In re: Bobby Joe Wallace and Bridget Janine Wallace
490 B.R. 898
| 9th Cir. BAP | 2013Background
- This is the second appeal from a bankruptcy court order finding appellants in contempt for violating a discharge injunction and sanctioning them $4,660.00 (First Contempt Order).
- On first appeal, the Panel affirmed portions of the First Contempt Order and vacated/remanded $3,000.00 punitive damages for lack of sufficient findings.
- The Second Contempt Order, issued before the Panel resolved the first appeal, fined appellants an additional $1,250.00 and allowed ongoing sanctions for nonpayment.
- Appellants argued the First Contempt Order was a money judgment enforceable only by execution, not contempt, and they paid or offered to pay the sanctions late.
- Debtors sought to enforce payment via contempt, arguing the First Contempt Order was a sanctions order enforceable by the court’s contempt powers.
- The bankruptcy court concluded the First Contempt Order was a sanctions order (not an ordinary money judgment) and granted the Second Contempt Motion, enforcing payment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Was the First Contempt Order a money judgment? | Rosales et al. contend it was a money judgment. | Wallace contends it was a sanctions order enforceable by contempt. | First Contempt Order not a money judgment; contempt proper. |
| Can contempt proceedings enforce sanctions for misconduct even if a prior order awarded monetary sanctions? | Debtors may use contempt to compel payment of sanctions. | If it were a money judgment, execution would be sole remedy. | Contempt may enforce sanctions for misconduct not ordinary money judgments. |
| Did the bankruptcy court abuse its discretion in issuing the Second Contempt Order? | Second Contempt Order correct to compel timely payment and sanction noncompliance. | Sanctions should be limited or clarified; there was ambiguity in payment deadlines. | No abuse of discretion; Second Contempt Order affirmed. |
Key Cases Cited
- Shuffler v. Heritage Bank, 720 F.2d 1141 (9th Cir. 1983) (contests enforcement of money judgments and contempt distinctions)
- Cleveland Hair Clinic, Inc. v. Puig, 106 F.3d 165 (7th Cir. 1997) (contempt is proper to enforce sanctions not ordinary money judgments)
- Aetna Cas. & Sur. Co. v. Markarian, 114 F.3d 346 (1st Cir. 1997) (money judgments and contempt enforcement distinctions)
- Hilao v. Estate of Marcos, 95 F.3d 848 (9th Cir. 1996) (civil contempt standards and enforcement principles)