 |
 |
to fill out a simple form to connect to Personal Injury Lawyers in your area.
|
|
|
|
|
Edwards v. Franchini5/26/1998
Certiorari denied, No. 25,281, September 8, 1998
APPEAL FROM THE DISTRICT COURT OF BERNALILLO COUNTY Robert L. Thompson, District Judge
{1} Defendants were Plaintiffs' attorneys in connection with a lawsuit against the State of New Mexico. On May 19, 1989, before the lawsuit came to trial, Plaintiffs filed a Chapter 11 bankruptcy petition in the United States Bankruptcy Court. Plaintiffs did not list any claim against Defendants as an asset of the bankruptcy estate. Upon conversion of the petition to a Chapter 7 bankruptcy petition, the bankruptcy court appointed a trustee of the bankruptcy estate. The trustee filed a motion to accept the trustee's settlement offer settling Plaintiffs' underlying case against the State of New Mexico for $25,000. The bankruptcy court approved the settlement. On November 27, 1993, with Plaintiffs still not bringing any claim against Defendants to the bankruptcy court's attention, the bankruptcy court entered a final decree stating that the bankruptcy estate had been fully administered. It discharged the trustee and closed the case.
{2} With the Conclusion of the bankruptcy proceeding, Plaintiffs brought an action against Defendants in the United States District Court, but that court dismissed the action for lack of subject matter jurisdiction. Then, on December 9, 1994, Plaintiffs filed this action for damages for breach of contract and legal malpractice with regard to the State of New Mexico lawsuit and the bankruptcy proceedings. Defendants answered the complaint and filed motions for summary judgment on the grounds that Plaintiffs lacked standing because of the bankruptcy proceeding and that the statute of limitations barred Plaintiffs' claims. The district court granted summary judgment for lack of standing and Plaintiffs appealed. As Plaintiffs' arguments do not have basis under bankruptcy law, we affirm.
Standing During Pendency of Proceedings Below
{3} Defendants based their motion for lack of standing on Rule 1-017(A) NMRA 1998, which requires that the action be prosecuted in the name of the real party in interest. According to Defendants, the bankruptcy trustee, not Plaintiffs, was the real party in interest to file the complaint. A real party in interest is the one who "`is the owner of the right being enforced and is in a position to discharge the defendant from the liability being asserted in the suit.'" (quoting )).
{4} We look to bankruptcy law to ascertain whether Plaintiffs were real parties in interest to originally bring this action. See . As we later discuss, under the Bankruptcy Code, when a debtor files a bankruptcy petition, all legal or equitable "interests of the debtor in property as of the commencement of the case" and " ny interest in property that the estate acquires after the commencement of the case" become property of the bankruptcy estate. 11 U.S.C. 541(a)(1), (7) (1994); see In re Dow, 132 B.R. 853, 859-60 (Bankr. S.D. Ohio 1991). According to the Bankruptcy Code, the debtor has the duty to schedule its assets and liabilities, see 11 U.S.C. 521(1), but even if it does not, unscheduled assets still become property of the bankruptcy estate. See In re Davis, 158 B.R. 1000, 1002 (Bankr. N.D. Ind. 1993). The bankruptcy estate is the responsibility of the bankruptcy trustee in a proceeding under Chapter 7 of the Bankruptcy Code. See 11 U.S.C. 704 (trustee has duty to investigate financial affairs of debtor, collect property of estate, and close estate).
{5} Unless the court makes a different order, property which the debtor schedules in the petition which is not administered when the court closes the case "is abandoned to the debtor." Id. 554(c). Property which is
Page 1 2 3 4 5 New Mexico Personal Injury Attorneys
Personal Injury Lawyers
|
| |
to fill out a simple form to connect to Personal Injury Lawyers in your area.
|
|