Opinion
Case No. 99-40718-399, Adv. Proc. No. 09-4027-705, [Related to Docket #1].
September 9, 2009
MEMORANDUM AND OPINION
On February 9, 2009, the Plaintiff filed the Complaint [Docket #1], commencing the above-referenced adversary proceeding and seeking a determination of nondischargeability pursuant to § 523(a)(6) of title 11 of the United States Code (the "Bankruptcy Code") for any debt related to his claim against the Debtor stemming from a prepetition assault. On April 29, 2009, the Debtor-Defendant (the "Defendant") filed his Answer [Docket #21], upon leave to file such answer out of time [Docket #23]. On August 26, 2009, the Adversary Proceeding was tried before the Court, with both parties appearing through counsel. Upon consideration of all pleadings, arguments, admissible evidence, and applicable law, the Court makes the following findings of fact and conclusions of law, and, consistent with this Memorandum and Opinion, will enter forthwith an order granting the Plaintiff a determination of nondischargeability of a debt in the amount of $4,000.00.
Hereinafter, all references to "section[s]" or "§ [§]" shall refer to the indicated section(s) of the United States Bankruptcy Code.
I. FACTS
On April 27, 1999, the Defendant assaulted the Plaintiff, striking him with an object similar to a two-by-four board. As a result, the Plaintiff sustained physical injuries for which he received emergency medical treatment at a local hospital and non-emergency treatment at a Veterans Administration hospital. Also in connection with the assault, on December 1, 1992, the Defendant pled guilty to a criminal charge of assault in the third degree under Missouri law, and the state court entered an order of conviction based on this plea (the "Criminal Judgment"). On April 11, 1994, the Plaintiff filed a civil suit against the Defendant in the Circuit Court of the City of St. Louis, Missouri, alleging a claim for assault and battery and a claim for conversion of property. On June 23, 1994, the Circuit Court entered a default judgment (the "Civil Judgment") related to these claims in the total principal amount of $29,000.00.
On January 25, 1999, the Defendant, along with his wife, filed the above-referenced joint main bankruptcy case (the "Main Case"). On September 20, 2007, the Plaintiff sought to revive the Civil Judgment in the Circuit Court, at which time the Defendant appeared through counsel. The Circuit Court determined that the Civil Judgment could be revived under state law. However, the fact that the Circuit Court, in 2007, revived the Civil Judgment has no bearing on whether the debt arising from that judgment was discharged in 1999 under federal bankruptcy law. Accordingly, the Plaintiff filed this Adversary Proceeding, seeking a determination of dischargeability as to the debt for injuries he sustained as a result of the assault on his person.
The Plaintiff's claim was not scheduled by the Defendant on his original schedule of assets and liabilities (the "SoFA"). Rather, the claim was scheduled pursuant to an amendment to the SoFA filed on December 9, 2008 [Docket #14]. The Complaint was filed two months later.
At trial, the Plaintiff offered testimony as to injuries sustained to his vehicle-injuries which apparently were caused by the Defendant contemporaneously with the assault. In the Civil Suit, the Plaintiff had alleged a claim for conversion of property related to this damage to his vehicle. However, the Plaintiff failed to seek in the Complaint in this Adversary Proceeding a nondichargeability determination as to a claim for a debt based on conversion. The Plaintiff seeks only a determination of nondischargeability as to the claim for a debt based on the Plaintiff's bodily injuries. Accordingly, the issue of whether a debt for the injuries sustained to the Plaintiff's car is dischargeable is not before this Court, and evidence offered solely on this issue is disregarded.
II. ANALYSIS
The Plaintiff claims that his debt is nondischargeable pursuant to § 523(a)(6), which provides that § 727 does not operate to discharge any debt "for willful and malicious injury by the debtor to another entity or to the property of another entity." 11 U.S.C. § 523(a)(6). In seeking this judgment, the Plaintiff argues that the doctrine of collateral estoppel applies to the Civil Judgment to preclude the litigation of the issue of whether the elements of § 523(a)(6) have been satisfied.
Collateral estoppel applies in bankruptcy court to bar the litigation of issues that were determined in a prior state court action. Meyer v. Asbury (In re Asbury), 195 B.R. 412, 415 (Bankr. E.D. Mo. 1996) (citing Grogan v. Garner, 498 U.S. 279, 284-85 n. 11 (1991)). The bankruptcy court looks to state law to determine whether the state court judgment has preclusive effect. Bublitz Machinery Co. v. Brewer (In re Brewer), 2006 WL 1109409, at *1 (Bankr. W.D. Mo. April 17, 2006). Thus, this Court looks to Missouri law to determine whether the Civil Judgment precludes the litigation here of the issues decided by the Circuit Court. Under Missouri law, for collateral estoppel to apply, it must be shown that:
(1) the issue decided in the prior adjudication mirrors that in the present action;
(2) the prior adjudication resulted in a final decision on the merits;
(3) the party against whom collateral estoppel may apply participated as a party or in privity with a party to the prior adjudication; and
(4) the party against whom the doctrine may apply has had a full and fair opportunity to litigation the issue.
T.K., a minor, by D.M., as next friend v. Love (In re Love), 347 B.R. 362, 365 (Bankr. W.D. Mo. 2006) (citing Galaxy Steel Tube, Inc. v. Douglass Coal Wrecking, Inc., 928 S.W.2d 420, 422 (Mo. Ct. App. 1996)).
The parties agree that the Civil Judgment is a default judgment. The Defendant did not file an answer in the Circuit Court case and failed to appear to defend himself at trial. "Under Missouri law, a default judgment entered as a result of a debtor's failure to appear or to defend the lawsuit . . . does not constitute a judgment on the merits for collateral estoppel purposes." Bublitz Machinery Co. v. Brewer (In re Brewer), 2006 WL 1109409, at *1 (citing Johnson v. Mo. Dep't of Health Senior Servs., 174 S.W.3d 568, 585 (Mo. Ct. App. 2005)). Although there may be certain exceptions to this general rule that a default judgment has no preclusive effect, the facts here do fall within those exceptions. Accordingly, the Civil Judgment does not operate to collaterally estop the Defendant from litigating the issues decided therein.
However, the preclusive effect of the Criminal Judgment is another matter. The Defendant voluntarily pled guilty to assault, and his conviction has the same legal effect as a finding of guilt after a jury or bench trial. As such, the last three of the four elements of collateral estoppel have been satisfied. Therefore, all that remains for the Court to determine is whether the issue decided in the criminal case mirrors the issue to be decided here: that is, whether the Plaintiff's injuries resulting from the assault by the Defendant were willful and malicious.
The adjectives "willful" and "malicious" are not synonymous and establish separate statutory elements, both of which must be established. Blocker v. Patch (In re Patch), 526 F.3d 1176, 1181 (8th Cir. 2008) ("The plain language of § 523(a)(6) requires courts . . . [to] determine whether the debtor both `willful[ly] and malicious[ly]' caused th[e] `injury.'"). Although the Bankruptcy Code does not define either "willful" or "malicious," case law sheds light on the terms' definitions: "[f]or purposes of § 523(a)(6) `willful' means that the injury, not merely the act leading to the injury, must be deliberate or intentional; and `malicious' means that the injury is targeted at the creditor, in the sense that the conduct is certain or almost certain to cause financial harm to that creditor." Jaynes v. Adams (In re Adams), 349 B.R. 199, 203 (Bankr. W.D. Mo. 2006).
The Adams definition of "willful" is wholly consistent with the recent holding in Blocker v. Patch, in which the Eighth Circuit confirmed that the definition of "willful" under § 523(a)(6) "is controlled by the Supreme Court's decision in Kawaauhau v. Geiger, 523 U.S. 57 (1998). There, the Court resolved a circuit split over the meaning of `willful,' holding that `debts arising from recklessly or negligently inflicted injuries do not fall within the compass of § 523(a)(6)'." Blocker v. Patch, 526 F.3d at 1180 (quoting Kawaauhau v. Geiger, 523 U.S. at 64); see also Cassidy v. Minihan, 794 F.2d 340, 344, 345 (8th Cir. 1986) (holding that, in enacting § 523(a)(6), Congress intended to bar the discharge of intentionally inflicted injuries.).
The "Willful" Element. On December 1, 1992, the Defendant was charged by substitute information in lieu of indictment with third degree assault in violation of Missouri Revised Statute § 565.070, based on the allegation that the Defendant attempted to cause physical injury to the Plaintiff by striking him. As such, the information charged a violation subsection (1) of Mo. Rev. Stat. § 565.070, which provides that "[a] person commits the crime of assault in the third degree if . . . [h]e attempts to cause . . . physical injury to another person." Pursuant to his plea agreement, the Plaintiff admitted guilt as to this charge.
When a person "attempts," he acts with the mens rea of intent. Black's Law Dictionary 123 (7th ed. 1999) (To "attempt" is to commit "[a]n overt act that is done with the intent to commit a crime . . ."). Therefore, there is no issue as to whether the Defendant admitted to acting intentionally in attempting to cause physical injury to the Plaintiff. However, for a debt to be nondischargeable under § 523(a)(6), the debt must be for a deliberate or intentional injury-not merely an unintentional injury that happens to be the result of an intentional act. Here, the Criminal Judgment establishes that not only that the Defendant acted intentionally in attempting to cause physical injury, but also that the resulting physical injuries were intentional. By being successful in his attempt to cause physical injury, the Defendant inflicted the intentional physical injuries sustained by the Plaintiff. One cannot attempt to cause physical injury, then claim that the injury directly resulting from such attempt was not intentionally inflicted. As such, the Criminal Judgment precludes litigating in this Court the issue of whether the debt resulting from that assault is a debt for a willful injury.
The "Malicious" Element. A debt is nondischargeable under § 523(a)(6) only if it is for an injury that was incurred as a result of the debtor's targeting of the creditor for an almost-certain financial harm. Here, the Defendant admitted to attempting to cause physical injury to the Plaintiff. In assaulting the Plaintiff, the Defendant would have known or reasonably should have known that the injuries resulting such an attempt would almost certainly result in financial harm (such as the incurrence of costs of medical treatment) to the Plaintiff. As such, the Criminal Judgment also precludes litigating here the issue of whether the debt is for a malicious injury. Accordingly, because the Defendant's criminal conviction for assault establishes that the injuries sustained by the Plaintiff as a result of the assault were willful and malicious, the debt is nondischargeable pursuant to § 523(a)(6). And, therefore, all four collateral estoppel elements-including the requirement that the "willful and malicious" issue was decided in the Criminal Prosecution-have been satisfied.
However, the amount of that nondischargeable debt was not established in the Criminal Prosecution. At trial, the evidence offered in support of the amount of the debt was limited. The seventeen-year-old copies of hospital records were, in some parts, difficult to read. Much of the testimony regarding the nature and extent of the Plaintiff's injuries, and the costs of treatment for these injuries, was based on the Plaintiff's memory and layman's characterizations of his medical treatments and diagnoses. However, the Court FINDS credible the Plaintiff's testimony and exhibit evidence as to his injuries and as to the allegation that he incurred $4,000.00 in medical bills for treatments directly related to the injuries.
III. CONCLUSION
Accordingly, the Court HOLDS that judgment in favor of the Plaintiff for a determination of nondischargeability of his debt in the amount of $4,000.00 is proper. An Order consistent with this Memorandum and Opinion will issue forthwith.