IN RE: RONALD L. NATALE; JANET L. NATALE RONALD NATALE and JANET NATALE v. French & Pickering Creeks Conservation Trust, Inc.

PRECEDENTIAL
Filed June 26, 2002
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 01-2022
IN RE: RONALD L. NATALE; JANET L. NATALE
RONALD NATALE and JANET NATALE
v.
FRENCH & PICKERING CREEKS CONSERVATION TRUST,
INC.; LESTER W. SCHWARTZ; FREDERICK L. REIGLE,
STANDING CHAPTER 13 TRUSTEE*
French & Pickering Creeks Conservation Trust, Inc.,
Appellant
*(Amended in accordance with Clerk’s Order
dated 5/21/2001)
On Appeal from the United States District Court
for the Eastern District of Pennsylvania
(D.C. Civ. No. 00-01159)
District Judge: Honorable Charles R. Weiner
Argued: May 21, 2002
BEFORE: BECKER, Chief Judge, GREENBERG,
Circuit Judge, and BARZILAY, Judge, U.S. C ourt of
International Trade**
(Filed: June 26, 2002)
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** Honorable Judith M. Barzilay, Judge, United States Court of
International Trade, sitting by designation.
Robert J. Sugarman (argued)
Carl W. Ewald
Sugarman & Associates, PC
Robert Morris Building
11th Floor, 100 N. 17th Street
Philadelphia, PA 19103
Attorneys for Appellant
Dexter K. Case (argued)
541 Court Street
Reading, PA 19601
Attorney for Appellees

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Ronald L. Natale and
Janet L. Natale
James E. McErlane
Guy A. Donatelli
Lamb, Windle & McErlane
24 East Market Street
West Chester, PA 19380
Attorneys for Appellee
First Financial Bank
OPINION OF THE COURT
GREENBERG, Circuit Judge.
I. BACKGROUND
The French and Pickering Creeks Conservation Trust
("Trust") appeals from an order of the district court entered
March 21, 2001, dismissing its appeal to the district court
from the bankruptcy court for want of jurisdiction in
accordance with the district court’s March 20, 2001
memorandum opinion concluding that the appeal to it was
untimely.1 The debtors in the underlying bankruptcy case,
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1. Lester W. Schwartz, who apparently is associated with the Trust, was
also a party in the bankruptcy court which treated him as part of the
Trust. He, however, has not joined in the notice of appeal to this court.
2
Ronald L. Natale and Janet L. Natale, brought this
adversary proceeding against the Trust asserting that the
Trust held a judgment lien against the debtors’ real estate
in Chester County, Pennsylvania, that was impairing their
exemption in their real estate. The debtors further alleged
that the value of the real estate was less than the amount
owed to First Financial Savings Bank and that "First
Financial Savings Bank’s [and], Commercial Credit
Corporation’s [mortgage liens] and real estate tax liens are
all superior to that of [the Trust’s] lien." App. at 19. The
debtors requested that the bankruptcy court find that the
Trust’s lien was "unsecured and void" and that the Trust’s
provable claim was unsecured. The bankruptcy court
docketed this proceeding as Adversary No. 99-0231.
The dispute is an outgrowth of the debtors’ action in
constructing a residence on the property in violation of a
recorded covenant that the Trust, the property’s previous
owner, placed on the property precluding the construction.
The financial institutions held mortgages on the property
that were recorded after the restriction had been placed on
the property. Following extensive litigation, the state courts
enforced the covenant and required the demolition of the
residence. In the litigation, the Trust obtained a $100,000
judgment to effect its removal if the debtors failed to do so.2
The judgment was entered after the financial institutions

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recorded their mortgages.
Adversary No. 99-0231 came on before the bankruptcy
court on the Trust’s motion to dismiss, which the court
converted into a motion for summary judgment. The
bankruptcy court partially resolved the matter in a
comprehensive opinion dated August 26, 1999, in which it
concluded:
The Court finds no merit to the contention of the
Trust that the judicial lien it acquired in 1998 should
be accorded priority superior to the mortgages recorded
in 1990 and 1992. Summary judgment on the issue of
lien priority is thus granted in favor of the Debtors and
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2. Ronald L. Natale’s parents also acquired the property with the debtors,
and were parties in the state court litigation. It is not necessary,
however, for purposes of this opinion to refer to them further.
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against the Trust. Another hearing will be scheduled to
determine any outstanding issues, such as the value of
the property and the avoidance of liens on personal
property.
App. at 82. The court simultaneously entered the following
order on August 26, 1999, implementing its opinion:
AND NOW, this 26th day of August, 1999, pursuant
to the Order dated July 6, 1999, converting the motion
to dismiss filed by French & Pickering Creeks
Conservation Trust, Inc., into a motion for summary
judgment, and following the receipt and consideration
of briefs filed pursuant to that order, it is ORDERED
and DECREED that summary judgment is GRANTED
in favor of the Debtors and against the defendants on
the issue of the priority of the Defendants’ judicial lien
on the Debtors’ real property in East Vincent
Township, Chester County Pennsylvania. The Court
FINDS and DECLARES that the Defendants’ judicial
lien does not relate back to the restrictive covenant in
the deed to the premises and instead occupies a
priority position behind the mortgages held by First
Financial Savings Bank and Commercial Credit
Corporation.
A further evidentiary hearing in this matter to
consider any remaining issues extant in this adversary
proceeding, including specifically valuation of the
subject realty and the extent, if any, to which the lien
of the Defendant may be avoidable under 11 U.S.C.
S 506 is hereby scheduled for September 16, 1999 at
10:00 a.m., United States Bankruptcy Court, 900
Market Street, 2nd Floor, Courtroom No. 4,
Philadelphia, Pennsylvania, 19107.
App. at 83-84. None of the parties appealed from the

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August 26, 1999 order when it was entered.
The court subsequently consolidated Adversary No. 99-
0231 with Adversary No. 99-0524 in which the debtors
sought an order determining the secured status of First
Financial’s mortgage lien and sought to avoid the lien
under 11 U.S.C. S 506(d) to the extent that it exceeded the
value of the real property it encumbered. The court held a
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hearing in the consolidated matter on November 29, 1999,
and in a comprehensive opinion dated January 31, 2000,
concluded:
The Court finds the value of the subject property to
be $102,422.00. Based on the foregoing, the Court
concludes in Adv. Proc. No. 99-524 that FFSB’s
mortgage lien, stipulated here to be in the amount of
$206,073, is completely unsecured under Code
S 506(a), and is thus void as a lien against the Debtor’s
share of the property under Code S 506(d). In Adv.
Proc. No. 99-231, because the Debtors’ exemption in
the real estate is completely impaired, the Trust’s
judgment lien may be avoided under Code S 522(f).
App. at 68. The court simultaneously entered the following
order on January 31, 2000, implementing the opinion:
AND NOW, this 31st day of January, 2000, upon
consideration of the above captioned adversary
proceedings brought by the Debtors, the answers filed
by the Defendants, and further, upon consideration of
the evidence presented at a consolidated trial of both
matters held on November 29, 1999, and the post-trial
submission of the parties, it is, for the reasons stated
more fully in the accompanying Opinion, hereby
ORDERED, that judgment is entered in favor of the
Debtor and against defendant First Financial Savings
Bank, PASA ("FFSB"), in Adv. Proc. No. 99-0524,
determining the mortgage lien of FFSB is completely
unsecured under Code S 506(a), and is thus void as a
lien against the Debtor’s share of the property under
Code S 506(d), and it is further
ORDERED, that judgment is entered in favor of the
Debtor and against defendant French & Pickering
Creeks Conservation Trust Inc., in Adv. Proc. No. 99-
0231, determining that because the Debtors’ exemption
in the real estate is completely impaired, the Trust’s
judgment lien is void under Code S 522(f).
App. at 69-70. The January 31, 2000 opinion and order
concluded Adversary Nos. 99-0231 and 99-0524.
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The Trust then filed an appeal on February 9, 2000, to
the district court pursuant to 28 U.S.C. S 158(a)(1) from the
bankruptcy court, which would be timely if its timeliness
were measured from January 31, 2000.3 Nevertheless, the
Trust undoubtedly intended the appeal to challenge
substantively only the August 26, 1999 order for, as it
explains in its brief, the notice of appeal to the district
court "referenced the Order determining that the Trust’s
judgment lien was junior to the Bank’s lien." Br. of
appellant at 5.
The district court set forth its reasons for dismissing the
appeal in the memorandum opinion dated March 20, 2001.
It explained that Fed. R. Bankr. P. 8002(a) required that a
notice of appeal be filed within ten days of the entry of the
order from which the appeal has been taken. It set forth
that the August 26, 1999 summary judgment granting
priority to the mortgage lien over the Trust’s judgment lien
was "a final order of the Bankruptcy Court and was the
only order referenced in the Trust’s notice of appeal." Thus,
in the district court’s view, it was required to measure the
time for appeal from August 26, 1999, and, accordingly, the
appeal was too late as it was filed on February 9, 2000.
Consequently, the court did not have jurisdiction. The
Trust then appealed to this court. We exercise plenary
review on this appeal. See Shareholders v. Sound Radio,
Inc., 109 F.3d 873, 878-79 (3d Cir. 1997).
II. DISCUSSION
Citing In re Saco Local Development Corp., 771 F.2d 441,
444-46 (1st Cir. 1983), the debtors urge that "[a] decision
affecting the priority of a creditor’s claim in a bankruptcy
case has historically been considered a discrete event
warranting immediate review." Br. of appellees at 7. Thus,
they contend that the district court correctly measured the
timeliness of the Trust’s appeal from the August 26, 1999
starting date. But Saco does not set forth the controlling
principle here, for in In re White Beauty View, Inc., 841
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3. Section 158 also permits certain interlocutory appeals to the district
courts, but those provisions are not implicated here.
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F.2d 524, 526 (3d Cir. 1988) (emphasis added), we
explained:
We interpret finality pragmatically in bankruptcy
cases because these proceedings often are protracted
and involve numerous parties with different claims. To
delay resolution of discrete claims until after final
approval of a reorganization plan, for example, would
waste time and resources, particularly if the appeal
resulted in reversal of a bankruptcy court order
necessitating re-appraisal of the entire plan. See
[Walsh Trucking Co. v. Insurance Co. of N. Am., 838
F.2d 698, 701 (3d Cir. 1988); In re Brown, 803 F.2d

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120, 123 (3d Cir. 1986); In re Comer, 716 F.2d 168,
172 (3d Cir. 1983).]
Despite that relaxed view of finality in the
bankruptcy setting as a whole, the general antipathy
toward piecemeal appeals still prevails in individual
adversary actions. As we commented in [In re Jeannette
Corp., 832 F.3d 43 (3d Cir. 1987)], inefficient use of
judicial resources is as objectionable in bankruptcy
appeals as in other fields. Jeannette, 832 F.2d at 46.
See [In re The Charter Co., 778 F.2d 617, 621 (11th
Cir. 1985)] (the particular adversary proceeding must
be finally resolved, rather than the entire bankruptcy
litigation); [In re Fox, 762 F.2d 54, 55 (7th Cir. 1985)]
(proceeding to establish claim against bankrupt estate
is final for purposes of appeal when completed, even
though the bankruptcy continues).
Following that reasoning, we have deemed final an
order of the bankruptcy judge expunging a creditor’s
claim, Walsh, 838 F.2d at 701, and an order lifting the
automatic stay subjecting real property to immediate
foreclosure, Comer, 716 F.2d at 172. However, we have
refused to consider final an order of the bankruptcy
court finding the debtor’s attorneys subject to
sanctions but not determining the amount or form of
the penalty. Jeannette 832 F.2d at 46. Nor is an order
final when it upholds liability, but does not fix the
amount of damages. Fox, 762 F.2d at 55. Thus, in
assessing the finality of a bankruptcy court order
adjudicating a specific adversary proceeding, we apply
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the same concepts of appealability as those used in
general civil litigation. E.g., In re Smith, 735 F.2d 459,
461 (11th Cir. 1984) (denial of summary judgment by
a bankruptcy judge is not a final order).
Accordingly, whatever might be true in other
circumstances as to the appealability upon its entry of an
order making a priority determination, the Trust could not
have appealed as of right from the August 26, 1999 order
until after the entry of the order in Adversary Nos. 99-0231
and 99-0524 concluding the adversary proceedings on
January 31, 2000, as the August 26, 1999 order did not
conclude Adversary No. 99-0231.4See In re Professional
Ins. Mgmt., 285 F.3d 268, 281 (3d Cir. 2002) ("[A]
bankruptcy court order ending a separate adversary
proceeding is appealable as a final order even though that
order does not conclude the entire bankruptcy case.")
(internal quotation marks omitted); In re Durability, Inc.,
893 F.2d 264, 266 (10th Cir. 1990) (per curiam) (holding
that a bankruptcy court’s partial summary judgment order
that established the priority of one creditor relative to
another but did not completely resolve the particular
adversary proceeding was interlocutory in nature, and
therefore not directly appealable); In re Compton Corp., 889
F.2d 1104, 1106 (Temp. Emer. Ct. App. 1989) ("[U]ntil all of

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the significant elements of a claim are determined in the
adversary proceeding between the trustee and the
[claimant], the final disposition of the priority issue alone is
insufficient for a final order to exist."); cf. Bethel v.
McAllister Bros., Inc., 81 F.3d 376, 381 (3d Cir. 1996) ("With
limited exceptions, we will not entertain an appeal unless
the district court’s order ends the litigation on the merits
and leaves nothing more for the court to do but execute the
judgment.") (internal quotation marks omitted). Accordingly,
inasmuch as the Trust could not have appealed as of right
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4. On August 26, 1999, Adversary No. 99-2031 had not yet been
consolidated with Adversary No. 99-0524. Consequently, if the August
26, 1999 order had concluded Adversary No. 99-0231 it might well have
been appealable at that time. However, inasmuch as the order did not
conclude the adversary proceeding, we cannot make a definitive ruling
on that point.
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until after entry of the January 31, 2000 order, its appeal
to the district court was timely.
Saco is not contrary to the result we reach. Saco held
that in the circumstances there, a determination that a
claim was entitled to priority under 11 U.S.C. S 507(a)(4)
was final and thus appealable even though the court
doubted that in a nonbankruptcy context it would have
reached that result, as the determination was of only a
small part of the overall liquidation proceedings and the
order did not determine the dollar amount of the claim
receiving priority. See Saco, 711 F.3d at 443 Thus, in a
nonbankruptcy situation, the priority determination would
not have been considered as resolving a complete"judicial
unit." Id. at 442-44. The court nevertheless held that the
order was final and appealable because "an order allowing
a claim or priority effectively settles the amount due the
creditor, . . . even if the claim or priority may be reduced by
other claims or priorities." Id. at 448. Accordingly, the Saco
court regarded the priority determination as having
resolved a complete judicial unit in the bankruptcy context.
Saco is plainly distinguishable. In this case the
parameters of Adversary No. 99-0231, and after the
consolidation, the parameters of both adversary
proceedings established the scope of the judicial unit for, as
we held in White Beauty, "in assessing the finality of a
bankruptcy court order adjudicating a specific adversary
proceeding, we apply the same concepts of appealability as
those used in general civil litigation." White Beauty, 841
F.2d at 526. The Saco court did not indicate that the
determination appealed there was part of a single, more
expansive adversary proceeding.5 This distinction is critical,
for in ordinary civil litigation the August 26, 1999 order
would not have been regarded as final when entered as it
did not resolve all issues within adversary No. 99-0231,
which constituted the relevant judicial unit. Saco,
moreover, is different as the court of appeals made clear

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that the impediment to finality there, aside from the usual
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5. Indeed, the opinion in Saco has been understood as involving a
situation in which the "bankruptcy court order end[ed] a separate
adversary proceeding." In re Moody, 817 F.2d 365, 367 (5th Cir. 1987).
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considerations present in bankruptcy proceedings
attributable to their ongoing character, was the effect of
litigation being pursued by other creditors on the amount
or priority of the creditor’s claim being advanced in Saco.
Saco simply did not address a situation such as that here
involving the scope of an ongoing adversary proceeding
when it is asserted that an order is final and appealable
with issues still extant in the adversary proceeding.
III. CONCLUSION
For the foregoing reasons, we will reverse the district
court’s March 21, 2001 order and will remand the matter to
that court for further proceedings in which it will consider
the Trust’s appeal on its merits.
A True Copy:
Teste:
Clerk of the United States Court of Appeals
for the Third Circuit
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