In re: G.A.D., INCORPORATED v. HUGH LOYER and GEORGE CHAPEL

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RECOMMENDED FOR FULL-TEXT PUBLICATION
Pursuant to Sixth Circuit Rule 206
ELECTRONIC CITATION: 2003 FED App. 0285P (6th Cir.)
File Name: 03a0285p.06
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
_________________
In re: G.A.D.,
INCORPORATED,
Debtor.
_______________________
DONNA EGLINTON,
Plaintiff-Appellant,
v.
HUGH LOYER and GEORGE
CHAPEL,
Defendants-Appellees.
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No. 01-2235
Appeal from the United States District Court
for the Eastern District of Michigan at Detroit.
No. 00-75251—Denise Page Hood, District Judge.
Argued: March 27, 2003
Decided and Filed: August 13, 2003
Before: MARTIN, Chief Circuit Judge; KENNEDY and
DAUGHTREY, Circuit Judges.
2 In re G.A.D., Inc. No. 01-2235
_________________
COUNSEL
ARGUED: Laurel A. Stuart-Fink, LAUREL STUART-
FINK & ASSOCIATES, West Bloomfield, Michigan, for
Appellant. Tony F. Di Ponio, CALHOUN, DI PONIO &
GAGGOS, Lathrup Village, Michigan, for Appellee.
ON BRIEF: Laurel A. Stuart-Fink, LAUREL STUART-
FINK & ASSOCIATES, West Bloomfield, Michigan, for
Appellant. Tony F. Di Ponio, CALHOUN, DI PONIO &
GAGGOS, Lathrup Village, Michigan, for Appellee.
_________________
OPINION
_________________
BOYCE F. MARTIN, JR., Chief Circuit Judge. Donna
Eglinton appeals the district court’s affirmance of a
bankruptcy court decision to deny reconsideration of a motion
to vacate. For reasons stated below, we AFFIRM.
In September 1996, Ronald Korte, Eglinton’s boyfriend,
filed a petition for relief under Chapter 11 of the United States
Bankruptcy Code, which was converted later to a Chapter 7
bankruptcy. On May 7, 1997, while his bankruptcy was
pending, Korte entered a lease agreement with defendants
Loyer and Chapel for nonresidential property in White Lake,
Michigan. The bankruptcy court approved the lease
agreement on April 24, 1997. The lease agreement contained
a clause stating Korte could not assign, transfer, or sublet
without the written consent of Loyer and Chapel.
Despite the prohibition, on May 12, 1997, Korte
purportedly assigned the lease agreement to G.A.D., Inc., a
Michigan corporation Eglinton owns, without notice to
creditors or permission to do so from the bankruptcy court or

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No. 01-2235 In re G.A.D., Inc. 3
landlords. We will refer to the transfer as an assignment,
although its actual legal status is indeterminate.
When the landlords learned of the transaction in December
of 1997, they entered into an agreement with the bankruptcy
trustee that he would be the only entity who could possess the
premises. Korte objected, but the bankruptcy court approved
the agreement. The district court affirmed the bankruptcy
court’s order on appeal.
Meanwhile, G.A.D. filed a notice of lis pendens on the
premises in Oakland County Circuit Court and a complaint
against the landlords. This first lawsuit sought a declaration
that the assignment was valid and enforceable, injunctive
relief, and monetary damages. Loyer and Chapel removed
from state court to Korte’s bankruptcy case as an adversary
proceeding. G.A.D. filed an objection to the notice of
removal, but the bankruptcy court found removal was
appropriate because the state court action was inextricably
intertwined with the bankruptcy case and related, pursuant to
11 U.S.C. §157(c)(1). The bankruptcy court then granted
Loyer and Chapel’s motion to dismiss with prejudice.
On September 22, 1998, G.A.D. filed a petition for Chapter
11 bankruptcy. G.A.D. asserted a leasehold interest in the
property. G.A.D’s bankruptcy case was converted to a
Chapter 7 proceeding, which vested the Chapter 7 trustee with
any interest G.A.D. had in the leasehold.
On June 13, 1999, Eglinton filed a complaint in her name
in Oakland County Circuit Court against Loyer and Chapel,
making the same claims as the former suit, except the latter
alleged fraud and misrepresentation, seeking monetary
damages for relief. Loyer and Chapel filed motions to
remove Eglinton’s suit to the G.A.D. bankruptcy and to
dismiss on July 28. Response from Eglinton was due fifteen
days later. On August 16, Loyer and Chapel filed a
certification of no response to the dismissal motion.
4 In re G.A.D., Inc. No. 01-2235
Eglinton responded to Loyer and Chapel’s attorney on
August 24 and 25 to the notice of removal and motion for
dismissal, respectively, several days after the time for
response expired. The bankruptcy court conducted a hearing
on August 26. Eglinton, who appeared pro se, claims she did
not have notice that the court would hear the motion to
dismiss in addition to the notice of removal on that day. The
bankruptcy court eventually dismissed Eglinton’s claims with
prejudice. Loyer and Chapel thereafter entered into an
agreement with the trustee of the G.A.D. bankruptcy to
purchase G.A.D.’s property. Eglinton subsequently returned
to state court with the suit. The state circuit court dismissed
her claims, and she appealed to the Michigan Court of
Appeals. Eventually, the state trial court dismissed her claim
on remand.
On July 24, 2000, almost a year after the hearing in
bankruptcy court, Eglinton filed a motion to vacate the
bankruptcy court order of dismissal, pursuant to Federal Rule
of Civil Procedure 60(b). The bankruptcy court entered an
order on September 8, 2000, denying Eglinton’s motion to
vacate. Eglinton filed a motion to reconsider, and the
bankruptcy court denied the motion to reconsider. Eglinton
appealed from this last order to the United States District
Court for the Eastern District of Michigan, which denied her
appeal and affirmed the order denying her motion to
reconsider. She filed a timely notice of appeal from the
district court’s decision.
We review denial of a Rule 60(b) motion for abuse of
discretion. Smith v. Kincaid, 249 F.2d 243, 245 (6th Cir.
1957). The burden is on the movant to bring herself within
the provisions of Rule 60(b). Id. We “find an abuse of
discretion only if we have ‘a definite and firm conviction that
the court below committed a clear error of judgment in the
conclusion it reached upon a weighing of the relevant
factors.’” Union Oil Co. of Cal. v. Serv. Oil Co. 766 F.2d
224, 227 (6th Cir. 1985)(quoting Taylor v. United States
Parole Com’n., 734 F.2d 1152, 1155 (6th Cir.1984)). A

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No. 01-2235 In re G.A.D., Inc. 5
lower court abuses its discretion when it relies on clearly
erroneous findings of fact, improperly applies the law, or uses
an incorrect legal standard. Romstadt v. Allstate Ins. Co., 59
F.3d 608, 615 (6th Cir. 1985).
Federal Rule of Civil Procedure 60(b) provides that a court
may relieve a party or party’s representative from a final
judgment, an order, or a proceeding under certain
circumstances. The pertinent circumstances here are
“mistake, inadvertence, surprise, or excusable neglect,” Fed.
R. Civ. P. 60(b)(1), and circumstances where “the judgment
is void,” Fed. R. Civ. P. 60(b)(4).
Time limitations govern the filing of a Rule 60(b) motion,
but the rule states generally that “[t]he motion shall be made
within a reasonable time.” We have held that “reasonable
time” under 60(b) means that if a reason to set aside the
judgment is known within the time for filing notice of appeal,
a motion should be brought under Rule 60(b)(1) during that
period. Barrier v. Beaver, 712 F.2d 231, 234-35 (6th Cir.
1983). Regardless of circumstances, no court can consider a
motion brought under Rule 60(b)(1), (2), or (3) a year after
judgment. Fed. R. Civ. P. 60(b); McDowell v. Dynamics
Corp. of America, 931 F.2d 380, 384 (6th Cir. 1991). Motions
under subsections (4), (5), and (6) may be made within a
“reasonable time,” which we have determined is dependent
upon the facts in a case, including length and circumstances
of delay in filing, prejudice to opposing party by reason of the
delay, and circumstances warranting equitable relief. Olle v.
Henry & Wright Corp., 910 F.2d 357, 365 (6th Cir. 1990).
The time for filing a notice of appeal from a judgment of the
bankruptcy court to the district court is ten days from entry of
the judgment under Bankruptcy Rule 8002.
Eglinton’s first claim for relief is based on her assertion that
her failure to file a motion to vacate or for reconsideration of
the bankruptcy court’s dismissal is a result of excusable
neglect under Rule 60(b)(1). She argues that proceeding as a
pro se plaintiff and pursuing the matter in state court are
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reasons to excuse her from the requirement to file a timely
notice of appeal from bankruptcy court to the district court
and the requirement to file a timely motion under Rule 60(b).
The Supreme Court has instructed courts to hold pleadings
filed by pro se litigants to a less stringent standard than those
filed by lawyers, Haines v. Kerner, 404 U.S. 519, 520 (1972),
but has“never suggested procedural rules in ordinary civil
litigation should be interpreted so as to excuse mistakes by
those who proceed without counsel.” McNeil v. United
States, 508 U.S. 106, 113 (1993).
We hold that the district court did not abuse its discretion
when it denied Eglinton’s motion to reconsider based upon
Rule 60(b)(1). The procedural law and deadlines are
straightforward. Federal Rule of Bankruptcy Procedure 9024
provides that Federal Rule of Civil Procedure 60 applies in
cases under the Bankruptcy Code. Mirroring the federal
rules, Local Rule 9024-1 of the Bankruptcy Court for the
Eastern District of Michigan states:
Motion to Alter or Amend Order or Judgment or for
Rehearing or Reconsideration
(a) Time. A motion to alter or amend an order or
judgment and a motion for rehearing or reconsideration
shall be served not later than 10 days after entry of such
order or judgment.
Eglinton filed her motion almost a year after the bankruptcy
court entered judgment. By failing to meet deadlines for a
response to the motion to dismiss and to file a notice of
appeal of the bankruptcy court’s decisions, she did not
comport with procedural rules.
Eglinton argues that she did not timely respond to the
motion to dismiss because she was unaware that the notice of
removal had no effect on the procedures required with respect
to the dismissal motion, essentially assuming no response was
necessary. The notice attached to the motion to dismiss,
however, states in very plain language that she had fifteen

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No. 01-2235 In re G.A.D., Inc. 7
days to file a response or the court might decide she did not
oppose the motion and rule against her. Though she was a
pro se litigant, procedural rules were available to her as they
are to all persons appearing before courts, and if unsure of the
procedural requirements, she could have clarified them with
the clerk’s office.
Though Eglinton asserted in the September 2000
bankruptcy court hearing, as she does here, that Loyer and
Chapel did not comply with local rules so that they are being
held to a less stringent application of the rules than she, this
allegation does not cure the defects in neglect of the
deadlines. Voicing procedural grievances a year after the
occurrence is inappropriate. Rather, the appropriate time to
voice that complaint was at the first bankruptcy court hearing
in 1999 or in motions properly filed then.
Eglinton’s second claim for relief asserts that the
bankruptcy court had no jurisdiction over the claims against
Loyer and Chapel, rendering the court’s judgment dismissing
her claim void. Under Rule 60(b)(4), if the rendering court
lacked subject matter jurisdiction, the underlying judgment is
void, and it is per se an abuse of discretion to deny a
movant’s motion to vacate. Antoine v. Atlas Turner, Inc., 66
F.3d 105, 108 (6th Cir. 1995).
Title 28, chapter 6, governs the jurisdiction and powers of
bankruptcy courts. Under 28 U.S.C. § 157 (b)(1), bankruptcy
judges may hear and determine core proceedings arising
under the bankruptcy code and may enter orders and
judgments in those proceedings. Core proceedings are
defined in a non-exclusive list at section 157(b)(2). The
significance of whether a proceeding is core or non-core is
that the bankruptcy judge may hear non-core proceedings
related to bankruptcy cases but cannot enter judgments and
orders without consent of all parties to the proceeding. See
§ 157(c). Without consent from the parties, a district judge
must make final determinations after considering the findings
and conclusions of the bankruptcy judge and after conducting
8 In re G.A.D., Inc. No. 01-2235
de novo review of matters to which any party has timely
objected. Id. Section 157(b)(3) provides that the bankruptcy
judge shall determine if a proceeding is core or related either
on any party’s timely motion or on the judge’s own motion.
In making the ruling, the court looks at the form and the
substance of the proceeding. Sanders Confectionary Prods.,
Inc., v. Heller Fin., Inc., 973 F.2d 474, 483 (6th Cir. 1992)
(citing In re Wolverine Radio Co., 930 F.2d 1132, 1144 (6th
Cir. 1991). “A core proceeding either invokes a substantive
right created by federal bankruptcy law or one which could
not exist outside of the bankruptcy.” Id.
If the dispute over the lease was not a core proceeding, then
the bankruptcy judge was without power to enter an order to
dismiss, and the order would be void. Other circuits have
determined, as quoted by the Eighth Circuit in Kocher v. Dow
Chem. Co., 132 F.3d 1225, 1230 (1997), that a Rule 60(b)(4)
motion will succeed only if the lack of subject matter
jurisdiction was “so glaring as to constitute ‘a total want of
jurisdiction,’ ” (quoting Kansas City S. Ry. v. Great Lakes
Carbon Corp., 624 F.2d 822, 825, (8th Cir.)(en banc), cert.
denied, 449 U.S. 955 (1980)), or “‘no arguable basis’ for
jurisdiction existed,” (quoting Nemaizer v Baker, 793 F.2d 58,
65 (2d Cir. 1986)).
Eglinton’s jurisdictional argument claims that the lease
assignment dispute was not a core proceeding in the Chapter
7 bankruptcy proceeding. Nevertheless, we conclude that she
has not shown a total want of jurisdiction. In removing the
suit filed by G.A.D. from state court to the Korte bankruptcy,
the bankruptcy court found that resolving the dispute over the
leasehold would require examining the purported assignment
and deciding if the transfer was valid, as well as analyzing
section 365 of the bankruptcy code governing executory
contracts and unexpired leases. Though not expressly using
the words “core proceeding,” the bankruptcy court found that
the controversy was inextricably intertwined with the
bankruptcy case. In Eglinton’s mirror-image suit, the very
same leasehold is in dispute; thus, validity of the transfer will

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No. 01-2235 In re G.A.D., Inc. 9
again require the court to make a determination of the
leasehold’s status in the bankrupt estate of G.A.D.
Additionally, determination of the fraud and
misrepresentation issue Eglinton raises would, as the
bankruptcy court found with respect to claims in the first suit,
require determination of the validity of the assignment and
the right to posses the premises. This goes to the heart of an
estate asset.
Even if we were to decide that the dispute was not a core
proceeding, procedural flaws would again defeat Eglinton’s
claims. A claimant has ten days in which to appeal a decision
of the bankruptcy court to the district court. Eglinton chose
instead to pursue her suit again in state court. “A party may
not use a Rule 60(b)(4) motion as a substitute for a timely
appeal.” Id.
In pursuing virtually the same suit in state and federal
court, by her corporation and by herself, and in doggedly
seeking favorable judgment despite neglect of procedural
mechanisms, Eglinton has not had just one bite at the apple
but has nearly consumed the entire fruit. Such litigation
tactics are disfavored, and we will not relieve her of the
consequences of the failure to meet deadlines. The judgment
of the district court is AFFIRMED.

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