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In Re: Victor Mondelli v. Nicholas J. Delzotti

March 29, 2011


The opinion of the court was delivered by: William J. Martini, U.S.D.J.:


Appellant-Debtor Victor Mondelli ("Mondelli") appeals eleven bankruptcy court orders entered between February 7, 2005 and March 15, 2010. Anna Mondelli, a purported intervenor, joins in the appeal (collectively the "Mondellis"). Chapter 7 Trustee-Appellee Nicholas Delzotti (the "Trustee" or the "Chapter 7 Trustee") and Appellees Jack Silverman Realty & Mortgage, LLC ("JSRM") and Berkeley Realty Partners 244, LLC ("BRP") (collectively "Appellees") move to dismiss the appeal. Also before the Court is BRP and JSRM's motion for sanctions under Federal Rule of Civil Procedure 11 against the Mondellis' current attorney, Kenneth Rosellini, and the law firm Hallock & Cammarota, LLP, ("H&C") and its partners, Joseph A. Hallock and Pietro Cammarota, filed by BRP and JSRM (the "Rule 11 Motion").

For the reasons stated below, both motions are GRANTED.

I.Factual and Procedural Background

Mondelli voluntarily filed for Chapter 13 bankruptcy on February 18, 2004 in the United State Bankruptcy Court for the District of New Jersey. At the time of the filing, Mondelli was represented by counsel. Id. On June 4, 2004, Mondelli terminated his counsel and proceeded pro se. He then requested that the case be dismissed; as an alternative to dismissal, the Chapter 13 Trustee recommended that the case be converted to Chapter 7, as Mondelli possessed equity in real estate that could cover all outstanding claims by creditors. After a hearing on the matter at which Mondelli failed to appear, the Bankruptcy Court converted the case to Chapter 7 on October 21, 2004. The Chapter 13 Trustee was thereafter replaced by the Chapter 7 Trustee.

On January 4, 2005, Mondelli obtained new counsel, Herbert Levenson, and moved to reconvert the case to Chapter 13, arguing that illness had prevented him from attending the hearing and that he was psychologically unfit to proceed pro se. In support of his motion, Mondelli included a letter from Stephen Grelecki, M.D., a psychiatrist who stated Mondelli was "under his care" and "should not be expected by the courts to represent himself." The Bankruptcy Court ordered the reconversion on February 7, 2005, subject to certain conditions including that Mondelli would complete and abide by an eventual Chapter 13 plan. The Bankruptcy Court then terminated the Chapter 7 Trustee, reappointed the Chapter 13 Trustee, and allowed the Chapter 7 Trustee claims for compensation and attorney's fees.

The Bankruptcy Court confirmed the Chapter 13 Plan (the "Plan") on February 3, 2006. The order confirming the Plan required that Mondelli refinance his real estate holdings within twelve months of the confirmation hearing or the case would be dismissed. On February 9, 2007, the Chapter 13 Trustee moved to vacate the February 7, 2005 order reconverting the case to Chapter 13 on the grounds that Mondelli had failed to abide by the conditions of the plan including that he failed to refinance his real estate holdings. On February 21, 2007, the Bankruptcy Court vacated the February 7, 2005 order and converted the case back to Chapter 7. The Chapter 13 Trustee was thereafter terminated and the Chapter 7 Trustee was reappointed. Mondelli promptly appealed. This Court ultimately affirmed the Bankruptcy Court's decision. See Mondelli v. Greenberg, No. 07-CV-3290, 2007 WL 4365310 (D.N.J. Dec. 12, 2007).

On May 15, 2007, the Bankruptcy Court authorized Mondelli to obtain a mortgage on real property he owned consisting of two commercial properties and one residential property from JSRM to allow Mondelli to pay off his creditors. On May 16, 2007, the Bankruptcy Court entered a consent order authorizing Mondelli to enter into a ground lease with BRP for one of the commercial properties once Mondelli closed the financing with JSRM. On May 21, 2007 while the appeal of the February 7, 2005 order was pending, Mondelli again obtained new counsel, finally settling on Rosellini, his present counsel. On June 27, 2007, the Bankruptcy Court entered another consent order authorizing Mondelli to enter into a ground lease with BRP for the other commercial property. Although Rosellini had appeared in the action by this time, Mondelli's previous attorney, Herbert Levenson, signed the June 27, 2007 consent order on Mondelli's behalf. Id.

On November 10, 2007, JSRM and BRP moved to enforce the consent orders, arguing that Mondelli had failed to comply with his obligations under the loan agreement as ordered by the court. On November 19, 2007, the Bankruptcy Court ordered Mondelli to comply with the loan agreements. Mondelli, through Rosellini, moved the Bankruptcy Court to reconsider the motion enforcing the loan agreements, raising four new arguments that it had not previously raised. The Bankruptcy Court denied both motions, and Mondelli, again acting through Rosellini, promptly appealed. The appeal was again assigned to this Court, and a full explanation of the appeal and coordinate facts can be found in the Court's opinion. See Mondelli v. Berkeley Realty Partners No. 224, LLC, No. 08-CV-1582, 2008 WL 3843268 (D.N.J. Aug. 14, 2008) aff'd 349 F. App'x 731 (3d Cir. Oct. 20, 2009). In short, this Court dismissed Mondelli's appeal, calling it "without merit." See id.

On May 7, 2008, the Bankruptcy Court granted an interim application for compensation by the law firm that had provided legal services for the Chapter 7 Trustee. Mondelli filed an interlocutory appeal without seeking leave of the Court, and this Court dismissed it for that reason. Mondelli v. Delzotti, No. 07-CV-5840 (D.N.J. May 2, 2008). On January 7, 2009, the Bankruptcy Court granted the "third and final" application for compensation for attorneys' fees for the Chapter 7 Trustee's attorneys. Mondelli, through Rosellini, promptly appealed. But it does not appear that Mondelli prosecuted the appeal.

On September 4, 2009, the Chapter 7 Trustee filed his final report and application for compensation. Rosellini filed objections on behalf of both Mondellis, and Anna Mondelli formally appeared in the bankruptcy case. On October 21, 2009, the Bankruptcy Court granted the Chapter 7 Trustee's final report and application for fees and expenses.

On March 12, 2010, the Chapter 7 Trustee filed his final account, certified that the bankruptcy estate had been fully administered, and applied to be discharged. On March 15, 2010, the Bankruptcy Court entered its Final Decree, finding that the estate had been fully administered and ordering that the Chapter 7 Trustee was discharged, the bond was canceled, and that the bankruptcy case was closed.

On March 29, 2010, the Mondellis, through Rosellini, filed the instant appeal.

II.The Motion to Dismiss

The Appellees move to dismiss the appeal on several grounds, including that the appeal is untimely and that the Mondellis lack standing to bring the appeal. Because these first two arguments are sufficient to find that dismissal is proper, the Court will not consider Appellees' remaining arguments.

A. The Timeliness of the Appeal

The Appellees argue that the appeal is untimely, and they are, for the most part, correct. A district court has jurisdiction to hear appeals from final judgments, orders, and decrees, and, with leave of the court, from interlocutory orders and decrees of bankruptcy judges. 28 U.S.C. § 158(a). Under Federal Rule of Bankruptcy Procedure 8002, a party has fourteen days from the date that an order is entered into the docket to file a notice of appeal.*fn1 This rule is jurisdictional in nature: if the party fails to file a notice within the time allowed, the district court lacks subject matter jurisdiction to hear the appeal. In re Taylor, 343 F. App'x 753, 755 & n.1 (3d Cir. 2009) (citing Shareholders v. Sound Radio, Inc., 109 F.3d 873, 879 (3d Cir. 1997)).

The Mondellis filed the instant notice of appeal with the Bankruptcy Court on March 29, 2010. They indicated eleven orders -- spanning the entirety of the bankruptcy case -- that they wish to appeal. As the Mondellis ...

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