F. Consumer Bankruptcy Issues
The following cases are of interest on discharge and dischargeability issues:
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(a)
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A sales and service agreement between a seller of farm equipment and the creditor, an agricultural equipment manufacturer, gave rise to an express trust with respect to sale proceeds. Here, the agreement used the word "trust" and the parties intended that the seller would take possession and segregate the proceeds, and hold them on behalf of the creditor. These provisions gave rise to a fiduciary obligation and debt was nondischargeable as one for fraud and defalcation in a fiduciary capacity. In re Strack, 524 F. 3d 493 (4th Cir 2008).
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(b)
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The creditor had a claim against physician for failing to get informed consent of patient, and the creditor sought to hold claim nondischargeable as a claim for willful and malicious injury. Held, that the interpretation of willful and malicious in Geiger governs, and the Court must find specific intent to injure or belief that injury was substantially certain to occur. Ditto v. McCurdy, 510 F.3d 1070 (9th Cir 2007)
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(c)
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In re Granoff, 2007 WL 2980190 (3d Cir. 2007) (slap of victim which led to personal injuries was substantially certain to produce injuries, and was nondischargeable as debt for willful and malicious injuries; somewhat inconsistent with other authorities and Supreme Court Geiger ruling).
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(d)
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In re Roberts, 2007 WL 208904 (9th Cir. 2007) (court grants discharge despite numerous omissions in filed documents which omissions court says were within normal parameters).
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(e)
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In re Cohen, 49 BCD P 15 (7th Cir. 2007) (claim based on false and misleading statements of accounts was dischargeable; creditor received statement of accounts which included items that were merely hopeful, but this did not establish falsity; mere bad character and dishonesty is not enough).
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(f)
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In re Hyman, 502 F.3d 61 (2d Cir. 2007) (to find fraud and defalcation must show conscious misbehavior or extreme recklessness; here, while debtor paid debts out of funds in which another party had an interest and there were issues of benefit to the other party and waiver).
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(g)
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In re Bucci, 493 F.3d 635 (6th Cir. 2007) (agreeing with most other courts of appeal, court holds debtor's obligation to make employee pension and benefit contributions was discharged and was not a debt for fraud or defalcation while acting in a fiduciary capacity; although debtor may have been an ERISA fiduciary under the CBA, the debtor was not a trustee for making the contributions, but instead, failure to contribute was
