Gomez v. Kamper Investments, LLC (In re Gomez)

Summarized by Jeffrey Fine , Dykema Gossett PLLC
15 years 4 months ago

Citation:

Pursuant to 5th CIR. R. 47.5, the Court determined that this opinion should not be published and is not precedent except under the limited circumstances set forth in 5th CIR. R. 47.5.4.

Tag(s):

5th Circuit

Ruling:

Debtors Esmeralda Gomez and Jose Luis Gomez directly appealed to the Fifth Circuit a bankruptcy court decision upholding the foreclosure sale of their home without first obtaining certification of the appeal. Appeal dismissed for lack of subject matter jurisdiction.

Procedural context:

Debtors obtained bankruptcy court order avoiding foreclosure sale of their home. Bank appealed the bankruptcy court order to the district court which reversed in part and remanded back to the bankruptcy court for findings as to whether foreclosure sale could be avoided under section 544. After trial, the bankruptcy court entered judgment against the Gomezes. Instead of appealing to the district court, the Gomezes filed a direct appeal to the Fifth Circuit, but they failed to obtain certification of the appeal by the bankruptcy or district courts. Appeal dismissed by the Circuit Court for lack of subject matter jurisdiction.

Facts:

The day after foreclosure sale of their home, the Gomezes filed a Chapter 13 and commenced an adversary proceeding to avoid the foreclosure sale. After evidentiary hearings, the bankruptcy court avoided the foreclosure sale of the home and awarded title of the home to the Gomezes. Defendant bank appealed to the district court. District court issued a “judgment” reversing the bankruptcy court in part, but remanding for further findings on whether foreclosure sale could be avoided under §544. The district court anticipated that the bankruptcy court would resolve the “fact finding matter” and then “send it back.” Instead, after a trial, the bankruptcy court held that the sale could not be avoided under §544 and entered judgment against the Gomezes. The bankruptcy court suggested on the record that the parties could take a direct appeal to the Fifth Circuit but emphasized repeatedly that the appeal needed to be certified and that the bankruptcy court was willing to certify the appeal. Also, because the bankruptcy court’s decision was final because it denied “all relief” requested by the Gomezes and left nothing else for the bankruptcy court to decide, they could have appealed to the district court—but they failed to do so. Instead, the Gomezes filed a direct appeal to the Fifth Circuit without obtaining certification of the appeal. The appeal was dismissed for lack of subject matter jurisdiction. The Fifth Circuit found that the Gomezes had failed to appeal the bankruptcy court judgment to the district court under 28 U.S.C. §158(d)(1). The Fifth Circuit also found that the district court’s remand order was not final for purposes of §158(d)(1). They found that the district court had remanded the matter to the bankruptcy court to conduct a trial and make findings of fact and conclusions of law. Because the district court’s remand order did not end the litigation on the merits, it was not an appealable final decision under §158(d)(1). Finally, the Fifth Circuit analyzed the only remaining potential basis for jurisdiction, § 158(d)(2), which gives the Circuit Court discretion to hear a direct appeal from a bankruptcy court decision in the event the bankruptcy court, the district court, a bankruptcy appellate panel, or all appellants and appellees acting jointly make a statutory certification. See 28 U.S.C. § 158(d)(2)(A)(i)-(iii). Having found that despite the repeated specific admonitions of the bankruptcy court to obtain certification of the appeal, the Gomezes failed to satisfy the statutory certification precondition to take a direct appeal to the Fifth Circuit, the Court had no discretion to authorize the Gomezes’ appeal, and no jurisdiction under §158(d)(2).

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