Beery v. Gonzales et al

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UNITED STATES BANKRUPTCY COURT
DISTRICT OF NEW MEXICO
In re: 	JEROME GRIGGS BEERY, 	No. 7-94-10504 MA
Debtor.
_____________________________________________________________________________
JEROME GRIGGS BEERY,
Plaintiff,
v. 	Adversary No. 06-1154 M
YVETTE GONZALES, CLIFFORD
GRAMER, CRESCENTIA K. MORRIS, for
the ESTATE OF WILLIAM MORRIS,
PORTER DEES, and NANCY MROZ,
Defendants.
ORDER GRANTING MOTION TO DISMISS OR FOR SUMMARY JUDGMENT FILED
BY CRESCENTIA K. MORRIS, PERSONAL REPRESENTATIVE
THIS MATTER is before the Court on the Motion to Dismiss or for Summary Judgment
Filed by Crescentia K. Morris, Personal Representative (“Motion”). The Motion seeks to
dismiss, or, alternatively, summary judgment on Counts I and IV of the Complaint Asking for
Removal of the Trustee and Attorney for Trustee (“Complaint”). Plaintiff Jerome Griggs Beery,
pro se, has not filed a response to the Motion. 	After review of the Complaint in light of the
Motion, the Court finds that it is appropriate to grant the Motion.
Count I of the Complaint states:
I allege that the defendants Gonzales and Morris have failed to prosecute this bankruptcy
case in a timely manner. Their failure constitutes an abuse of the judicial process and I
ask the court to remove them from the case and impose appropriate financial sanctions.
Defendant Crescentia K. Morris asserts that Count I fails to state a claim upon which relief can
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be granted. Dismissal for failure to state a claim under Rule 12(b)(6), Fed.R.Civ.P., made
applicable to adversary proceedings by Rule 7012, Fed.R.Bankr.P., is appropriate only when the
movant has demonstrated that the Plaintiff can prove no set of facts that would entitle him to
recovery. See In re American Freight System, Inc., 179 B.R. 952, 956 (Bankr.D.Kan.1995)
(citing Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 101-102, 2 L.Ed.2d 80 (1957)
(remaining citations omitted)). When considering a motion to dismiss, the Court must accept all
well-pleaded facts in the complaint as if they were true, and construe the facts in the light most
favorable to the plaintiff. In re Sheffield Steel Corp., 320 B.R. 405, 411 (Bankr.N.D.Okla.2004)
(citing Ballen v. Prudential Bache Securities, Inc., 23 F.3d 335, 336 (10th Cir.1994).
Crescentia Morris, as representative and/or assignee of the Estate of William Morris, is a
creditor of the Plaintiff’s bankruptcy estate. See Creditor List in Jerome Griggs Beery Case No.
7-94-10504 MA; Proof of Claim No. 5 filed by Crescentia K. Morris, Assignee of the Estate of
William W. Morris in Case No. 7-94-10504. 	There is no duty imposed by the Bankruptcy Code
upon creditors to prosecute bankruptcy proceedings. 	Dismissal of Count I for failure to state a
claim upon which relief may be granted is, therefore, appropriate.
Count IV of the Complaint states:
The claim submitted by William Morris in this bankruptcy was fraudulent in that the
plaintiff was not in debt to William Morris and therefore was no valid claim by Morris
against the estate. I ask that the court deny the Morris claim in the bankruptcy.
Morris asserts that an adversary proceeding is not the proper means for adjudicating a
claim. Claims objections are considered contested matters under Rule 9014, Fed.R.Bankr.P.
See In re Miramar Resources, Inc., 176 B.R. 45, 49 (Bankr.D.Colo. 1994) (noting that “[a]
simple objection to a claim is a contested matter”). 	However, if an objection to claim is joined
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with a demand for relief of the kind specified in Rule 7001, it becomes an adversary proceeding.
Rule 3007, Fed.R.Civ.P. 	The assertion in Count IV the claim of William Morris was
fraudulent, and, therefore, not valid, does not raise one of the enumerated types of adversary
proceedings contained in Rule 7001, Fed.R.Bankr.P. 	Rule 7001(2), Fed.R.Bankr.P. provides
that “a proceeding to determine the validity, priority, or extent of a lien or other interest in
property” constitutes an adversary proceeding. Count I appears only to contest the validity of
the claim itself, i.e., the amount of any claim, rather than the validity of any lien or any interest
Morris might assert against property of the bankruptcy estate. Therefore, technically, the
objection to the claim of Morris is not properly before the Court in the form of an adversary
proceeding. 	Nevertheless, the Court will not dismiss Count I based on this technical infirmity.
Morris also asserts that the validity of the claim of William Morris was already
determined as part of adversary proceeding No. 97-1059 M. 	When matters outside the
Complaint and answer are offered by the movant and considered by the Court, it is appropriate to
treat a request for dismissal as a request for summary judgment. See Rule 12(b), Fed.R.Civ.P.,
made applicable to adversary proceedings by Rule 7012, Fed.R.Bankr.P. 	Summary judgment is
appropriate when “there is no genuine issue as to any material fact and . . . the moving party is
entitled to judgment as a matter of law.” Rule 56(c), Fed.R.Civ.P., made applicable to adversary
proceedings by Rule 7056, Fed.R.Bankr.P.
In Adversary Proceeding No. 97-1059, Yvette Gonazles, the Chapter 7 Trustee of
requested a determination of the validity, extent, and priority of liens against certain real
property. See Docket # 1; Adversary Proceeding No. 97-1059M. 	On July 14, 2003, the Court
entered Findings of Fact and Conclusions of Law in Adversary Proceeding No. 97-1059 M
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which found, inter alia, that William Morris obtained all right, title, and interest, in and to a
judgment in the amount of $59,037.22 obtained by Ronald R. Peterson, Trustee against Jerome
Beery in a case before the United States Bankruptcy Court for the Northern District of Illinois,
that the judgment was recorded in the real property records of Los Alamos County, New Mexico
and Sandoval County, New Mexico, that Crescentia Morris, as personal representative of the
estate of William Morris assigned to herself as heir and distribute of the estate of William
Morris, all right, title and interest of the estate of William Morris in the judgment. 	While the
Court found that a determination with respect to the nature, extent and amount of all liens should
be delayed in light of the fact that one of the named defendants in Adversary Proceeding No. 97-
1059 M had not been properly notified of the trial and the fact that no buyer for the properties
had yet been found, the Court found that the judgment constituted a lien against certain real
property the Court determined was property of the bankruptcy estate. See Findings of Fact and
Conclusions of Law, p. 16.; Adversary Proceeding No. 97-1059 M.
Thus, the validity of the lien which comprises claim of the estate of William Morris has
already been decided, and cannot be relitigated in this subsequent proceeding under the doctrine
of collateral estoppel. See In re Gordon, 303 B.R. 645, 650-51 (Bankr.D.Colo. 2003) (collateral
estoppel prevents relitigation of issues decided by a federal court upon a showing of the
following elements: “1. the issue previously decided is identical with the one presented in the
action in question, 2. the prior action has been finally adjudicated on the merits, 3. the party
against whom the doctrine is invoked was a party, or in privity with a party, to the prior
adjudication, and 4. the party against whom the doctrine is raised had a full and fair opportunity
to litigate the issue in the prior action.”) (citing Dodge v. Cotter Corp., 203 F.3d 1190, 1197-98
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(10th Cir. 2000). Morris and Plaintiff participated in Adversary Proceeding No. 97-1059, and the
issue of the validity of Morris’ lien was before the Court which issued a final decision on the
merits in its Findings of Fact and Conclusions of Law and Judgment, entered July 14, 2003.
Plaintiff’s appeal of the Court’s Judgment entered in Adversary No. 97-1059 M was dismissed
for failure to prosecute. See Mandate dated September 10, 2003 (Docket # 208; Adv. Proc. No.
97-1059).
WHEREFORE, IT IS HEREBY ORDERED that the Motion is GRANTED. A judgment
consistent with this Order will be entered.
_________________________________________
MARK B. McFEELEY
United States Bankruptcy Judge
COPY TO:
Jerome G. Beery 	Walter L. Reardon, Jr. 	Nancy Mroz
Plaintiff 	Attorney for Crescentia Morris 	108 Central Park Square
PO Box 4712 	3733 Eubank Blvd. NE 	Los Alamos, NM 87544
Los Alamos, NM 87544 	Albuquerque, NM 87111
Clifford Gramer 	Robert H. Jacobvitz 	Porter Dees
Defendant 	Attorney for Yvette Gonzales 	623 Hwy 165
3733 Eubank Blvd. NE 	500 Marquette NW, Suite 650 	Placitas, NM 87043
Albuquerque, NM 87111 	Albuquerque, NM 87102
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