Jacobs v. Jaeger-Jacobs (In re Jaeger-Jacobs)
490 B.R. 352
Bankr. E.D. Wis.2013Background
- Amanda Jaeger-Jacobs filed Chapter 7 bankruptcy on Jan 3, 2012; Ryan Jacobs sought nondischargeability of debts under 523(a)(5) and/or 523(a)(15) tied to the parties' Marital Settlement Agreement (MSA).
- Debtor admitted MSA terms but denied they create nondischargeable obligations.
- Plaintiff moved for summary judgment on Feb 28, 2013; debtor replied Mar 14, 2013.
- MSAs (May 13 and Oct 15, 2010) allocated specific debts; Wells Fargo was joint liability; Kohls and CitiCard were attributed to the debtor.
- Debtor stopped paying Wells Fargo; plaintiff paid $4,907.17 to protect credit; Kohls and CitiCard payments remained unpaid; creditors have not sued yet.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the MSA debts are nondischargeable under 523(a)(5) or 523(a)(15). | MSA obligations are domestic support or incurred in divorce. | Debts not clearly domestic support; relief under 523(a)(5)/(a)(15) not established. | Court applies 523(a)(15) and finds exceptions to discharge; 523(a)(5) need not be decided. |
| Whether the hold-harmless indemnity creates a new debt and renders payments non-voluntary. | Payments were to satisfy existing liability, not voluntary contributions. | Plaintiff's payments were voluntary or not tied to liability. | Payments were for the debtor's liability; not voluntary; plaintiff can seek enforcement. |
| Whether the Kohl’s and CitiCard debts present a justiciable controversy for this court. | Debtors' obligations exist and are enforceable; not advisory. | No present controversy; advisory opinions would be inappropriate. | Not necessary to decide to resolve the case; court proceeded on other grounds. |
| Whether the plaintiff is entitled to costs and attorney’s fees. | Costs and reasonable fees should be awarded. | MSA allocates each party’s own fees; no fee shifting. | Costs awarded; attorney’s fees denied in bankruptcy; state court to decide future fees. |
Key Cases Cited
- In re Tarone, 434 B.R. 41 (Bankr.E.D.N.Y. 2010) (relevance to nondischargeability under 523(a)(15) and related standards)
- In re Golio, 393 B.R. 56 (Bankr.E.D.N.Y. 2008) (nond dischargeability considerations under 523(a)(15))
- In re Hying, 477 B.R. 731 (Bankr.E.D.Wis. 2012) (distinction between support and property division; 523(a)(5) vs (a)(15))
- In re Schweitzer, 370 B.R. 145 (Bankr.S.D.Ohio 2007) (hold-harmless obligations; new debt between ex-spouses)
- In re Williams, 398 B.R. 464 (Bankr.N.D.Ohio 2008) (hold-harmless obligations and continued liability to creditors)
- Commonwealth Plaza Condo. Ass’n v. City of Chicago, 693 F.3d 743 (7th Cir. 2012) (jurisdiction; advisory opinions; core vs non-core)
- Georgi, 459 B.R. 716 (Bankr.E.D.Wis. 2011) (distinction between 523(a)(5) and 523(a)(15) and their applicability)