In Re Newman

196 B.R. 700, 35 Collier Bankr. Cas. 2d 1630, 1996 Bankr. LEXIS 661, 1996 WL 324466
CourtUnited States Bankruptcy Court, S.D. New York
DecidedJune 12, 1996
Docket19-10089
StatusPublished
Cited by22 cases

This text of 196 B.R. 700 (In Re Newman) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In Re Newman, 196 B.R. 700, 35 Collier Bankr. Cas. 2d 1630, 1996 Bankr. LEXIS 661, 1996 WL 324466 (N.Y. 1996).

Opinion

DECISION ON MOTION FOR RELIEF FROM THE AUTOMATIC STAY

JEFFRY H. GALLET, Bankruptcy Judge.

Tammy Newman, a creditor and the former spouse of this chapter 7 debtor, moves for relief from the automatic stay so that she may enforce a prepetition order for child support and maintenance and a prepetition judgment for child and spousal support and legal fees out of the debtor’s postpetition assets. She also seeks to pursue an application in state court to hold the debtor in criminal contempt.

The Chapter 7 Trustee does not object to my granting the relief requested. The debt- or does.

BACKGROUND

The Newmans entered into a separation agreement on April 25, 1981, which was incorporated, but not merged, into a judgment of divorce that year. The debtor failed to pay child support and spousal maintenance, as required. Indeed, this debtor seems to have a long and inglorious history of nonpayment of support obligations.

Ms. Newman commenced a proceeding to collect arrears in the New York State Supreme Court, which culminated in a judgment being entered against the debtor, on his consent, in the amount of $148,752.56 for child support and spousal maintenance, plus $3,850 in attorneys fees, for a total of $152,-602.56, on October 18, 1995. There have ■been no payments to reduce the judgment.

Subsequent to the entry of the judgment, and to date, Mr. Newman has been obligated to make support and maintenance payments. He has failed to do so, both before and after the filing of his bankruptcy petition.

The debtor opposes Ms. Newman’s motion arguing that relief from the stay is premature and harmful to other creditors. He offers neither legal nor factual support for that argument. Neither the trustee nor any other creditor has joined Mr. Newman in his objection, although 21 creditors received notice of Ms. Newman’s motion.

He further argues that since she is asking for relief from the automatic stay, Ms. Newman must intend to pursue estate assets. He offers no further support for that position. Ms. Newman has indicated that she intends to pursue his postpetition income, as identified in the schedule Mr. Newman filed with this court.

Finally, Mr. Newman argues that the legal fees portion of the judgment, awarded to Polstein Ferrara & Dwyer, P.C., is dis-chargeable. Polstein Ferrara & Dwyer, P.C. has not moved for relief from the stay, although it has commenced an adversary proceeding to declare legal fees nondischargeable on the grounds that they were “incurred ... in connection with the obtaining of child support and spousal maintenance.”

DISCUSSION

This long-running matrimonial dispute has found its way from the state courts to the federal courts. Before going further, I must consider the role of the federal courts in family law matters such as these.

Federal courts should avoid deciding family law matters wherever possible. Carver v. Carver, 954 F.2d 1573 (11th Cir.1992), cert. den., 506 U.S. 986, 113 S.Ct. 496, 121 L.Ed.2d 434 (1992).

[Tjhere is a danger that bankruptcy will be used as a weapon in an ongoing battle between former spouses over the issues of alimony and child support or as a shield to avoid family obligations. It is important that the bankruptcy code ... not be used *703 to deprive dependents, even if only temporarily, of the necessities of life.

Id. at 1579 (quoting Caswell v. Lang, 757 F.2d 608, 610 (4th Cir.1985)).

In addition, Federal courts recognize the special expertise of state courts in domestic relations matters. Hisquierdo v. Hisquierdo, 439 U.S. 572, 99 S.Ct. 802, 59 L.Ed.2d 1 (1979); Robbins v. Robbins, 964 F.2d 342 (4th Cir.1992). Accordingly, bankruptcy courts will generally defer to state courts in the interest of judicial economy and restraint and out of respect for the state courts’ expertise in domestic relations issues. In re Wright, 184 B.R. 318 (Bankr.N.D.Ill.1995).

The thread running through the recent bankruptcy court decisions is best summed up in In re Sinewitz, 166 B.R. 786 (Bankr.D.Mass.1994), where the court declared:

The United States Bankruptcy Court is not a sanctuary for the avoidance of child support obligations. Nor will the Court allow itself to be used as a tool to evade ... [state court] child support orders by: (1) serving as a de novo appellate court to review the extent or timing of payment of those nondischargeable obligations, or (2) diluting their efficacy by discharging attorney’s fees necessitated by the enforcement of ... [state court] child support orders.

Id. at 789.

The bankruptcy courts will not entertain cases filed primarily as litigation tactics by spouses engaged in “scorched earth” legal wars. In re Purpura, 170 B.R. 202 (Bankr.E.D.N.Y.1994).

THE LAW

THE AUTOMATIC STAY

The mere filing of a petition in bankruptcy, -without any further action by the Bankruptcy Court or the debtor, stays the commencement or continuation of any state or federal litigation, including appeals, against the debtor, including those exempted from discharge, based on a cause of action which arose prior to the filing of the bankruptcy, other than those specifically excepted by statute. 11 U.S.C. 362(a)(1); In re Montana, 185 B.R. 650 (Bankr.S.D.Fla.1995).

The Bankruptcy Code exempts several types of • actions from the automatic stay. Among them are-actions or proceedings to establish or modify an order for support and to collect support from property which is not part of a debtor’s estate. 11 U.S.C. § 362(b)(2)(A), (B); In re Campbell, 185 B.R. 628 (Bankr.S.D.Fla.1995).

Once a debt is found to be nondis-chargeable as support arrears, the debt is no longer subject to the automatic stay. However, the amount of the arrears and the enforcement of any support judgment, is within the jurisdiction of the state courts. In re Wright, 184 B.R. 318 (Bankr.N.D.Ill.1995). Postpetition earnings of a Chapter 7 debtor are not protected by the automatic stay. Carver v. Carver, 954 F.2d 1573 (11th Cir. 1992), cert. den., 506 U.S. 986, 113 S.Ct. 496, 121 L.Ed.2d 434 (1992).

As to those areas protected by the automatic stay, relief from the stay is liberally granted. Carver v. Carver,

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Cite This Page — Counsel Stack

Bluebook (online)
196 B.R. 700, 35 Collier Bankr. Cas. 2d 1630, 1996 Bankr. LEXIS 661, 1996 WL 324466, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-newman-nysb-1996.