Narrative Opinion Summary
This case involves an appeal by Glay H. Collier, II and McBride and Collier, LLC against decisions made by Bankruptcy Judge Jeffrey Norman concerning Angela Washington's bankruptcy proceedings. Washington filed for Chapter 13 bankruptcy in 2010, later converted to Chapter 7, and experienced issues with her discharge due to financial management certification requirements. The Collier Appellants, who represented Washington until 2014, faced allegations of improper fee collection and violations of the Bankruptcy Code. In February 2015, they sought summary judgment, which was partially granted. Following a trial, they were found to have violated various bankruptcy provisions, resulting in damages and sanctions. Key issues on appeal included the imposition of a $20,000 civil penalty without due process and the timeliness of Washington's claims under 11 U.S.C. § 526. The appellate court reversed the civil penalty due to procedural deficiencies but affirmed other Bankruptcy Court rulings, including the award of attorneys' fees to Washington. The court remanded the case for further proceedings, addressing the legal standards applied in bankruptcy violations and the interpretation of statutory limitations. The decision underscores the courts' emphasis on due process and proper procedural notice when imposing sanctions in bankruptcy cases.
Legal Issues Addressed
Attorneys' Fees Awards in Bankruptcy Proceedingssubscribe to see similar legal issues
Application: The Bankruptcy Court upheld Washington's award of attorneys' fees despite her contingency fee arrangement, aligning with Fifth Circuit precedent.
Reasoning: The Bankruptcy Court determined Washington's actual damages to be $600, plus $102 for insufficient funds fees, and ordered the return of $1,675.04 in attorneys’ fees previously paid to the Collier Appellants.
Automatic Stay Violations under 11 U.S.C. § 362subscribe to see similar legal issues
Application: The Bankruptcy Court found in favor of Washington regarding violations of the automatic stay, rejecting the application of a state statute of limitations.
Reasoning: The Bankruptcy Court concluded that Louisiana's prescription period did not apply to the alleged violations of the automatic stay and found that the Collier Appellants did not adequately raise the defense of laches.
Bankruptcy Court Sanctions under 11 U.S.C. § 526(c)(5)subscribe to see similar legal issues
Application: The Bankruptcy Court imposed a $20,000 civil penalty on the Collier Appellants for conduct violating 11 U.S.C. § 526(c)(5), but this was reversed due to lack of proper notice and due process.
Reasoning: The Court found no indication that the Bankruptcy Court intended to impose sanctions prior to the April 2, 2015 hearing. Consequently, it reversed the Bankruptcy Court's April 7, 2015 order imposing a $20,000 civil penalty on Collier, granting the Collier Appellants' appeal.
Statute of Limitations for Claims under 11 U.S.C. § 526(c)(2)(A)subscribe to see similar legal issues
Application: Washington's claims under 11 U.S.C. § 526(c)(2)(A) were found timely, as the statute of limitations was considered to start upon discovery of the violations.
Reasoning: The Court ultimately found that the Collier Appellants did not present evidence or argument on this affirmative defense at trial, leading to the overruling of their claim that the statute of limitations under 28 U.S.C. 1658(a) barred the claims under 11 U.S.C. 526(c)(2)(A).