NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS SEP 8 2023
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
In re: SARAH HOOVER, No. 22-35814
Debtor, D.C. No. 3:21-cv-05154-RSL
______________________________
SARAH HOOVER, MEMORANDUM*
Plaintiff-Appellee,
v.
PHH MORTGAGE CORPORATION, DBA
PHH Mortgage Services; et al.,
Defendants-Appellants,
and
QUALITY LOAN SERVICE
CORPORATION OF WASHINGTON; IH6
PROPERTY WASHINGTON, L.P., DBA
Invitation Homes,
Defendants.
Appeal from the United States District Court
for the Western District of Washington
Robert S. Lasnik, District Judge, Presiding
Argued and Submitted August 23, 2023
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
Seattle, Washington
Before: HAWKINS, GRABER, and McKEOWN, Circuit Judges.
In 2003 Ali Suleiman, the trustor, established a spendthrift trust for the
benefit of his children. In 2005 the trustor bought a house into which his daughter,
Plaintiff Sarah Hoover, moved. The trust was amended in 2011 to provide that
Plaintiff would receive the house when the trustor died. The trustor died in 2015,
but the trustees did not transfer title to Plaintiff. She made mortgage payments on
the house until 2018. Plaintiff filed for bankruptcy in 2019, but Defendants
(various lenders and loan servicers) foreclosed on the house after the filing of the
bankruptcy. Plaintiff moved for a ruling that Defendants had violated the
automatic stay, 11 U.S.C. § 362(a), and some Defendants moved to annul the stay
retroactively. The bankruptcy court, affirmed by the district court, ruled on
summary judgment that the house was property of the bankruptcy estate; held that
Defendants PHH Mortgage Corporation, NewRez, LLC, and HSBC Bank USA,
N.A., had violated the stay; and declined to annul the stay. Those three Defendants
bring this timely appeal, and we have jurisdiction under 28 U.S.C. §§ 158(d) and
1291. We affirm in part, vacate in part, and remand with the instruction that the
district court dismiss part of the appeal.
1. We review de novo the grant of summary judgment to Plaintiff. United
States v. Warfield (In re Tillman), 53 F.4th 1160, 1166 (9th Cir. 2022). The house
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was part of the bankruptcy estate. Plaintiff had an interest in the house within the
meaning of 11 U.S.C. § 541(a). Under Washington law, creditors could reach the
property because it was “ready for distribution.” Knettle v. Knettle, 68 P.2d 218,
220 (Wash. 1937). The time for distribution, as established by the trustor, arrived
when he died 2015; the trust required conveyance “as soon as practicable” after the
trustor’s death. No conditions precedent remained to be performed, but only the
ministerial transfer of title. There is no evidence that the trustees relied on the
discretion granted to them elsewhere in the trust instrument, even if that discretion
could in theory override the mandatory provision for distribution of the house to
Plaintiff.
2. We review for abuse of discretion the decision on the motion to annul the
automatic stay. Nat’l Env’t Waste Corp. v. City of Riverside (In re Nat’l Env’t
Waste Corp.), 129 F.3d 1052, 1054 (9th Cir. 1997). Defendants had notice of
Plaintiff’s bankruptcy filing before the foreclosure sale took place, and the
bankruptcy court committed no legal error or abuse of discretion when weighing
the equities.
3. We lack jurisdiction over the bankruptcy court’s interim conclusion,
affirmed by the district court, that the violation of the automatic stay was “willful,”
11 U.S.C. § 362(k)(1), on the part of some Defendants. The bankruptcy court
deferred determining the amount of actual damages and deciding whether punitive
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damages were warranted. Thus, there was no completed “proceeding” within the
meaning of 28 U.S.C. § 158, from which an appeal could be taken at this time.
Ritzen Grp. Inc. v. Jackson Masonry, LLC, 140 S. Ct. 582, 587 (2020); Bullard v.
Blue Hills Bank, 575 U.S. 496, 501–02 (2015); Perl v. Perl, (In re Perl), 811 F.3d
1120, 1125 (9th Cir. 2016).
4. Finally, Defendants argue that the bankruptcy court, affirmed by the
district court, erred in characterizing an action as having been in “complete
disregard for the automatic stay.” This argument pertains to the potential future
assessment of damages, over which the district court and we lack jurisdiction.
We affirm the bankruptcy court’s holding that Defendants PHH, NewRez,
and HSBC Bank violated the automatic stay and the bankruptcy court’s denial of
the motion to annul the automatic stay. We vacate the district court’s rulings on
the issues of willfulness and of the “complete disregard” comment, and we remand
with the instruction that the district court dismiss those parts of the appeal to the
district court as premature.
AFFIRMED IN PART; VACATED IN PART; REMANDED WITH
INSTRUCTIONS. Costs on appeal to Appellee.
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