Adversary Proceeding - How to remove it to District Court?

[DoctorWho]

My situation is a long and disastrous one at this point. I have two separate attorneys working on my Chapter 13. One was hired just for the bankruptcy and the other was hired for an adversary proceeding against a bank. Unfortunately, the bankruptcy attorney turned out to be a complete joke and due to his numerous late filings and failure to appear at a confirmation hearing, my Chapter 13 was dismissed. There was (and still is) a pending adversary proceeding against the bank. They did not answer, so I would have won a default judgment but my attorney on that side doesn't want to file it until he sees if the court will maintain jurisdiction or not. (See Pocklington, IN Re Stardust)

My question is, would you not be able to remove the proceeding out of the bankruptcy court and into the federal district court? If you could, I would hope that you would still be able to pursue the default judgment against the bank.

I have been dealing with this since last summer and have spent way too much money on this just to see myself having to re-do it because of an incompetent attorney.

Any advice would be great. I have read through this forum before and figured that by what I've read someone would have a logical answer to this. I appreciate your time and consideration into looking into this for me.

Thanks!

Also I know you have an Adversary Proceeding Forum but it seemed it was more about dealing with them being filed against you and since this partly deals with Chapter 13 jurisdiction, I thought it would be more general in this forum. I apologize in advance if that was not the correct assumption.

[despritfreya]

I do not know if your district has similar procedures (it probably does) but here is the standard Order that is entered in mine:

"The above captioned related bankruptcy proceeding was dismissed on __________ and the above captioned adversary proceeding remains open and pending. The dismissal of the related bankruptcy proceeding does not divest this court of jurisdiction over this adversary proceeding, In re Carraher, 971 F.2d 327 (9th Cir. 1992). This court may retain jurisdiction when judicial economy, fairness, convenience and comity favor retention, In re Casamont Investors, Ltd., 196 B.R. 517 (9th Cir. BAP 1996). IT IS ORDERED THAT this adversary proceeding shall be dismissed (if commenced by the filing of a complaint) or shall be remanded to the State Court (if commenced by the filing of a Notice of Removal) unless a party files, within 21 days of the date of this order, a written motion for the court to retain jurisdiction or the bankruptcy proceeding is reinstated. Any response shall be filed no later than 14 days after service of the motion. The party filing the motion to retain shall have the motion set for hearing pursuant to the judge's procedures posted at the court's web site and shall prepare, serve on all parties, and file a notice of the hearing."

Des.

[justbroke]

You would only have to move it if the Bankruptcy court doesn't believe that it has jurisdiction. I'm guessing this is a TILA or RESPA issue with respect to a mortgage? Anyhow, and forgive my guessing, yes something needs to be done with the open AP. If the Chapter 13 was sufficiently planned (good plan), then I would have (probably) hired a new lawyer or at least asked for Reconsideration and to Vacate the dismissal.

I hope that you find good representation soon.

[HHM]

Yeah, drop it and let the house go?

In any event, I am not sure about removal to Federal District Court. But you can generally get dismissal without prejudice of the AP and refile in another appropriate venue. However, if this really is a real estate issue, it is substantially easier and less costly to litigate these issues in bankruptcy court than regular federal court.

[justbroke]

Your wondering the impact of your case being dismissed and the affect on the AP as was In Re Stardust Inn 70 BR 888, 891 (Bankr.E.D.Pa.1987)? That case wasn't even in your District/State and is not binding anyhow. I think that, as HHM writes, maybe you should allow it to close and then re-open a new Chapter 13 in the Bankruptcy Court. I'll tell you, the Bankruptcy Court was much nicer to deal with than what I'd expect in the actual Federal District Court.

Besides, Pocklington 21 B.R. 199, 201 (Bankr.S.D.Cal.1982) was fact specific so it may not even apply to you. Also be aware that you can't assume that you'd win a summary judgment when a party does not answer. The Judge has to still weigh the facts and make a determination, so summary judgment isn't always that simple. Was your AP of a specific amount (on the cover sheet)?

[DoctorWho]

There was a motion to reinstate filed, but the attorney screwed that up as well and the case was officially dismissed due to failure to prosecute. The plan amendments were not done for 4 months and were filed less than 10 days before confirmation. The adversary attorneys are/were aware of the problems getting in touch with bankruptcy counsel, but insisted that it should sort out and to keep trying to get a hold of him. His phone mailbox was always full and I wrote him letters (he only lives 4 miles from me) which he did not pick up nor sign for. He's a joke and let this get way out of hand. I've dropped close to $20,000 on this so far, so I am now looking for a malpractice attorney.

The cases I cited were used by the adversary counsel. This is not a TILA/RESPA/FDCPA case. This was for fraud, rico, consumer practices violations, etc. The only money asked for was $25,000 per violation (5) and for the court to remove their false lien on the property. They did not answer the complaint and the only thing left to be filed was for the default judgment. This judge has granted similar cases, so the fact that she would not grant it was not the concern, but getting it in front of her in the first place.

Also, I did not even need to file bankruptcy in the first place. The only debt I was dealing with was some minor taxes (that I could have fixed outside of bankruptcy) and the issue with this bank. I do not currently have any credit cards (paid off/closed) so to continue to drop my credit was something I was hoping to avoid, but I'm sure I can find a malpractice attorney for this issue.

[justbroke]

I think that what you wrote, shows that it's not as simple as it looks. I have seen attorneys reference cases, thinking it would help them, and the Judge corrects them and uses it against them. Not that this is your issue at all. You hired an attorney who didn't fully represent you.

I don't know where you want to go from here.

[HHM]

Okay...what was the goal...what was the end game scenario you were hoping to achieve. And based on the type of claims you are bringing (no offense, but when I see those terms wielded around, RICO, et al, my mind turns to "frivolous lawsuit") what was the underlying issue for which you needed a bK in the first place (normally, a BK 13 in this context is used to stop a foreclosure quickly).