Sixth Circuit Creates a Split: The 14-Day Deadline for an Appeal Is Not Jurisdictional

Creating a split of circuits, the Sixth Circuit held that the 14-day deadline for filing an appeal from a bankruptcy court’s order is not jurisdictional.

Bankruptcy Rule 8002(a)(1) is nonetheless “mandatory,” the circuit court held. The appeals court therefore dismissed the appeal as “dilatory,” not for lack of jurisdiction.

The facts were routine.

The bankruptcy court entered a lift-stay order on September 12, giving the debtor 14 days to appeal. The deadline was September 26, but the pro se debtor did not file her appeal until October 9. The district court dismissed the appeal for lack of jurisdiction, leading the debtor to appeal a second time.

Writing for the appeals court, Circuit Judge Jeffrey S. Sutton admitted that the Sixth Circuit had held in 1999 and again in 2017 that the deadline for an appeal in Bankruptcy Rule 8002(a)(1) is jurisdictional. He also cited the Third, Fifth, Seventh and Tenth Circuits for likewise holding that the deadline is jurisdictional.

In his eight-page opinion on October 28, Judge Sutton reexamined circuit court authority in light of the Supreme Court’s rulings in Arbaugh and its progeny. Arbaugh v. Y&H Corp., 546 U.S. 500 (2006).

For the unanimous Court in Arbaugh, the late Justice Ruth Bader Ginsburg said that Congress must “clearly state” that a requirement is jurisdictional before courts will treat the deadline as a non-waivable and non-forfeitable jurisdictional imperative. According to Judge Sutton, Justice Ginsburg was bent on limiting the “profligate” and imprecise use of “jurisdiction.” Id. at 510.

Following Arbaugh, Judge Sutton said that the Supreme Court “has treated most of the procedural requirements that have come before it since then as not being jurisdictional in the constitutional sense of the term.” [Emphasis in original.]

Judge Sutton said it was “not . . . a hard principle to apply here.” Deadlines in the Bankruptcy Rules are jurisdictional, he said, “when they implement an appeal deadline created by Congress. Otherwise, they are not. Thus: A bankruptcy appellate deadline is not jurisdictional when Congress did not create it.”

“Under this straightforward principle, Bankruptcy Rule 8002(a)(1)’s appeal deadline falls on the nonjurisdictional side of the line,” Judge Sutton said.

The language of the statute and the rule were crucial in Judge Sutton’s conclusion. 28 U.S.C. § 158(c)(2) provides that bankruptcy appeals “shall be taken in the same manner as appeals in civil proceedings generally are taken to the courts of appeals from the district courts and in the time provided by Rule 8002 of the Bankruptcy Rules.”

Implementing Section 158(c)(2), Bankruptcy Rule 8002(a)(1) requires that “a notice of appeal must be filed with the bankruptcy clerk within 14 days after entry of the judgment, order, or decree being appealed.”

By merely invoking the Bankruptcy Rules, Judge Sutton said that Section 158(c)(2) did “not create a clear jurisdictional limit on federal courts.” He noted that the rules committee had recently changed the deadline from 10 to 14 days.

“All in all,” Judge Sutton held that “Bankruptcy Rule 8002(a)(1)’s 14-day time limit for filing a notice of appeal does not create a jurisdictional imperative.”

Having jurisdiction did not necessarily mean that the debtor could appeal. The words “shall” in Section 158 and “must be” in the rule are “mandatory,” Judge Sutton said. He therefore dismissed the appeal as “dilatory,” not for lack of appellate jurisdiction.

Observations

The opinion by Judge Sutton supports our interpretation of a decision the week before by the Eleventh Circuit in Tufts v. Hay, 19-11496 (11th Cir. Oct. 20, 2020).

We inferred from Tufts that the Eleventh Circuit views the Barton doctrine as a prudential limit, not a jurisdictional bar on a creditor’s ability to sue a retained professional in a bankruptcy case without permission from the bankruptcy court. To read the ABI story, click here.