Eighth Circuit: Liberal Construction of Bankruptcy Notice of Appeal Requirements

By Alexander Beeby posted 04-08-2020 14:42

Contributing Editor: Kenneth M. McGurran, Winthrop & Weinstine

In Briggs v. Rendlen (In re Reed), 943 F.3d 849 (8th Cir. 2019), the Eighth Circuit held as valid a local bankruptcy rule in Missouri requiring a separate notice of appeal and a separate filing fee for each order being appealed, but also held that noncompliance should not have resulted in automatic dismissal.

An attorney was sanctioned and banned from practicing before the bankruptcy court for six months. A few years later, the attorney filed two motions relating to this ban, both of which were denied. The attorney timely filed a single notice of appeal to the district court challenging the two orders and paid a single filing fee. The district court entered an order striking the notice of appeal because it did not comply with Eastern District of Missouri Local Bankruptcy Rule 8001(A), which requires separate notices of appeal and filing fees for each order. After the district court denied the attorney’s motion to reconsider and vacate the order striking his notice of appeal, the attorney timely filed a notice of appeal, arguing that the local rule is invalid, or, alternatively, that the district court erred in treating the rule as jurisdictional.

After determining that the order striking the notice of appeal was final and appealable, the Eighth Circuit considered the validity of Local Bankruptcy Rule 8001(A). Federal Rule of Bankruptcy Procedure 9029(a)(1) expressly permits bankruptcy courts to adopt local rules of procedure as long as they are consistent with the federal rules. Federal Rule of Bankruptcy Procedure 8003(a)(3) is silent as to a party’s right to appeal multiple orders with a single notice of appeal. The court found that, while Local Bankruptcy Rule 8001(A) is “more specific than the related federal rules,” it is “not inconsistent with any of them,” and accordingly rejected the argument that the Local Rule is invalid.

Next, the Eighth Circuit considered Supreme Court decisions instructing courts to “liberally construe rules governing notices of appeal and avoid treating imperfections in notices of appeal as fatal” as long as the notices provide certain information. Smith v. Barry, 502 U.S. 244, 247–48 (1992); Becker v. Montgomery, 532 U.S. 757, 759 (2001). Because the attorney’s notice of appeal “undoubtedly provided the necessary information,” namely “who was appealing, from what judgment, and to which appellate court the appeal was directed[,]” the court held that the notice’s imperfection was not fatal. Likewise, the court held that the failure to pay the required fee did not render the notice of appeal ineffective, and that the attorney should have had an opportunity to cure the defect. Parissi v. Telechron, Inc., 349 U.S. 46, 46–47 (1955); B.J. McAdams, Inc. v. I.C.C., 551 F.2d 1112, 1115 n.3 (8th Cir. 1977).  The Eighth Circuit held that an appeal from a bankruptcy order “shall be taken in the same manner as appeals in civil proceedings generally are taken to the courts of appeals from the district courts[.]” Accordingly, the court held it would “apply the same liberal construction of the notice requirements in civil proceedings to bankruptcy appeals” and remanded the case.

Editors in Chief