Tavella v. Edwards (In Re Edwards)

151 B.R. 19, 1993 Bankr. LEXIS 494, 23 Bankr. Ct. Dec. (CRR) 1776, 1993 WL 69987
CourtUnited States Bankruptcy Court, D. Connecticut
DecidedMarch 10, 1993
Docket19-20201
StatusPublished
Cited by3 cases

This text of 151 B.R. 19 (Tavella v. Edwards (In Re Edwards)) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, D. Connecticut primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Tavella v. Edwards (In Re Edwards), 151 B.R. 19, 1993 Bankr. LEXIS 494, 23 Bankr. Ct. Dec. (CRR) 1776, 1993 WL 69987 (Conn. 1993).

Opinion

MEMORANDUM AND ORDER ON PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT

ALAN H.W. SHIFF, Bankruptcy Judge.

The Plaintiff has moved for a summary judgment, determining that certain obligations of the defendant, her former husband, are nondischargeable. The motion is granted because the only disputed issue has been decided in a state court proceeding.

BACKGROUND

On November 8, 1990, after a one day dissolution hearing, Judge Novak of the Connecticut Superior Court entered a decree dissolving the marriage of the plaintiff and the defendant. The decree ordered the defendant to indemnify and hold the plaintiff harmless from the following debts (the “Debts”): a $31,900 debt to Ford Motor Credit Corp., guaranteed by plaintiff; a $20,000 debt to Norwalk Municipal Employee Credit Union, on which the plaintiff was a co-signer; and credit card debts of approximately $1,650. 1

At the dissolution hearing, the plaintiff testified that the defendant had threatened on several occasions to file a bankruptcy petition. Plaintiffs Exhibit No. 6, p. 207. The plaintiff's attorney argued that indemnification against liability for the Debts was necessary for the plaintiff’s continued support, that if the defendant’s obligation was discharged in bankruptcy, the plaintiff would not “be able to support herself,” and that the judge should state in the decree that the indemnification was necessary for her support so that the obligation would not be discharged in bankruptcy. Id. at pp. 208-212. The defendant’s attorney objected, arguing that an award for the plaintiff’s support would deprive the defendant of the benefit of a bankruptcy discharge, that the plaintiff could support herself, and that if she could not, she could file a bankruptcy petition. Id. at pp. 215-217.

The decree provided:

This order is made for the purpose of freeing the plaintiff of her liability as to these past obligations [the Debts] so that she may properly care for herself. This indemnification is necessary for the plaintiff's continued economic welfare and accordingly, the defendant’s obligation in this respect is in the nature of alimony and support.

Plaintiffs Exhibit No. 1, Paragraph 7.

On March 1, 1991, the defendant filed a chapter 7 petition. This adversary proceeding was commenced to determine whether the defendant’s obligation to indemnify the *21 plaintiff from the Debts is nondischargeable under Code § 523(a)(5)(B). 2

DISCUSSION

Rule 56(c) F.R.Civ.P., made applicable by Rule 7056 F.R.Bankr.P., requires that summary judgment

shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.

“In determining whether summary judgment is appropriate, ‘the judge’s function is not himself to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial.’ ” Jenkins v. Glynn (In re Glynn), 138 B.R. 360, 361 (Bankr.D.Conn.1992) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986)). The moving party bears the burden of showing that no material facts are in dispute, and all reasonable inferences are to be drawn and all ambiguities are to be resolved in favor of the non-moving party. Id.

The outcome of the underlying adversary proceeding requires the resolution of a single issue, to wit: was the defendant’s obligation to indemnify the plaintiff from liability for the Debts, “actually in the nature of alimony, maintenance, or support”? If it was, the obligation is not dischargeable. See § 523(a)(5)(B); Forsdick v. Turgeon, 812 F.2d 801 (2d Cir.1987). The resolution of this motion for summary judgment, however, turns on whether that factual issue was raised, litigated, and actually decided by the state court. If it was, the doctrine of collateral estoppel will preclude its relit-igation a second time in this court. Carter v. Carter (In re Carter), 138 B.R. 356, 358 (Bankr.D.Conn.1992).

Collateral Estoppel

The fact that a state court award is labelled alimony or support is not determinative of the § 523(a)(5)(B) issue. Sweeny v. Sweeny (In re Sweeny), 99 B.R. 192, 195 (Bankr.D.Conn.1989). The bankruptcy court must determine whether a particular award is actually in the nature of alimony, maintenance, or support where the actual nature of the award has not already been determined by the state court. Vaudreuil v. Busconi (In re Busconi), 140 B.R. 308, 312-313 (Bankr.D.Mass.1992); In re Smith, 125 B.R. 630, 631 (Bankr.E.D.Okla.1991). However, where a state court of appropriate jurisdiction 3 has determined the actual nature of the award, § 523(a)(5)(B) does not require that the bankruptcy court redetermine this issue. See Grogan v. Garner, 498 U.S. 279, 111 S.Ct. 654, 112 L.Ed.2d 755 (1991) (finding the application of collateral estoppel based on a prior state court judgment was appropriate notwithstanding the fact that the determination of dischargeability of a fraud claim is within exclusive jurisdiction of bankruptcy court); Leslie v. Hart (In re Hart), 130 B.R. 817, 847 (Bankr.N.D.Ind.1991) (applying collateral estoppel in a § 523(a)(5) determination); Polley v. Spangler (In re Polley), 74 B.R. 68, 71 (Bankr.S.D.Ohio 1987). As this court stated in In re Carter, supra, 138 B.R. at 358:

[Although the determination of whether an obligation is dischargeable in bankruptcy under § 523(a)(5)(B) is generally made by bankruptcy courts, when that issue was actually litigated in a state court, a majority of federal courts will apply collateral estoppel to bar its relit-igation. Klingman v. Levinson, 831 F.2d 1292, 1295 (7th Cir.1987).

*22 In Brown v. Felsen, 442 U.S. 127, 99 S.Ct. 2205, 60 L.Ed.2d 767 (1979), the Supreme Court stated

Whereas res judicata forecloses all that which might have been litigated previously, collateral estoppel treats as final only those questions actually and necessarily decided in a prior suit. If, in the course of adjudicating a state-law question, a state court should determine factual issues using standards identical to those of § 17, [of the Bankruptcy Act, the predecessor to Code § 523(a) ] ...

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Bluebook (online)
151 B.R. 19, 1993 Bankr. LEXIS 494, 23 Bankr. Ct. Dec. (CRR) 1776, 1993 WL 69987, Counsel Stack Legal Research, https://law.counselstack.com/opinion/tavella-v-edwards-in-re-edwards-ctb-1993.