IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
____________________
No. 97-21040
Summary Calendar
____________________
In The Matter Of: HARVEN MICHAEL MCKENZIE,
Debtor.
-------------
HARVEN MICHAEL MCKENZIE,
Appellant,
v.
KUKUI INCORPORATED; W STEVE SMITH, Trustee,
Appellees.
_________________________________________________________________
Appeal from the United States District Court
for the Southern District of Texas
(H-97-CV-3311)
_________________________________________________________________
July 16, 1998
Before KING, SMITH, and WIENER, Circuit Judges.
PER CURIAM:*
Harven Michael McKenzie filed a Chapter 7 bankruptcy
petition. His discharge was contested by Kukui, Incorporated,
and by the Trustee, W. Steve Smith. The bankruptcy court entered
*
Pursuant to 5TH CIR. R. 47.5, the court has 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this opinion should not be published and is not precedent except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.
judgment denying McKenzie a discharge. McKenzie appealed the
judgment to the district court. The district court dismissed his
appeal and McKenzie now appeals the district court’s dismissal.
We vacate the district court’s judgment.
I. FACTS AND PROCEDURAL HISTORY
In October 1995, McKenzie filed a Chapter 7 bankruptcy
petition. Kukui, Incorporated and Trustee W. Steve Smith
(collectively, Kukui) filed an adversary proceeding objecting to
McKenzie’s discharge. On September 18, 1997, the bankruptcy
court entered final judgment denying McKenzie’s discharge.
On September 24, 1997, McKenzie timely filed a notice of
appeal. On October 2, 1997, McKenzie filed an emergency motion
to extend the time to file his designation of record. The
district court denied the motion for an extension of time the
next day. On October 6, McKenzie timely filed his designation of
record. On October 8, McKenzie filed a motion for extension of
time to file his appellate brief. The district court denied the
motion for an extension of time the next day.
On October 8, McKenzie called the clerk’s office and the
transcription service regarding trial transcripts to be included
in the designated record, as is required by Bankruptcy Rule 8006.
According to a series of affidavits, the transcript order form,
which was promptly submitted to the clerk’s office by McKenzie,
was not forwarded by the clerk’s office to the transcription
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service, nor were alleged deficiencies in the form called to
McKenzie’s attention for correction. In short, the form simply
sat in the “trouble basket” in the clerk’s office. McKenzie
discovered nearly five weeks later that the order had never been
forwarded to the transcription service. On November 19, McKenzie
resubmitted his trial transcript order form to the clerk’s
office. On November 20, 1997, the district court dismissed
McKenzie’s appeal based on his failure to timely file an
appellate brief pursuant to Bankruptcy Rule 8009, giving no
further reasons.
II. DISCUSSION
In reviewing actions of the district court acting in its
appellate capacity, several different standards of review may
govern our decision, depending on the nature of the holdings
reviewed. See HECI Exploration Co. v. Holloway (In re HECI
Exploration Co.), 862 F.2d 513, 518 (5th Cir. 1988). We review
the district court’s disposition of questions of law de novo.
See United States v. Kolstad (In re Kolstad), 928 F.2d 171, 173
(5th Cir. 1991). Where the disputed holding involves a matter
that is within the district court’s discretion, we will affirm
the judgment of a district court acting in its appellate role
unless the court has clearly abused its discretion. See In re
HECI Exploration Co., 862 F.2d at 518. The determination of the
appropriate sanction for a party’s violation of the Bankruptcy
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Rules related to appeal of the bankruptcy court’s final orders is
a matter within the district court’s discretion; we therefore
review this determination for an abuse of discretion. See
Pyramid Mobile Homes, Inc. v. Speake (In re Pyramid Mobile Homes,
Inc.), 531 F.2d 743, 746 (5th Cir. 1976); see also Resolution
Trust Corp. v. SPR Corp. (In re SPR Corp.), 45 F.3d 70, 73-74
(4th Cir. 1995); see also 10 COLLIER ON BANKRUPTCY ¶ 8001.06[2]
(Lawrence P. King et al. eds., 15th ed. rev. 1998) (“Under the
plain language of the second sentence of Rule 8001(a), the
district court . . . may dismiss the appeal (or impose lesser
sanctions) if no designation is forthcoming, if no brief is
filed, or if the appellant fails to take any of the other steps .
. . in Part VIII of the Bankruptcy Rules. . . . The severity of
the sanction rests in the sound discretion of the court, in light
of all the circumstances, which may include the substantiality of
the questions presented on appeal, prejudice to the appellee or
want of it, and the bona fides of the appellant.”)
A. Perfection of Appeal
Because both parties argue specific provisions of the
Bankruptcy Rules, the starting point of our analysis is an
examination of the language of the pertinent rules. Bankruptcy
Rules 8001 through 8009 govern the timing of the basic documents
necessary to perfect an appeal from a bankruptcy court’s judgment
or order. Rules 8001 and 8002 require the appellant to file
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notice of appeal with the bankruptcy clerk within ten days of the
entry of the final judgment or order. See FED. R. BANKR. P. 8001,
8002. Rule 8006 requires the appellant to file a record
designation and statement of issues on appeal within ten days of
the clerk’s filing of the notice, and also to submit a written
request to the court reporter “immediately” should trial
transcripts be needed. See FED. R. BANKR. P. 8006. Rule 8007(a)
requires the reporter to acknowledge and forward the trial
transcript request to the district court clerk with an estimated
date of completion. Rule 8007(b) requires the bankruptcy clerk
to forward a copy of the record to the district court clerk once
the record is complete. See FED. R. BANKR. P. 8007. The district
court clerk is then responsible for docketing the appeal and
providing notice to all concerned parties. See id. Rule 8009
requires the appellant to serve and file the appellate brief
within fifteen days of the entry of the appeal on the docket,
pursuant to Rule 8007. See FED. R. BANKR. P. 8009.
B. Analysis
McKenzie argues that the district court erred in dismissing
the appeal based on his failure to file an appellate brief
because the brief was not yet due.1 In support of this argument,
1
McKenzie also contends that the district court abused
its discretion in denying his motion to extend time to file a
brief, and that the district court’s dismissal of his appeal
deprived him of his right to due process. Because we conclude
that the district court’s dismissal of McKenzie’s appeal was
improper, we need not address these claims.
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McKenzie asserts that the Bankruptcy Rules regarding the
perfection of an appeal operate in a specific sequence.
Dismissal cannot be premised on the failure to timely file the
appellate brief when the obligation to file that brief has not
yet been triggered under the rules.
Kukui contends that because McKenzie himself caused the
delays in fulfilling the requirements of the preceding Bankruptcy
Rules, he should not be allowed to prevent a sanction imposed
under Rule 8009. Kukui further contends that even if the
district court did improperly rely on Rule 8009 in dismissing the
appeal, the judgment should be affirmed if some other basis in
the record justifies dismissal. In support of this argument,
Kukui contends that McKenzie’s failure to adhere to the
procedural requirements of Rule 8006 and other rules warrants
discretionary dismissal pursuant to Rule 8001(a).2 We must thus
determine whether the district court abused its discretion in
dismissing McKenzie’s appeal based upon its purported violation
of Rule 8009 and, if so, whether the dismissal can nevertheless
be affirmed on grounds not relied upon by the district court.
In order to file a bankruptcy appeal, the parties and
various court officials must carry out certain duties prescribed
2
Bankruptcy Rule 8001(a) provides, in part: “An
appellant’s failure to take any step other than timely filing a
notice of appeal does not affect the validity of the appeal, but
is ground [for] . . . dismissal of the appeal.” See FED. R.
BANKR. P. 8001.
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by the Bankruptcy Rules. See Jewelcor Inc. v. Asia Commercial
Co. (In re Jewelcor), 11 F.3d 394, 397-98. (3d Cir. 1993). Rule
8009 sets the appellant’s 15-day time period for filing his
brief, specifically indicating that such period begins to run
“after entry of the appeal on the docket pursuant to Rule 8007."
See FED. R. BANKR. P. 8009 (emphasis added). Rule 8007
establishes the procedure for docketing an appeal in the district
court; the completed record must be forwarded to the district
court clerk, who must enter the appeal on the docket and give
notice of the docketing date to the parties concerned. Without
these mandatory actions, an appeal is not docketed “pursuant to
Rule 8007." See In re Jewelcor, 11 F.3d at 398 (describing
compliance with Rule 8007 as a condition precedent to
commencement of the brief-filing period); see also 10 COLLIER ON
BANKRUPTCY ¶ 8007.04 (Lawrence P. King et al., eds., 15th ed. rev.
1998) (“[The district court] clerk is to enter the appeal in the
docket . . . . It is the docketing which commences the running
of the period within which briefs are to be filed.”); see also
WILLIAM L. NORTON, JR., BANKRUPTCY RULES 561 editor’s comments (1997-
1998) (same).
Although the facts surrounding the delay in transcript
preparation and record transmission are disputed, it is clear
from the record that the appeal was never docketed, the district
court clerk’s required notice of docketing was never sent, and
therefore the briefing period did not begin to run. The plain
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language of Rules 8007 and 8009 therefore indicates that
McKenzie’s brief was not yet due. Consequently, dismissal
predicated solely on McKenzie’s failure to file a brief was
erroneous under the circumstances.
Although this court can defer to the district court’s
discretionary sanction of dismissal, it cannot do so when
dismissal is based upon an inapplicable bankruptcy rule. A lower
court necessarily abuses its discretion when it bases a ruling on
an erroneous view of the law. See Chaves v. M/V Medina Star, 47
F.3d 153, 156 (5th Cir. 1995) (citing Cooter & Gell v. Hartmarx
Corp., 496 U.S. 384, 405 (1990)). Because the dismissal cannot
reasonably be premised on Rule 8009, we find that the district
court abused its discretion in so holding.
Dismissal of a bankruptcy appeal is an extremely severe
sanction. See International Bhd. of Teamsters v. Braniff
Airways, Inc. (In re Braniff Airways), 774 F.2d 1303, 1305 (5th
Cir. 1985) (describing dismissal as a “penalty of last resort”);
see also DANIEL R. COWAN, BANKRUPTCY LAW & PRACTICE § 18.6, at 530 (6th
ed. 1994) (describing dismissal for failure to file brief as
“severe”). It should be a sanction reserved for the most
egregious of situations. See In re Braniff Airways, 774 F.2d at
1304 (affirming the district court’s dismissal where the
appellant had not filed its brief over a year and a half after
docketing of the appeal); see also In re Pyramid Mobile Homes,
Inc., 531 F.2d at 746 (affirming the district court’s dismissal
8
where no effort was made to comply with the Bankruptcy Rules four
months after filing the appeal). This court has set a high
standard for discretionary dismissal, condoning it where imposed
“only after clear delay or contumacious conduct by the plaintiff
and a finding that lesser sanctions would not cure the problem.”
In re Braniff Airways, 774 F.2d at 1305. Here, the district
court made no finding as to why lesser sanctions could not remedy
McKenzie’s purported violation of Rule 8009.
Kukui additionally argues that the district court’s judgment
can be upheld regardless of erroneous reasoning as long as
another ground in the record justifies dismissal. Kukui suggests
that McKenzie violated Rule 8006 by failing to submit a request
for a transcript to the clerk’s office immediately and that this
is an adequate alternative ground for upholding the dismissal.
We disagree.
There was no district court finding as to violations of
other Bankruptcy Rules in this case, and it is inappropriate for
this court to make the factual determinations attendant to
determining whether McKenzie violated other Bankruptcy Rules. We
can say that, judging solely from the “cold” affidavits, the
blame for the delay in processing McKenzie’s transcript order
form may not belong solely on McKenzie. In view of the added
delay that has occurred by reason of this appeal, it seems to us
that the best thing for all concerned would be to get on with the
appeal of the important issue that McKenzie is challenging--the
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denial of his discharge--rather than to engage in the fact-
finding and blame-placing about a considerably less important
issue that would have to occur to support another dismissal of
the appeal.
III. CONCLUSION
For the foregoing reasons, we VACATE the district court’s
judgment dismissing McKenzie’s appeal. The costs of this appeal
shall be borne by the appellees.
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