agr eed, t hat t he demur r er

f i l ed on Sept ember 9 was f i l ed af t er t he hear i ng on t he St ay

Rel i ef Mot i on and, t her ef or e, t hat i t coul d not be newl y

di scover ed evi dence.An or der denyi ng the Mot i on to Reconsi der t he St ay Rel i ef

Or der was ent ered on November 1, 2013 ( Reconsi derat i on Or der) .

Thi s t i mel y appeal f ol l owed.

II. JURISDICTION

The bankrupt cy cour t had j ur i sdi ct i on under 28 U. S. C. 1334

and 157( b) ( 2) ( G) . We have j ur i sdi ct i on under 28 U. S. C. 158.

III. ISSUES

1. Di d t he bankr upt cy cour t abuse i t s di scret i on when i t gr ant ed

t he St ay Rel i ef Mot i on?

2. Di d t he bankr upt cy cour t abuse i t s di scret i on when i t deni ed

Cr uz s Mot i on t o Reconsi der ?

IV. STANDARDS OF REVIEW

St andi ng i s a l egal i ssue we r evi ew de novo. Loyd v. Pai ne

Webber , I nc. , 208 F. 3d 755, 758 ( 9t h Ci r . 2000) ; Kr onemyer v. Am.

Cont r act or s I ndem. Co. ( I n r e Kr onemyer ) , 405 B. R. 915, 919 ( 9t h

Ci r . BAP 2009) .

A bankr upt cy cour t s deci si on t o gr ant r et r oact i ve r el i ef

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f r om t he aut omat i c st ay i s r evi ewed f or an abuse of di scr et i on.

Nat l Envt l . Wast e Cor p. v. Ci t y of Ri ver si de ( I n r e Nat l Envt l .

Wast e Cor p. ) , 129 F. 3d 1052, 1054 ( 9t h Ci r . 1997) ; Wi l l i ams v.

Levi ( I n r e Wi l l i ams) , 323 B. R. 691, 696 ( 9t h Ci r . BAP 2005) . We

al so revi ew t he bankrupt cy cour t s deni al of a mot i on f or

r econsi der at i on f or an abuse of di scr et i on. Tr acht Gut , LLC v.

Cnt y. of L. A. Tr easur er & Tax Col l ect or ( I n r e Tr acht Gut , LLC) ,

503 B. R. 804, 810 ( 9t h Ci r . BAP 2014) . A bankr upt cy cour t abuses

i t s di scret i on i f i t appl i ed t he wr ong l egal st andar d or i t s

f i ndi ngs wer e i l l ogi cal , i mpl ausi bl e or wi t hout suppor t i n t he

r ecor d. Tr af f i cSchool . com, I nc. v. Edr i ver I nc. , 653 F. 3d 820,832 ( 9t h Ci r . 2011) .

V. DISCUSSION

As a t hr eshol d ar gument , SS Tr ust cont ends t he St ay Rel i ef

Or der i s not r evi ewabl e on appeal . We di sagree. When a mot i on

f or r econsi der at i on under Ci vi l Rul e 60( b) , appl i cabl e her e by

Rul e 9024, i s f i l ed wi t hi n 14 days of ent r y of t he under l yi ng

or der , as i t was her e, we have j ur i sdi ct i on t o r evi ew bot h t he

under l yi ng or der and t he or der denyi ng r econsi der at i on. Wal l St .

Pl aza, LLC v. J SJ F Cor p. ( I n r e J SJ F Cor p. ) , 344 B. R. 94, 99 ( 9t h

Ci r . BAP 2006) ( appl yi ng f or mer 10- day rul e) ; Rul e 8002( b) .

Nonet hel ess, Cr uz desi gnat ed and at t ached t o hi s not i ce of appeal

onl y t he Reconsi der at i on Or der , not t he St ay Rel i ef Or der .

Al t hough Rul e 8001( a) does not r equi r e a not i ce of appeal t o

desi gnat e the or der or j udgment f r om whi ch an appeal i s t aken, our

Local Rul e 8001( a) - 1 does. However , we may depart f r om our l ocal

r ul es absent pr ej udi ce. I n r e J SJ F Cor p. , 344 B. R. at 100 ( ci t i ng

Al f r ed M. Lewi s, I nc. v. Hol zman ( I n r e Tel emar t Ent er s. , I nc. ) ,

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524 F. 2d 761, 766 ( 9t h Ci r . 1975) ) . No pr ej udi ce i s pr esent her e

because t he par t i es have br i ef ed t he i ssues r egar di ng t he St ay

Rel i ef Or der . Accor di ngl y, t he St ay Rel i ef Or der and t he

Reconsi der at i on Or der are pr oper l y bef or e us. See Uni t ed St at es

v. Ar ki son ( I n r e Cascade Rds. , I nc. ) , 34 F. 3d 756, 761 ( 9t h Ci r .

1994) ( appel l ate cour t may r evi ew mer i t s of a bankr upt cy cour t

or der wher e par t i es have f ul l y br i ef ed t hose i ssues even i f t he

or der was not i dent i f i ed i n t he not i ce of appeal ) .

A. The bankruptcy court did not abuse its discretion when itgranted the Stay Relief Motion.

Cr uz r ai ses a var i et y of ar gument s asser t i ng t hat t he

bankrupt cy cour t abused i t s di scr et i on i n gr ant i ng t he St ay Rel i ef

Mot i on. We addr ess each i n t ur n.

1. The bankruptcy court had jurisdiction to consider theStay Relief Motion.

Cr uz f i r st ar gues t he bankr upt cy cour t l acked j ur i sdi ct i on t o

consi der t he St ay Rel i ef Mot i on because hi s bankrupt cy case had

been di smi ssed. Cr uz i s i ncor r ect . I n t he Di smi ssal Or der , t he

bankr upt cy cour t expr essl y reser ved j ur i sdi ct i on over al l i ssues

ar i si ng under 362. Fur t her , af t er a case i s di smi ssed, t he

cour t may annul t he aut omat i c st ay, t her eby ret r oact i vel y

r at i f yi ng an act other wi se vi ol at i ve of t he st ay. J ohnson v. TRE

Hol di ngs LLC ( I n r e J ohnson) , 346 B. R. 190, 194 ( 9t h Ci r . BAP

2006) .

2. SS Trust established it had a colorable claim to the

Property.

Cr uz cont ends SS Tr ust was not t he real par t y i n i nt er est and

l acked st andi ng t o seek r el i ef f r om st ay. We di sagr ee.

The f i l i ng of a pet i t i on f or bankr upt cy r el i ef aut omat i cal l y

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st ays t he commencement of any act t o obt ai n possessi on of or t o

enf or ce a l i en agai nst pr oper t y of t he debt or or of t he est at e.

See 362( a) ( 3) , ( a) ( 4) and ( a) ( 5) . The aut omat i c st ay does not

appl y t o pr oper t y t hat i s not pr oper t y of t he est at e. I t does,

however , st ay the enf or cement of a l i en secur i ng a pr epet i t i on

cl ai m agai nst pr oper t y of t he debt or , whi ch i ncl udes pr oper t y

acqui r ed by an i ndi vi dual debt or post pet i t i on. 3 COLLI ER ON

BANKRUPTCY 362. 03[ 7] ( Al an N. Resni ck & Henr y J . Sommers, eds. ,

16t h ed. 2012) .

Under 362( d) , a par t y i n i nt er est may r equest r el i ef f r om

t he st ay. A par t y i n i nt er est can i ncl ude any par t y t hat has apecuni ar y i nt er est i n t he mat t er , t hat has a pr act i cal st ake i n

t he r esol ut i on of t he mat t er or t hat i s i mpact ed by the aut omat i c

st ay. Br own v. Sobczak ( I n r e Sobczak) , 369 B. R. 512, 517- 18 ( 9t h

Ci r . BAP 2007) . Pr oceedi ngs t o deci de mot i ons f or r el i ef f r om t he

aut omat i c st ay ar e ver y l i mi t ed. [ A] par t y seeki ng r el i ef f r om

st ay need onl y est abl i sh t hat i t has a col or abl e cl ai m t o enf or ce

a r i ght agai nst pr oper t y of t he est ate. Veal v. Am. Home Mor t g.

Ser vi ci ng, I nc. ( I n r e Veal ) , 450 B. R. 897, 914- 15 ( 9t h Ci r . BAP

2011) . A par t y has a col or abl e cl ai m suf f i ci ent t o est abl i sh

st andi ng t o pr osecut e t he mot i on i f i t has an owner shi p i nt er est

i n t he subj ect pr oper t y. I d. at 913; Edwar ds v. Wel l s Far go Bank,

N. A. ( I n r e Edwar ds) , 454 B. R. 100, 105 ( 9t h Ci r . BAP 2011) .

Cr uz appear s t o ar gue t hat SS Tr ust f ai l ed t o est abl i sh a

col or abl e cl ai m t o t he Pr oper t y because i t di d not r ecor d a

t r ust ee s deed. Wi t hout a r ecor ded t r ust ee s deed, Cr uz ar gues,

t he f or ecl osur e sal e cannot be deemed f i nal , SS Tr ust s al l eged

i nt er est i n t he Pr oper t y was not per f ect ed and, t hus, hi s i nt er est

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i s super i or . Cr uz mi si nt er pr et s Cal i f or ni a l aw.

Sect i on 2924h( c) of t he Cal i f or ni a Ci vi l Code pr ovi des t hat

f or t he pur poses of t hi s subsect i on ( deal i ng wi t h f i nal i zi ng a

t r ust ee s sal e) , t he sal e shal l be deemed f i nal upon t he

accept ance of t he l ast and hi ghest bi d. I t t hen di scusses when

t he sal e " i s per f ect ed, " based on t i mi ng of r ecor dat i on of t he

t r ust ee s deed wi t hi n 15 days. See al so 4 Har r y D. Mi l l er &

Mar vi n B. St ar r , CAL. REAL ESTATE 10: 252 (3d ed. 2013) ( Under

Cal i f or ni a l aw [ t ] he pur chaser at t he f or ecl osur e sal e r ecei ves

t i t l e f r ee and cl ear of any r i ght , t i t l e, or i nt er est of t he

t r ust or or any gr ant ee or successor of t he t r ust or . ) . Ther ef or e,t i t l e t echni cal l y t r ansf er r ed t o SS Tr ust , by l aw, even wi t hout

r ecor dat i on of a t r ust ee s deed on sal e.

I n suppor t of i t s St ay Rel i ef Mot i on, SS Tr ust pr ovi ded a

decl ar at i on f r om an empl oyee who test i f i ed t hat he at t ended t he

sal e on J ul y 15, 2013, and pur chased t he Proper t y. Al t hough a

t r ust ee s deed had not yet been r ecorded at t hat t i me, SS Tr ust

of f er ed a document ent i t l ed Trust ee s Sal e Resul t s, whi ch

i ndi cat ed t hat SS Tr ust had pur chased t he Pr oper t y f or $711, 000. 8

Accor di ngl y, SS Tr ust s owner shi p i nt er est i n t he Pr oper t y

est abl i shed a col or abl e cl ai m and, hence, st andi ng t o pr osecut e

t he St ay Rel i ef Mot i on.

3. The Property was not property of the estate, but it wasproperty of the debtor.

Cr uz cont ends t he Pr opert y was est ate pr opert y because he

8 Cr uz has at t ached i n hi s r epl y br i ef a copy of t he now-r ecor ded t r ust ee s deed, r ecor ded on Oct ober 1, 2013, whi ch st at est hat SS Tr ust , bei ng t he hi ghest bi dder at t he sal e on J ul y 15,2013, was t he benef i ci ar y of sai d Deed of Tr ust at t he Ti me ofsai d Tr ust ee s Sal e.

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r ecei ved a gr ant deed f r om Ms. Ko. Even pr esumi ng t he Cr uz Deed

was val i d, t he r ecor d r ef l ect s t hat he di d not obt ai n an i nt er est

i n t he Pr oper t y unt i l J ul y 15, 2013, when t he Cr uz Deed was

execut ed and r ecorded. Ther ef or e, t he Proper t y was not est at e

pr oper t y because Cr uz, a chapt er 7 debt or , acqui r ed hi s i nt er est

i n i t af t er t he commencement of t he case. See 541( a) ( 1)

( pr oper t y of t he est at e i s def i ned as al l l egal or equi t abl e

i nt erest s of t he debt or i n pr opert y as of t he commencement of t he

case) ( emphasi s added) . Because of t hi s, t he bankrupt cy cour t

f ound t hat t he Pr oper t y was never pr ot ect ed by t he aut omat i c st ay.

We agr ee t he Propert y was not propert y of t he est ate, buti t ar guabl y was pr oper t y of t he debt or and st i l l pr ot ect ed by

t he st ay under 362( a) ( 5) 9 at t he t i me of t he sal e. However , any

pot ent i al st ay vi ol at i on was cur ed by t he bankrupt cy cour t s

pr oper annul ment of t he st ay.

4. Cause existed to annul the stay.

Act i ons t aken i n vi ol at i on of t he aut omat i c st ay ar e voi d.

However , an act i on t aken i n vi ol at i on of t he aut omat i c st ay that

woul d ot her wi se be voi d may be decl ared val i d i f cause exi st s f or

r et r oact i ve annul ment of t he st ay. Schwar t z v. Uni t ed St at es ( I n

r e Schwar t z) , 954 F. 2d 569, 573 ( 9t h Ci r . 1992) . Sect i on 362( d)

empower s t he bankrupt cy cour t t o annul t he st ay. I t pr ovi des:

( d) On r equest of a par t y i n i nt er est and af t er not i ceand a hear i ng, t he cour t shal l gr ant r el i ef f r omt he st aypr ovi ded under subsect i on ( a) of t hi s sect i on, such as by

9 Sect i on 362( a) ( 5) pr ovi des that a bankrupt cy pet i t i onst ays any act t o cr eat e, per f ect , or enf or ce agai nst pr oper t y oft he debt or any l i en t o t he ext ent t hat such l i en secur es a cl ai mt hat ar ose bef or e the commencement of t he case under t hi s t i t l e.

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t er mi nat i ng, annul l i ng, modi f yi ng, or condi t i oni ng suchst ay

( 1) f or cause, i ncl udi ng t he l ack of adequat e pr ot ect i onof an i nt er est i n pr oper t y of such par t y i n i nt er est [ . ]

362( d) ( 1) ; I n r e Schwar t z, 954 F. 2d at 572 ( [ S] ect i on 362( d)

gi ves t he bankr upt cy cour t wi de l at i t ude i n craf t i ng r el i ef f r om

t he aut omat i c st ay, i ncl udi ng t he power t o gr ant r et r oact i ve

rel i ef f rom t he s tay. ) .

I n deci di ng whet her cause exi st s t o annul t he st ay, a

bankrupt cy cour t shoul d exami ne t he ci r cumst ances of t he speci f i c

case and bal ance t he equi t i es of t he par t i es r espect i ve

posi t i ons. Gaspr om, I nc. v. Fat eh ( I n r e Gaspr om, I nc. ) , 500 B. R.598, 607 ( 9t h Ci r . BAP 2013) ( ci t i ng I n r e Nat l Envt l . Wast e

Cor p. , 129 F. 3d at 1055) ; Fj el st ed v. Li en ( I n r e Fj el st ed) , 293

B. R. 12, 24 ( 9t h Ci r . BAP 2003) . Under t hi s appr oach, t he

bankrupt cy cour t consi der s ( 1) whet her t he credi t or was awar e of

t he bankrupt cy pet i t i on and aut omat i c st ay and ( 2) whet her t he

debt or engaged i n unr easonabl e or i nequi t abl e conduct . I n r e

Nat l Envt l . Wast e Cor p. , 129 F. 3d at 1055. I n Fj el st ed, we

appr oved addi t i onal f act or s f or consi der at i on i n assessi ng t he

equi t i es:

1. Number of [ bankrupt cy] f i l i ngs;

2. Whet her , i n a r epeat f i l i ng case, t he ci r cumst ances i ndi cat ean i nt ent i on t o del ay and hi nder cr edi t or s;

3. A wei ghi ng of t he ext ent of pr ej udi ce t o credi t or s or t hi r dpar t i es i f t he st ay r el i ef i s not made r et r oact i ve, i ncl udi ng

whet her harm exi st s t o a bona f i de pur chaser ;4. The [ d] ebt or s over al l good f ai t h ( t ot al i t y of ci r cumst ances

t est ) ( ci t at i on omi t t ed) ;

5. Whet her cr edi t or s knew of t he st ay but nonet hel ess t ookact i on, t hus compoundi ng t he pr obl em;

6. Whether t he debt or has compl i ed, and i s otherwi se compl yi ng,

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wi t h t he Bankr upt cy Code and Rul es;

7. The r el at i ve ease of r est or i ng t he par t i es t o t he st at us quoant e;

8. The cost s of annul ment t o debt ors and cr edi t or s;

9. How qui ckl y cr edi t ors moved f or annul ment , or how qui ckl ydebt or s moved t o set asi de the sal e or vi ol at i ve conduct ;

10. Whet her , af t er l ear ni ng of t he bankrupt cy, cr edi t or spr oceeded t o t ake st eps i n cont i nued vi ol at i on of t he st ay,or whet her t hey moved expedi t i ousl y t o gai n r el i ef ;

11. Whet her annul ment of t he st ay wi l l cause i r r epar abl e i nj ur yt o t he debt or ; and

12. Whet her s t ay r el i ef wi l l pr omot e j udi ci al economy or ot heref f i ci enci es .

293 B. R. at 25. These f actors merel y pr esent a f r amework f oranal ysi s and [ i ] n any gi ven case, one f act or may so out wei gh t he

ot her s as t o be di sposi t i ve. I d.

The r ecor d suppor t s t he bankrupt cy cour t s deci si on t o grant

t he St ay Rel i ef Mot i on on t he al t er nat e basi s t hat cause exi st ed

t o annul t he st ay. The cour t i dent i f i ed onl y one f act or as

j ust i f yi ng annul ment of t he st ay: t he post pet i t i on t r ansf er of a

f r act i onal i zed i nt er est i n t he Pr oper t y to Cr uz on t he day of t he

sal e. I n other words, Cr uz had engaged i n unr easonabl e or

i nequi t abl e conduct , or t he cour t cer t ai nl y quest i oned hi s over al l

good f ai t h, whi ch sat i sf i es f actor f our . The cour t s addi t i onal

f i ndi ngs under 362( d) ( 4) al so suppor t annul ment . I n par t i cul ar ,

Cr uz was f ound t o have f i l ed hi s case i n bad f ai t h as par t of a

scheme t o del ay, hi nder and def r aud cr edi t or s. Thi s f i ndi ng

sat i sf i es f actor f our . Cr uz deni es t hat he f i l ed hi s case i n bad

f ai t h and cont ends t he bankrupt cy cour t er r ed by not consi der i ng

al l of t he f act s. We di sagr ee. Our r evi ew of t he r ecor d shows

t he cour t consi der ed al l of t he f act s. Fur t her , Cr uz s skel et al

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f i l i ng, hi s f ai l ur e t o f i l e al l necessar y bankr upt cy document s

r esul t i ng i n di smi ssal of hi s case and hi s f ai l ur e t o l i st t he

Pr oper t y on hi s Schedul e A or t o amend i t af t er obt ai ni ng hi s

i nt erest sat i s f i es f act or s i x.

I n addi t i on, t he r ecor d r ef l ect s t hat SS Tr ust was unawar e of

t he st ay at t he t i me of t he sal e, whi ch sat i sf i es f actor f i ve.

Cr uz di sput es thi s. I t i s hi ghl y unl i kel y t hat SS Tr ust , a t hi r d-

part y pur chaser , was on not i ce of Cr uz s bankr upt cy case when he

f axed hi s Not i ce of Bankrupt cy Fi l i ng t o t he l ender and r ecor ded

t he Cr uz Deed j ust mi nut es bef or e t he sal e. Mor eover , SS Tr ust

pr esent ed uncont r over t ed evi dence that i t was not awar e of Cr uz sbankrupt cy f i l i ng. Once SS Tr ust l ear ned of Cr uz s bankrupt cy, i t

di d not t ake any f ur t her st eps whi ch coul d vi ol at e t he aut omat i c

st ay and i t pr ompt l y moved f or r el i ef , whi ch sat i sf i es f act or s

ni ne and t en.

We concl ude t he bankrupt cy cour t di d not abuse i t s di scr et i on

i n f i ndi ng t hat cause exi st ed f or r et r oact i ve annul ment of t he

st ay t o val i dat e t he f or ecl osur e sal e.

B. The bankruptcy court did not abuse its discretion in denyingthe Motion to Reconsider.

Cr uz di d not pr esent any ar gument i n hi s openi ng br i ef as t o

how t he bankrupt cy cour t abused i t s di scr et i on by denyi ng t he

Mot i on t o Reconsi der t he St ay Rel i ef Or der . However , he at t empt ed

t o do so i n hi s repl y br i ef . Gener al l y, we wi l l not consi der

ar gument s rai sed f or t he f i r st t i me i n t he r epl y. Sec. Pac. Nat l

Bank v. Ki r kl and ( I n r e Ki r kl and) , 915 F. 2d 1236, 1241 n. 7 ( 9t h

Ci r . 1990) . But , consi der i ng Cr uz s pr o se st at us, whi ch di ct at es

t hat we must const r ue hi s br i ef s l i ber al l y, and t hat SS Tr ust has

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f ul l y br i ef ed t hi s i ssue, we wi l l consi der hi s ar gument .

Cr uz f i r st ar gues t he bankrupt cy cour t er r ed by not gr ant i ng

t he Mot i on t o Reconsi der under Ci vi l Rul e 60( b) ( 2) based on hi s

newl y di scover ed evi dence of t he l ender s demur r er f i l ed i n t he

st at e cour t act i on, i n whi ch t he l ender st at ed t he sal e had not

yet occur r ed. Ci vi l Rul e 60( b) ( 2) pr ovi des rel i ef f r om a j udgment

or or der based on newl y di scover ed evi dence that , wi t h reasonabl e

di l i gence, coul d not have been di scover ed i n t i me to move f or a

new t r i al under [ Ci vi l ] Rul e 59( b) . I n gener al , t he evi dence

must have exi st ed at t he t i me t he j udgment or order was ent ered.

See Fant asyl and Vi deo, I nc. v. Cnt y. of San Di ego, 505 F. 3d 996,1005 ( 9t h Ci r . 2007) ; J ones v. Aer o/ Chem Cor p. , 921 F. 2d 875, 878

( 9t h Ci r . 1990) ( r el i ef under Ci vi l Rul e 60( b) ( 2) r equi r es t hat t he

evi dence: ( 1) exi st ed at t he t i me of t he t r i al ; ( 2) coul d not

have been di scover ed t hr ough due di l i gence; and ( 3) was of such

magni t ude that pr oduct i on of i t ear l i er woul d have been l i kel y t o

change t he di sposi t i on of t he case) . I n ot her wor ds, t he evi dence

must be newl y di scovered by t he movant r ather t han si mpl y new.

I n r evi ewi ng t he t r anscr i pt f r om t he r econsi der at i on hear i ng,

t he bankrupt cy cour t made i ncor r ect st at ement s about t he r ecor d.

The demurr er , f i l ed on September 9, 2013, came bef or e t he hear i ng

on t he St ay Rel i ef Mot i on, whi ch was hel d on Sept ember 10, 2013,

and bef ore t he St ay Rel i ef Or der ent ered on Sept ember 25, 2013.

Thus, i t coul d have been newl y di scover ed evi dence; i t exi st ed

at t he t i me of t r i al , coul d not have been di scover ed t hr ough due

di l i gence because i t was f i l ed j ust one day bef or e t he st ay r el i ef

hear i ng, and i t was pot ent i al l y of such magni t ude t hat pr oduct i on

of i t ear l i er coul d have under mi ned SS Tr ust s st andi ng t o seek

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r el i ef f r om st ay. Nonet hel ess, t he cour t s er r or her e was

harml ess. Cr uz admi t t ed t he sal e had occur r ed on J ul y 15, 2013,

r i ght f ul l y or wr ongf ul l y, and t hat SS Tr ust was t he buyer . Thus,

hi s own admi ssi on negat es any pot ent i al r el evance t he l ender s

st atement about t he sal e coul d have had. Fur t her , we know now

t hat t he sal e di d occur on J ul y 15, 2013, as evi denced by t he now-

r ecor ded t r ust ee s deed, whi ch Cr uz submi t t ed t o t he Panel .

Cr uz al so appear s t o ar gue the bankr upt cy cour t er r ed by not

gr ant i ng t he Mot i on t o Reconsi der under Ci vi l Rul e 60( b) ( 6) , but

he f ai l s t o ar t i cul at e any ar gument t o suppor t ent i t l ement t o such

r el i ef . Ci vi l Rul e 60( b) ( 6) pr ovi des f or r el i ef f r om a j udgmentor order based on any ot her r eason t hat j ust i f i es rel i ef . Thi s

r ul e i s used spar i ngl y as an equi t abl e r emedy to pr event mani f est

i nj ust i ce and i s t o be ut i l i zed onl y wher e ext r aor di nar y

ci r cumst ances pr event ed a par t y f r om t aki ng t i mel y act i on t o

pr event or cor r ect an er r oneous j udgment . Lat shaw v. Trai ner

Wor t ham & Co. , 452 F. 3d 1097, 1103 ( 9t h Ci r . 2006) ( i nt er nal

quot at i ons omi t t ed) . Cr uz had t o demonst r at e bot h i nj ur y and

ci r cumst ances beyond hi s cont r ol whi ch pr event ed hi m f r om

pr oceedi ng wi t h t he def ense of t he act i on i n a pr oper f ashi on.

I d.

The bankrupt cy cour t r ul ed t hat r el i ef under Ci vi l Rul e

60( b) ( 6) was not war r ant ed [ g] i ven t he f act s of t he case,

i ncl udi ng post - pet i t i on t r ansf er of t he Pr oper t y to Debt or on t he

eve of bankrupt cy f i l i ng[ . ] Tent at i ve Rul i ng ( Oct . 23, 2013) 10-

11. Thi s i s i ncor r ect f act ual l y. Cr uz engaged i n a post pet i t i on

t r ansf er of t he Pr oper t y, but i t was not on t he eve of hi s

bankr upt cy f i l i ng; i t occur r ed af t er t he f act . Nonet hel ess, t he

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r ecor d does not suppor t r el i ef f or Cr uz under Ci vi l Rul e 60( b) ( 6) .

Cr uz di d not pr esent any evi dence est abl i shi ng t hat ci r cumst ances

beyond hi s cont r ol kept hi m f r om def endi ng agai nst t he St ay Rel i ef

Mot i on. I n f act, he di l i gent l y def ended agai nst i t , f i l i ng hi s

opposi t i on, decl ar at i on and suppor t i ng document s. Al t hough hi s

al l eged at t or ney f ai l ed t o appear at t he hear i ng, no evi dence

suggest s i t woul d have changed t he out come of t he bankr upt cy

cour t s rul i ng had she appear ed. Gi ven t he f act s bef or e t he

cour t , whi ch Cr uz s at t or ney woul d have been l i mi t ed t o, SS Tr ust

est abl i shed t hat i t was ent i t l ed t o st ay r el i ef . 10

Accordi ngl y, we concl ude t he bankr upt cy cour t di d not abusei t s di scr et i on i n denyi ng t he Mot i on t o Reconsi der .

VI. CONCLUSION

For t he f oregoi ng reasons, we AFFI RM.

10 Al t hough Cr uz was al so deni ed r el i ef under Ci vi l Rul e60( b) ( 1) , he di d not ar t i cul at e any ar gument r egar di ng t hi s i ssue.I n any event , t he recor d r ef l ect s t he bankrupt cy cour t appl i ed t hecor r ect l aw, and none of i t s f i ndi ngs appear t o be cl ear l yer r oneous.

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in re: guido yarol cruz, 9th cir. bap (2014)

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