In re Kelly, 2:17-ap-01415-RK. (2018)
Court: United States Bankruptcy Court, C.D. California
Number: inbco20181010931
Visitors: 14
Filed: Oct. 09, 2018
Latest Update: Oct. 09, 2018
Summary: NOT FOR PUBLICATION STATEMENT OF UNCONTROVERTED FACTS AND CONCLUSIONS OF LAW IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT (L.B.R. 7056-1(b)(2) ROBERT KWAN , Bankruptcy Judge . Pursuant to Rule 56 of Federal Rules of Civil Procedure and Local Bankruptcy Rule 7056-1(b)(2), the court adopts the following STATEMENT OF UNCONTROVERTED FACTS AND CONCLUSIONS OF LAW IN SUPPORT OF MOTION OF PLAINTIFF MARK GROSS FOR SUMMARY JUDGMENT. All uncontroverted facts are supported by the Declaration of MARK P.
Summary: NOT FOR PUBLICATION STATEMENT OF UNCONTROVERTED FACTS AND CONCLUSIONS OF LAW IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT (L.B.R. 7056-1(b)(2) ROBERT KWAN , Bankruptcy Judge . Pursuant to Rule 56 of Federal Rules of Civil Procedure and Local Bankruptcy Rule 7056-1(b)(2), the court adopts the following STATEMENT OF UNCONTROVERTED FACTS AND CONCLUSIONS OF LAW IN SUPPORT OF MOTION OF PLAINTIFF MARK GROSS FOR SUMMARY JUDGMENT. All uncontroverted facts are supported by the Declaration of MARK P. ..
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NOT FOR PUBLICATION
STATEMENT OF UNCONTROVERTED FACTS AND CONCLUSIONS OF LAW IN SUPPORT OF MOTION FOR SUMMARY JUDGMENT
(L.B.R. 7056-1(b)(2)
ROBERT KWAN, Bankruptcy Judge.
Pursuant to Rule 56 of Federal Rules of Civil Procedure and Local Bankruptcy Rule 7056-1(b)(2), the court adopts the following STATEMENT OF UNCONTROVERTED FACTS AND CONCLUSIONS OF LAW IN SUPPORT OF MOTION OF PLAINTIFF MARK GROSS FOR SUMMARY JUDGMENT. All uncontroverted facts are supported by the Declaration of MARK P. GROSS, Electronic Case Filing Number (ECF) 67.
I. STATEMENT OF UNCONTROVERTED FACTS
UNCONTROVERTED FACT SUPPORTING EVIDENCE
1. Plaintiff is a family law specialist attorney 1. Declaration of Mark P. Gross (ECF 67 pp.
practicing in California. 18-21, ¶ 2)
2. Plaintiff was appointed as Minor's Counsel 2. Not Disputed — Defendant's Statement of
to represent the interests of the minor child of Genuine Issues of Material Fact, ECF 95,
Debtor Sharon Kelly, also known as Sharon filed on 8/17/18; see also, Declaration of
Krieger (Debtor or KELLY), and her Mark P. Gross (ECF 67 pp. 18-21, ¶¶ 2 and 3,
husband, Robert Krieger (KRIEGER), in their and its exhibits: ECF 67, Exhibit 1: Los
marital dissolution case, Case No. BD497003, Angeles Superior Court (LASC) Order
before the Superior Court of California for 6/9/2009, ECF 67, Exhibit 2: LASC Order
the County of Los Angeles. 6/16/2009, ECF 67, Exhibit 3: Further Am.
LASC Order 7/14/2009).
3. Plaintiff's appointment as Minor's Counsel 3. Declaration of Mark P. Gross (ECF 67 pp.
was based on the findings of the Superior 18-21, ¶¶ 2 and 3, and its exhibits:
Court, based on the needs of the minor child ECF 67, Exhibit 1: LASC Order 6/9/2009
and ability of the debtor to pay a portion of ECF 67, Exhibit 2: LASC Order 6/16/2009
the fees. ECF 67, Exhibit 3: Further Am. LASC Order
7/14/2009).
4. After the Superior Court relieved Plaintiff 4. Not Disputed — Defendant's Statement of
of his duties as Minor's Counsel on October Genuine Issues of Material Fact, ECF 95; see
15, 2010, the Superior Court re-appointed also, Declaration of Mark P. Gross (ECF 67
Plaintiff as Minor's Counsel on October 17, pp. 18-21, ¶¶ 4 and 5, and its exhibits:
2011. ECF 67, Exhibit 4: LASC Judgment
10/15/2010
ECF 67, Exhibit 5: LASC Order and M.O.
10/17/2011).
5. Plaintiff's re-appointment as Minor's 5. Declaration of Mark P. Gross (ECF 67 pp.
Counsel was based on the findings of the 18-21, ¶ 5, and its exhibits:
Superior Court, based on the needs of the ECF 67, Exhibit 5: LASC Order and M.O.
minor child and ability of Debtor to pay a 10/17/2011).
portion of the fees.
6. Debtor was ordered to pay 50% of the 6. Not Disputed — Defendant's Statement of
Plaintiff's fees incurred as Minor's Counsel. Genuine Issues of Material Fact, ECF 95; see
also, Declaration of Mark P. Gross (ECF 67
pp. 18-21, ¶ 7, and exhibit:
ECF 67, Exhibit 7: LASC Order 12/14/2012).
7. The Superior Court Judge received 7. (a) Declaration of Mark P. Gross, ECF 67
evidence and argument in the form of pp. 20-21, ¶ 10-12 and exhibit thereto;
declarations and memoranda of points and ECF 67, Exhibit 8 (ECF 67, pp. 73-77):
authorities GROSS'S REQUEST FOR LASC Order 3/16/2015 Ruling on Submitted
ORDERS (RFO), and opposition declarations Matter;
and points and authorities from Plaintiff and
Debtor, on the issues as to whether the fees (b) Decl. of Mark P. Gross ECF 68, and
were for representation as Minor's Counsel, Exhibits 10, 11, 12, 13, 14, 15 thereto:
as to reasonableness, and as to accuracy of
the fees. (i) ECF 68, Exhibit 10, p.25: MARK
GROSS Request for Order (fee
application) and supporting
declarations 8/14/2014, (NOTE
ECF 68 Ex.10 pp.75-78 is a chart
submitted in evidence in state court
action showing how all payments
were allocated from 7/1/2009 to
7/31/2014 including the community
property-sourced payments from
Mr. Krieger); and
Jill Street's notice of errata 9/12/2014;
(ii) ECF 68, Exhibit 11 p.86, 90:6-92:14)
Defendant KELLY
Petitioner's Opposition Declaration
(on the issue of the application of the
alleged Community Property (CP)
payments) and 92:17-28 (on the issue
of ability to pay);
and Defendant KELLY'S Points and
Authorities ECF 68, Ex.11, pp100-106:19
(on ability to pay) and ECF 68,
Ex.11, pp. 106:19-109:14 (on the
alleged CP payments) and Exhibits
(Income and Expense Declaration of
KELLY on the ability to pay issue) at
ECF 68, Ex.11-pp 113-116, 159-161,
163-164 (escrow stmt). Ex. 6 (ECF 68,
Ex.11 pp328-332) on CP payments
issue.
(iii) ECF 68, Exhibit 12, p.366-396:
KRIEGER'S Further Response to
Minor's Counsel Motion and the
Court's Tentative Ruling 12/21/2014
opposing KELLY'S position on the
source of payments and ability to pay.
(iv) ECF 68, Exhibit 13, pp397-550
KELLY'S Responsive Declaration &
P&A to Minor's Counsel Request for
Order, Petitioner's (KELLY) Audit
and Objections to Minors Counsel
Mark Gross's billing 2009 to present
12/22/2014, legal argument and
declaration testimony challenging of
GROSS'S accuracy and reasonableness
of fees charged (ECF 68, Ex.13, pp.
400:20-424:22) and argument and
testimony by declaration on the CP
payments issue ECF 68, Ex.11, pp.
425:1-426:19 and ECF 68, Ex.11,
pp430:20-432:20 (on issue of
reasonableness of fees)
(v) Exhibit 14 (ECF 68, Ex. 14, pp. 551
Respondent's (KRIEGER) Analysis of
Petitioner and Attorney Schwartz's
Financial Statements and Request for
Legal Fees 12/31/2014 (responding to
KELLY on need and ability, and the
audit)
(vi) ECF 68, Ex.15, pp.613) KRIEGER'S
Further Response to Minor's Counsel's
Motion
8. The Superior Court Judge received 8. (a)
evidence and argument in the form of ECF 77, Ex. C, p.93 Decl. of Sharon Kelly
declarations and memoranda of points and (Transcript of 2/27/2015) on issues
authorities from both Plaintiff and Debtor reasonableness and ability to pay ECF 77, Ex.
over how to allocate the payments from C, pp.93, 96:3-97:10; spreadsheets on how
Robert Krieger which Debtor claims were payments applied and amount owed by
from community property sources and each — ECF 77 pp97:15-98:28, 98:18-22,
should have been allocated in part to her. 99:9-104:9,
AND
(b) Decl. of Mark P. Gross ECF 68, and
Exhibits 10, 11, 12, 13, 14, 15 thereto:
(i) ECF 68, Exhibit 10, p.25: MARK
GROSS Request for Order (fee
application) and supporting declarations
8/14/2014, (NOTE ECF Ex.10 pp.75-78
is a chart submitted in evidence in
state court action showing how all
payments were allocated from
7/1/2009 to 7/31/2014 including the
community property-sourced
payments from Mr. Krieger); and
Jill Street's notice of errata 9/12/2014
(ii) ECF 68, Exhibit 11 p.86, 90:6-92:14)
Defendant KELLY
Petitioner's Opposition Declaration
(on the issue of the application of the
alleged CP payments) and 92:17-28
(on the issue of ability to pay)
and Defendant KELLY'S Points and
Authorities ECF 68, Ex.11, pp100-106:19
(on ability to pay) and ECF 68,
Ex.11, pp. 106:19-109:14 (on the
alleged CP payments) and Exhibits
(Income and Expense Declaration of
KELLY on the ability to pay issue) at
ECF 68, Ex.11-pp 113-116, 159-161,
163-164 (escrow stmt). Ex. 6 (ECF 68,
Ex.11 pp328-332) on CP payments
issue.
(iii) ECF 68, Exhibit 12, p.366-396:
KRIEGER'S Further Response to
Minor's Counsel Motion and the
Court's Tentative Ruling 12/21/2014
opposing KELLY'S position on the
source of payments and ability to pay.
(iv) ECF 68, Exhibit 13, pp397-550
KELLY'S Responsive Declaration &
P&A to Minor's Counsel Request for
Order, Petitioner's (KELLY) Audit
and Objections to Minors Counsel
Mark Gross's billing 2009 to present
12/22/2014, legal argument and
declaration testimony challenging of
GROSS'S accuracy and reasonableness
of fees charged (ECF 68, Ex.13, pp.
400:20-424:22) and argument and
testimony by declaration on the CP
payments issue ECF 68, Ex.11, pp.
425:1-426:19 and ECF 68, Ex.11,
pp430:20-432:20 (on issue of
reasonableness of fees)
9. After receiving evidence in the form of 9. Decl. of Sharon Kelly, ECF 77 and exhibits
declarations, memoranda of points and thereto:
authorities, and exhibits from KELLY, ECF 77, Exhibit C, p.93 (Transcript of
GROSS and KRIEGER, the Superior Court 2/27/2015): reasonableness and ability to pay
held a hearing on February 27, 2015, on the ECF 77, pp.93, 96:3-97:10; spreadsheets on
issues of reasonableness, accuracy, and the how payments applied and amount owed
allocation of the allegedly community by each — ECF 77 pp97:15-98:28, 98:18-22,
property payments, and was presented 99:9-104:9.
with a spreadsheet showing how the
payments were applied.
10. At the hearing before the Superior Court 10. ECF 77, Exhibit C, pp.98:4-104:9
on February 27, 2015, KELLY's counsel, and (Transcript of 2/27/2015 Page:Line no. 5:4-11:9)
GROSS presented argument regarding the
hourly rate being charged, the allocation
issue, need and ability to pay and
reasonableness and accuracy of the Minor's
Counsel Request for Order.
11. At the hearing before the Superior Court 11. ECF 77, Exhibit C, pp.118:23-124:3
on February 27, 2015, Link K. Schwartz (Transcript of 2/27/2015 Page:Line. 25:23-31:3)
(SCHWARTZ), KELLY's counsel, and
GROSS presented argument regarding
application of the alleged community
property sourced payments made by
KRIEGER, with KELLY arguing that
GROSS had not properly credited KELLY for
payments made.
12. SCHWARTZ argued at the hearing that 12. Not Disputed — Defendant's Statement of
KELLY was entitled to credit for $85,914.19 Genuine Issues of Material Fact, ECF 95; see
on account of payments made by KRIEGER also, ECF 77, Exhibit C, pp. 123 (Transcript
from alleged community funds. of 2/27/2015 Page:Line no. 30:26)
13. SCHWARTZ also argued that it was 13. Not Disputed — Defendant's Statement of
KRIEGER who was misusing community Genuine Issues of Material Fact, ECF 95; see
assets to pay a separate property debt, also, ECF 77, Exhibit C, pp. 122 (Transcript
because each of the parties separately owes of 2/27/2015 Page:Line no. 29:2-29:8)
the debt to Minor's Counsel.
14. The Superior Court Judge ruled on the 14. ECF 77, Exhibit C, pp. 125 (Transcript of
issue of adjustment of the alleged 2/27/2015 Page:Line no. 32:3-10)
community payments by stating ". . . we can,
for purposes of, you know, releasing minor's
counsel from this case as long as there is an
amount that . . . . . is adjudged or agreed to be
how much he is owed. If there are then
credits or reimbursements from one party
or the other, that could be done down the
road."
15. KRIEGER stated on the record that some 15. Not Disputed — Defendant's Statement of
community funds were used to pay Minor's Genuine Issues of Material Fact, ECF 95; see
Counsel, but argued that those were allocated also, ECF 77, Exhibit C, pp. 131:17-22,
earlier in the case by the previous Judge 135:20-136:4 (Transcript of 2/27/2015 Page
Shaller with whom he did not agree. 38:17-21, 42:20-43:4).
16. The Superior Court Judge ruled that there 16. Not Disputed — Defendant's Statement of
were no further reserved issues on GROSS'S Genuine Issues of Material Fact, ECF 95; see
Request for Order, rejecting a request by also, ECF 77, Exhibit C, pp. 143:23-28
SCHWARTZ for further reserved issues. (Transcript of 2/27/2015 Page:Line no. 50:23-28).
17. On March 16, 2015, the Superior Court 17. ECF 67, Exhibit 8 (ECF 67, pp. 73-77):
Judge determined that KELLY owed LASC Order 3/16/2015 Ruling on Submitted
GROSS $70,900.58 and awarded him that Matter.
amount, as and for minor's counsel fees
against the debtor, thereby accepting
GROSS'S method of accounting for the
payments received, and rejecting
KELLY'S arguments about crediting her
with half of certain payments.
18. Omitted. 18. Omitted
19. Omitted. 19. Omitted.
II. CONCLUSIONS OF LAW
CONCLUSIONS OF LAW SUPPORTING AUTHORITY
1. The Court may grant summary judgment on 1. Fed. R. Civ. P. 56(a)
each claim on which it is sought if the moving
party establishes that "there is no genuine
dispute as to any material fact and movant is
entitled to judgment as a matter of law."
2. An issue of material fact is only "genuine" 2. Farris v. City of Riverside 667 F. Supp. 2d
if the evidence permits a reasonable fact finder 1151, 1155 (C.D. Cal. 2009)
to "return a verdict for the nonmoving party."
3. Omitted. 3. Omitted.
4. The court has jurisdiction over 4. 28 U.S.C. §§ 157(b)(2)(I) and 1334, In re
determinations of dischargeability of debt. Jodoin, 209 B.R. 132 (9th Cir. BAP 1997).
5. Nondischargeable Domestic Support 5. 11 U.S.C. §§ 101(a)(14A) and 523(a)(5).
Obligation includes a debt which is in the
nature of support.
6. The Superior Court's determination that 6. In re Harmon, 250 F.3d 1240, 1245 (9th Cir.
Debtor owes Plaintiff for her share of the 2001), citing, Lucido v. Superior Court, 51
attorneys' fees as Minor's Counsel has Cal.3d 335, 341 (1990); In re Bugna, 33 F.3d
collateral estoppel effect because the issue of 1054, 1057 (9th Cir. 1994), citing, 28 U.S.C.
Debtor's liability for Plaintiff's fees as § 1738.
Minor's Counsel is identical to the one
decided in Debtor's marital dissolution case
before the Superior Court, that issue was
actually litigated in that proceeding, that issue
was necessarily decided in that proceeding, the
Superior Court's determination is final and on
the merits and the party against whom
preclusion is sought, Debtor, is the same in the
prior proceeding.
7. Fees that are payable by a party in a marital 7. In re Chang 163 F.3d 1138 (9th Cir. 1998).
dissolution action to a professional for
services incurred for and on behalf of that
party's minor children is in the nature of
support.
8. Attorneys' fees payable to Plaintiff as 8. In re Peters, 964 F.2d 166 (2nd Cir. 1992);
Minor's Counsel are in the nature of child 11 U.S.C. §§ 101(a)(14A) and 523(a)(5).
support and thus nondischargeable in
bankruptcy.
9. A debt to a spouse, former spouse, or child 9. 11 U.S.C. § 523(a)(15).
of the debtor and not of the kind described in
paragraph (5) that is incurred by the debtor in
the course of a divorce or separation or in
connection with a separation agreement,
divorce decree or other order of a court of
record
10. That a court award of attorneys' fees and 10. In re Tritt, 2014 WL 1347763 (Bankr. E.D.
costs to an attorney for a non-debtor former Tex. 2014).
spouse in post-divorce litigation between the
parties should be construed as a debt of the
former spouse. "Whether a fee is due to a
former spouse or to the attorney of a former
spouse has been determined to be
irrelevant . . ."
11. Attorneys' fees and costs awarded "in 11. 11 USC § 523(a)(15); In re Tritt, 2014 WL
connection with" a divorce decree or other 1347763 (Bankr. E.D. Tex. 2014); In re
order of a court of record, as that term is used Prensky, 416 B.R. 406, 409-412 (Bankr. D.
in § 523(a)(15), are nondischargeable under 11 N.J. 2009), In re Adam, 2015 WL 1530086 (9th
U.S.C. § 523(a)(15) Cir. BAP 2015).
12. Interest on a nondischargeable debt is 12. In re Gosney, 205 B.R. 418 (9th Cir. BAP
also nondischargeable. 1996).
13. Interest on a debt which arose under state 13. In re Niles, 106 F.3d 1456, 1463 (9th Cir.
law bears interest governed by state law. 1996).
IT IS SO ORDERED.
Source: Leagle
