Federal Judiciary

Seventh Circuit Discusses Split Re Whether a District Court's Order to Remand to Bankruptcy Court is Appealable

Circuit courts remain split on which test to apply in determining whether a district court order that remands a case to a bankruptcy court is appealable. See, e.g., In re Lopez, 116 F.3d 1191, 1192 (7th Cir.1997) (cataloging cases). Most circuits have held that such an order is not final and appealable unless the remand is for "ministerial" proceedings. See, e.g., In re Pratt, 524 F.3d 580, 584-85 (5th Cir.2008), cert. denied, --- U.S. ----, 128 S.Ct. 2445, --- L.Ed.2d ---- (2008); In re Penn Traffic Co., 466 F.3d 75, 78-79 (2d Cir.2006) (per curiam); In re Torres, 432 F.3d 20, 22-23 (1st Cir.2005); In re Popkin & Stern, 289 F.3d 554, 556 (8th Cir.2002); In re Overland Park Fin. Corp., 236 F.3d 1246, 1251 (10th Cir.2001); In re Alvarez, 224 F.3d 1273, 1275 (11th Cir.2000); Jove Eng'g v. IRS, 92 F.3d 1539, 1547-48 (11th Cir.1996); In re St. Charles Preservation Investors, Ltd., 916 F.2d 727, 728-29 (D.C.Cir.1990) (per curiam); see also In re Wallace & Gale Co., 72 F.3d 21, 24 (4th Cir.1995) ("District court orders remanding cases to the bankruptcy court for further consideration are not, ordinarily, final orders."). The Sixth Circuit "will not deem final a district court's decision remanding to a bankruptcy court for further proceedings if the district court has not certified the decision pursuant to Fed.R.Civ.P. 54(b)." In re Brown, 248 F.3d 484, 485 (6th Cir.2001); see also In re Yousif, 201 F.3d 774, 781 (6th Cir.2000) (Moore, J., concurring). And the Third and Ninth Circuits apply multi-factor balancing tests to determine whether an order is final and appealable in this context. See In re Fowler, 394 F.3d 1208, 1211 (9th Cir.2005); In re Pransky, 318 F.3d 536, 540-41 (3d Cir.2003).

Our circuit precedent accords with the majority view: "[E]ven if the decision of the bankruptcy court is final, a decision by the district court on appeal remanding the bankruptcy court's decision for further proceedings in the bankruptcy court is not final, and so is not appealable to this court, unless the further proceedings contemplated are of a purely ministerial character...." In re Lopez, 116 F.3d at 1192. What remains to be decided here is hardly ministerial: the bankruptcy court still has to answer the $350,000 question whether Holland is entitled to an exemption under Florida law. See In re A.G. Fin. Serv. Ctr., Inc., 395 F.3d 410, 413 (7th Cir.2005) ("To say that the remand is for a ministerial act is to say that the district judge has fully resolved the litigation: there is no legal decision for a bankruptcy judge to make, no fact to find, no discretion to exercise."). Only then-after the bankruptcy court has made its final ruling, the district court has revisited the case, and a fresh notice of appeal to our court has been filed-can we exercise jurisdiction over the matter. See In re Fox, 762 F.2d 54, 55-56 (7th Cir.1985).

Full post as published by Split Circuits on August 22, 2008 (boomark / email).