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Thomas v. Grigsby

United States District Court, D. Maryland

August 30, 2016

VALERIE LAVERNE THOMAS, et al., Appellants,
v.
NANCY SPENCER GRIGSBY, Appellee.

          MEMORANDUM OPINION

          PAULA XINIS United States District Judge

         Valerie LaVerne Thomas together with her son, Mark Thomas, appeal an order of the United States Bankruptcy Court for the District of Maryland denying the removal of the Chapter 13 Trustee. ECF No. 1. Pending and ready for resolution is a motion to dismiss the appeal filed by Appellee Nancy Spencer Grigsby, Chapter 13 Trustee. ECF No. 11. Oral argument is deemed unnecessary because the facts and legal arguments are adequately presented in the briefs and record, and the decisional process would not be significantly aided by oral argument. See Fed. R. Bankr. P. 8019(b)(3); see also Local Rule 105.6. For the reasons stated below, Appellee's Motion to Dismiss (ECF No. 11) is GRANTED.

         I. BACKGROUND

         On December 31, 2015, Valerie LaVerne Thomas (the “Debtor”) commenced her bankruptcy case under Chapter 13 of the Bankruptcy Code and Nancy Spencer Grigsby was appointed as the Chapter 13 Trustee. ECF No. 5 at 8; ECF No. 3-8 at 7. More than three months later, the Debtor, together with her son, Mark Thomas (“Mr. Thomas”), as trustee for the Valerie LaVerne Thomas Trust, (collectively, “Appellants” or “Thomas Appellants”) filed their Joint Motion to Remove Chapter 13 Trustee and Motion for Leave to Intervene as Representative of the Estate (the “Motion”). ECF No. 3-1; B.R. Doc. 37.

         The Motion requested the Bankruptcy Court to (a) allow Mr. Thomas to intervene in the Debtor's bankruptcy case for the purpose of providing estate-planning services to the Debtor and to use an office that he maintains as successor-in-interest of the LaVal Corporation, which operates out of the Debtor's home, and (b) replace Nancy Spencer Grigsby, Chapter 13 Trustee (“Trustee” or “Appellee”), with Mr. Thomas, who is a trustee for The Valerie LaVerne Thomas Trust. ECF No. 3-1; B.R. Doc. 37.

         The Trustee opposed the Motion, arguing that Mr. Thomas is not a proper party to “intervene” in the Bankruptcy proceedings[1] and that no cause had been shown to remove the Trustee and replace her with Mr. Thomas. ECF No. 3-2; B.R. Doc. 41. The Bankruptcy Court denied the Appellants' Motion because no cause was shown to grant the relief requested. ECF No. 1-1 at 1; B.R. Doc. 43 at 1; see also B.R. Doc. 96 at 3, Order Denying Joint Motion to Stay Pending Appeal of Order (denying removal of the trustee because the Motion did not allege any misconduct, negligence or the existence of a conflict of interest by the Chapter 13 Trustee).

         On April 15, 2016, Valerie LaVerne Thomas and Mark Thomas filed a joint notice of appeal with this Court, appealing the denial of the movants' Motion. ECF No. 1; B.R. Doc. 51. The Appellants contend that the Motion was denied “without having afforded adequate notice, or an opportunity to be heard, thereupon.” ECF No. 5 at 5. They also assert that the Bankruptcy Court misapplied the law in deciding that no cause had been shown for removing the Chapter 13 Trustee. ECF No. 5 at 17.

         The Thomas Appellants filed their appellate brief on May 11, 2016 “pursuant to 28 U.S.C. § 158” asserting that the order denying the motion to remove the Trustee “is final in Bankruptcy Case No. 15-27855, as to inter alia, the interests of Appellant, Mark Thomas, as a Trustee of The Valerie LaVerne Thomas Trust.” ECF No. 5 at 5. The Trustee responded by moving to dismiss the appeal. ECF No. 11. The Trustee contends that the Court lacks jurisdiction to review the Order because it is interlocutory and not final, and thus the appeal must be dismissed. For the reasons that follow, the Motion to Dismiss will be GRANTED.

         II. STANDARD OF REVIEW

         The jurisdiction of a district court to hear appeals from bankruptcy courts is conferred by 28 U.S.C. § 158(a), which provides:

(a) The district courts of the United States shall have jurisdiction to hear appeals

(1) from final judgments, orders, and decrees;
(2) from interlocutory orders and decrees issued under section 1121(d) of title 11 increasing or reducing the time periods referred to in section 1121 of such title; and
(3) with leave of the court, from other interlocutory orders and decrees[.]

28 U.S.C. § 158(a). “Thus, by statute, an appeal of right exists only from a final judgment, and any other appeal, i.e., from an interlocutory order, may lie only upon obtaining leave of the court.” In re Rood, 426 B.R. 538, 546 (D. Md. 2010). “[I]nterlocutory review is not to be granted lightly. While it is a prerequisite to our jurisdiction, certification by a district court that an interlocutory order turned on a ‘controlling question of law' does not require us to grant leave to appeal.” In re Pawlak, No. Civ-DKC-14-2839, 2015 WL 1523017, at *2 (D. Md. Apr. 1, 2015), reh'g denied, No. ...


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