Plaintiff insurance company filed a nondischargeability action under 11 U.S.C. §523(a)(6) to except a California state court default judgment from the debtor's discharge. The debtor admitted she intentionally started a fire in the home of the plaintiff's insured but claimed her intent was limited to a desire to burn shirts hanging in a closet, not to destroy the entire home. The debtor further defended her actions by claiming she was not able to foresee the potential and likely consequences of her conduct due to a mental defect or illness from which she suffered at the time she started the fire. The plaintiff filed a summary judgment motion claiming the debtor's admission of intent to start the fire and application of collateral estoppel to the previously obtained default judgment left no material issue of fact to be determined at trial. The court granted summary judgment and determined California's collateral estoppel doctrine applies to default judgments and barred the debtor from presenting new defenses not raised in the state court litigation. The court also found that even absent the application of collateral estoppel, the debtor's admission of intentionally igniting a fire to the plaintiff's insured's property amounts to a willful and malicious injury to the plaintiff and the defendant did not offer any evidence to support a defense of mental impairment.
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Title: State Farm Fire and Casualty Company v. Edie (In re Edie) | Date: Sep-7-2004 | Status: PUBLISHED (Judge Boulden) | Case(s): 03-2449
Title: In re Cluff, In re Medina | Date: Aug-23-2004 | Status: PUBLISHED (Judge Boulden) | Case(s): 03-32779, 03-39152
The Debtors sought disallowance of certain unsecured claims because creditors failed to attach sufficient documentation under Bankruptcy Rule 3001(c). The Court overruled the Debtors' objections because (1) Bankruptcy Rule 3001(c) does not create an independent ground to disallow claims; (2) failure to comply with the documentation requirements in Bankruptcy Rule 3001(c) is an evidentiary defect that only deprives a claim of its prima facie validity; and (3) failure to comply with Bankruptcy Rule 3001(c) merely results in the claimant having the burden of proof if an objection to the claim is filed, but that objection must meet or surpass the evidence set forth in the claim. The Debtors' objections were found insufficient because many of the claims were entitled to prima facie validity and the Debtors did not rebut that presumption with sufficient evidence. The Debtors' objections to proofs of claim not entitled to prima facie validity were overruled because the Debtors did not come forward with any evidence that was of equal force to that contained in the claim to rebut the allegations made in the proofs of claim.
Title: In re GloBill.com | Date: Aug-18-2004 | Status: UNPUBLISHED (Judge Boulden) | Case(s): 04-26754
A motion to dismiss or suspend case under 11 U.S.C. §305(a)(1) was filed by parties claiming ownership and/or control of the debtor. The moving parties raised the question of whether or not the filing of the debtor's petition by the person allegedly in control of the debtor at the time of filing, was authorized. The questions of control and ownership of the debtor were the subject of extensive litigation which was being pursued prior to filing in California litigation. The court determined it was in the best interest of the creditors of the estate and the debtor to dismiss the case pursuant to §305.
Title: In re Bushman | Date: Jun-10-2004 | Status: UNPUBLISHED (Judge Boulden) | Case(s): 01-26116
The debtors filed a motion for partial reconsideration to reopen a sanctions hearing to present evidence regarding actual and punitive damages that was not presented in a prior sanctions hearing. The court determined that the debtors' failure to present evidence regarding damages at the sanctions hearing was not due to mistake or inadvertence or any other reason allowed under Federal Rule Civil Procedure 60(b) but was part of counsel's calculated litigation strategy and the motion for reconsideration was denied.
Title: Quality Press v. Heidelberg Print Finance Americas (In re Quality Press) | Date: Apr-28-2004 | Status: UNPUBLISHED (Judge Thurman) | Case(s): 03-2446
The Court granted summary judgment in favor of creditor Heidelberg against the Debtor, Quality Press. A Chapter 11 Plan had been confirmed for the same Debtor in 1994, granting Heidelberg secured creditor status. Heidelberg's financing statement lapsed years later and subsequently it filed a new financing statement. Thereafter, the Debtor filed the current bankruptcy case. The Debtor challenged the effectiveness of Heidelberg's lien under several theories. The Court determined that the filing of the new financing statement without the signature of the Debtor following the lapse was allowed under 70A-9a-509 of the Revised Utah Article 9. The Court next determined that the description of the collateral in the new financing statement as "All of Debtor's Equipment" adequately described the several pieces of printing equipment secured in favor of the creditor and that such was not seriously misleading or overbroad. The Court also determined that the "plain meaning" of the 1994 Plan did not enjoin Heidelberg from filing the financing statement after the earlier statement had lapsed. Finally, the Court determined that the Heidelberg's §1111(b) election in the prior bankruptcy did not bar it from the possibility of seeking a deficiency in the current case.
Title: In re Leigh | Date: Apr-27-2004 | Status: UNPUBLISHED (Judge Thurman) | Case(s): 03-33764
At a confirmation hearing on debtor's chapter 13 plan, the court asked the trustee to submit a memorandum regarding treatment of a tax refund received by debtors, which was at least partially attributable to the Earned Income Credit. Debtors were directed to respond to trustee's memorandum once it was filed, which they failed to do. The court ruled that tax refunds must be disclosed by debtors to the chapter 13 trustee and included as projected disposable income in their plan, even where some portion of the refund is attributable to EIC. The court concluded that debtors' failure to do so meant that their plan failed to comply with 11 U.S.C. § 1322(b)(1), and could not be confirmed.
Title: In re Leigh | Date: Apr-27-2004 | Status: UNPUBLISHED See 454a.pdf (Judge Thurman) | Case(s): 03-33764
This decision was inadvertantly filed out of order. See 454a.pdf for summary.
Title: In re Harmsen | Date: Apr-13-2004 | Status: UNPUBLISHED (Judge Boulden) | Case(s): 03-33637
One of the debtor's creditors filed an involuntary chapter 7 petition against him as a single petitioning creditor under 11 U.S.C. §303(b)(2) seeking adjudication in an attempt to collect upon a foreign judgment. The debtor responded to the involuntary petition claiming he had more than eleven holders of claims and the involuntary petition filed by a single petitioner was therefore improper. The petitioning creditor challenged whether the alleged debtor's listed holders of claims were eligible under §303, asserting some entities could not be counted because they were insiders or subject to voidable transfers under §§547, 548, or 549. The court found it unnecessary to reach the determination of the required number of qualifying petitioners because the petitioner could not prove that the alleged debtor was not generally paying his debts as they became due and dismissed the petition.
Title: Troff v. State of Utah (In re Troff) | Date: Mar-8-2004 | Status: UNPUBLISHED (Judge Clark) | Case(s): 04-2491
Debtor brought an adversary seeking a ruling that a state court restitution order was discharged in the debtor's Chapter 7 bankruptcy proceeding. In 1997, the Debtor was ordered to pay $239,969 in restitution by the Third District Court for the State of Utah. When debtor filed for Chapter 7 relief, the debtor properly listed the State of Utah in his schedules and statements and received a Chapter 7 discharge. It was uncontested that all restitution payments received by the State were turned over to the victim of the crime. The Court found that under § 523(a)(7), because the restitution payments were turned over to the victim, the restitution payments were not to and for the benefit of a governmental unit and because the restitution payments were compensatory for actual pecuniary loss, the state ordered restitution was discharged in debtor's Chapter 7 bankruptcy.
Title: Troff v. State of Utah (In re Troff) | Date: Mar-8-2004 | Status: UNPUBLISHED See 452a.pdf (Judge Clark) | Case(s): 04-2491
This decision was inadvertantly filed out of order. See 452a.pdf for summary.