CA1: bankruptcy automatic stays and stays pending appeal

In Re: Vito Lomagno and Marie Midolo, No. 05-9003.  “The bankruptcy court determined that Salomon Brothers Realty Corp. (“Salomon”) did not violate an automatic stay by foreclosing on the Debtors’ house while the Debtors’ Chapter 13 petition dismissal was on appeal.”  In this case, the Bankruptcy court had dismissed the debtor’s chapter 13 petition (and its automatic stay) on its own motion, and the debtors appealed to the BAP.  The BAP reversed, but while the BAP was considering it, Salomon began foreclosure proceedings.  “The Debtors argued that the BAP’s reversal of the dismissal order reinstated the automatic stay retroactively.”  The petitioners argue that “equity requires that the violation be remedied by retroactive application of the stay.”  While the First acknowledges that Great Pac. Money Mkts., Inc. v. Krueger (In re Krueger), 88 B.R. 238 (B.A.P. 9th Cir. 1988) suggests that there may be due process interests at stake here, because they debtors had the opportunity – but waived it – to pursue a stay pending appeal, they are entitled to no relief.  Moreover, “after their motions before the bankruptcy court and the BAP were denied, however, the Debtors could have sought a writ of mandamus or appealed to this court, but chose not to do so. See Rochman v. Ne. Utils. Serv. Group (In re Pub. Serv. Co. of N.E.), 963 F.2d 469, 472 (1st Cir. 1992).”