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Griswold v. Zeddun

United States District Court, W.D. Wisconsin

June 27, 2016

GREG GRISWOLD, Appellant,
v.
BRENDA ZEDDUN, ROBERT T. KASDORF, RICHARD D HUMPHREY, and JUDGE ROBERT D. MARTIN, Appellees.

          OPINION & ORDER

          JAMES D. PETERSON District Judge

         This is appellant Greg Griswold’s second recent appeal from a decision of the United States Bankruptcy Court for the Western District of Wisconsin related to a farm owned by Laura Ann Wierzbicki. Griswold’s previous appeal arose from Wierzbicki’s bankruptcy proceedings. The current appeal arises from Griswold’s own bankruptcy. Griswold appeals orders relating to the lifting of the automatic stay to allow Wierzbicki’s trustee to proceed with Griswold’s eviction. I will affirm the bankruptcy court’s decisions.

         BACKGROUND

         The parties have been involved in extensive litigation in both state and federal courts. I draw the following information from the dockets in this case, the previous bankruptcy appeals filed by appellant Griswold, and the underlying bankruptcy proceedings.

         Greg Griswold and Laura Ann Wierzbicki are the unmarried parents of three minor children. Griswold and Brenda Zeddun, the trustee in Wierzbicki’s bankruptcy, disputed ownership of a farm originally owned by Wierzbicki that she transferred to Griswold before filing for bankruptcy. In a September 15, 2015 order, I affirmed the judgment of the Bankruptcy Court for the Western District of Wisconsin avoiding that transfer as a “constructive fraudulent transfer” under the Bankruptcy Code. See Griswold v. Zeddun, No. 14-cv-718 (W.D. Wis.).

         In October 2015, Zeddun obtained a judgment for eviction and writ of restitution against Griswold in state court in an attempt to remove him from the farm. Griswold countered by filing his own voluntary petition for bankruptcy under Chapter 7 of the Bankruptcy Code on October 28, 2015. The next day, Zeddun filed a motion for relief from the automatic stay and a motion for expedited hearing on that motion, on the basis that the writ of restitution would expire November 4.

         At a November 2, 2015, hearing, Bankruptcy Judge Robert D. Martin granted the motions for expedited hearing and for relief from automatic stay, and also denied a motion for his recusal raised by Griswold at the hearing. Griswold appeals all three of these rulings.

         ANALYSIS

         This court has jurisdiction over this appeal pursuant to 28 U.S.C. § 158(a)(1); the bankruptcy court’s order lifting the automatic stay is an appealable final order. Colon v. Option One Mortg. Corp., 319 F.3d 912, 916 n.1 (7th Cir. 2003) (“All courts that have considered the matter agree that an order lifting the automatic stay is a final judgment. . . . We see no reason to disagree with the other circuits.”). I review the decision to lift the stay under the abuse-of-discretion standard, while noting that a court necessarily abuses its discretion when a decision is based on erroneous conclusions of law. Id. at 916. I review the bankruptcy court’s conclusions of law under a de novo standard. Id.[1]

         Under 11 U.S.C. § 362, the filing of a bankruptcy petition serves to stay many types of legal actions or the enforcement of various types of judgments against a debtor. But trustee Zeddun sought to lift the stay for purposes of Griswold’s eviction. Section 362(b) details when a bankruptcy petition does not operate as an automatic stay; one such circumstance is when a lessor has a pre-petition judgment for possession of the property against the debtor. See 11 U.S.C. § 362(b)(22).[2] Judge Martin ruled as follows:

[T]he only issue before me is one on which congress has expressed itself clearly and directly. What is sought here appears to me to be primarily a comfort order, but there’s really no room for -- there’s no discretion involved. The specific language of Section 362(b)(22) covers the fact, and . . . this hearing is essentially redundant. I do grant the motion because it’s compelled by the language of the statute.

Dkt. 3, at 14.

         Zeddun persuasively argues that Griswold’s appeal of the ruling regarding the stay should be dismissed because it is moot. Following Judge Martin’s ruling, Griswold did not move for a stay of the ruling pending appeal in either the bankruptcy court or this court, and Zeddun completed eviction proceedings against him. And Griswold’s bankruptcy case is now closed, for reasons unrelated to the stay; almost immediately after Judge Martin’s ruling, Griswold moved to dismiss his bankruptcy petition. That motion was denied because the trustee was not certain that Griswold had no non-exempt assets. The case was later dismissed after the trustee concluded that Griswold’s estate indeed had no non-exempt assets. See Dkt. 100 and 113 in the underlying bankruptcy case, In re Griswold, No. 15-13875-rdm (Bankr. W.D. Wis.). Griswold did not oppose this dismissal. So although Griswold asks for “all previous adverse rulings made by Judge Martin . . . [to] be now vitiated, ” Dkt. 4, at 44, it does not appear that granting Griswold the relief he seeks would do him any good.

         Even if Griswold’s claim regarding the stay was not moot, I would dismiss the appeal. Griswold has not shown that the granting of the lift-stay motion was at all improper, although I am not convinced that the reasoning for the underlying decision was correct. From my review of applicable statutes, it is not obvious that § 362(b)(22) should have applied to the relationship between Wierzbicki and Griswold. By the section’s own terms, it applies to “residential property in which the debtor resides as a tenant under a lease or rental agreement, ” and Zeddun argued below that there was no lease or any other agreement for Griswold to live on the farm; he was essentially trespassing. This may be why Zeddun’s brief in the bankruptcy court relied instead upon 11 U.S.C. § 362(d)(2), under which an automatic stay against an eviction proceeding may be lifted if the debtor does not have any equity in the property. See In re Griswold, Dkt. 8. But the substantive question whether § 362(b)(22), § 362(d)(2), or some other section should apply to the eviction proceedings is immaterial because Griswold did not challenge Judge Martin’s application of ...


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