Young v. Harris, 663 B.R. 457

Rachel Harris (Debtor/Defendant) borrowed $6,000 in total from Jimmy Doyle Young (Creditor/Plaintiff) over seven months, with an agreement to repay after the sale of Harris's mother's house.
Harris’s mother’s house sold in May 2020, but Harris failed to repay Young; she also misinformed Young about the status of the house post-sale.
Harris filed for Chapter 13 bankruptcy in September 2021, but did not list Young as a creditor, so Young did not receive notice or an opportunity to object to the discharge.
Young only learned of the bankruptcy after filing a state court action and subsequently brought this adversary proceeding in bankruptcy court for a determination of nondischargeability and damages.
Harris defaulted on appearing for trial, leaving only Young's testimony and evidence; Young sought compensatory and punitive damages and a ruling that the debt was nondischargeable.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Statute of limitations for collection of debt	Loan was acknowledged in writing; agreement tolled statute until house sale in 2020	Time barred by three-year limitation	Tolled—action timely filed
Breach of contract / open account claim	Entitled to recovery of $6,000 loaned	No ongoing obligation/forgot to list creditor	Judgment for Young on breach of contract
Fraudulent or negligent misrepresentation	Harris lied about house sale to conceal debt and prevent collection	No intent to defraud; forgetfulness	No fraud liability; no damages proven beyond contractual loss
Nondischargeability of debt under §§ 523(a)(2)(A), (a)(3), (a)(6)	Debt obtained and concealed by fraud; should be excepted from discharge	No fraud; discharge applies; creditor omitted inadvertently	Debt is dischargeable; Young failed to prove nondischargeability

In re Morrison, 555 F.3d 473 (5th Cir. 2009) (bankruptcy court jurisdiction includes claims that may affect the bankruptcy estate)
In re Bass, 171 F.3d 1016 (5th Cir. 1999) (federal courts must ensure subject matter jurisdiction)
Celotex Corp. v. Edwards, 514 U.S. 300 (1995) (bankruptcy jurisdiction is statutorily grounded and limited)
Anderson v. Lancaster, 215 Miss. 179 (Miss. 1952) (due date on an open account sets accrual for statute of limitations)
American Bankers Ins. Co. of Fla. v. Wells, 819 So.2d 1196 (Miss. 2001) (limitations period for fraud claims begins on discovery)
Spraggins v. Sunburst Bank, 605 So.2d 777 (Miss. 1992) (elements of fraudulent and negligent misrepresentation)
Purvis v. Barnes, 791 So.2d 199 (Miss. 2001) (compensatory damages required before punitive damages)
Stone v. Caplan (In re Stone), 10 F.3d 285 (5th Cir. 1994) (Robinson factors for dischargeability of unscheduled debts)
Small Bus. Ass’n v. Bridges, 894 F.2d 108 (5th Cir. 1990) (requirement of actual notice for § 523(a)(3) claims)
Selenberg v. Bates, 856 F.3d 393 (5th Cir. 2017) (elements of actual fraud under § 523(a)(2)(A))
Husky Int’l Elecs., Inc. v. Ritz, 578 U.S. 355 (2016) (actual fraud under § 523(a)(2)(A) includes fraudulent schemes)
In re Hudson, 107 F.3d 355 (5th Cir. 1997) (exceptions to discharge should be narrowly construed)