The Tenth Circuit Bankruptcy Appellate Panel has affirmed a lower court’s decision, ruling that a late appeal filing, caused by a simple calendaring mistake, did not qualify as “excusable neglect.” This means the appellants, Amy Liebl-Weaver, KT Weaver, and KT Weaver Construction, LLC, will not be able to proceed with their appeal due to missing the filing deadline.
The case, *In re Amy Liebl Darter, MD, PC*, involved a Chapter 7 bankruptcy proceeding where the appellants were found liable for fraudulent transfer, civil conspiracy, and embezzlement. The bankruptcy court had ruled in favor of the Trustee, Douglas Gould, awarding him partial relief. The appellants then attempted to appeal this decision but missed the deadline to file their notice of appeal by a single day.
The Issue: Excusable Neglect
The central issue in this appeal revolved around whether the appellants’ late filing was due to “excusable neglect.” Under bankruptcy rules, a party has 14 days after a judgment is entered to file a notice of appeal. However, the court can extend this deadline if a motion for extension is filed within the original 14-day period, or within 21 days after that time expires if the party shows excusable neglect.
The appellants argued that their late filing was the result of an honest calendaring mistake. Their counsel, they claimed, had miscalculated the deadline. The bankruptcy court, however, denied their motion to extend the deadline, concluding that miscalendaring a clear and unambiguous deadline did not constitute excusable neglect.
The Supreme Court’s Guidance: *Pioneer Investment Services Co. v. Brunswick Associates Ltd. Partnership*
The court’s decision hinged on the interpretation of “excusable neglect,” a term previously addressed by the Supreme Court in the 1993 case *Pioneer Investment Services Co. v. Brunswick Associates Ltd. Partnership*. In *Pioneer*, the Supreme Court defined excusable neglect as a broad and equitable concept, extending beyond circumstances outside the movant’s control. The Court emphasized that “neglect” can include inadvertence, mistake, or carelessness.
The *Pioneer* court also provided four factors for courts to consider when determining whether neglect is excusable:
* The danger of prejudice to the opposing party.
* The length of the delay and its potential impact on judicial proceedings.
* The reason for the delay, including whether it was within the reasonable control of the movant.
* Whether the movant acted in good faith.
The Supreme Court cautioned against a rigid approach, stressing the need for flexibility and equitable judgment.
The Tenth Circuit’s Interpretation: *United States v. Torres* and *Biodiversity Conservation Alliance v. Bureau of Land Management*
The Tenth Circuit has further clarified the application of the *Pioneer* standard in cases involving late filings. In *United States v. Torres*, the court ruled that a misinterpretation of a clear and unambiguous rule does not constitute excusable neglect. In that case, the attorney had confused the deadline for civil and criminal appeals.
Furthermore, in an unpublished decision, *Biodiversity Conservation Alliance v. Bureau of Land Management*, the Tenth Circuit addressed a situation where an attorney missed a deadline due to a misunderstanding about the date the judgment was entered. The court determined that this also did not qualify as excusable neglect, emphasizing that the reason for the delay – the attorney’s miscalculation – was within the attorney’s control.
The Bankruptcy Court’s Decision and the Appellate Panel’s Affirmation
In the current case, the bankruptcy court found that the appellants’ counsel had miscalculated the appeal deadline by relying on the date they received electronic notice of the judgment, rather than the date it was entered. The bankruptcy court acknowledged the minimal prejudice, short delay, and good faith of the appellants. However, the court emphasized that the calendaring error resulted from a misunderstanding of an unambiguous rule and was entirely within counsel’s control.
The Tenth Circuit Bankruptcy Appellate Panel affirmed the bankruptcy court’s decision. The appellate panel found that the bankruptcy court had correctly applied the *Pioneer* framework and considered all the relevant factors. The panel also cited the *Torres* and *Biodiversity* cases, concluding that the calendaring error, stemming from a miscalculation of the deadline, did not constitute excusable neglect.
No Need for a Hearing
The appellants also argued that the bankruptcy court erred by resolving the motion without holding a hearing. However, the appellate panel found that the relevant facts were undisputed and that the bankruptcy court had acted within its discretion in denying the motion without a hearing.
The appellate panel concluded that the bankruptcy court had not abused its discretion and that the order denying the motion to extend time to file the notice of appeal should be affirmed.