Thompson v. West (Lawyers Weekly No. 13-03-0986, 12 pp.) (William L. Osteen Jr., J.) 1:12-cv-00380; M.D.N.C.
Holding: The appellants argue that the guardian of their sister’s estate, who is not related to their sister, lacked the authority to file a bankruptcy petition on their sister’s behalf; however, the appellants’ status as siblings does not give them standing to intervene in their sister’s bankruptcy case.
The court affirms the bankruptcy court’s order denying the appellants’ motions to intervene, to dismiss the voluntary bankruptcy petition, and to stay the sale of certain assets.
On April 4, 2007, the debtor’s niece petitioned for adjudication of incompetence and applied for appointment of guardian in Forsyth County. The debtor was adjudicated incompetent, but the parties dispute the date of adjudication. The court clerk’s notes indicate that the debtor was adjudicated incompetent on April 26 and that the parties agreed that a disinterested person should be appointed guardian.
On May 1, 2007, the superior court appointed an unrelated person as guardian of the debtor’s estate. The clerk issued the formal incompetency order on May 3, but the letters of appointment list April 26 as the date of adjudication. Under N.C. law, an incompetence order may be first appealed to superior court and then to the Court of Appeals. There is no evidence that the May 3 order was ever appealed. On Sept. 11, 2011, the appointed guardian filed a voluntary bankruptcy petition on behalf of the debtor.
The appellants fail to address the bankruptcy court’s finding that they did not have standing to pursue their motions. Appellants have presented no evidence of any interest they may have in their sister’s bankruptcy estate other than as presumptive heirs under N.C. law.
Appellants’ status as siblings and presumptive heirs of the debtor is insufficient to confer standing. Furthermore, those seeking to appeal from a bankruptcy court’s order do not have standing unless they have been directly and adversely affected pecuniarily by the order.
The bankruptcy court also correctly found that appellant’s arguments are barred by the Rooker-Feldman doctrine, as the superior court’s appointment of a guardian was never challenged in state court. Before the bankruptcy court could have granted any of the relief sought by appellants, it would have had to find that the superior court’s appointment of the guardian was improper. Any procedural irregularity resulting from the issuance of the incompetency order two days after the appointment of the guardian is insufficient to set aside or ignore that appointment. Accordingly, the bankruptcy court appropriately determined that it did not have jurisdiction to consider appellants’ arguments related to the incompetency and guardianship proceedings.
The court affirms the bankruptcy court’s order denying motion to dismiss bankruptcy case, motion to intervene, and motion to stay proceedings.