United States District Court, D. Maryland, Southern Division
In re MARY HAYES JENKINS et al. Debtors.
WELLS FARGO BANK, N.A., et al. Appellees. MARY HAYES JENKINS et al. Appellants, Adversary No. 16-370
J. HAZEL UNITED STATES DISTRICT JUDGE.
Mary Hayes Jenkins and Mark Quarterman Jenkins filed these
appeals from two orders issued by the United States
Bankruptcy Court for the District of Maryland: an order
dismissing their adversary proceeding for lack of subject
matter jurisdiction, ECF No. 1 (17-1626), and an order
denying as moot their Motion to Stay proceedings pending a
ruling on their Motion for Withdrawal of Reference, ECF No. 1
(17-1625). As grounds for reversal of both orders, Appellants
argue that the Bankruptcy Court erred in dismissing the
adversary proceeding without first addressing their Motion to
Stay on its merits. The Court has jurisdiction over these
appeals because the Bankruptcy Court's order dismissing
the adversary proceeding was a final order pursuant to 28
U.S.C. § 158(a)(1) and the order denying Appellants'
Motion to Stay was final according to the “more
pragmatic, ” “less technical, ”
“relaxed rule of appealability in bankruptcy.”
A.H. Robins Co. v. Piccinin, 788 F.2d 994, 1009 (4th
Cir. 1986). No. hearing is necessary. Fed.R.Bankr.P. 8019;
see also Loc. R. 105.6 (D. Md. 2016). Because the
Court finds that the Bankruptcy Court did not abuse its
discretion by continuing administration of the adversary
proceeding despite the filing of a Motion to Stay, and
Appellants do not challenge the order dismissing the
proceeding on its merits, the appealed from orders will be
August 4, 2016, Appellants filed an adversary proceeding
against Appellees Wells Fargo Bank, N.A. (Wells Fargo), as
servicer, and U.S. Bank National Association. ECF No.
asserted claims arising out of a prolonged loan modification
process connected to a deed of trust loan held by Appellees.
Id. Appellants requested a jury trial. Id.
Before Appellants filed this adversary proceeding, the
Bankruptcy Court confirmed their plan in the main Chapter 13
bankruptcy case on March 1, 2016. ECF No. 3-55. The loan
subject to dispute in the adversary proceeding was addressed
in the plan this way:
If any secured claim not described in the previous paragraphs
is filed and not disallowed, that claim shall be paid or
otherwise dealt with outside of the plan directly by the
Debtor[s], and it will not be discharged upon completion of
the plan. Wells Fargo Home Mortgage - to be
treated outside plan - Loan Modification and/or
Id. ¶ 2.e.vi. (emphasis in original). Appellees
moved to dismiss the adversary proceeding on September 9,
2016. ECF No. 3-7 ¶ 1. Appellants then filed a Motion
for Withdrawal of Reference on September 26, 2016. ECF No.
the parties filed amended pleadings, the Bankruptcy Court
issued a show cause order on December 28, 2016 asking whether
the adversary proceeding should be dismissed for lack of
subject matter jurisdiction. ECF No. 3-31. Both parties
responded on January 11, 2017. ECF No. 32, 35.
January 13, 2017, Appellants moved to stay proceedings
pending a ruling from this Court on their Motion for
Withdrawal of Reference. ECF Nos. 3-36, 3-69. Appellants
filed the Motion to Stay in both the adversary proceeding and
the main bankruptcy case. Id. On February 17, 2017,
notwithstanding the pending Motion to Stay, the Bankruptcy
Court issued a memorandum opinion and order dismissing the
adversary proceeding without prejudice for lack of subject
matter jurisdiction. The Bankruptcy Court did not rule on the
Motion to Stay the adversary proceeding, but, on February 22,
2017, it denied as moot the identical Motion to Stay pending
in the main bankruptcy case. ECF No. 3-78. Because the
Bankruptcy Court had dismissed the adversary proceeding, this
Court dismissed as moot the Appellants' Motion to
Withdraw Reference on February 24, 2017. ECF No. 3-79.
March 2, 2017, Appellants noticed appeals of the Bankruptcy
Court's orders dismissing the adversary proceeding and
denying the Motion to Stay. ECF No. 1. This Court ordered
that briefing be consolidated in these two appeals. ECF No.
17. In April 2017, Appellants filed a Complaint in this Court
with the same allegations that previously pended before the
Bankruptcy Court in the adversary proceeding. Jenkins et
al v. Wells Fargo Bank, N.A., No.
STANDARD OF REVIEW
core issue in these appeals is whether the Bankruptcy Court
erred in failing to rule on the merits of Appellants'
Motions to Stay before dismissing the adversary proceeding
and mooting Appellants' Motion for Withdrawal of
Reference. A lower court's “[f]ailure to consider
and rule on significant pretrial motions before issuing
dispositive orders” is reviewed for “abuse of
discretion.” See Chudasama v. Mazda Motor
Corp., 123 F.3d 1353, 1367 (11th Cir. 1997); Ellison
v. Ford Motor Co., 847 F.2d 297, 300-01 (6th Cir.1988)
(finding district court's failure to rule on motion to
amend complaint before granting summary judgment abuse of
discretion); McDonnell Douglas Corp. v. Polin, 429
F.2d 30, 31 (3d Cir.1970) (directing district court to
consider and rule on motion to transfer). Further,
“[t]he grant or denial of a request to stay proceedings
calls for an exercise of the” bankruptcy court's
“judgment to balance the various factors relevant to
the expeditious and comprehensive disposition of [cases] on
the court's docket.” Maryland v. Universal
Elections, Inc., 729 F.3d 370, 375 (4th Cir. 2013).
Thus, the Court reviews both the decision not to rule on
Appellants' Motion to Stay the adversary proceeding (the
only ground Appellants give for reversal of the order
dismissing the proceeding) and the denial of the Motion to
Stay the main Bankruptcy case for abuse of discretion.
contend that the Bankruptcy Court should have stayed the
adversary proceeding while the District Court considered the
Motion to Withdraw Reference. However, Bankruptcy Rule
5011(c) states that proceedings are not stayed when a motion