Grimsley v. Owens (In re Owens)

43 B.R. 10
CourtUnited States Bankruptcy Court, S.D. Ohio
DecidedAugust 16, 1984
DocketAdv. No. 1-83-0601; Related No. 1-83-02323
StatusPublished

This text of 43 B.R. 10 (Grimsley v. Owens (In re Owens)) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, S.D. Ohio primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Grimsley v. Owens (In re Owens), 43 B.R. 10 (Ohio 1984).

Opinion

DECISION

BURTON PERLMAN, Bankruptcy Judge.

In this adversary proceeding a claim is asserted against defendant/debtor Thomas L. Owens based upon 11 U.S.C. § 523(a)(6), it being the position of plaintiffs that there is a debt owed them by defendant “for willful and malicious injury by the debtor” to the property of plaintiffs. More specifically, it is the contention of plaintiffs that defendant, who was then in the business of repairing automobiles, willfully and maliciously converted their Corvette which they had turned over to him for repairs. (Title to the vehicle was in the name of plaintiff Roberta S. Grimsley. Roberta Grimsley did not appear at the trial, but rather did her husband Joseph G. Grimsley, Jr., (hereafter “Grimsley”) testify at the trial. Because plaintiffs are resident in Florida it was stipulated between the parties that Roberta Grimsley need not appear at the trial.) The proceeding came on for hearing. The only evidence was the testimony of Grimsley and of Thomas L. Owens. At the conclusion of the evidence we reserved decision.

The facts are essentially undisputed, though the parties draw radically different inferences from the facts. During the period here in question, from March 1981 until the spring of 1983, defendant was engaged in the automobile repair business in a sole proprietorship named Owens Corvette Center, located in Withamsville, Ohio. The proprietorship terminated in bankruptcy on August 1, 1983. In March 1981 Grimsley brought his Corvette to defendant’s premises for repair. The vehicle had been involved in a rear-end collision. With plaintiffs’ consent, the Corvette remained at those premises for some two years. Very extensive restoration was necessitated by the collision. As plaintiffs accumulated funds to pay for work, defendant performed it. Thus, the first thing that was done was in March 1981. It consisted of the installation of a new clip on the car, which connotes extensive body work. Further work was performed on two other occasions. The witnesses could not recall what had happened the second time but the third time, new brakes were installed and a major tune-up was done. The tune-up was in March 1982.

After the tune-up defendant moved the car outside and shortly thereafter the wheels and tires were stolen. Defendant reported the theft and informed plaintiff of it. Defendant had serious and continuing problems with vandalism and theft and kept guard dogs on the premises in an effort to deal with these problems. Defendant was not insured against the loss of the wheels and tires. The car remained on the ground without wheels and tires for an extended period of time, until some time in 1983.

[12]*12Defendant never contacted Grimsley to tell him that the car had disappeared. Grimsley phoned defendant to find out where it was when he discovered that the car was no longer at defendant’s premises. He left messages, but defendant never called him. Defendant testified that he did not call back because he was too busy. In addition, he initially thought that Grimsley might have removed the car himself — that someone was trying to pull something on him.

After discovery of the disappearance of the car, Grimsley called the police department and filed a stolen car report. The police did go out and check the report. No evidence was introduced with respect to the result of that investigation. Defendant on occasion offered to purchase the car from plaintiffs. After the disappearance of the vehicle, defendant did not return the ignition key for the car to plaintiffs.

Based upon the foregoing state of the record, it is the position of plaintiffs that they have carried their burden of showing a willful and malicious conversion by defendant of the vehicle here in question.

We have in prior decisions had occasion to deal with the law relevant to the question which is here presented to us. Thus, in In re Walker, 44 B.R. 1 (Bankr.S.D.Ohio), we said at pp. 2-3:

The applicable statute is 11 U.S.C. § 523(a)(6) which provides:
(a) A discharge under section 727, 1141, or 1328(b) of this title does not discharge an individual debtor from any debt—
* * * sk *
(6) for willful and malicious injury by the debtor to another entity or to the property of another entity:
* * * * * *
Under the Bankruptcy Act, § 17(a)(2) made express reference to willful and malicious conversion as ground for denying discharge of a debt. The word ‘conversion’ is omitted from the successor legislation, that above quoted, but the language ‘willful and malicious injury’ was intended by the Congress to include a willful and malicious conversion. See 3 Collier on Bankruptcy, (15th ed.) ¶ 523.16[3], pp. 523-126 through 523-127.
In a decision under the Bankruptcy Act, In Re Johns, No. B-1-76-2164, slip op. at 6, (Bankr.S.D.Ohio entered Aug. 31, 1977), we said the following:
But even assuming, arguendo, that net proceeds from sale of gasoline in the hands of defendant were plaintiff’s property, we cannot see that there was a willful and malicious conversion thereof, even recognizing as urged by plaintiff that there is no need to prove any animus or actual malice. Not all conversions are willful and malicious, and whether a conversion is to be described as willful and malicious depends on the facts and circumstances of the case. U.S.F. & G. Co. v. Tanner, 279 F.Supp. 396, 400 (D.C.Col.1968); Rees v. Jensen, 170 F.2d 348 (9th Cir.1948); Royal Indemnity Co. v. Sherman, et al., 124 Cal.App.2d 512 [269 P.2d 123] 42 A.L.R.2d 890 (1954). Emphasis supplied.)
This statement is valid under the Bankruptcy Code as well. See generally, In Re Haynes, 19 B.R. 849 9 BCD 226 (Bankr.E.D.Mich.1982); In Re Norton, 21 B.R. 725 (Bankr.W.D.Mo.1982).

Further in In Re Greenwell, Adversary File No. 1-81-0111, Decision entered Dec. 30, 1981 (Bankr.S.D.Ohio) we said the following at pp. 2-3:

The main case applied in the interpretation of the now superseded Bankruptcy Act of § 17(a)(8) was Tinker v. Colwell, 139 [193] U.S. 473 [24 S.Ct. 505, 48 L.Ed. 754] (1902). It is clear that in enacting the Bankruptcy Code, the Congress meant to change the way in which that case was being applied, as may be seen from a review of the legislative history of 11 U.S.C. § 523(a)(6), provided that a debtor ‘for willful and malicious injury by the debtor to another entity or to the [13]*13property of another entity’ was nondis-chargeable. (H.R.8200 95th Cong. 1st Sess. [1977]. The accompanying report (H.R.Rep. No. 595, 95th Cong. 1st Sess. 365 [1977] then elaborated upon this section as follows:
[Paragraph] 6 excepts debt for willful and malicious injury by the debtor to another person or the property of another person, Under this paragraph, ‘willful’ means deliberate or intentional. To the extent that Tinker v. Colwell, 139 [193] U.S.

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Related

Tinker v. Colwell
193 U.S. 473 (Supreme Court, 1904)
Royal Indemnity Co. v. Sherman
269 P.2d 123 (California Court of Appeal, 1954)
Rees v. Jensen
170 F.2d 348 (Ninth Circuit, 1948)
Cadillac Vending Co. v. Haynes (In Re Haynes)
19 B.R. 849 (E.D. Michigan, 1982)
Callahan v. Norton (In Re Norton)
21 B.R. 725 (W.D. Missouri, 1982)
Ford Motor Credit Co. v. Klix (In Re Klix)
23 B.R. 187 (E.D. Michigan, 1982)
United States Fidelity and Guaranty Company v. Tanner
279 F. Supp. 396 (D. Colorado, 1968)

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Bluebook (online)
43 B.R. 10, Counsel Stack Legal Research, https://law.counselstack.com/opinion/grimsley-v-owens-in-re-owens-ohsb-1984.