Cook et al v. Garrett Capital et al

UNITED STATES BANKRUPTCY COURT
DISTRICT OF NEW MEXICO
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06/10/06
Daniel William Cook, et al. v. Garrett Capital, et al.
04-01240
Order Denying [24-1] Motion For Default Judgment by Daniel William Cook, Yolanda
T. Cook.
Received on: 2005-02-11 14:12:38.000
2005-02-11 00:00:00.000
2005-02-11 00:00:00.000
James Burke
Case 04-01240-s Doc 30 Filed 02/11/05 Entered 02/11/05 16:45:00 Page 1 of 7

UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF NEW MEXICO
In re:
DANIEL WILLIAM COOK
and YOLANDA COOK,
Debtors. No. 11-04-17704 SA
DANIEL WILLIAM COOK, et al.,
Plaintiff,
v. Adv. No. 04-1240 S
GARRETT CAPITAL, et al.,
Defendant.
ORDER DENYING MOTION FOR DEFAULT
JUDGMENT AGAINST WELLS FARGO BANK, NA
This matter came before the Court for a pretrial
conference on February 8, 2005. Plaintiffs are self-
represented. Defendants Garrett Capital, Scott Garrett,
Catherine F. Davis and Hunt & Davis, P.C. appeared through
their attorneys Catherine F. Davis and Julie J. Vargas.
Defendant Wells Fargo Bank, N.A., appeared through its
attorney Sutin, Thayer & Brown (Jay D. Hertz and Michelle
Ostrye). One matter pending on the docket was Plaintiffs’
Motion for Default Judgment (doc. 24). The Court ruled that
this Motion would be denied. This Order is entered pursuant
to that ruling.
FACTS
1. Plaintiffs filed this adversary complaint on December 7,
2004.
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Page -2-
2. The Court issued a summons on December 9, 2004.
3. Plaintiffs served Wells Fargo by mail on December 13,
2004.
4. On January 10, 2005, Wells Fargo filed a Motion to
Abstain (doc. 15), a Memorandum in Support of Abstention
(doc. 16), and a Motion to Stay this adversary proceeding
pending a ruling on the abstention motion (doc. 17).
5. Plaintiff’s Motion for Default Judgment states [sic]:
Trustees moves the Court consider entering a
Default Judgment should Wells not file a
responsive pleading in accordance with Rule 7
within 20 days. Wells has not yet responded in
accordance with Rule 1011 of the Bankruptcy Code
and Rule 12 of F.R.Civ.P. Therefore a motion
for a Default Judgment is requested should Wells
not file a responsive pleading to the Complaint
or to Trustees amended Complaint as the case may
be.
CONCLUSIONS OF LAW
1. The Federal Rules of Bankruptcy Procedure (“Bankruptcy
Rules”) govern procedure in cases under the Bankruptcy
Code. Fed.R.Bankr.P. 1001.
2. Part VII of the Bankruptcy Rules (Rules 7001-7087) govern
“Adversary Proceedings.” Many of these Rules adopt the
Federal Rules of Civil Procedure, see, e.g. Bankruptcy
Rule 7003 (“Rule 3 F.R.Civ.P. applies in adversary
proceedings.”) Others adopt parts of the Federal Rules
of Civil Procedure, see, e.g. Bankruptcy Rule 7004(a)
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Page -3-
(“Rule 4(a), (b), (c)(1), (d)(1), (e)-(j), (l), and (m)
F.R.Civ.P. applies in adversary proceedings.”) Other
7000 series Bankruptcy Rules do not adopt the Federal
Rules of Civil Procedure, see, e.g. Bankruptcy Rule
7012(a) (“If a complaint is duly served, the defendant
shall serve an answer within 30 days after the issuance
of the summons, except when a different time is
prescribed by the court.”) Compare Fed.R.Civ.P. 12(a)
(“Unless a different time is prescribed in a statute of
the United States, a defendant shall serve an answer ...
within 20 days after being served with the summons and
complaint.”)
3. Under Bankruptcy Rule 7012(a), Wells Fargo had 30 days
from the issuance of the summons to respond to the
complaint.
4. The summons was issued on December 9, 2004, and the 30th
day after issuance was January 9, 2005 (a Sunday). If a
deadline occurs on a Saturday, Sunday or legal holiday,
the deadline is automatically extended to the next
business day. Bankruptcy Rule 9006(a). Therefore, Wells
Fargo’s deadline was January 10, 2005.
5. On January 10, 2005 Wells Fargo filed its Motion to Stay
proceedings pending a ruling on its abstention motion
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1 The Court observes that had Wells Fargo only filed a
Motion to Abstain in response to the complaint, that may not
(continued...)
Page -4-
pursuant to Bankruptcy Rule 5011(c). That rule provides,
in part:
The filing of a motion for ... abstention ...
shall not stay the administration of the case or
any proceeding therein before the bankruptcy
judge except that the bankruptcy judge may stay,
on such terms and conditions are as proper,
proceedings pending disposition of the motion.
6. Bankruptcy Rule 9006(b) provides, in part:
[w]hen an act is required ... to be done at or
within a specified period by these rules ... the
court for cause shown may at any time in its
discretion ... order the period enlarged if the
request therefor is made before the expiration
of the period originally prescribed.
7. Wells Fargo’s Motion to Stay serves as a motion to stay
the proceedings, but also necessarily serves as a request
for enlargement of time to file any response.
8. Bankruptcy Rule 7055 adopts Fed.R.Civ.P 55 for defaults.
Rule 55(a) states “When a party against whom a judgment
for affirmative relief is sought has failed to plead or
otherwise defend as provided by these rules and that fact
is made to appear by affidavit or otherwise, the clerk
shall enter the party’s default.”
9. Wells Fargo did not fail to plead or defend timely, and
entry of default would not be proper1.
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1(...continued)
have been sufficient to avoid default. Bankruptcy Rule
7012(b) adopts Fed.R.Civ.P. 12(b)-(h). Under Rule 12(b),
certain motions can be filed in response to a complaint, e.g.,
motions regarding jurisdiction, service, failure to state a
claim. Motions to abstain are not on the list of optional
motions in Rule 12(b). Furthermore, Bankruptcy Rule 5011(c)
provides that a motion to abstain does not normally stay a
case. See Littenstein v. Dorcich (In re Littenstein), 35 B.R.
123, 124 (9th Cir. BAP 1983)(suggesting that a motion to
abstain may not be a proper response under former Rule
712(b).); Container Transport, Inc. v. Scott Paper Co. (In re
Container Transport, Inc.), 86 B.R. 804, 808 n.4 (E.D. Pa.
1988)(“The Defendant therefore should have filed its Answer
and the case should have proceeded as if the Motion for
Abstention had never been filed, unless a stay had been
entered, by the terms of B.Rule 5011(c).”)
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10. Plaintiffs’ citation of certain rules in their Motion for
Default Judgment is not correct. Bankruptcy Rule 1011
applies only to involuntary petitions and petitions
commencing cases ancillary to foreign proceedings. An
adversary is neither. And, while Federal Rule 12(a) sets
a 20 day deadline for answers, Bankruptcy Rule 7012(a)
sets a 30 day deadline.
IT IS ORDERED that Plaintiffs’ Motion for Default Judgment
(doc. 24) is denied.
Honorable James S. Starzynski
United States Bankruptcy Judge
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I hereby certify that on February 11, 2005, a true and correct
copy of the foregoing was electronically transmitted, faxed,
delivered, or mailed to the listed counsel and/or parties.
Daniel William Cook
5101 Eakes Road NW
Albuquerque, NM 87107
Yolanda T. Cook
5101 Eakes Road NW
Albuquerque, NM 87107
Catherine F Davis
PO Box 30088
Albuquerque, NM 87190-0088
Jay D Hertz
PO Box 1945
Albuquerque, NM 87103-1945
Julie J Vargas
PO Box 30088
Albuquerque, NM 87190-0088
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