Brown v. Foresight Investment

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

In re: THURMAN BROWN, 

No. 05-15605

THURMAN BROWN, D.C. No.

Appellant,  CV-04-01439-SRB

v. Adv.No. 02-1381

WILSHIRE CREDIT CORPORATION, OPINION

Appellee.



Appeal from the United States District Court

for the District of Arizona

Susan R. Bolton, District Judge, Presiding

Submitted February 14, 2007*

San Francisco, California

Filed April 26, 2007

Before: Stephen Reinhardt, Pamela Ann Rymer and

Barry G. Silverman, Circuit Judges.

Opinion by Judge Silverman;

Concurrence by Judge Rymer

*This panel unanimously finds this case suitable for decision without

oral argument. See Fed. R. App. P. 34(a)(2).

4579

IN RE: BROWN 4581

COUNSEL

Ronald J. Ellett, Jay S. Volquardsen; Ellett Law Offices, P.C.,

Phoenix, Arizona, for debtor Thurman Brown and appellant

Ellett Law Offices, P.C.

David Wm. Engelman, William H. Anger; Engelman Berger,

P.C., Phoenix, Arizona, for Appellee Wilshire Credit Corpo-

ration.

4582 IN RE: BROWN

OPINION

SILVERMAN, Circuit Judge:

A bankruptcy judge ruled in open court on cross-motions

for summary judgment regarding debtor Thurman Brown’s

claim that Wilshire Credit Corporation violated the Bank-

ruptcy Code’s automatic stay. Later that day, the judge signed

a minute entry stating that Wilshire’s motion for summary

judgment was granted and that Brown’s was denied, and tak-

ing under advisement a related motion for sanctions. Brown

filed his appeal nearly three months later when the court

entered judgment awarding sanctions against his counsel. We

hold today that a minute entry that merely grants summary

judgment — without more — does not become a final,

appealable judgment just because it has been signed by the

judge. The minute entry in this case was the memorialization

of a ruling, not a judgment, and thus did not trigger the 10-day

window in which Brown was required to appeal. Accordingly,

the district court erred in dismissing Brown’s appeal as

untimely.

BACKGROUND

Because this opinion is limited to the timeliness of Brown’s

appeal to the district court,1 we will just briefly summarize the

facts. Brown obtained a loan from LaSalle National Bank

secured by a deed of trust. Wilshire Credit Corporation ser-

viced the loan for the bank. After Brown defaulted, Fidelity

National Title Insurance Company, the foreclosure trustee on

the deed of trust, scheduled a non-judicial foreclosure sale.

The sale took place a few hours after Brown had filed for

bankruptcy protection. Complications ensued. Ultimately,

Brown brought an adversary proceeding against Wilshire

alleging that Wilshire violated the automatic stay.

1

In a separate memorandum disposition filed contemporaneously with

this opinion, we reverse the bankruptcy court’s award of sanctions against

Ronald Ellett, Brown’s counsel.

IN RE: BROWN 4583

Cross-motions for summary judgment were filed, and argu-

ment on the motions was held on April 22, 2004. Ruling from

the bench at the conclusion of the argument, the bankruptcy

judge granted Wilshire’s motion for summary judgment and

gave his reasons. At the end of the bankruptcy judge’s

remarks, the following exchange occurred:

COURT: Those are my findings of fact and con-

clusions of law. Do you wish to lodge a

— or propose formal findings and conclu-

sions,2 or do you want me to simply sign

the minute entry?

WILSHIRE’S COUNSEL:

If you’ll sign the minute entry, that will

suffice, Your Honor.

COURT: I’ll sign the minute entry. That will be

the order.

Later that day, the court issued a document labeled “MIN-

UTE ENTRY” that read as follows:

Appearances:

JAY S. VOLQUARDSEN, ATTORNEY

FOR THURMAN BROWN

RICK SHERMAN ATTORNEY FOR

WILSHIRE

2

Ordinarily, findings of fact and conclusions of law are made in the

wake of a contested hearing, not in the course of granting summary judg-

ment, which presupposes that the facts are undisputed. We presume that

the bankruptcy judge meant either that he would allow counsel to submit

a proposed written order granting the motion and containing the judge’s

rationale, or a proposed formal written judgment dismissing the action.

4584 IN RE: BROWN

Proceedings:

Mr. Volquardsen reviewed the history of

this matter and urged the Court to grant the

debtor’s motion for summary judgment.

COURT: FINDINGS OF FACT AND CONCLU-

SIONS OF LAW WERE STATED ON THE

RECORD. IT IS ORDERED DENYING THE

DEBTOR’S MOTION FOR SUMMARY JUDG-

MENT AND GRANTING WILSHIRE’S MOTION

FOR SUMMARY JUDGMENT.

/s/ Randolph J. Haines

RANDOLPH J. HAINES

U.S. BANKRUPTCY JUDGE

Mr. Sherman requested the Court rule on his 9011

motion advising he believes it is fully briefed.

COURT: THE COURT WILL REVIEW THE

DOCKET TO DETERMINE IF THE MOTION

HAS BEEN FULLY BRIEFED. IT IS ORDERED

TAKING THE MOTION UNDER ADVISEMENT

UNLESS BY NEXT TUESDAY, APRIL 27, 2004

EITHER PARTY FILES A REQUEST FOR HEAR-

ING.

cc: Pat

Jim

Six days later, in an April 28, 2004 “Memorandum Deci-

sion” — which also bears the judge’s signature — the bank-

ruptcy court decided in principle to sanction Brown’s lawyer,

Ronald Ellett, because, the bankruptcy judge said, he “never

advanced a single fact demonstrating that Wilshire took an

active step in violation of the automatic stay after having

knowledge of the existence of the bankruptcy,” and because

IN RE: BROWN 4585

his papers were void of any law or non-frivolous argument for

the extension of existing law that “imputed knowledge is a

sufficient basis to find a willful stay violation.” The amount

of the sanction remained to be determined.

In a ruling dated June 30, 2004, the bankruptcy court

largely denied Brown’s motion for reconsideration. As to

sanctions, the bankruptcy court awarded $18,791.63, and

directed Wilshire’s counsel to lodge a form of judgment.

On July 6, 2004, the bankruptcy court entered a formal

“Judgment Awarding Rule 11 Sanctions Against Ellett Law

Offices, P.C.” In contrast to the April 22 minute entry, this

document bore the court seal and language apparently rubber-

stamped on the top of the first page reading: “IT IS HEREBY

ADJUDGED and DECREED this is SO ORDERED. The

party obtaining this order is responsible for noticing it pursu-

ant to Local Rule 9022-1.” Immediately below the stamped

language was the date, followed by the judge’s signature. In

the body of the document, it says, “IT IS FURTHER

ORDERED granting judgment in favor of defendant Wilshire

Credit Corporation and against plaintiff/debtor’s attorney . . .

in the amount of $18,791.63, with post-judgment interest . . . .

IT IS FURTHER ORDERED expressly directing the entry of

this judgment as the Court finds that there is no just reason for

delay.”

Accompanying that document was a separate document

captioned, “Notice of Entry of Judgment or Order,” in which

the court clerk gave notice that judgment had been entered on

the court docket, and certified that copies of the judgment had

been mailed to the parties.

On July 15, 2004, nine days after entry of the judgment

awarding sanctions, Brown appealed the bankruptcy court’s

summary judgment order. Ellett appealed the judgment

awarding sanctions against his firm on July 7, 2004.

4586 IN RE: BROWN

The district court dismissed Brown’s appeal of the order

granting summary judgment against him because his appeal

was not filed within ten days of April 22, 2004, the day the

bankruptcy court entered its minute order granting Wilshire’s

motion for summary judgment. See Bankr. R. Proc. 8002(a)

(“The notice of appeal shall be filed with the clerk within 10

days of the date of the entry of the judgment, order, or decree

appealed from.”). That minute entry, the district court rea-

soned, was a “final order” in so much as it evidenced the

bankruptcy court’s intent that the summary judgment ruling

“end the controversy regarding the alleged violation of the

automatic stay.” “Most importantly,” the district court went

on to say, “Judge Haines signed the minute entry.” The dis-

trict court then affirmed the award of sanctions against Ellett

and his law firm, concluding that he “offer[ed] no plausible

factual or legal basis for holding Wilshire liable for the acts

or failures to act of the trustee, Fidelity.”

ANALYSIS

We must determine whether the bankruptcy court’s April

22, 2004 minute entry constitutes a final, appealable order. If

it does, Brown’s appeal to the district court was untimely,

depriving us of jurisdiction to hear his appeal. In re Slimick,

928 F.2d 304, 306-09 (9th Cir. 1990). If the minute entry is

not a final, appealable order, Brown’s appeal was not

untimely, and we may review the merits of the bankruptcy

court’s summary judgment ruling. For the reasons that follow,

we hold that the minute entry was not a final, appealable

order.

[1] A disposition is final if it contains “ ‘a complete act of

adjudication,’ that is, a full adjudication of the issues at bar,

and clearly evidences the judge’s intention that it be the

court’s final act in the matter.” Id. at 307 (emphasis in origi-

nal); see also United States v. Lummi Indian Tribe, 235 F.3d

443, 448 (9th Cir. 2000) (“A final decision is one that ends

the litigation on the merits and leaves nothing for the court to

IN RE: BROWN 4587

do but execute judgment.” (internal quotations omitted)). “Ev-

idence of intent consists of the Order’s content and the

judge’s and parties [sic] conduct.” In re Slimick, 928 F.2d at

308.3

[2] On its face, the April 22, 2004 minute entry, although

signed, is simply the memorialization of the proceedings of

that day. A comparison of the April 22 minute entry with the

July 6, 2004 judgment awarding sanctions illustrates this

point. The July 6, 2004 judgment came affixed with the court

seal and contained unequivocal judgment-granting language.

In contrast, the minute entry of April 22 merely recites that

one motion was “ordered” granted and another one denied.

That phrase, “IT IS ORDERED,” often precedes utterances

that are not final judgments at all, e.g., “IT IS ORDERED

continuing the case” and “IT IS ORDERED setting the fol-

lowing briefing schedule.” More important than “IT IS

ORDERED” is what has been ordered. Tellingly, the April

22, 2004 minute entry did not order that “judgment be

entered” in favor of Wilshire or that Brown’s case be “dis-

missed with prejudice.” These are conspicuous omissions.

Indeed, with respect to finality, we have previously drawn

a distinction between (1) an order that merely provides that

“[t]he motion of the Defendant for summary judgment . . . is

now decided as follows: The said motion is hereby granted,”

and (2) a later judgment that concluded, “It is, therefore,

ordered, adjudged and decreed that the plaintiff take nothing

by its actions against the defendant.” Monarch Brewing Co.

3

Two things are necessary to trigger the time in which to appeal: (i) the

lower court’s intent that its order be “final,” and (ii) compliance with Fed.

R. Civ. P. 58, which, in cases like this one, “requires entry of a document

distinct from any opinion or memorandum.” Hollywood v. City of Santa

Maria, 886 F.2d 1228, 1231 (9th Cir. 1989); see also Bankr. R. Proc. 9021

(Fed. R. Civ. P. 58 generally applies in bankruptcy). Because the April 22,

2004 minute entry does not satisfy the first requirement for appealability,

we do not reach the question of whether it satisfies the “separate docu-

ment” rule in Fed. R. Civ. P. 58.

4588 IN RE: BROWN

v. George J. Meyer Mfg. Co., 130 F.2d 582, 583 (9th Cir.

1942) (“We are satisfied that the [earlier order] was not

intended as the rendition of a judgment in favor of the defen-

dant.”); see also Am. Nat’l Bank & Trust Co. of Chicago v.

Sec’y of Hous. & Urban Dev., 946 F.2d 1286, 1289 (7th Cir.

1991) (minute entry is final order where it provided that

“Judgment is entered as follows” and then outlined the relief

ordered by the court); In re Cahn, 188 B.R. 627, 630 (9th Cir.

BAP 1995) (order granting summary judgment and dismiss-

ing adversary proceeding was final and appealable).

[3] While we recognize that “no formal words of judgment

are necessary to convey finality,” In re Slimick, 928 F.2d at

308, there must be some dispositive language sufficient to put

the losing party on notice that his entire action — and not just

a particular motion or proceeding within the action — is over

and that his next step is to appeal. The minute entry at issue

here gives exactly the opposite sort of notice. It specifically

recites that the bankruptcy judge intends to rule in the near

future on Wilshire’s then-pending motion for sanctions. See

Nat’l Distrib. Agency v. Nationwide Mut. Ins. Co., 117 F.3d

432, 434 (9th Cir. 1997) (“The rulings on their face demon-

strate that the court contemplated further action, and we will

not venture to guess whether the court subjectively intended

otherwise.”).

We follow a “pragmatic approach” to finality in bankruptcy

— “a complete act of adjudication need not end the entire

case, but need only end any of the interim disputes from

which an appeal would lie.” In re Slimick, 928 F.2d at 307 n.1.4

4

In re Slimick involved an order sustaining a trustee’s objection to an

amended schedule of exemptions, which was necessarily “a complete act

of adjudication” in so far as the objection constituted the entire proceeding

at hand. 928 F.2d at 307 (“the sustaining of the objection here necessarily

simultaneously denied the amended exemption claim”). The same is not

true of a motion for summary judgment within an adversary proceeding;

there, finality is achieved when the entire proceeding is dismissed, see In

IN RE: BROWN 4589

But here, the two motions clearly were intertwined. The

motion for sanctions simply cannot be characterized as

involving “discrete issue[s]” apart from the summary judg-

ment motion. In re Lazar, 237 F.3d 967, 985 (9th Cir. 2001)

(“[B]ankruptcy court order is final, and thus appealable,

where it (1) resolves and seriously affects substantive rights

and (2) finally determines discrete issue to which it is

addressed.” (internal quotations omitted)).

We have held that a minute entry triggered the time period

in which to appeal, but those cases involved post-judgment

motions for relief, which do not raise the same concerns that

the losing party lacks notice that he can exercise his right to

appeal. In Beaudry Motor Co. v. Abko Props., Inc., 780 F.2d

751 (9th Cir. 1986), for example, the district court denied a

motion for a new trial and leave to amend, both of which fol-

lowed its grant of summary judgment and entry of judgment.

Unlike Brown here, then, the plaintiff in Beaudry Motor

already knew its case was dead — judgment already had been

handed down. Its post-judgment motions were an effort to res-

urrect the case, but for purposes of appealability, they merely

stayed the time for appeal, which had otherwise begun to run.

See Fed. R. App. P. 4(a)(4)(A)(v). Thus, all that mattered was

when the district court entered its order disposing of the post-

judgment motions, because a notice of appeal must then be

filed within thirty days, measured from the entry of the order.

See Beaudry Motor, 780 F.2d at 753-54 (citing Fed. R. App.

4(a)(4)(B)).

The same is true of Ingram v. ACandS, Inc., 977 F.2d 1332

(9th Cir. 1992). That case went to trial, and judgment was

re Cahn, 188 B.R. at 630, not when one motion is granted or denied. In

other words, with respect to the “pragmatic approach” to finality, Brown’s

adversary proceeding was the “interim dispute[ ]” from which an appeal

may lie, In re Slimick, 928 F.2d at 307 n.1, not the cross-motions for sum-

mary judgment.

4590 IN RE: BROWN

entered in favor of plaintiffs on the jury’s findings. See id. at

1336 (“The [district] court determined that Fibreboard was

jointly and severally liable for the full amount of the judgment

. . . .”). The defendants’ right to pursue motions for a new trial

suspended the time in which to appeal, but unless and until

they were granted, the fact remained that they had lost and the

case was over. They did not need any further notice from the

district court on that issue.

[4] We reaffirm the rule that a minute entry ordering the

denial of a motion for new trial, after a final judgment has

already been entered, starts the appeal clock. But that’s not

the case here. The minute entry of April 22, 2004 was not a

ruling on a post-judgment motion. As already explained, it

merely memorialized the bankruptcy court’s ruling on pre-

judgment motions.

[5] Lest litigants be misled about when their time to appeal

begins to run, there must be some “clear and unequivocal

manifestation by the trial court of its belief that the decision

made, so far as it is concerned, is the end of the case.” Fia-

taruolo v. United States, 8 F.3d 930, 937 (2d Cir. 1993). As

we said in Carter v. Beverly Hills Sav. & Loan Assoc., 884

F.2d 1186, 1189 (9th Cir. 1989), “Wherever the rules estab-

lish a time requirement that limits a litigant’s ability to obtain

relief from a final judgment, it is imperative that the district

court provide a clear signal that the time period within which

that relief can be sought has begun to run.” Because that kind

of certainty is lacking here, the April 22, 2004 minute entry

cannot be deemed a final, appealable order.

[6] Accordingly, we REVERSE the district court’s order

dismissing Brown’s appeal of the summary judgment rulings

for lack of jurisdiction and REMAND for the district court’s

consideration of his appeal.

IN RE: BROWN 4591

RYMER, Circuit Judge, concurring in the judgment:

I agree that Brown’s appeal to the district court was timely,

though for somewhat different reasons.

Brown argues that the April 22 minute order was not final

because it was intertwined with a sanctions motion on which

the bankruptcy court had not yet ruled. If so, then the bank-

ruptcy court’s June 30 order regarding sanctions was the final

order, its July 6 judgment was the “separate document”

required by Fed. R. Bankr. P. 9021, and the July 15 appeal

was timely under Fed. R. Bankr. P. 8002(a).

Alternatively, if the April 22 order is independent of the

sanctions motion, then the question is whether the minute

entry was a “document” within the meaning of Bankruptcy

Rule 9021, which incorporates Fed. R. Civ. P. 58. We have

held that a minute order denying post-judgment relief consti-

tutes a “document” for purposes of Civil Rule 58 only “if it

(1) states that it is an order; (2) is mailed to counsel; (3) is

signed by the clerk who prepared it; and (4) is entered on the

docket sheet.” Ingram v. ACandS, Inc., 977 F.2d 1332, 1338-

39 (9th Cir. 1992) (citing Beaudry Motor Co. v. Abko Props.,

Inc., 780 F.2d 751, 754-55 (9th Cir. 1986)); Carter v. Beverly

Hills Sav. & Loan Ass’n, 884 F.2d 1186, 1188-90 (9th Cir.

1989). While it is possible that more should be required of a

document purporting to set forth summary judgment than of

a post-judgment order, certainly we should not require less.

This being so, the minute entry here could not trigger the

clock for filing an appeal because, at a minimum, it was not

mailed to counsel.1

As the appeal would be timely even if the minute order

were final, I wouldn’t venture to guess what more magic

1

I express no opinion as to whether electronic communication satisfies

or renders obsolete the mailing requirement in ACandS, as Wilshire’s con-

tention to this effect is not supported by the record.

4592 IN RE: BROWN

words are needed to make an order granting summary judg-

ment a final disposition in bankruptcy than “It is ordered . . .

granting Wilshire’s motion for summary judgment.” I’d stick

with In re Slimick, 928 F.2d 304, 305-06 (9th Cir. 1990).