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U.S.D.J. Rama Gvildys v. Stephen A. Beukas and Sandra Beukas

November 9, 2012


The opinion of the court was delivered by: Hon. Stanley R. Chesler,




This matter comes before the Court on the appeal filed by Plaintiff-Appellant Rama Gvildys ("Appellant" or "Dr. Gvildys"). Dr. Gvildys appeals from the July 24, 2012, order entered by the United States Bankruptcy Court for the District of New Jersey ("Bankruptcy Court") in the bankruptcy adversary proceeding Gvildys v. Beukas et al., Adv. No. 10-2067, 2012 Bankr. LEXIS 3400 (Bankr. D.N.J. July 24, 2012). Appellee Sandra Beukas ("Appellee" or "Mrs. Beukas") has opposed the appeal. For the reasons stated below, this Court will affirm the Bankruptcy Court's order.

This Court has jurisdiction to hear appeals of the final judgments and orders of the Bankruptcy Court pursuant to 28 U.S.C. § 158(a)(1). This Court reviews the Bankruptcy Court's "legal determinations de novo, its factual findings for clear error and its exercise of discretion for abuse thereof." In re American Pad & Paper Co., 478 F.3d 546, 551 (3d Cir. 2007); see also Fed. R. Bankr. P. 8013.


This dispute concerns whether certain debts owed by Appellee are dischargeable in bankruptcy. The debts in question arose out of business dealings between Dr. Gvildys and Appellee's husband, Stephen Beukas ("Mr. Beukas"). Dr. Gvildys and Mr. Beukas were partners in a mobile dental practice called New Jersey Mobile Dental Practice, P.A. ("NJMDP").

The Complaint alleges that the Beukases are also the sole shareholders of Mobile Dental Practice, P.C. ("Mobile"), which was formed by Mr. Beukas with the intention of providing mobile dental services different from those of NJMDP. The Complaint alleges that from 2005 to 2009, the Beukases deposited money belonging to NJMDP into a bank account for Mobile. All of the funds deposited into the Mobile account were subsequently disbursed, some in the form of direct payments to Mr. Beukas, while other funds were allegedly used to pay for the Beukases' personal expenses. The Complaint further alleges that none of the Monthly Operating Reports filed in the Beukases' bankruptcy proceedings included payments received from the Mobile account.

Dr. Gvildys filed an adversarial action to have the debts owed to her by the Beukases declared non-dischargeable under various subsections of 11 U.S.C. § 727(a), which, in relevant parts, provides for non-dischargeability where the debtor has engaged in certain wrongful conduct. Dr. Gvildys moved for summary judgment before the Bankruptcy Court on all counts against both Beukases. Mrs. Beukas cross-moved to dismiss the claims against her. The Bankruptcy Court granted Dr. Gvildys summary judgmentagainst Mr. Beukas. As to Mrs. Beukas, however, the Bankruptcy Court denied Dr. Gvildys's motion for summary judgment and instead granted Mrs. Beukas's cross-motion to dismiss. Dr. Gvildys now appeals the portion of the Bankruptcy Court's order granting Mrs. Beukas's cross-motion to dismiss.


Dr. Gvildys's main point on appeal is that the Bankruptcy Court's grant of Mrs. Beukas's motion to dismiss is error because it is entirely inconsistent with the Bankruptcy Court's grant of summary judgment on Dr. Gvildys's claims against Mr. Beukas. Dr. Gvildys also argues that the Bankruptcy Court erred by applying a summary judgment standard to Mrs. Beukas's motion to dismiss. In opposition, Mrs. Beukas muddles the record by recasting the Court's grant of her cross-motion to dismiss as a grant of summary judgment. Without the aid of Mrs. Beukas's notably unhelpful opposition brief, the Court is persuaded that the Bankruptcy Court correctly dismissed Dr. Gvildys's claims against Mrs. Beukas.

As a threshold matter, it will be helpful for the Court to clarify the fact that, despite Appellee's argument on appeal, the Bankruptcy Court granted her motion to dismiss. In response to Dr. Gvildys's motion for summary judgment, Beukases filed a notice of motion titled "Notice of Cross-Motion to Dismiss Plaintiff's Adversary Proceeding and Opposition to Plaintiff's Motion for Summary Judgment." (emphasis added) The Beukases' supporting brief was similarly titled "Debtors' Brief in Opposition to the Plaintiff's Motion for Summary Judgment and in Support of Dismissing Her Complaint with Prejudice on the Basis of Estoppel and Unclean Hands." (emphasis added) Judge Steckroth's opinion for the Bankruptcy Court also makes clear that the Court granted dismissal, not summary judgment. See Gvildys, supra, 2012 Bankr. LEXIS 3400 at *46 ("Thus, the cross-motion to dismiss is granted, with prejudice, as to Mrs. Beukas.") (emphasis added).

Dr. Gvildys recognizes the fact that the Bankruptcy Court granted Appellee dismissal, not summary judgment. But Dr. Gvildys argues that the Bankruptcy Court erred by incorrectly applying the Federal Rule of Civil Procedure 56 summary judgment standard in dismissing her claims against Appellee. The Bankruptcy Court's opinion excerpts two statements made by Dr. Gvildys's counsel at oral argument:

In fact, counsel admitted at argument that "with respect to Mrs. Beukas, I don't think that I can show that she knows that" money was improperly transferred from NJMDP to another account. Further, counsel conceded that he could not demonstrate that she had any control over the funds. ("The Court: You don't allege or can prove that she had control over the ...

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