Bullard v. Blue Hills Bank, fka Hyde Park Savings

PETITIONER: Louis B. Bullard
RESPONDENT: Blue Hills Bank, fka Hyde Park Savings Bank
LOCATION: Bullard's Property

DOCKET NO.: 14-116
DECIDED BY: Roberts Court (2010-2016)
LOWER COURT: United States Court of Appeals for the First Circuit

CITATION: 575 US (2015)
GRANTED: Dec 12, 2014
ARGUED: Apr 01, 2015
DECIDED: May 04, 2015

ADVOCATES:
Douglas Hallward-Driemeier - for the respondent
James A. Feldman - for the petitioner
Zachary D. Tripp - for the petitioner

Facts of the case

Louis Bullard borrowed $387,000 from Hyde Park Savings to buy his property in Massachusetts. In December 2010, he filed for Chapter 13 of the Bankruptcy Code and proposed a plan in which he offered to pay the bank back the value of the property in a loan that was secured by the actual property and then put the rest of the home loan into a pool with other debts that would be paid at a different rate. The bankruptcy court rejected this plan because it believed this hybrid plan was inconsistent with certain provisions of the Bankruptcy Code. The bankruptcy appellate panel agreed but stated the order was appealable because Bullard could simply propose another plan. Bullard petitioned for an appeal but the bankruptcy appellate panel denied the petition because the petitioner had already filed his notice of appeal to the U.S. Court of Appeals for the First Circuit. The First Circuit held that it did not have jurisdiction, as courts of appeals only have jurisdiction over "final decisions, judgments, orders and decrees."

Question

Is an order denying confirmation of a bankruptcy plan appealable?

Media for Bullard v. Blue Hills Bank, fka Hyde Park Savings

Audio Transcription for Opinion Announcement - May 04, 2015 in Bullard v. Blue Hills Bank, fka Hyde Park Savings

John G. Roberts, Jr.:

I have the opinion of the court this morning in Case Number 14-116, Bullard v. Blue Hills Bank.

This is a case from the Court of Appeals for the First Circuit involving a Chapter 13 bankruptcy.

That type of bankruptcy is available to an individual with regular income, but not enough to pay his debts.

Such an individual can submit a plan to payoff as much as he can over three to five years, and if he sticks to the plan he can receive a discharge of any remaining debt.

The plan however has to be approved by the Bankruptcy Court and the creditors can urge the court not to approve it.

That's what happened here.

The petitioner, Bullard, submitted a plan, but his major creditor, a bank, objected.

The Court agreed with the bank's objection and denied approval, or as it's known in bankruptcy, confirmation of the plan.

But the Court told Bullard he could submit an amended plan and try again.

That's very typical in a Chapter 13 case.

But Bullard did not try again.

He thought the Court should have approved his plan and so he appealed to the Court of Appeals.

Now, that's where things got interesting, at least for lawyers and judges.

There is a general principle in the law that you can appeal only final decisions, you can understand why.

Judges make all sorts of rulings in the course of a case, whether to grant a particular motion, allow or disallow witness testimony, and so on.

Now, if whoever lost one of those matters could appeal before the end of the case, the case would go on forever and the Appeals Court would have to give legal rulings on matters that might well become moot before the end of the case.

Now, the rule is actually quite a bit looser in bankruptcy, but you still can only appeal as of right final orders in a proceeding.

No problem says Bullard.

The proceeding concerned whether to confirm or deny the plan he submitted and he certainly got a final decision on that.

No, not so fast, says the bank.

The proceeding was about whether to confirm a plan; the one Bullard submitted was rejected, but the Court said try again with another one.

That proceeding is not final until a plan is confirmed or the entire bankruptcy case is dismissed because the debtor cannot get any plan confirmed.

So what's the preceding, the decision on each particular plan or the whole process for confirming a plan?

We think it's the whole process.

The main reason is that only confirmation or dismissal of the entire case changes the legal position of the parties.

Now, with confirmation the plan becomes binding on creditor and debtor alike.

The property in the bankruptcy estate goes to the debtor.

The trustee distributes to the creditors money that has been deposited by the debtor during the proceedings.

So you can appeal a confirmation order.

If the case is dismissed of course, the legal position of the parties also changes.

Sarah from Law Aspect

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