                                                            FILED
                                                             DEC 14 2012
 1                                                       SUSAN M SPRAUL, CLERK
                                                           U.S. BKCY. APP. PANEL
                                                           OF THE NINTH CIRCUIT
 2
                     UNITED STATES BANKRUPTCY APPELLATE PANEL
 3
                               OF THE NINTH CIRCUIT
 4
 5   In re:                        )       BAP No.      CC-11-1698-MkBePa
                                   )
 6   GENNADY TIKHONOV and          )       Bk. No.    SV 11–15614-MT
     ALBINA TIKHONOV,              )
 7                                 )
                    Debtors.       )
 8   ______________________________)
                                   )
 9   GENNADY TIKHONOV;             )
     ALBINA TIKHONOV,              )
10                                 )
                    Appellants,    )
11                                 )
     v.                            )       MEMORANDUM*
12                                 )
     THE BANK OF NEW YORK MELLON   )
13   TRUST CO., N.A.,              )
                                   )
14                  Appellee.      )
     ______________________________)
15
                         Submitted Without Oral Argument
16                            on November 15, 2012**
17                          Filed – December 14, 2012
18                Appeal from the United States Bankruptcy Court
                      for the Central District of California
19
               Honorable Maureen Tighe, Bankruptcy Judge, Presiding
20
     Appearances:      Appellants Gennady and Albina Tikhonov pro se on
21                     brief; Bernard J. Kornberg, Adam N. Barasch and
                       Jan T. Chilton of Severson & Werson on brief for
22                     appellee The Bank of New York Mellon Trust Co.,
                       N.A.
23
24
          *
           This disposition is not appropriate for publication.
25   Although it may be cited for whatever persuasive value it may
26   have (see Fed. R. App. P. 32.1), it has no precedential value.
     See 9th Cir. BAP Rule 8013-1.
27
          **
           By order entered October 10, 2012, this appeal was deemed
28   suitable for submission without oral argument.
 1   Before:    MARKELL, BEESLEY*** and PAPPAS, Bankruptcy Judges.
 2
 3                               INTRODUCTION
 4        Gennady and Albina Tikhonov (“Debtors”) appeal from a
 5   bankruptcy court order granting relief from stay under 11 U.S.C.
 6   § 362(d)(1)1 to the Bank of New York Mellon Trust Co., N.A.,
 7   formerly known as the Bank of New York Trust (“BONY”).     We hold
 8   that the appellants lack standing, and thus we DISMISS this
 9   appeal.    Even if the appellants had standing, however, we would
10   AFFIRM.
11                                   FACTS
12   A.   The parties, the debt and the encumbered property
13        The following facts reflect this Panel’s understanding of
14   the key players, the debt incurred and the encumbrances against
15   the relevant parcel of real property:      a single-family residence
16   located in Sherman Oaks, California (“Residence”).     For the most
17   part, we have drawn these facts from the various deeds, notes and
18   other transaction documents offered as exhibits by the parties.
19   Neither party has attempted to challenge the authenticity of
20   these documents, or the propriety of our considering them.      While
21   the parties’ respective statements of fact focus on different
22   parts of the record, neither effectively has challenged the
23
24        ***
            Hon. Bruce T. Beesley, United States Bankruptcy Judge for
     the District of Nevada, sitting by designation.
25
          1
26         Unless specified otherwise, all chapter and section
     references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532, and
27   all “Rule” references are to the Federal Rules of Bankruptcy
     Procedure, Rules 1001-9037. All “Civil Rule” references are to
28   the Federal Rules of Civil Procedure.

                                       2
 1   existence or the basic nature of the real estate and lending
 2   transactions leading up to their dispute.
 3        On or about April 6, 2006, a man named Leonid Ovsovich
 4   (“Ovsovich”) owned the Residence.     On that date, he borrowed
 5   roughly $1 million from Mortgageit, Inc. (“Mortgageit”).     In
 6   exchange for the loan, Ovsovich executed an Adjustable Rate Note
 7   (“Note”) and a Deed of Trust (“First Trust Deed”), both dated
 8   April 6, 2006.
 9        The First Trust Deed was recorded on April 18, 2006, in the
10   Official Records of Los Angeles County, as instrument number
11   XX-XXXXXXX.    The First Trust Deed identified Ovsovich as the
12   borrower, Mortgageit as the lender, and Mortgage Electronic
13   Registration Systems, Inc. or “MERS” as the beneficiary, but
14   “solely as nominee for Lender and Lender’s successors and
15   assigns.”   The First Trust Deed elsewhere reiterated that “MERS
16   is a separate corporation that is acting solely as a nominee for
17   Lender and Lender’s successors and assigns.    MERS is the
18   beneficiary under this Security Instrument.”    Under the First
19   Trust Deed, Ovsovich acknowledged his understanding and
20   agreement, on the one hand, that MERS only held a legal interest
21   to the property described under the First Trust Deed, and on the
22   other hand, that MERS had the right/authority as nominee for the
23   lender and the lender’s successors and assigns to exercise all of
24   their rights and interests under the First Trust Deed, to the
25   extent “necessary to comply with law or custom.”
26        On November 2, 2006, Ovsovich borrowed another $25,000
27   against the Residence, this time from Reliant Group, Inc.
28   (“Reliant”).   In exchange for this loan, Ovsovich executed a

                                       3
 1   promissory note and a Deed of Trust (“Second Trust Deed”), both
 2   dated November 2, 2006.    The Second Trust Deed was recorded on
 3   November 9, 2006, in the Official Records of Los Angeles County,
 4   as instrument number XX-XXXXXXX.
 5           In 2007, Reliant conducted foreclosure proceedings against
 6   the residence, which culminated in a trustee’s sale held on
 7   December 10, 2007, at which the Akselrod Revocable Family Trust
 8   (“Akselrod Family Trust”) was the successful bidder.    That same
 9   day, the trustee under the Second Deed of Trust executed a
10   Trustee’s Deed Upon Sale conveying the Residence to the Akselrod
11   Family Trust.    The Trustee’s Deed Upon Sale was recorded on
12   January 10, 2008, in the Official Records of Los Angeles County,
13   as instrument number 20080057975.
14           In July 2008, one of the Debtors, Albina Tikhonov, purchased
15   the Residence from the Akselrod Family Trust.    In furtherance of
16   this sale, the Akselrod Family Trust executed a Grant Deed in
17   favor of Albina Tikhonov, dated July 2, 2008.    The Grant Deed
18   was recorded on July 9, 2008, in the Official Records of Los
19   Angeles County, as instrument number 20081215761.    In conjunction
20   with this sales transaction, Albina Tikhonov promised to pay the
21   Akselrod Family Trust $100,000 and executed a Deed of Trust
22   (“Third Trust Deed”) dated July 15, 2008, to secure her $100,000
23   debt.    The Third Trust Deed was recorded on July 22, 2008, in the
24   Official Records of Los Angeles County, as instrument number
25   20081303344.
26           Because the Second Trust Deed was junior to the First Trust
27   Deed, the Akselrod Family Trust and its successor in interest,
28   Albina Tikhonov, took title to the the Residence subject to the

                                        4
 1   First Trust Deed.2
 2   B.   The Debtors’ bankruptcy case and BONY’s relief from stay
          motion
 3
 4        The Debtors filed their chapter 13 bankruptcy case in May
 5   2011, and the bankruptcy court entered an order in October 2011
 6   confirming their second amended chapter 13 plan (“Confirmed
 7   Plan”).   The Debtors’ Confirmed Plan did not provide for any
 8   payments to secured creditors.   Moreover, the Confirmed Plan
 9   explicitly provided that the Debtors were immediately and
10   unconditionally surrendering the Residence to the Akselrod Family
11   Trust.    As the Confirmed Plan put it:
12        The Debtor hereby surrenders the following personal or
          real property (Identify property and creditor to which
13        it is surrendered.)
14        Creditor Name:                   Description:
          The Akselrod Family Trust        14713 Valleyheart Dr.
15                                         Sherman Oaks, CA 91403
16   2nd Amended Chapter 13 Plan (July 11, 2011) at p. 7.
17        Notwithstanding the Debtors’ surrender of their interest in
18   the Residence to the Akselrod Family Trust, BONY filed a motion
19   for relief from stay.   In the motion, BONY: (1) asserted that it
20   was the successor to Mortgageit under the First Trust Deed, and
21   (2) sought relief from the stay to permit BONY to pursue
22   foreclosure proceedings against the Residence.    BONY asserted
23
          2
24         See 5 Harry D. Miller and Marvin B. Starr, CAL. REAL ESTATE
     § 11:100 (3d ed. 2009) (stating that the purchaser at a
25   foreclosure sale takes title subject to any senior interests in
26   the foreclosed property, and further stating that “the liens of
     any trust deeds recorded before the foreclosed security remain on
27   the property after the foreclosure sale, and the title of the
     purchaser is subject to the payment of their secured obligations
28   when due.”)

                                       5
 1   that it was entitled to relief from stay under § 362(d)(1), for
 2   cause, because its interest in the residence was not adequately
 3   protected.   According to BONY, the Debtors had not made any
 4   postpetition payments due on the debt secured by the First Trust
 5   Deed, and over $25,000 in accrued postpetition payments had not
 6   been made.   The notice accompanying the motion warned the
 7   Debtors: “If you fail to file a written response to the Motion or
 8   fail to appear at the hearing, the court may treat such failure
 9   as a waiver of your right to oppose the Motion and may grant the
10   requested relief.”   Notice Of Motion And Motion For Relief From
11   The Automatic Stay (Oct. 25, 2011) at p. 2.
12        The Debtors did not file an opposition to BONY’s relief from
13   stay motion.   Instead, the Debtors filed a document entitled:
14   “Debtor’s Objection to Claims of the Bank of New York Mellon
15   Trust Company, National Association FKA the Bank of New York
16   Trust Company, N.A. as Successor to JPMorgan Chase Bank N.A. as
17   Trustee.”    The Debtors also filed a declaration and a memorandum
18   of points and authorities in support of their claim objection
19   (collectively, “Claim Objection Papers”).
20        The Claim Objection Papers are difficult to read at best and
21   incomprehensible at times.   Nonetheless, it seems reasonably
22   clear that the Debtors intended the Claim Objection Papers to be
23   linked to BONY’s relief from stay motion.   While the nature of
24   the intended link is far from clear, the Claim Objection Papers
25   repeatedly reference the relief from stay motion.   Moreover, the
26   November 30, 2011 hearing date for the relief from stay motion is
27   listed on the caption page of each of the Claim Objection Papers.
28        The bankruptcy court held a hearing on the relief from stay

                                       6
 1   motion on November 30, 2011.   Shortly before the hearing, the
 2   bankruptcy court issued a tentative ruling in which it indicated
 3   that it was inclined to grant the relief from stay motion.     The
 4   tentative ruling stated that no opposition had been filed in
 5   response to the motion.   The tentative ruling accepted a $900,000
 6   valuation of the Residence based on the Debtors’ bankruptcy
 7   schedules.   The other facts stated in the tentative ruling appear
 8   to have been drawn from BONY’s motion.    These facts included:
 9   (1) $1,256,638.61 as the amount owed to BONY, (2) the absence of
10   an equity cushion, and (3) Debtors’ negative equity in the
11   Residence in the amount of $356,638.61 ($900,000 value, less
12   underlying debt of $1,256,638.61).    The tentative ruling further
13   specified that attendance at the November 30, 2011 relief from
14   stay hearing was required: “APPEARANCE REQUIRED –    RULING MAY BE
15   MODIFIED AT HEARING.”    Tentative Ruling (Nov. 29, 2011) at p. 1.
16        The hearing on the relief from stay motion was brief.
17   BONY’s counsel appeared telephonically.   No one appeared on
18   behalf of the Debtors.    After BONY indicated that it was prepared
19   to rest on the bankruptcy court’s tentative ruling, the court
20   granted the motion as follows:
21        Okay. There was an objection to your claim filed,
          which is why I thought there might be a Debtor here,
22        but there isn’t, and that was noticed -- I think it
          came in with no date -- for December 13th. So your
23        motion is granted, and we’ll deal with that other
          matter [the claim objection] at that time.
24
25   Hr’g Tr. (Nov. 30, 2011) at 1:8-14.
26        The bankruptcy court entered an order granting the relief
27   from stay motion, and the Debtors timely appealed.
28        While not technically part of the record before the

                                       7
 1   bankruptcy court at the time it ruled on the relief from stay
 2   motion, the bankruptcy court’s January 4, 2012 order overruling
 3   the Debtors’ claim objection arguably gives some insight into the
 4   court’s thought process at the time it ruled on BONY’s relief
 5   from stay motion.3      In the order on the claim objection, the
 6   bankruptcy court acknowledged that it was unclear on the face of
 7   the Claim Objection Papers whether the Debtors had meant to
 8   object to a claim or to oppose BONY’s relief from stay motion.
 9   The court further acknowledged: (1) that BONY had not filed any
10   proof of claim, and (2) that the November 30 hearing date on the
11   relief from stay motion was referenced in the Claim Objection
12   Papers.
13           According to the bankruptcy court, notwithstanding the
14   above-referenced facts, in light of the Debtors’ failure to
15   appear at the relief from stay hearing, it elected to treat the
16   Claim Objection Papers as an objection to claim, and set a
17   continued hearing on the objection to claim for December 13,
18   2011.       When the Debtors also failed to appear at the December 13,
19   2011 hearing on the objection to claim, the court overruled the
20   objection to claim.
21           The debtors never have attempted to explain their absence
22   from the hearings.      Nor have they argued that the bankruptcy
23   court erred in relying on their failure to appear in making its
24   rulings.      Nor have they denied receipt of adequate notice of all
25   relevant documents and proceedings.
26
27
             3
           Our consideration of this post-appeal order does not alter
28   our analysis or the outcome of this appeal.

                                          8
 1                               JURISDICTION
 2        The bankruptcy court had jurisdiction pursuant to 28 U.S.C.
 3   §§ 1334 and 157(b)(2)(G).   We have jurisdiction under 28 U.S.C.
 4   § 158.
 5                                  ISSUES
 6   1.   Do the Debtors have standing to prosecute this appeal?
 7   2.   If the Debtors had standing to appeal, did the bankruptcy
 8        court err when it granted BONY’s motion for relief from the
 9        automatic stay?
10                           STANDARDS OF REVIEW
11        Standing is a legal issue we review de novo. Allen v. U.S.
12   Bank, N.A. (In re Allen), 472 B.R. 559, 565 (9th Cir. BAP 2012)
13   (citing Veal v. Am. Home Mortg. Serv., Inc. (In re Veal),
14   450 B.R. 897, 906, 918 (9th Cir. BAP 2011)).
15        We review an order granting relief from stay for abuse of
16   discretion.   Kronemyer v. Am. Contractors Indem. Co. (In re
17   Kronemyer), 405 B.R. 915, 919 (9th Cir. BAP 2009).     Under the
18   abuse of discretion standard, we apply a two-part test.    First,
19   we consider de novo whether the bankruptcy court identified the
20   correct law to consider in light of the relief requested.    United
21   States v. Hinkson, 585 F.3d 1247, 1262 (9th Cir. 2009) (en banc).
22   Second, we review the bankruptcy court’s factual findings, and
23   its application of those findings to the relevant law, to
24   determine whether they were either “(1) ‘illogical,’
25   (2) ‘implausible,’ or (3) without ‘support in inferences that may
26   be drawn from the facts in the record.’” Id. (quoting Anderson v.
27   City of Bessemer City, N.C., 470 U.S. 564, 577 (1985)).
28

                                      9
 1                                DISCUSSION
 2   A.   The Debtors lack standing to appeal the relief from stay
          order.
 3
 4        Even though neither party raised it, we must satisfy
 5   ourselves that the Debtors have standing to appeal.     Standing is
 6   a threshold issue in all federal cases that must be satisfied
 7   before the court can exercise jurisdiction.     In re Veal, 450 B.R.
 8   at 906 (citing Warth v. Seldin, 422 U.S. 490, 498 (1975)).
 9   Article III of the Constitution requires litigants to demonstrate
10   their standing by showing: injury in fact, causation, and
11   redressability.   Id.
12        We do not doubt here the existence of Article III standing.
13   The order on appeal granted BONY relief from the automatic stay,
14   which in turn permitted BONY to pursue foreclosure proceedings
15   against property listed on the Debtor’s bankruptcy schedules as
16   property of their bankruptcy estate.      In addition, if we were to
17   reverse, that reversal would redress any harm allegedly caused by
18   the order granting relief from the stay.
19        However, in addition to Article III standing, there are a
20   number of prudential limitations on federal court jurisdiction.
21   Whereas Article III standing focuses on whether the court has
22   jurisdiction, prudential standing doctrine focuses on whether the
23   court should exercise that jurisdiction.     See Sprint Commc’ns Co.
24   v. APCC Servs., Inc., 554 U.S. 269, 289 (2008) (stating that
25   prudential standing embodies judicially self-imposed limits on
26   the exercise of jurisdiction).
27        Two aspects of prudential standing doctrine are implicated
28   by the facts of this case.   First, federal courts ordinarily

                                      10
 1   decline to exercise jurisdiction when a party seeks to vindicate
 2   rights belonging to others, rather than their own legal rights.
 3   See Warth, 422 U.S. at 509; In re Veal, 450 B.R. at 906-07.       This
 4   aspect of prudential standing is commonly referred to as third
 5   party standing.    See id.   Second, federal appellate courts
 6   typically decline to exercise jurisdiction over appeals
 7   originating from bankruptcy cases unless the appellant is a
 8   “person aggrieved” – that is, a person who has been “‘directly
 9   and adversely pecuniarily affected’” by the order on appeal.      See
10   Sherman v. SEC (In re Sherman), 491 F.3d 948, 957 n.8 (9th Cir.
11   2007) (quoting Fondiller v. Robertson (In re Fondiller), 707 F.2d
12   441, 442 (9th Cir. 1983)).    The Ninth Circuit has referred to
13   this doctrine as the “prudential appellate standing” doctrine.
14   Id.   We address each of these prudential standing doctrines in
15   turn below.
16         1.   The Debtors lack third party standing.
17         As indicated above, under the third party standing doctrine,
18   litigants generally must assert their own legal rights and not
19   the rights of others.   See Sprint Commc’ns Co. v. APCC Servs.,
20   Inc., 554 U.S. at 289-90.    The problem here with respect to the
21   Debtors’ third party standing arises from their Confirmed Plan.
22   The Confirmed Plan’s terms are binding on the Debtors, as well as
23   their creditors.   § 1327; Enewally v. Wash. Mut. Bank (In re
24   Enewally), 368 F.3d 1165, 1172 (9th Cir. 2004); see also
25   United Student Aid Funds, Inc. v. Espinosa, ––– U.S. –––, 130
26   S.Ct. 1367, 1376 (2010).
27         The Debtors’ Confirmed Plan provides for the Debtors’
28   immediate and unconditional surrender of their interest in the

                                       11
 1   Residence to the Akselrod Family Trust.      As a result of that
 2   surrender, the Debtors do not appear to have retained any
 3   interest in the Residence.4      Consequently, the only party
 4   potentially impacted by BONY’s obtaining relief from stay with
 5   respect to the Residence was the Akselrod Family Trust.         Thus,
 6   the Debtors impermissibly were seeking to enforce the rights of
 7   the Akselrod Family Trust, rather than their own rights.        See
 8   York Int’l Bldg., Inc. v. Chaney (In re York Int’l Bldg., Inc.),
 9   527 F.2d 1061, 1067 (9th Cir. 1975) (applying third party
10   standing doctrine where the debtor and its sole shareholder
11   sought to enforce rights belonging to their creditors).
12           The Debtors’ Confirmed Plan remains in full force and
13   effect.      They have not sought to revoke or amend their Confirmed
14   Plan.       Accordingly, the Debtors lack third party standing to
15   enforce any rights the Akselrod Family Trust may hold with
16   respect to the Residence.
17           2.    The Debtors lack prudential appellate standing.
18           As set forth above, an appellant only has prudential
19
             4
20         This surrender also arguably rendered BONY’s relief from
     stay proceedings moot because the Residence no longer would have
21   qualified as property of the debtor’s bankruptcy estate. See
     §§ 362(c)(1); 541(a)(1). Nonetheless, we decline to decide this
22
     appeal on that basis. Creditors often find it necessary to
23   obtain “comfort orders” before they effectively can proceed
     against property that used to be estate property. To deny relief
24   from stay on mootness grounds in these situations would deprive
     the creditors of any certainty as to the status of the debtors’
25   property and former property, exposing them to the risk of
26   contempt proceedings should they wrongly interpret the status of
     that property. Furthermore, third parties on whom the creditor
27   may rely to facilitate the enforcement of their rights against
     such property sometimes refuse to act unless the creditor first
28   obtains a comfort order.

                                         12
 1   appellate standing if it is a person aggrieved, and an appellant
 2   only qualifies as a person aggrieved if it has been directly and
 3   adversely affected pecuniarily by the order on appeal.    But there
 4   are two additional requirements to qualify as a person aggrieved.
 5   Provided that the appellant had adequate notice of the bankruptcy
 6   court proceedings, the appellant is not a person aggrieved unless
 7   he or she: (1) objected to the request for relief leading to the
 8   order appealed, and (2) appeared at the hearing on the requested
 9   relief.   See Brady v. Andrew (In re Commercial W. Fin. Corp.),
10   761 F.2d 1329, 1335 (9th Cir. 1985); see also Weston v. Mann
11   (In re Weston), 18 F.3d 860, 864 (10th Cir. 1994) (creditors
12   lacked standing to appeal bankruptcy court’s order resolving
13   trustee election because they did not participate in resolution
14   of disputed election).   These two elements of the person
15   aggrieved test are founded on “the need for economy and
16   efficiency in the bankruptcy system.”   In re Ray, 597 F.3d 871,
17   874 (7th Cir. 2010) (citing In re Commercial W. Fin. Corp.,
18   761 F.2d at 1335).
19        Furthermore, the requirements of attendance at and objection
20   in the bankruptcy court proceedings ensures that “the bankruptcy
21   court is made aware of all available evidence and objections when
22   making its determination . . . and prevent[s] a party in interest
23   from ‘lying in the weeds’ during bankruptcy court proceedings
24   . . . only to appeal and generate additional unnecessary
25   proceedings.”   White v. Virginia (In re Urban Broad. Corp.),
26   304 B.R. 263, 272 (E.D. Va. 2004) aff’d on other grounds,
27   401 F.3d 236, 244 (4th Cir. 2005) (non-participation is an issue
28   of waiver not standing).

                                     13
 1           Here, the Debtors have failed to satisfy two of the
 2   prudential appellate standing requirements.    For the same reasons
 3   that we held above that the Debtors’ lacked third party standing,
 4   the Debtors also cannot show that they have been directly and
 5   adversely affected pecuniarily by the order on appeal.    Pursuant
 6   to the Confirmed Plan’s terms, the Debtors no longer have any
 7   interest in the Residence.    Consequently, the relief from stay
 8   order permitting BONY to foreclose on the Residence could not
 9   have affected the Debtors in any meaningful way.
10           Moreover, all of the types of harm associated with non-
11   appearance alluded to in Urban Broad. Corp., above, occurred
12   here.    The Debtors’ failure to appear at the hearing and explain
13   their intentions with respect to their difficult-to-understand
14   Claim Objection Papers left the bankruptcy court in the
15   unenviable position of attempting to ascertain from the face of
16   those papers what the Debtors had intended without their
17   participation and assistance.    In addition, their failure to
18   appear directly resulted in the bankruptcy court not addressing
19   their Claim Objection Papers in the context of the relief from
20   stay proceedings, which in turn has spawned the current appeal,
21   as well as the potential for post-appeal proceedings.
22           In sum, given that we cannot ascertain any impact on the
23   Debtors arising from the relief from stay order, and given their
24   failure to attend the relief from stay hearing, we hold that the
25   Debtors lacked prudential appellate standing.
26   B.      Even if the Debtors had standing, the bankruptcy court did
             not abuse its discretion in granting relief from stay.
27
28           In addressing the issues raised by the Debtors’ pro se

                                       14
 1   appeal brief, we are cognizant of our duty to interpret their
 2   brief liberally and to ensure that their substantive contentions
 3   are not deemed waived simply as a result of their failure to
 4   comply with mere technical procedural requirements or their
 5   inability to state their contentions using formal legal
 6   terminology.      See Balistreri v. Pacifica Police Dep’t, 901 F.2d
 7   696, 699 (9th Cir. 1990).
 8           Nonetheless, having carefully reviewed their appeal brief,
 9   we are convinced that their various arguments challenging the
10   order on appeal all boil down to a single relevant assertion:
11   that BONY lacked standing as the “real party in interest” under
12   Civil Rule 17(a)(1) to seek relief from stay in their bankruptcy
13   case.       The Debtors have advanced numerous theories why BONY
14   lacked standing.      Some of their theories are plausible while
15   others are patently meritless or incomprehensible.      However,
16   their critical theories attacked BONY’s contention that it is the
17   holder of the Note and hence had standing as the party entitled
18   to enforce the Note under governing commercial law statutes.5
19   According to the Debtors, BONY is not the party entitled to
20   enforce the note and consequently lacked standing.      But we
21
22           5
           The parties to this appeal seem to agree that California
23   law should be applied to resolve their dispute. Given that the
     Note is silent, that the Debtors reside in California and that
24   Osovich executed the Note and the First Trust Deed in California,
     we agree. See Cal. Com. Code § 1301(b); see also Barclays
25   Discount Bank Ltd. v. Levy, 743 F.2d 722, 724–25 (9th Cir. 1984).
26   Nonetheless, for ease of reference, we will cite the Uniform
     Commercial Code (“UCC”) in support of our commercial law
27   analysis. Unless otherwise noted, the relevant provisions of
     California’s version of the UCC do not materially diverge from
28   their UCC cognates.

                                         15
 1   disagree with the Debtors.   For purposes of BONY’s relief from
 2   stay motion, BONY sufficiently established its standing as the
 3   party entitled to enforce the Note by presenting to the
 4   bankruptcy court a copy of the Note and an allonge, which
 5   together contained an unbroken chain of special indorsements; the
 6   last indorsement in this chain named BONY as payee.    We explain
 7   immediately below why the Note and the allonge are sufficient to
 8   resolve this standing issue in BONY’s favor.6
 9        As a preliminary matter, we note the limited scope of stay
10   relief proceedings.   Such proceedings are summary in nature and
11   limited to determining whether there are “sufficient
12   countervailing equities to release an individual creditor from
13   the collective stay.” In re Veal, 450 B.R. at 914.     Thus, a
14   relief from stay proceeding is not an appropriate vehicle for
15   finally and definitively determining a creditor’s claim or
16   security.   Id.; see also Johnson v. Righetti (In re Johnson),
17   756 F.2d 738, 740 (9th Cir. 1985) (“Hearings on relief from the
18   automatic stay are thus handled in a summary fashion.    The
19   validity of the claim or contract underlying the claim is not
20   litigated during the hearing.” (citations omitted)).
21        Because stay relief is limited in nature, is subject to an
22
23
          6
           Arguably, the Debtors did not adequately present their
24   standing argument in the bankruptcy court because they did not
     file an explicit objection to BONY’s relief from stay motion and
25   because they did not appear for the relief from stay hearing.
26   Nonetheless, we will exercise our discretion to examine the
     Debtors’ standing argument. See City of Los Angeles v. County of
27   Kern, 581 F.3d 841, 846 (9th Cir. 2009) (holding that appellate
     court may consider, but was not required to consider, unpreserved
28   prudential-standing argument).

                                     16
 1   expedited hearing process, see § 362(e), and does not finally
 2   adjudicate the parties’ rights and liabilities, a party seeking
 3   stay relief only needs to establish that it has a “colorable
 4   claim” against property of the estate.     Veal, 450 B.R. at 914–15
 5   (citing United States v. Gould (In re Gould), 401 B.R. 415, 425
 6   n.14 (9th Cir. BAP 2009); Biggs v. Stovin (In re Luz Int’l,
 7   Ltd.), 219 B.R. 837, 842 (9th Cir. BAP 1998); Grella v. Salem
 8   Five Cent Sav. Bank, 42 F.3d 26, 32 (1st Cir. 1994)).
 9        At its heart, the Debtors’ standing argument questions
10   BONY’s third party standing.   As we explained above, in order to
11   establish third party standing, BONY needed to establish that it
12   was asserting its own legal rights and not the rights of others.
13   See Sprint Commc’ns Co. v. APCC Servs., Inc., 554 U.S. at 289-90.
14        Under § 362(d), any “party in interest” can request relief
15   from the automatic stay.   But the term “party in interest” is not
16   defined in the Bankruptcy Code.    Whether a moving party qualifies
17   as a party in interest under § 362(d) is determined on a
18   case-by-case basis, taking into account the movant’s claimed
19   interest and the alleged impact of the stay on that interest.
20   In re Kronemyer, 405 B.R. at 919.      A “party in interest” includes
21   any party that has “an actual pecuniary interest” in the matter
22   or “a practical stake” in its outcome.     Brown v. Sobczak (In re
23   Sobczak), 369 B.R. 512, 517–18 (9th Cir. BAP 2007).
24        As indicated in Veal, a creditor can establish that it is a
25   “party in interest” with standing to seek relief from stay by
26   showing that it is a person entitled to enforce the note, or that
27   it holds some ownership or other interest in the note amounting
28   to a colorable claim.   Id. at 917 (citing In re Hwang, 438 B.R.

                                       17
 1   661, 665 (C.D. Cal. 2010)).
 2        In relevant part, a party is a person entitled to enforce
 3   the note if it is a “holder” of the note, as defined in UCC
 4   § 1-201(b)(21)(A).   In re Veal, 450 B.R. at 910-11.   A “holder”
 5   includes a “person in possession of a negotiable instrument that
 6   is payable . . . to an identified person that is the person in
 7   possession.”   UCC § 1-201(b)(21)(A); see also In re Veal,
 8   450 B.R. at 911.   In turn, a negotiable instrument has been made
 9   payable to an identified person when it contains a “special
10   indorsement” specifying that the instrument is payable to that
11   identified person.   See UCC § 3-205(a).
12        Here, the face of the Note reflects that Mortgageit, the
13   original payee under the Note, indorsed it by making it payable
14   to an entity called Residential Funding Corp. (“RFC”).7   In turn,
15   RFC specially indorsed the Note by making it payable to JP Morgan
16   Chase Bank, as Trustee (“Chase”).8   Finally, on the face of the
17   allonge, BONY as Chase’s successor essentially specially indorsed
18
19
20
          7
           BONY has claimed that Mortgageit endorsed the Note in
21   blank. Even if that is true, it appears from the indorsements on
22   the face of the Note that RFC converted Mortgageit’s indorsement
     into a special indorsement. See UCC § 3-205(c) (“The holder may
23   convert a blank indorsement that consists only of a signature
     into a special indorsement by writing, above the signature of the
24   indorser, words identifying the person to whom the instrument is
     made payable.”)
25
          8
26         UCC § 3-110(c)(2)(i) provides in relevant part that, for
     purposes of determining who is the holder of an instrument, an
27   instrument that is payable to a person described as a trustee is
     payable to that trustee, regardless of whether the beneficiary of
28   the trust is named.

                                     18
 1   the Note to itself.9
 2        Importantly, we have not been able to locate anything in the
 3   Debtors’ Claim Objection Papers or in their brief on appeal
 4   suggesting in any way that they challenged the effectiveness of
 5    any of these indorsements or the validity of the allonge.10     Nor
 6   did they dispute that BONY was Chase’s successor.     Indeed, all of
 7   Debtors’ papers repeatedly referred to BONY as Chase’s successor.
 8   BONY attached to its relief from stay motion the declaration of
 9   John Castagna (“Castagna”), who declared that he was an employee
10   of BONY’s servicing agent GMAC Mortgage, LLC, and a custodian of
11   records for BONY pertaining to documents concerning the loan
12   transaction from which the Note and the First Trust Deed
13   originated.     Castagna further declared that BONY was the current
14   holder of the Note, and he attached to his declaration as
15   exhibits a copy of the Note and the accompanying allonge in
16   support of this contention.11     Under the particular circumstances
17
          9
18         See UCC § 3-204(d) (“If an instrument is payable to a
     holder under a name that is not the name of the holder,
19   indorsement may be made by the holder in the name stated in the
     instrument or in the holder’s name or both, but signature in both
20   names may be required by a person paying or taking the instrument
     for value or collection.”)
21
          10
22         At pages 28 through 30 of their opening appeal brief, the
     Debtors do discuss the requirements for indorsement of negotiable
23   instruments, citing California’s versions of UCC §§ 3-201, 3-203
     and 3-204. But they never claim there or elsewhere in their
24   brief that there was anything wrong with the Mortgageit
     indorsement, the RFC indorsement or the Chase indorsement.
25   Instead, in an inexplicable non sequitur, they claim that the
26   allegedly fraudulent conduct of Executive Trustee Services
     prevented any proper negotiation of the Note.
27
          11
               The Debtors did not raise any question, let alone a
28                                                          (continued...)

                                        19
 1   of this matter as described above, Castagna’s declaration and the
 2   attached exhibits were sufficient to establish BONY’s status as
 3   the current holder of the Note, as the person entitled to enforce
 4   the Note, and as a party with standing to seek relief from
 5   stay.12
 6        We once again acknowledge the duty that all federal courts
 7   have “to ensure that pro se litigants do not lose their right to
 8
 9        11
           (...continued)
     genuine question, regarding the authenticity of the original Note
10   BONY claimed to hold. Nor did they assert any evidentiary
11   objection based on Fed. R. Evid. 1002 to the copy of the Note
     attached as an exhibit to Castagna’s declaration. Accordingly,
12   BONY was not required to produce in court the original Note in
     order to substantiate their status as a holder of the Note for
13   purposes of the relief from stay proceedings. At pages 26 and 27
     of their appeal brief, the Debtors did complain about a
14   promissory note, but it is reasonably clear that Debtors were not
15   complaining about BONY’s Note – the Note securing the First Trust
     Deed. Rather, it appears that they were complaining about the
16   promissory note that Albina Tikhonov executed and made payable to
     the Akselrod Family Trust, which was secured by the Third Trust
17   Deed.
18        12
           Because we have concluded that BONY had standing as the
19   holder of the Note, we need not determine whether BONY also held
     the beneficial interest in the First Trust Deed. In any event,
20   the beneficial interest in a deed of trust follows the note. See
     Cal. Civ. Code § 2936 (“The assignment of a debt secured by
21   mortgage carries with it the security.”); Cockerell v. Title Ins.
     & Trust Co., 42 Cal. 2d 284, 291, 267 P.2d 16, 20 (Cal. 1954)
22
     (“Assuming for the moment that the assignment of the note,
23   secured by the third trust deed, was a valid assignment, no
     further assignment of the deed of trust was necessary.”); see
24   also Carpenter v. Longan, 83 U.S. 271, 275 (1872) (“The transfer
     of the note carries with it the security, without any formal
25   assignment or delivery, or even mention of the latter.”); UCC
26   § 9-203(g) (“The attachment of a security interest in a right to
     payment or performance secured by a security interest or other
27   lien on personal or real property is also attachment of a
     security interest in the security interest, mortgage, or other
28   lien.”)

                                    20
 1   a hearing on the merits of their claim [or defense] due to
 2   ignorance of technical procedural requirements.”   Balistreri,
 3   901 F.2d at 699.   Nonetheless, this duty has its limits.   Neither
 4   this Panel nor the bankruptcy court are required to ferret out
 5   and substantiate arguments on behalf of pro se parties when the
 6   parties make no attempt to assert these arguments.   See DeBuono
 7   v. Fanelli (In re Fanelli), 263 B.R. 50, 62 (Bankr. N.D.N.Y.
 8   2001).   In other words, the requirement of stating a valid,
 9   comprehensible claim or defense is not a “technical procedural
10   requirement” that a pro se party can be excused from.   See
11   Victery v. Arizona, 2011 WL 2940763, at *4 (D. Ariz. 2011).
12   Here, the Debtors simply did not make any challenge to the
13   authenticity of the Note or the accompanying allonge.   Nor did
14   they challenge the indorsements on either of these documents.
15   Consequently, the presentation of evidence that BONY made in
16   conjunction with its relief from stay motion was sufficient to
17   establish its standing to seek relief from stay.
18                               CONCLUSION
19        For all of the reasons set forth above, we hold that the
20   appellants lack standing, and thus we DISMISS this appeal.     Even
21   if the appellants had standing, however, we would AFFIRM.
22
23
24
25
26
27
28

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