Adversary Proceedings versus Contested Matters

Bankruptcy litigation can be confusing to the inexperienced practitioner.  If you are contemplating litigation in bankruptcy court, you should first determine which rules apply.  Then you should read them.  

There are two terms of art that apply to litigation in bankruptcy court, "adversary proceedings" and "contested matters."  Adversary proceedings (or "adversaries") are separate lawsuits brought in bankruptcy court.  They start with traditional pleadings, including a complaint, motions to dismiss, answer, affirmative defenses, etc.  Then they proceed to discovery and a trial.  Contested matters, on the other hand, are brought by motion and are governed more like state-court motion practice.  

Adversary proceedings are governed by Part VII of the Federal Rules of Bankruptcy Procedure.  Rule 7001 states that the following are adversary proceedings: 

1. A proceeding to recover money or property, other than a proceeding to compel the debtor to deliver property to the trustee, or a proceeding under Sec. 554(b) or Sec. 725 of the Code, Rule 2017, or Rule 6002;
2. A proceeding to determine the validity, priority, or extent of a lien or other interest in prperty, other than a proceeding under Rule 4003(d);
3. A proceeding to obtain approval under Sec. 363(h) for the sale of both the interest and of a co-owner in property;
4. A proceeding to object to or revoke a discharge, other than an objection to discharge under Secs. 727(a)(8), (a)(9), or 1328(f);
5. A proceeding to revoke an order of confirmation of a chapter 11, chapter 12, or chapter 13 plan;
6. A proceeding to determine the dischargeability of a debt;
7. A proceeding to obtain an injunction or other equitable relief, except when a chapter 9, chapter 11, chapter 12, or chapter 13 plan provides for the relief;
8. A proceeding to subordinate any allowed claim or interest, except when a chapter 9, chapter 11, chapter 12, or chapter 13 plan provides for subordination;
9. A proceeding to obtain a declaratory judgment relating to any of the foregoing; or
10. A proceeding to determine a claim or cause of action removed under 28 U.S.C. 1452.

If your proceeding is not contained in that list, it is a "contested matter," which is governed by Rule 9014.  If your issue does not fall into one of the 10 categories listed above, it must be brought by motion.  

It is also helpful to think in these terms if you are defending a proceeding.  You may have a motion to dismiss if your opponent brought a contested matter in an adversary complaint, or vise versa.   

As usual, call me with any questions.  

Lost, Abandoned, or Mislaid Property (Finders keepers, losers weepers?)

The Arizona Appellate Court recently decided an interesting case that analyzed the law of found property.  Robert Spann (the "original homeowner") died in 2001.  His daughter (the "estate") took charge of his house.  The estate sold the house to Sarina Jennings and Clinton McCallum (the "new homeowners").  The new homeowners hired a contractor to do some renovations to the house.  The contractor found $500,000 in cash hidden behind a wall and tried to keep it.  As you can imagine, everybody filed suit against everybody else.      

In explaining who should get to keep the money and why, the Appellate Court analyzed the law of found property.  Found property can be lost, mislaid, abandoned, or treasure trove.  "Lost" property includes property the owner unintentionally parts with through either carelessness or neglect.  "Abandoned" property has been thrown away or voluntarily forsaken by its owner.  Property is "mislaid" if the owner intentionally places it in a certain place and then later forgets about it.  Property is considered "treasure trove" if it verifiably antiquated and has been concealed for so long as to indicate the the owner is probably dead or unknown.

A finder's rights depend on how a court classifies the found property.  Under the common law, it has been said the people do not normally abandon their money; and, accordingly, found money will never be considered abandoned, but rather lost or mislaid property.  The estate, the new homeowners, and the contractor all made claim to the $500,000.  The question was whether the $500,000 was lost or mislaid by the original homeowner because cash can't be abandoned and this money was not antique enough to be considered treasure trove.

The Court found that the money was mislaid property that belongs to its true owner, the estate, as opposed its finder, the contractor and/or new homeowners.  HERE is a link to the opinion.

Don't turn verbs into nouns.

As most of you probably already know, and as I have mentioned in the past, Bryan Garner is a really smart guy.  He is the Editor of Black's Law Dictionary and the author of dozens of books about legal writing and language.  One of his pet peeves (and one of mine now too) is when writers turn verbs into nouns.  Mr. Garner calls this "nominalization" or "burying" a verb.

Basically, you should use action verbs instead of nouns whenever possible.  It will make your writing clearer and easier to understand, not to mention shorter.   Instead of trying to describe the process of nominalization, or how to avoid it, I will give you a list of 20 nominalizations taken from several of Mr. Garner's books, and the action verbs that you should replace them with:

• in violation of - violate
• provide an illustration of - illustrate
• in mitigation of - mitigate
• conduct an examination of - examine
• make an accommodation for - accommodate
• make a contribution - contribute
• provide assistance - assist
• place a limitation upon - limit
• provide protection to - protect
• reach a resolution - resolve
• reveal the identify of - identify
• bring an action against - sue
• are in compliance with - comply
• draw a distinction - distinguish
• made allegations - alleged
• was in conformity with - conformed
• take into consideration - consider
• provide a description of - describe
• have a discussion about - discuss
• reveal the identify of - identify

I am a big fan of cleaner legal writing.  Sentences should be less wordy and briefs should have fewer pages.  Just by quickly glancing at the chart above it is easy to see that one word can often take the place of three or four words.  Good luck and be brief.

Mahoney, Silverman & Cross is Hiring

Mahoney, Silverman & Cross, LLC, a Will County, Illinois AV Rated law firm, seeks an attorney for its civil litigation group with 4-7 years of experience.  Candidate must have an outstanding academic record, exceptional interpersonal and communicative skills and significant experience and demonstrated success in the preparation and trial of civil cases.  Please send your detailed resume (which should describe your professional experience in civil litigation highlighting the types and complexity of cases as well as your experience with discovery, motions, bench and jury trials and appellate review), undergraduate and law school transcripts, and writing sample to: Ms. Julie M. Van Eck, Mahoney, Silverman & Cross, LLC, 822 Infantry Drive, Suite 100, Joliet, IL 60435; 815-730-9500, 815-730-9598 (fax); or via email to jvaneck@msclawfirm.com. All inquiries will remain confidential.   

Will County Eviction Procedures

It has been a while since I have had to schedule an eviction in Will County.  They have changed their procedures in the meantime.

They now conduct evictions on Tuesdays and Thursdays.  The Tuesday evictions use the Sheriff's contracted movers.  The plaintiff of course pays for those movers.  If you would like to use your own movers, your eviction will proceed on a Thursday and you must provide four able-bodied movers at that time.

The Sheriff's Department has separate instructions for each type of eviction.  I have attached two separate instruction sheets HERE. (Please disregard the obvious grammatical error on the top of page 2.)

I have also posted these instructions in the Forms Archive of this Blog.

Great times, No winners.

The 8th Annual NIU Law Golf Outing was a great success.  It was a beautiful day out on the course and it seemed that fun times were had by all.

But, once again, there were a lot of disappointed coffee-drinking blog readers out there on the links.  The Law Blog sponsored Hole 18 (photo evidence below), which NO ONE PICKED IN OUR CONTEST!!

So, for the third consecutive year, the prizes will roll over.  Next year we need 18 guesses no matter what.  All of the readers should invite their friends and former classmates to subscribe to this blog.  I really want to give away some prizes next year.  So long.

NIU Alumni Golf Outing

The 8th Annual NIU Law Golf Outing & Awards Dinner will be held on Friday, June 8th at the River Heights Golf Course in DeKalb.  Once again, the Northern Law Blog will be sponsoring a hole at the golf outing.  That means that it is time again for the annual contest to guess which hole we will be sponsoring.

Every year the Law Blog offers a prize to the first person to guess the hole at which the Northern Law Blog sign will appear.  In past years the prizes have been limited to a drink of the winner's choosing at the 19th hole (it's an open bar).  Last year, however, the Law Blog was able to secure this matching set of Dreyer Foote coffee mugs as prizes:

But no one won them.  In fact, NO ONE HAS EVER WON THIS CONTEST!!!  Two years ago we only had a handful of guesses.  Last year we only had nine guesses and no one guessed Hole 10.  I know there were a lot of disappointed coffee-drinking blog readers at last year's golf outing.  So, you will be happy to hear that the coffee mugs have rolled over into this year's prize pool.  

But the Law Blog has been having a tremendous year.  This year we are really going all out.  This year we are actually going to give the winner something to put in the coffee mugs:

That's right.  A Starbucks gift card of unknown value.  (The Law Blog Accounting Department is still running some numbers.)  

Here are the rules.  Simply comment to this post with a number between 1 and 18.  The winner will be determined on June 8th once we locate our sponsor sign on the golf course.  If there are multiple correct guesses, the first one to post wins.  The winner need not be present at the golf outing, although I will have the prizes at the golf course if the winner is present.  If the winner is not present, we will make arrangements the following week for the awards presentation.  Good Luck.

People v. Mains and the community care taking exception

The 2nd District Appellate Court recently found in People v. Mains, 2012 IL App (2d)110262 that it was a valid use of the community caretaking exception when police stopped and questioned a motorist because his emergency flashers were on and he was fixing his engine.

In Mains, the defendant was experiencing difficulty driving on a highway and was going between 25-30 miles per hour with his emergency flashers activated. After defendant drove into a church parking lot and opened the hood to work on engine, officers arrived, activated emergency lights and took his name and birth date. Police subsequently discovered that defendant’s driver’s license was revoked and he was arrested. While the prosecution argued that the stop was constitutional under Terry v. Ohio, 392 U.S. 1 (1968) or as part of a community caretaking function, the trial court disagreed, quashing the arrest, while the state appealed.

A community caretaking exception applies “where (1) the officer is performing a function other than the investigation of a crime, and (2) the search or seizure was reasonable because it was undertaken to protect the safety of the general public.” People v.McDonough, 239 Ill. 2d 260, 269 (2010). The 2nd District found that both requirements were met in the instant case. Specifically, the appellate court cited the fact that defendant was driving well below speed limit, which could pose danger to other motorists. Additionally, the court held that asking for defendant's name and birth date was not initiating a criminal investigation. The court finally held that there was no need to determine whether it was acceptable under Terry.

For those interested, I have included two blurbs of cases cited in Mains for cases where the court also found a community care taking exception.

People v. Dittmar, 2011 IL App (2d)091112-“officer’s stop of the defendant was justified under the community caretaking exception because the defendant’s actions of pulling his vehicle to the side of the road and switching positions with the passenger gave the officer reason to believe that the defendant might need assistance due to a mechanical problem or other emergency” Mains at ¶ 14.

People  v.  Robinson,  368  Ill.  App.  3d  963- “officer was  engaged  in community caretaking when, after rousing the unconscious defendant, he asked him to step out of his vehicle and to produce identification” Mains at ¶ 15.

This stuff cannot be made up.

The Illinois Supreme Court released an opinion yesterday dealing with abandonment of claims and fraudulent misrepresentation.  But that stuff is boring.  No one really cares about abandonment of claims and fraudulent misrepresentation.  That stuff doesn't sell newspapers (or blogs).

People want to read about scandal and intrigue.  People want to read about other people whose lives are more whacked out than their own.  Well, if that's what you like, then just keep reading because it's about to get weird in here.  (Plus, if you really do care about abandonment of claims and fraudulent misrepresentation, I'll address them briefly at the end.)

In 2005, a woman from Batavia, Illinois ("defendant") created an account in an online chatroom called the "Deadwood Boards," which was dedicated to the HBO television series Deadwood.  She created the account as a man named "Jesse James."  She began chatting as "Jesse" with other people, including a woman in California ("plaintiff").

"Jesse" eventually developed an online, romantic relationship with plaintiff.  They chatted on the Deadwood Boards, they exchanged personal emails, they sent each other handwritten letters, gifts, and personal photos.  They even spoke on the telephone, with defendant using a voice-altering device to disguise her female voice and sound more like "Jesse."

During this time, defendant also developed a relationship with plaintiff under her own name. She claimed to be a common friend of Jesse.  Defendant also developed a universe of approximately 20 other fictional online characters that were either related to or otherwise involved with Jesse, including an ex-wife, a son, his therapist, and various friends and family members.  These characters all communicated with plaintiff from separate and distinct email addresses.  They also sent photos, handwritten letters, and packages that were postmarked from different states and several foreign countries.

In response, plaintiff sent gifts and cash worth more than $10,000 to Jesse and the other fictional characters.  These fictional characters were really messing with plaintiff.  For instance, plaintiff, who thought she was dating Jesse, purchased tickets to actually fly and meet him.  Jesse, however, emailed and cancelled the plans.  Then, several of the fictional characters, including Jesse's therapist, contacted plaintiff to tell her that Jesse had attempted suicide.  This caused plaintiff to start seeing a therapist of her own, which eventually cost her more than $5,000.

After Jesse recovered from his suicide attempt, plaintiff wanted him to move in with her.  Jesse agreed to move to California.  Plaintiff spent nearly $1,000 preparing her house for Jesse to move in.  Shortly before he was supposed to move in, however, Jesse's "sister," Alice, informed plaintiff that Jesse had died from liver cancer.  This caused plaintiff to enter a deep depression.  She experienced headaches, exhaustion, inability to sleep, inability to concentrate at work, and she contracted a recurring infection known as multidrug resistant staphylococcus aureus ("MRSA") because her immune system was so weakened.

Defendant, posing as herself, then flew to California to help plaintiff grieve the loss of Jesse.  Plaintiff again spend nearly $1,000 readying her house for the visit.  While defendant was out there, some of plaintiff's actual friends discovered the fictional nature of the universe of characters created by defendant and confronted her.  She admitted everything on videotape.

THE LAW

Plaintiff then filed a seven-count complaint in Kane County, Illinois for fraud and other claims.    Following several motions to dismiss, six of the counts were eventually dismissed with prejudice.  Plaintiff filed a third amended complaint that only alleged fraudulent misrepresentation.  That count was also dismissed with prejudice.  Plaintiff appealed.  The appellate court reversed the dismissal of the third amended complaint.  Both sides filed petitions for leave to appeal to the Supreme Court.  The Supreme Court took both appeals. Plaintiff was appealing the ruling that she had abandoned the first six counts when she filed a third amended complaint alleging only fraudulent misrepresentation.  Defendant was appealing the ruling that plaintiff had actually stated a case for fraudulent misrepresentation.

ABANDONMENT OF CLAIMS

The Supreme Court held that "a party who files an amended pleading waives any objection to the trial court's ruling on the former complaints," and "where the amendment is complete in itself and does not refer to or adopt the prior pleading, the earlier pleading ceases to be part of the record for most purposes, being in effect abandoned and withdrawn."  

In this case, the plaintiff abandoned the first six counts when she filed the one-count, third amended complaint.  So, if you elect to replead after dismissal of several counts, you must refer to or adopt the dismissed counts or you will have abandoned them.

FRAUDULENT MISREPRESENTATION

The history and origin of fraudulent misrepresentation lie in the common law action of deciet, "a very narrow tort that applies only to cases involving business or financial transactions between parties."  And while courts have, on rare occasions, have recognized claims for fraudulent misrepresentation in settings that are not, strictly speaking, "commercial" or "financial" in nature, they have never recognized fraudulent misrepresentation in a setting that is "purely personal" in nature.

In this case, plaintiff and defendant were not engaged in any kind of business dealings or bargaining and all misrepresentations were made in a purely personal relationship, so plaintiff's fraudulent misrepresentation count failed as well.

So, more than seven years after the relationship started, the plaintiff was left with nothing.

HERE is the opinion.  Don't believe everything you read online, people.  Later!!