Arellano et al v. Montoya et al

1 This adversary proceeding stems from the Plaintiff/Debtors
having participated in a closing to purchase their home and later
discovering that the funds intended to pay off the existing
mortgage were not delivered to the mortgagee and thus that the
existing mortgage lien was never released.
UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF NEW MEXICO
In re:
JIMMIE ARELLANO and
MARTHA ARELLANO,
Debtors. 	No. 13-06-11966 SL
JIMMIE ARELLANO, et al.
Plaintiffs,
v. 	Adv. No. 07-1024 S
AMOS MONTOYA, et al.
Defendants.
MEMORANDUM OPINION ON DEFENDANT
CITIFINANCIAL, INC.’S DEMAND FOR ARBITRATION
This matter is before the Court on Defendant Citifinancial’s
Demand for Arbitration. 	At the initial pretrial conference the
Court instructed the parties to submit briefs. 	Citifinancial
(doc 10), First American Title Insurance Co. (doc 14) and
Plaintiffs (doc 15) filed briefs. 	Citifinancial filed a reply
(doc 23). 	The Court finds that Citifinancial’s demand is well
taken and that this adversary proceeding should be stayed as to
Citifinancial. 1
FACTS
On or about April 5, 2002, the Plaintiffs executed a 4-page
note in the principal amount of $64,098.03 to Citifinancial,
bearing interest at an 8.76% variable rate calling for 360
monthly payments and to be secured by a security interest in real
Case 07-01024-s Doc 30 Filed 06/14/07 Entered 06/14/07 15:09:28 Page 1 of 15

Page -2-
property (Plaintiff’s residence). 	Pages 3 and 4 consist entirely
of a “Notice of Arbitration Provision” that details an agreement
to arbitrate any “Claim” (as defined in the notice).
On May 9, 2006, Plaintiffs filed a voluntary chapter 7
proceeding in the District of New Mexico, No. 7-06-10741. 	The
deadline for objections to discharge or dischargeability was
October 21, 2006. 	No objections were filed. 	Debtors received a
discharge on November 20, 2006 (doc 34).
Meanwhile, on October 25, 2006, Plaintiffs filed a voluntary
chapter 13 proceeding in the District of New Mexico, No. 13-06-
11966. 	On November 20, 2006 Plaintiffs filed their Statements
and Schedules. 	Citifinancial is listed as a disputed, contingent
secured creditor on Schedule D. 	On November 20, 2006, Plaintiffs
filed their chapter 13 plan (“Plan”). 	(doc 18 in main case.)
Plan provision XII, item 9 states as follows:
Alternative Dispute Resolution Clauses. 	The plan filed
by the debtor herein specifically rejects, avoids
cancels and otherwise releases the debtor from any and
all contractual provisions, with any party or entity,
which could or may impose on the debtor any duty,
requirement or obligation to submit any and all claims,
demands, or causes of action of the debtor or any
defenses, affirmative or otherwise, of any nature
whatsoever, whether known or unknown, and whether
arising pre-petition or post-petition, to any form of
binding attribution (sic) or alternative dispute
resolution. 	Consequently, confirmation of this plan
shall constitute a finding that any such clauses,
conditions or provisions, whether arising under the
Federal Arbitration Act or any state rule, statute, or
regulation, are invalid, void and otherwise
unenforceable as to the debtor or the Chapter 13
Trustee. 	Acceptance by creditors of payments under
Case 07-01024-s Doc 30 Filed 06/14/07 Entered 06/14/07 15:09:28 Page 2 of 15

2The chapter 7 trustee has since filed a motion to intervene
in this adversary and that motion was granted on May 15, 2007.
Standing is not an issue for the purposes of this Memorandum.
Page -3-
this plan and/or failure of any creditor to file an
objection to confirmation of the plan herein,
constitutes waiver of any right(s) of said creditor(s)
to seek enforcement or any arbitration agreement and
constitutes consent to the removal of any arbitration
clause from any type of contract or contracts with the
debtor herein.
The Plan nowhere mentions Citifinancial by name, and proposes no
distributions to Citifinancial. 	The Plan was sent out on 25 day
notice to creditors pursuant to Federal Bankruptcy Rule 2002.
Citifinancial did not object to confirmation. 	Citifinancial did
not file a proof of claim. 	Several other creditors did object to
confirmation, and the Plan is not yet confirmed.
On February 14, 2007, the Plaintiffs filed the current
adversary proceeding, which is related to the chapter 13 case. 2
Citifinancial is one of the named defendants in the adversary
proceeding; Coount One is directed solely at Citifinancial and is
captioned “Claims for Breach of Contract, Fraud, Negligence,
Prima Facie Tort, and RESPA Violations against Defendant Citi and
for the Bankruptcy Court to Determine the Extent and Validity of
the Mortgage Lien Asserted by Citi.” 	Citifinancial has demanded
enforcement of the arbitration provision.
The Adversary Proceeding alleges that it is a core
proceeding. 	(Doc 1 ¶ 2). 	Citifinancial denies core status and
Case 07-01024-s Doc 30 Filed 06/14/07 Entered 06/14/07 15:09:28 Page 3 of 15

Page -4-
does not consent to entry of final orders by the Bankruptcy Court
(Doc 5 ¶ 2).
CONCLUSIONS
In Shearson/American Express, Inc. v. McMahon, 482 U.S. 220,
225-27 (1987), the United States Supreme Court found a strong
federal policy favoring arbitration in the federal courts:
[The Federal Arbitration Act, 9 U.S.C. § 1 et
seq.] was intended to “revers[e] centuries of judicial
hostility to arbitration agreements,” Scherk v.
Alberto-Culver Co., supra, 417 U.S., at 510, 94 S.Ct.,
at 2453, by “plac[ing] arbitration agreements ‘upon the
same footing as other contracts.’ ” 417 U.S., at 511,
94 S.Ct., at 2453, quoting H.R.Rep. No. 96, 68th Cong.,
1st Sess., 1, 2 (1924). 	The Arbitration Act
accomplishes this purpose by providing that arbitration
agreements “shall be valid, irrevocable, and
enforceable, save upon such grounds as exist at law or
in equity for the revocation of any contract.” 	9
U.S.C. § 2. 	The Act also provides that a court must
stay its proceedings if it is satisfied that an issue
before it is arbitrable under the agreement, § 3; and
it authorizes a federal district court to issue an
order compelling arbitration if there has been a
“failure, neglect, or refusal” to comply with the
arbitration agreement, § 4.
The Arbitration Act thus establishes a “federal
policy favoring arbitration,” Moses H. Cone Memorial
Hospital v. Mercury Construction Corp., 460 U.S. 1, 24,
103 S.Ct. 927, 941, 74 L.Ed.2d 765 (1983), requiring
that “we rigorously enforce agreements to arbitrate.”
Dean Witter Reynolds Inc. v. Byrd, supra, 470 U.S., at
221, 105 S.Ct., at 1242. 	This duty to enforce
arbitration agreements is not diminished when a party
bound by an agreement raises a claim founded on
statutory rights...
The Arbitration Act, standing alone, therefore
mandates enforcement of agreements to arbitrate
statutory claims. 	Like any statutory directive, the
Arbitration Act's mandate may be overridden by a
contrary congressional command. 	The burden is on the
party opposing arbitration, however, to show that
Congress intended to preclude a waiver of judicial
Case 07-01024-s Doc 30 Filed 06/14/07 Entered 06/14/07 15:09:28 Page 4 of 15

Page -5-
remedies for the statutory rights at issue. 	See
[Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth,
Inc., 473 U.S. 614, 628, 105 S.Ct. 3346, 3354 (1985)].
If Congress did intend to limit or prohibit waiver of a
judicial forum for a particular claim, such an intent
“will be deducible from [the statute's] text or
legislative history,” ibid., or from an inherent
conflict between arbitration and the statute's
underlying purposes. 	See Id., at 632-637, 105 S.Ct.,
at 3356-3359; 	Dean Witter Reynolds Inc. v. Byrd, 470
U.S., at 217, 105 S.Ct., at 1240.
Later Courts have summarized this Supreme Court passage as a
“three factor test” of Congressional intent: (1) the text of the
statute; (2) its legislative history; and (3) whether an inherent
conflict between arbitration and the underlying purposes of the
statute exists. 	See, e.g., Whiting-Turner Contracting Co. v.
Electric Machinery Enter., Inc. (In re Electric Machinery Enter.,
Inc.), 479 F.3d 791, 795-96 (11 th Cir. 2007). (Citations
omitted.) 	Neither the text of the Bankruptcy Code or its
legislative history evidence a Congressional intent to create an
exception to the Federal Arbitration Act in the Bankruptcy Code.
Id. at 796. 	Therefore, in the bankruptcy context, the issue is
whether arbitration would conflict with the underlying purposes
of the Bankruptcy Code. 	Id.; see also In re Gandy, 299 F.3d 489,
495 (5 th Cir. 2002):
A bankruptcy court does possess discretion, however, to
refuse to enforce an otherwise applicable arbitration
agreement when the underlying nature of a proceeding
derives exclusively from the provisions of the
Bankruptcy Code and the arbitration of the proceeding
conflicts with the purpose of the Code.
(Citation omitted.)
Case 07-01024-s Doc 30 Filed 06/14/07 Entered 06/14/07 15:09:28 Page 5 of 15

3 The determination of core status itself is, however, a
core proceeding on which the Bankruptcy Court can enter a final
order. 	See 28 U.S.C. § 157(b)(3) (“The bankruptcy judge shall
determine ... whether a proceeding is a core proceeding under
this subsection or is a proceeding that is otherwise related to a
case under title 11.”). 	See also Celotex Corp. v. AIU Ins. Co.
(In re Celotex Corp.), 152 B.R. 667, 672 n.6 (Bankr. M.D. Fla.
1993) (“The determination of core is a core matter....”).
Page -6-
Courts addressing the issue of whether arbitration
inherently conflicts with the Bankruptcy Code
distinguish between core and non-core proceedings. 	See
Hays & Co. v. Merrill Lynch, Pierce, Fenner & Smith,
Inc., 885 F.2d 1149, 1156-57 (3d Cir. 1989). 	In
general, bankruptcy courts do not have the discretion
to decline to enforce an arbitration agreement relating
to a non-core proceeding. 	See Crysen/Montenay Energy
Co. v. Shell Oil Co. (In re Crysen/Montenay Energy
Co.), 226 F.3d 160, 166 (2d Cir. 2000). 	However, even
if a proceeding is determined to be a core proceeding,
the bankruptcy court must still analyze whether
enforcing a valid arbitration agreement would
inherently conflict with the underlying purposes of the
Bankruptcy Code. 	See Ins. Co. of N. Am. v. NGC
Settlement Trust & Asbestos Claims Mgmt. Corp. (In re
National Gypsum), 118 F.3d 1056, 1067 (5th Cir. 1997).
Electric Machinery Enter., 479 F.3d at 796.
Therefore, under this methodology, the Court first
determines whether a proceeding is core or non-core. 	If it is
non-core, the Bankruptcy Court must stay the proceeding in favor
of arbitration. 	If it is core, the Bankruptcy Court undertakes a
further analysis to determine if arbitration would conflict with
the purposes of the Bankruptcy Code.
In this case, the Court finds that Count One of the
adversary proceeding is a non-core proceeding 3. 	First, a quick
review of bankruptcy jurisdiction follows.
Case 07-01024-s Doc 30 Filed 06/14/07 Entered 06/14/07 15:09:28 Page 6 of 15

Page -7-
Bankruptcy Court jurisdiction is established by 28 U.S.C. §
1334, which lists four types of matters over which the district
court has bankruptcy jurisdiction: 1) cases “under” title 11
(which are the bankruptcy cases themselves, initiated by the
filing of a Chapter 7, Chapter 11, etc. petition), 2) proceedings
“arising under” title 11 (such as a preference recovery action
under §547), 3) proceedings “arising in” a case under title 11
(such as plan confirmation), and 4) proceedings “related to” a
case under title 11 (such as a collection action against a third
party). 	Wood v. Wood (In re Wood), 825 F.2d 90, 92 (5 th Cir.
1987). 	In the District of New Mexico, all four types have been
referred to the bankruptcy court. 	See 28 U.S.C. § 157(a);
Administrative Order, Misc. No. 84-0324 (D. N.M. March 19, 1992).
Jurisdiction is then further broken down by 28 U.S.C. § 157,
which grants full judicial power to bankruptcy courts not only
over cases “under” title 11 but also over “core” proceedings,
§157(b)(1), but grants only limited judicial power over “related”
or “non-core” proceedings, §157(c)(1). 	Wood, 825 F.2d at 91;
Personette v. Kennedy (In re Midgard Corporation), 204 B.R. 764,
771 (10 th Cir. B.A.P. 1997). 	This core/non-core distinction is
important, because it defines the extent of the Bankruptcy
Court’s jurisdiction and the standard by which the District Court
reviews the factual findings. 	Halper v. Halper, 164 F.3d 830,
836 (3 rd Cir. 1999).
Case 07-01024-s Doc 30 Filed 06/14/07 Entered 06/14/07 15:09:28 Page 7 of 15

Page -8-
“Core” proceedings are matters “arising under” and “arising
in” cases under title 11. 	Wood, 825 F.2d at 96; Midgard, 204
B.R. at 771. 	Matters “arise under” title 11 if they involve a
cause of action created or determined by a statutory provision of
title 11. 	Wood, 825 F.2d at 96; Midgard, 204 B.R. at 771.
Matters “arise in” a bankruptcy if they concern the
administration of the bankruptcy case and have no existence
outside of the bankruptcy. 	Wood, 825 F.2d at 97; Midgard, 204
B.R. at 771. 	Bankruptcy judges may hear and determine core
proceedings and enter final orders and judgments. 	28 U.S.C. §
157(b)(1). 	28 U.S.C. § 157(b)(2) contains a nonexclusive list of
15 types of core proceedings.
“Non-core” proceedings are those that do not depend on the
bankruptcy laws for their existence and that could proceed in
another court even in the absence of bankruptcy. 	Wood, 825 F.2d
at 96; Midgard, 204 B.R. at 771. 	“Proceedings ‘related to’ the
bankruptcy include (1) causes of action owned by the debtor which
become property of the estate pursuant to 11 U.S.C. § 541, and
(2) suits between third parties which have an effect on the
bankruptcy estate.” 	Celotex Corporation v. Edwards, 514 U.S.
300, 307 n.5 (1995).
Bankruptcy courts have jurisdiction over non-core
proceedings if they are at least “related to” a case under title
11. 	28 U.S.C. § 157(c)(1)(“A bankruptcy judge may hear a
Case 07-01024-s Doc 30 Filed 06/14/07 Entered 06/14/07 15:09:28 Page 8 of 15

Page -9-
proceeding that is not a core proceeding but that is otherwise
related to a case under title 11.”) 	However, unless all parties
consent otherwise, 28 U.S.C. § 157(c)(2), bankruptcy judges do
not enter final orders or judgments in non-core proceedings.
Rather, they submit proposed findings of fact and conclusions of
law to the district court, which enters final orders and
judgments after de novo review. 	28 U.S.C. § 157(c)(1); Federal
Bankruptcy Rule 9033. 	See also Orion Pictures Corporation v.
Showtime Networks, Inc. (In re Orion Pictures Corporation), 4
F.3d 1095, 1100-01 (2 nd Cir. 1993)(discussing Section 157's
classification scheme).
28 U.S.C. § 157(b)(2) gives a nonexclusive list of 16 “core
proceedings.” 	The fact that a matter is listed among the “core
proceedings” of 28 U.S.C. § 157(b)(2) cannot end the inquiry,
however. 	In Northern Pipeline Construction Co. v. Marathon Pipe
Line Company, 458 U.S. 50, 76 (1982), the United States Supreme
Court ruled that Article III of the Constitution “bars Congress
from establishing legislative courts to exercise jurisdiction
over all matters related to those arising under the bankruptcy
laws.” 	In Marathon, the debtor sought damages for alleged
breaches of contract and warranty, misrepresentation, coercion,
and duress. 	Id. at 56. 	The Supreme Court distinguished this
adjudication of “state-created private rights” from the
“restructuring of debtor-creditor relations, which is at the core
Case 07-01024-s Doc 30 Filed 06/14/07 Entered 06/14/07 15:09:28 Page 9 of 15

Page -10-
of the federal bankruptcy power.” 	Id. at 71. 	The Court found
that the broad grant of jurisdiction to the bankruptcy courts
found in 28 U.S.C. § 1471 (1976 ed., Supp.IV) was
unconstitutional because it “impermissibly removed most, if not
all, of the ‘essential attributes of the judicial power’ from the
Art. III district court” and vested those attributes in the
bankruptcy court. 	Id. at 87. 	Congress responded with the
current jurisdictional scheme which categorizes matters as either
core or non-core. 	Any determination by the Bankruptcy Court of
the core status of a matter should be done with the dictates of
Marathon in mind.
Plaintiffs’ Count One is all based on state or federal law,
with the possible exception of the request to determine the
validity, extent, and priority of Citifinancial’s lien against
Plaintiffs’ residence. 	The state and federal law claims all
existed before the first bankruptcy case was filed, and are pre-
petition causes of action. 	The state and federal law claims are
not a case under title 11 because they were not initiated by a
bankruptcy petition. 	Nor do the state and federal law claims
arise under a provision of title 11 nor did they come about
during a case under title 11. 	The state and federal law claims
are related to a case under title 11 because, if Plaintiffs are
successful, the bankruptcy estate would be increased. 	The state
and federal law claims are not “core.”
Case 07-01024-s Doc 30 Filed 06/14/07 Entered 06/14/07 15:09:28 Page 10 of 15

Page -11-
Plaintiffs’ request to determine the validity, extent, and
priority of Citifinancial’s lien raises a more difficult
question. 	28 U.S.C. § 157(b)(2)(K) specifies that a proceeding
to determine the validity, extent, or priority of a lien is a
core proceeding. 	As noted above, however, the Court must keep
the dictates of Marathon in mind.
It is generally accepted that a core proceeding is
one which “invokes a substantive right provided by
title 11 or [ ] is a proceeding that, by its nature,
could arise only in the context of a bankruptcy case.”
In re Wood, 825 F.2d 90, 97 (5th Cir. 1987); see also
In re Riverside Nursing Home, 144 B.R. 951, 955 (S.D.
N.Y. 1992); In re J.T. Moran, 124 B.R. 931, 937 (S.D.
N.Y. 1991); In re Brooks Fashion Stores, Inc., 124
B.R.436 (S.D. N.Y. 1991); In re Braniff International
Airlines, Inc., 159 B.R. 117, 125 (E.D. N.Y. 1993).
The Second Circuit has refined this analysis by stating
that “[t]he relevant analysis is whether the nature of
[the] adversary proceeding, rather than the state or
federal basis for the claim, falls within the core of
federal bankruptcy power.” 	In re Manville Forest
Products Corp., 896 F.2d 1384, 1389 (2d Cir. 1990)
(holding that adversary proceeding arising from proof
of claim filed with bankruptcy court was core despite
fact that it involved breach of contract) (citing In re
Wood, supra )(emphasis in original).
Hassett v. Bancohio Nat’l Bank (In re CIS Corp.), 172 B.R. 748,
755-56 (S.D. N.Y. 1994). 	The mere characterization of a
proceeding as core is not dispositive of whether it is core.
Hudgins v. Shah (In re Systems Engineering & Energy Mgt. Assoc.,
Inc.), 252 B.R. 635, 642 n.2 (Bankr. E.D. Va. 2000). 	See also
Mugica v. Helena Chemical Co. (In re Mugica), ___ B.R. ___, 2007
WL 466602, *3 (Bankr. S.D. Tex. 2007):
Case 07-01024-s Doc 30 Filed 06/14/07 Entered 06/14/07 15:09:28 Page 11 of 15

Page -12-
The form of this adversary proceeding does not invoke
the special powers of bankruptcy or raise any primary
issues in bankruptcy. 	The substance of the suit is
based entirely on state law. 	While a final judgment in
Debtor’s favor may create additional funds for the
estate, this suit involves neither a right particular
to bankruptcy nor does it arise strictly in a
bankruptcy context. 	Accordingly, the Court finds this
suit does not constitute a core proceeding.
The Plaintiffs here are not seeking to use any provision of
the Bankruptcy Code to determine the validity, extent, or
priority of Citifinancial’s lien. 	Rather, the result of the
state court causes of action will dictate that result. 	If
Plaintiffs succeed on their state law claims, Citifinancial will
not be a creditor and the result will be that the lien will be
void, or avoided, or avoidable. 	It is only through Plaintiffs’
use of semantics that this claim could be called a core
proceeding. 	The Court should examine the substance of what is
sought, not the language used in the complaint.
Both sides caustically criticize each other's use of
“semantics” to obscure the real issues. 	I agree that
it is useless to categorize the claims by means of the
words used to describe them. 	In making my
determination I will look beyond the labels to the
substance of the action in order to discover whether it
can be fairly said to arise under the bankruptcy code
and falls within the bankruptcy court's core
jurisdiction. 	See e.g. In re Treadway, 117 B.R. 76, 81
(Bankr. D. Vt. 1990) (mere characterization of claims
within the terms of the bankruptcy statute is not
dispositive of core/non-core determination).
Hassett, 172 B.R. at 756. 	The substance of Count One is non-
core.
Case 07-01024-s Doc 30 Filed 06/14/07 Entered 06/14/07 15:09:28 Page 12 of 15

4 This holding of Andersen has been distinguished, e.g.,
Banks v. Sallie Mae Servicing Corp. (In re Banks), 299 F.3d 296,
301-302 (4 th Cir. 2002), and widely criticized. 	E.g., Poland v.
Educational Credit Mgt. Corp. (In re Poland), 382 F.3d 1185, 1189
n. 2 (10 th Cir. 2004) (“The panel is of the view that Andersen
was wrongly deciced and should be reconsidered.”).
Page -13-
Plaintiffs argue that Citifinancial waived its right to
arbitration by not objecting to a provision in the Debtors’
chapter 13 plan which provided for such a waiver. 	The Court
finds this argument not well taken. 	First, the chapter 13 plan
that provided for the waiver has not been confirmed, so cannot be
res judicata or issue preclusive. 	Second, Citifinancial’s not
objecting to the plan is not sufficient evidence of a voluntary
relinquishment of a known right in these particular
circumstances; e.g., when the Debtors and Citifinancial were
specifically litigating the arbitration issue. 	Third, the Court
finds that this provision in the plan is reminiscent of the
student loan chapter 13 cases that attempted to discharge student
loans through confirmation. 	See, e.g., Andersen v. UNIPAC-
NEBHELP (In re Anderson), 179 F.3d 1253, 1260 (10 th Cir.
1999)(holding that chapter 13 plan that contained a finding that
excepting student loans from discharge would impose an undue
hardship in fact discharged the student loans). 4 	Compare In re
Poland, 382 F.3d at 1189 (holding that chapter 13 plan that
contained no finding that excepting student loans from discharge
in fact does not discharge student loans). 	In this case, the
Case 07-01024-s Doc 30 Filed 06/14/07 Entered 06/14/07 15:09:28 Page 13 of 15

Page -14-
Plan was never confirmed, so there was never a finding that the
arbitration provision should be voided or on what grounds.
Finally, the Court questions whether Citifinancial had sufficient
due process in this case. 	The plan was not “served” on
Citifinancial; rather, “notice” of the plan was sent to all
creditors, including Citifinancial. 	Debtors are attempting to
change the provision of a contract. 	Arguably this requires an
adversary proceeding, but even if it did not, it at least
constitutes a contested matter. 	See Bankruptcy Rule 9014.
Contested matters must be “served”. 	Bankruptcy Rule 9014(b).
See In re Banks, 299 F.3d at 301:
Bankruptcy Rule 2002(b) does not require specific
notice of plan provisions affecting a particular
creditor, nor does it require the notice to be served
in any particular manner or upon any particular person.
There are many aspects to and actions that may be taken
in bankruptcy cases which affect the general
administration of the case and all creditors generally,
but none specifically. 	Generally, such matters require
“notice,” but not service of process. 	When the rights
of specific parties become an issue, however, service
of the initiating motion or objection on the affected
party is required. 	Mailing the proposed plans, the
hearing notice, and the confirmation order satisfies
the “notice” requirement under Rule 2002, but not the
service and summons requirements of Rule 7004.
(Citations and internal punctuation omitted.) 	Because the Plan
was not served on Citifinancial, the Court finds that it would
deny Citifinancial its due process rights to allow Plaintiffs to
unilaterally alter their contract with Citifinancial, at least
Case 07-01024-s Doc 30 Filed 06/14/07 Entered 06/14/07 15:09:28 Page 14 of 15

Page -15-
where the arbitration issue has not already been resolved between
the two parties.
In sum, the Court finds that Count One is a non-core
related-to proceeding. 	Therefore, the Court should stay this
adversary proceeding pending arbitration of Count One. 	Because
the Court has determined that Count One is non-core, it need not
address the issue of whether arbitration would conflict with
bankruptcy policies in this case. 	An appropriate Order will
enter.
Honorable James S. Starzynski
United States Bankruptcy Judge
copies to:
R Trey Arvizu, III
PO Box 1479
Las Cruces, NM 88004-1479
James A Askew
PO Box 1888
Albuquerque, NM 87103-1888
Robert H Jacobvitz
500 Marquette NW Ste 650
Albuquerque, NM 87102-5309
Paul M Fish
PO Box 2168
Albuquerque, NM 87103-2168
Case 07-01024-s Doc 30 Filed 06/14/07 Entered 06/14/07 15:09:28 Page 15 of 15