Filed: Dec. 26, 2012
Latest Update: Feb. 12, 2020
Summary: NOT PRECEDENTIAL UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT _ No. 11-3029 _ In re: VICTOR MONDELLI, Debtor VICTOR MONDELLI, ANNA MONDELLI and KENNETH ROSELLINI, ESQ., Appellants _ Appeal from the United States District Court for the District of New Jersey (D.C. Civil No. 2-10-cv-03393) District Judge: Honorable William J. Martini _ Submitted Under Third Circuit LAR 34.1(a) November 13, 2012 Before: RENDELL, FUENTES and CHAGARES, Circuit Judges (Opinion Filed December 26, 2012) _ OPINIO
Summary: NOT PRECEDENTIAL UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT _ No. 11-3029 _ In re: VICTOR MONDELLI, Debtor VICTOR MONDELLI, ANNA MONDELLI and KENNETH ROSELLINI, ESQ., Appellants _ Appeal from the United States District Court for the District of New Jersey (D.C. Civil No. 2-10-cv-03393) District Judge: Honorable William J. Martini _ Submitted Under Third Circuit LAR 34.1(a) November 13, 2012 Before: RENDELL, FUENTES and CHAGARES, Circuit Judges (Opinion Filed December 26, 2012) _ OPINION..
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NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
_____________
No. 11-3029
_____________
In re: VICTOR MONDELLI,
Debtor
VICTOR MONDELLI,
ANNA MONDELLI and
KENNETH ROSELLINI, ESQ.,
Appellants
_____________
Appeal from the United States District Court
for the District of New Jersey
(D.C. Civil No. 2-10-cv-03393)
District Judge: Honorable William J. Martini
_____________
Submitted Under Third Circuit LAR 34.1(a)
November 13, 2012
Before: RENDELL, FUENTES and CHAGARES, Circuit Judges
(Opinion Filed December 26, 2012)
_____________
OPINION OF THE COURT
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RENDELL, Circuit Judge.
Appellant/Debtor Victor Mondelli and Appellant Anna Mondelli, a purported
intervenor, appeal the District Court’s dismissal of their appeals of eleven bankruptcy
orders and the District Court’s denial of their motion for reconsideration. In addition,
Kenneth Rosellini, the Mondellis’ lawyer, appeals the District Court’s imposition of Rule
11 sanctions against him and the District Court’s denial of his motion for reconsideration.
For the reasons discussed below, we will affirm.
I.
Mondelli filed for relief under Chapter 13 of the Bankruptcy Code on February 18,
2004. He later requested that the case be dismissed. The Chapter 13 Trustee suggested
that, as an alternative to dismissal, the case be converted to Chapter 7, and instructed
Mondelli to attend a hearing on the possible conversion. Neither Mondelli nor his lawyer
attended. On October 21, 2004, the Bankruptcy Court converted the case to Chapter 7,
and on February 7, 2005, for reasons not related to this appeal, the Bankruptcy Court
reconverted the case to Chapter 13. The Bankruptcy Court amended its February 7, 2005
Order on February 15, 2005, and the Chapter 13 Plan was ultimately confirmed on
February 3, 2006. On February 21, 2007, the Bankruptcy Court vacated the February 7,
2005 Order and converted the case back to Chapter 7. The Mondellis now appeal the
February 7, 2005 and February 15, 2005 Orders for the first time.
In orders dated April 6, 2005 and April 20, 2005, the Bankruptcy Court granted
compensation to the Chapter 7 Trustee. The Mondellis now appeal these orders for the
first time.
On May 15, 2007, the Bankruptcy Court entered a consent order, agreed to by
Mondelli, authorizing Mondelli to obtain a loan from Jack Silverman Realty & Mortgage
Co. (“JSRM”). On May 16, 2007, the Bankruptcy Court entered a related consent order,
agreed to by Mondelli, which authorized Mondelli to lease property to Berkeley Realty
Partners 224, LLC (“Berkeley”). On June 27, 2007, the Bankruptcy Court entered
2
another consent order, which Mondelli again agreed to, authorizing Mondelli to lease an
additional property to Berkeley. None of the consent orders included provisions that
authorized a party to appeal the order, and Mondelli was represented by counsel when he
agreed to all three consent orders. On November 19, 2007, the Bankruptcy Court entered
an order enforcing the consent orders. In re Victor Mondelli, No. 04-15268 (Bankr.
D.N.J. Nov. 19, 2007). Mondelli filed a motion for reconsideration, which the
Bankruptcy Court denied. Mondelli appealed this ruling to the District Court, which
dismissed Mondelli’s appeal for failure to comply with Rule 8006 of the Federal Rules of
Bankruptcy Procedure. Mondelli v. Berkeley Realty Partners # 244, LLC, 2008 WL
3843268 (D.N.J. Aug. 14, 2008). On further appeal, we then affirmed. In re Mondelli,
349 Fed. App’x. 731 (3d Cir. 2009).
On October 17, 2007 and May 7, 2008, the Bankruptcy Court entered orders
granting attorneys fees to the Chapter 7 Trustee. On January 7, 2009, the Bankruptcy
Court entered an order approving the “third and final application” for fees. On January
20, 2009, Mondelli filed a notice of appeal to the District Court of the October 17, 2007,
May 7, 2008, and January 7, 2009 Orders. He thereafter failed to prosecute these
appeals. The Mondellis now appeal these orders to this Court. On October 21, 2009, the
Bankruptcy Court entered an order granting the Trustee fees and expenses. The
Mondellis now appeal this order for the first time.
On March 15, 2010, the Bankruptcy Court entered its Final Decree. On March 29,
2010, the Mondellis filed a notice of appeal to the District Court, indicating their intent to
3
appeal eleven orders. As described in the Mondellis’ notice of appeal, these orders
include:
February 7, 2005 Order Converting Case to Chapter 13;
February 15, 2005 Amendment to Order Converting Case to Chapter 13;
April 6, 2005 Order Granting Compensation to Trustee;
April 20, 2005 Order Granting Compensation to Trustee;
May 15, 2007 Consent Order Authorizing Ground Lease;
May 16, 2007 Consent Order Authorizing Debtor to Enter into a Ground
Lease;1
October 17, 2007 Order Granting Attorneys Fees for Trustee;
May 7, 2008 Order Granting Attorneys Fees for Trustee;
January 7, 2009 Order Granting Attorneys Fees for Trustee;
October 21, 2009 Order Granting Trustee Fees and Expenses; and
March 15, 2010 Final Decree.
In connection with the appeal of the May 15, 2007 and May 16, 2007 consent
orders, JSRM and Berkeley (the “Rule 11 Movants”) moved for Rule 11 sanctions
against the Mondellis’ attorney, Kenneth Rosellini, and Hallock and Cammarota, LLP,
the law firm where Rosellini was “Of Counsel” (“Rule 11 Defendants”). JSRM and
Berkeley did not serve the Rule 11 Defendants with a copy of the Rule 11 motion that
they intended to file. Rather, JSRM and Berkeley sent the Rule 11 Defendants a letter
that outlined some of their reasons as to why Rule 11 sanctions were warranted.
The District Court dismissed all of the appeals, reasoning that the Mondellis did
not have standing to appeal the Final Decree, and that their appeals of the other ten other
orders was untimely.2 In addition, the District Court concluded that the letter JSRM and
1
Without explanation, the Mondellis’ brief substitutes the June 27, 2007 consent order for
the May 16, 2007 consent order. We will consider the Mondellis as having appealed both
decisions.
2
This opinion will refer to these ten orders as the “Orders.”
4
Berkeley sent to the Rule 11 Defendants substantially complied with Rule 11’s safe-
harbor provision, and granted sanctions against both Rosellini and Hallock and
Cammarota, LLP (the “Rule 11 Order”). The District Court, however, limited the basis
of the sanctions to the allegations set forth in the letter.
The Mondellis filed a motion for reconsideration, and in response, the Rule 11
Movants moved for additional Rule 11 sanctions. In addition, Rosellini filed a motion for
reconsideration of the Rule 11 Order. The District Court denied both motions for
reconsideration and the subsequent motion for sanctions.
The Mondellis now appeal the dismissal of all of their appeals to this Court. In
addition, Rosellini appeals the imposition of sanctions.
II.
a. The Bankruptcy Orders
On appeals from the District Court’s review of bankruptcy matters, we review
findings of fact under the clearly erroneous standard and exercise plenary review over
questions of law. In re Dykes, 10 F.3d 184, 185-86 (3d Cir. 1993).
The Mondellis raise two arguments as to why this Court should reverse the
District Court’s dismissal of their appeals of eleven bankruptcy orders. First, the
Mondellis argue that the Bankruptcy Court erred in converting Mondelli’s case to
Chapter 7 instead of dismissing it as he requested in 2004.3 The Mondellis, who do not
3
Although irrelevant to our decision, we note that Mondelli never filed a motion to
dismiss the Chapter 13 case nor did he file a motion opposing the conversion of his case
to Chapter 7. In addition, Mondelli’s motion to reconvert his case to Chapter 13, (A-
885), makes no contention that the District Court erred in converting the case to Chapter
5
contend that their appeals of the Orders were timely, appear to suggest that this error
absolves them of having to have raised timely appeals. Second, the Mondellis argue that
because the Bankruptcy Court never issued an order approving the Trustee’s Final
Report, they should be allowed to appeal the Final Decree. Neither of these arguments
has merit.
i. The Orders
A party has fourteen days from the date of the entry of the judgment to file a
notice of appeal. Fed. R. Bankr. P. 8002(a). This deadline is strictly construed, In re
Universal Minerals, Inc., 755 F.2d 309, 311 (3d Cir. 1985), and a party’s failure to file a
timely notice of appeal creates a jurisdictional defect that bars appellate review.
S’holders v. Sound Radio, Inc.,
109 F.3d 873, 879 (3d Cir. 1997). Thus, any alleged error
by the Bankruptcy Court in converting Mondelli’s case to Chapter 7 in 2004—a decision
that Mondelli did not appeal4— is irrelevant in deciding whether the Mondellis’ appeals
of the Orders should be dismissed because they were untimely. The only inquiry is
whether the Mondellis met the deadline, and it is clear they did not. Although as noted,
the Mondellis do not argue that the District Court erred in concluding that the Mondellis’
appeals of the Orders were untimely, we will briefly address the Orders at issue.
7—only that Mondelli “attempted to have a Voluntary Dismissal.” As
discussed supra,
Mondelli was successful in reconverting his case to Chapter 13.
4
Mondelli appealed the Bankruptcy Court’s decision to reconvert the case from Chapter
13 to Chapter 7 in 2007. The District Court affirmed the Bankruptcy Court’s decision,
Mondelli v. Greenberg,
2007 WL 4365310 (D.N.J. Dec. 12, 2007), which Mondelli did
not appeal.
6
The Mondellis missed the deadline to appeal the February 7, 2005 and February
15, 2005 Orders by almost four years, as these orders were final when the Chapter 13
plan was approved on February 3, 2006. See In re Young, 237 F.3d 1168, 1172-73 (10th
Cir. 2001); In re Salvo,
2008 WL 938585, at *2-3 (Bankr. N.D. Oh. Apr. 4, 2008).
Similarly, Mondelli’s appeals of the Bankruptcy Court’s April 6, 2005 Order, April 20,
2005 Order, October 17, 2007 Order, May 7, 2008 Order, and January 7, 2009 Order,
which granted attorneys fees to the Chapter 7 Trustee, and its October 21, 2009 Order
that granted compensation to the Chapter 7 Trustee, are well past the fourteen day
deadline, as these orders were final for purposes of appeal when they were entered on the
docket. See
S’holders, 109 F.3d at 880-81.
The Mondellis’ appeal of the May 15, 2007, May 16, 2007, and June 27, 2007
consent orders is also untimely. Moreover, the Mondellis are precluded from even
appealing these orders, as they are consent judgments, see Verzilli v. Flexon, Inc., 295
F.3d 421, 424 (3d Cir. 2002) (explaining circumstances when a party can appeal a
consent judgment), and this Court had already considered the merits of these orders in In
re Mondelli, 349 Fed. App’x. 731 (3d Cir. 2009). Accordingly, we will affirm the
District Court’s dismissal of the Mondellis’ appeals of the Orders.
ii. The Final Decree
Moreover, we agree with the well-reasoned analysis of the District Court that the
Mondellis did not have standing to appeal the Final Decree. “[O]nly those whose rights
or interests are directly and adversely affected pecuniarily by an order of the bankruptcy
court may bring an appeal.” In re PWS Holding Corp., 228 F.3d 224, 249 (3d Cir. 2000)
7
(internal quotation marks and citation omitted). Here, the Final Decree did nothing more
than recognize that the estate had been fully administered and order necessary ministerial
acts. Indeed, the Mondellis do not even suggest that any right has been compromised by
the Final Decree. Thus, we will affirm the District Court’s dismissal of the Mondellis’
appeal of this order.
b. Rule 11 Sanctions
The parties dispute whether the Rule 11 Movants’ letter to the Rule 11 Defendants
was procedurally defective.5 We agree with the District Court that the letter substantially
complied with the safe-harbor provision in Rule 11 and that the Rule 11 Movants are
entitled to a decision on the merits of their request for sanctions. See Nisenbaum v.
Milwaukee Cnty., 333 F.3d 804, 808 (7th Cir. 2003) (holding defendants substantially
complied with safe-harbor provision by sending notification letter); Jeffreys v. Rossi,
275
F. Supp. 2d 463, 480 n.27 (S.D.N.Y. 2003) (same).
We conclude that the District Court did not abuse its discretion in imposing
sanctions on the Rule 11 Defendants for appealing two (or three) consent orders. See
Waltz v. Cnty. of Lycoming, 974 F.2d 387, 388 (3d Cir. 1992) (explaining that this Court
reviews a district court’s imposition of Rule 11 sanctions for abuse of discretion). A
party cannot appeal a consent judgment unless at least one of three exceptions applies: (1)
a party did not actually consent; (2) the court approving the consent order lacked the
subject matter jurisdiction to enter the judgment; and (3) the consent judgment explicitly
reserves the right to appeal.
Verzilli, 295 F.3d at 424; In re Sharon Steel Corp.,
918 F.2d
5
The Rule 11 Defendants did not challenge the Rule 11 Movants’ motion on procedural
grounds to the District Court. The District Court raised the issue sua sponte.
8
434, 437 n.3 (3d Cir. 1990). None of these exceptions apply here. As such, we will
affirm the District Court’s imposition of sanctions.
III.
For the reasons stated above, we will affirm the District Court’s ruling.
9
