In Re Gregory A. Lemaire, Debtor. Paul Handeen v. Gregory A. Lemaire

LeMAIRE, Gregory In re A. Debtor. HANDEEN, Appellant,

Paul LeMAIRE, Appellee.

Gregory A.

No. 88-5275. Appeals,

United States Court

Eighth Circuit.

July R. McMILLIAN, JOHN Before Judges. MAGILL, Circuit

GIBSON, аnd Judge. MAGILL, Circuit In this appeal, we consider the first dischargeability time the Act, 11 Reform U.S.C. seq., 1301 et a of civil owed §§ an assault an assailant. The victim urges adopt bright creditor-victim us prohibiting line rule debt incurred as a result of debtor’s activity. Such a heinous criminal rule effectively nondischarge- extend the would ability provision 11 U.S.C. directly result proceedings, contrary unsup- 13’s terms legislative ported history. the statute’s judicial engage We refuse in such activ- ism.

The creditor asserts that the court’s fail- bright ure to adopt a line rule will result in months, years. twenty-seven He served becoming “haven for criminal Chapter 13 and was relеased in After re- otherwise non- discharge their debtors” to lease, graduate LeMaire returned to school arising criminal out of dischargeable debts University He re- at the of Minnesota. recog- While we disagree. We conduct. experimental his Ph.D. in ceived behavior in for abuse inherent potential nize the pharmocology January in Since 1985. discharge, to our refusal allowing a such then, he has a served as research fellow at automatically nondischarge- debt make the University, expects the and to continue to the not mean that circumstances able does work as а researcher for a at the scientist The irrelevant. a debt are underlying bankruptcy University completing year after a third must court district court and a research fellow. underlying the circumstances consider the debt as one factor good determining in a debtor’s a judgment Handeen obtained civil for 1325(a)(3). purposes for faith $50,362.50 against in September LeMaire Corporation Assistance Education thereafter, Shortly 1985. Handeen at- (8th Cir.1987); re Zellner, In F.2d tempted judgment by to collect on the com- Cir.1982). Be- Estus, F.2d 311 mencing garnishment proceedings. On find court1 cause we that the 16, 1987, January ter 13 Chap- LeMaire filed fоr determined properly and court2 district Handeen, protection. In addition to acting in in this case was that the debtor LeMaire’s debt schedule names two addi- faith, we affirm. University tional creditors: the of Minneso- parents. his ta and The schedules show a parents debt to his secured a 1980 $900 Datsun I. $11,822 wagon station and an debt note promissory parents to his based on at the of this case arises The heart debt signed day LeMaire the before he filed in against entered from a civil court.4 LeMaire after LeMaire intention- Gregory injured Paul Han- ally seriously and shot original plan proposed pay- LеMaire’s privy court to all deen. This is not per thirty-six month $175 ments months. Before the confirmation for Han- underlying LeMaire’s attack on facts deen, hearing of that attack viciousness but original plan, on LeMaire it to modified kill intended dispute. LeMaire to not the payments per increase month $265 so, Handeen, very attempted to do and thirty-six origi- for months. This modified of the nearly The nature attack succeeded. plan provided nal would have creditors with In by the record before us. is made clear approximately percent. a dividend of 13.75 at Handeen nine July LeMaire shot objected Hаndeen After a rifle, hitting him a bolt action times with five times. LeMaire fired hearing, court denied con- several of 23, 1987, May In an dated firmation. the court concluded that LeMaire was order range. al- point shots blank Handeen at most died. all of to the applying disposable income plan expressed concern Le- pled aggravated as- and about guilty to propose plan failure to for the ten Maire’s received a sentence one to sault and Legal $3,600 1. Kressel, Fees Honorable Robert J. United Payment 3,000 Partial Judge Judgment States for Handeen District Living Expenses and Minnesota. Educational 3,050 1971-1981 2,172 Computer Personal Loan for 2. The Honorable Diana E. Murphy, United Loan for Purchase of Car States Judge District for the District of Minneso- court disallowed the claims ta. living expenses based on from 1971-1981 and car, upheld the loan for a but the claims based University 3. The debt to the $800 was for an fees, legal on partial loans for of debt student loan. LeMaire has made a reaffirma- computer. Handeen loan for the After a agreement however, University, tion with the hearing, the reduced debt claimed agreeing pay original $500 of the debt at the parents, finding spent LeMaire’s money end origi- of deferment in accordance with the providing living for LeMaire’s and education- agreement. nal expenses gift al parents was a and that they allowing retain title to the car which LeMaire to use. The court allowed an unse- LeMaire’s filed a secured 4. claim $8,772. $3,072 January cured claim of Order of $9,650, and an unsecured claim for re- flecting following: debt for the statutory period sixty maximum appealed months. to the district court 1322(c). See 11 U.S.C. The court also from the bankruptcy court’s orders allow ing claim denied Handeen’s motion to dismiss. parents’ general LeMaire’s unsecured denying Hаndeen’s motion for LeMaire filed September On amended of fact and conclusions monthly payment increasing the new of (1) appeal, law. On Handeen argued that: extending the term to $500 faith; was not plan, this creditors Under sixty months. (2) does not include all of Le- approximately receive a dividend would projected disposable Maire’s income for the objected to confir- percent. 42.3 plan’s five-year period; (3) LeMaire’s re plan was not grounds that the mation stipend search regular was not income for that LeMaire faith and proposed purposes of 11 101(29); (4) U.S.C. and § disposable income his dedicate all of did not to LeMaire’s debt to his was either a bankruptcy court held The plan. the gift, or by was barred the statute of limita motion, con- hearing on Handeen’s tions or statute of frauds. The district plan on Novem- amended firmed LeMaire’s rejected arguments these and af 12, 1987. ber firmed the decision of the bankruptcy court. Handeen raises the same argu that Le- found bankruptcy court appeal ments on review, this court. On of net income monthly had a Maire $1,185.24 we examine a bankruptcy court’s decision monthly expenses expenses reasonable tо determine whether its factual deducting After of $760.87.5 are clearly erroneous and whether legal its LeMaire income, found that the court from conclusions, which subject to de novo in dis- per month approximately $424 had posable review, are correct. Education Assistance less Although this was income. Corporation Zellner, 1222, pay proposed to than the $500 (8th 1224 Cir.1987); Wegner v. Grune con- bankruptcy court plan, the the under waldt, 1317, F.2d Cir.1987). Le- recognized that plan and the firmed differ- up have to make [the Maire “will by or areas other by sacrifices ence] continued ents.” tions that II. par- suppоrt from financial objec- urges Handeen’s that because un rejected The court 523(a)(6) in der 11 U.S.C. an individual debt- was § provide discharged or not be plan did not “for willful and good faith and injury by malicious LeMaire’s the debtor to another in the amount of payments for disposable entity or property of entity,” another income. plan purporting discharge for amended filed a motion such a debt should not be confirmed. No on Novem- of law findings and conclusions disputes one that LeMaire’s debt to Han objecting motion 25, He filed a 1987. ber deen arises out of a “willful and malicious De- parents on of LeMaire’s to the claims injury” purposes 523(a)(6). for of § the LeMaires’ arguing that cember issue in this case is whether a debt for should be gifts to their son and claims were disallowed injury willful and malicious which is within motions were such. Both scope 523(a)(6) (and of therefore § January 1988. The on heard nondischargeable would be 7, under amend- motion for Handeen’s court denied ed 523(a),727) see U.S.C. discharge- §§ in an of law findings and conclusions able under 13. This is a case of In an order January 1988. dated order dated impression first in this circuit. 7, 1988, allowed January the court Although expressly prohibits in the amount LeMaires’ claims § discharge under $8,772.6 certain sеctions of the Monthly expenses Transportation Expenses 5. are as follows: 70.00 dental, (including Miscellaneous Rent $240.00 medical, drugs, glasses, and Food Clothing 175.00 recreation) 30.00 20.00 Professional Dues 4.00 Professional Periodicals 39.00 Professional Conferences 75.00 Professional Books 16.66 Health Insurance 48.75 TOTAL: $760.00 Auto Insurance 35.00 Motorcycle supra Insurance 6.66 See note 4. Code,7 by its it does not terms (5) respect with to each allowed secured 1328(a). discharge under Le- apply Maire provided claim for plan— § application discharge has for filed an (A) the holder such has accepted claim 1328(a), provides: which pursuant to § plan; completion after practicable As soon as (B)(i) plan provides that the holder of payments under the by the debtor all such claim retain the securing lien such * * * grant plan, the court shall claim; and provided debtor a all debts (ii) value, as of the effective date of * * * except debt— plan, the under property to be distributed 1322(b)(5) (1) provided for under section account such claim title; of this or is not less than the allowed amount of (2) specified kind section claim; such 523(a)(5)of this title.8 (C) the debtor surrenders the property 1328(a). U.S.C. Debts securing holder; § such claim to such 523(a)(6) are not included in the list of (6) the debtor will be able make all nondischargeable under debts which are payments under the and to comply 1328(a). express on the statu Based with the tory we find debts language, which 1325(a). 11 U.S.C. If six require- all § 523(a)(6) scope fall within be of the § satisfied, ments are the court 1328(a) discharged pursuant if to § plan. must confirm H.R.Rep. ‍‌‌‌‌‌‌​​‌​‌‌​‌​​‌​​​​‌​​​​​​​​​‌‌‌‌​​‌​​​‌‌​‌‌​​‍the No. 95- requisites the debtor can meet the of 595, Cong., (1977), 95th 1st Sess. 430 U.S. Swan, Chapter 13. See 98 Matter of 1978, Code Cong. p. & Admin.News (Bankr.Neb.1989); Seely, B.R. re 502 In 1325(a)(3), Under LeMaire’s the dischargeability of § 309, (Bankr.E.D.Va.1980); 6 B.R. 311 In depends debt on 728, (E.D.Pa. DeSimone, 25 re B.R. 729 proposed plan whether faith. good in thе 1982); Chase, 814, In 28 B.R. 815 re argues person that a who (Bankr.Md.1983), on other reversed files seeking discharge (D.C.Md.1984)(re grounds, 43 B.R. 739 debt the incurred as result of criminal con- Chapter good analy versed on 13 faith duct can do in good never so faith. Based sis). history good on the of the require- faith 1325(a) 11 sets out six criteria U.S.C. interpretation ment § and this circuit’s of which ruptcy debtor must meet before bank- 1325(a)(3), disagree. we § Chapter confirm court will 13 objective Our interpreting when a federal plan: statute is “to ascertain the intent of Con- plan if— court shall confirm a [T]he (1) gress give legislative and to effect to the complies provisions the with the Hudson, (9th will.” In re 859 F.2d 1418 chapter appli- of and other this with the Cir.1988). the of a language While statute title; provisions of cable this always starting point is the when its con- issue, (2) fee, charge, any required or amount struction is at see In re Ron Pair 28, (6th Cir.1987), chapter Enterprises, under 123 of title or the 828 F.2d 367 confirmation, plan, paid prior before must also review in to be has we law order to paid; provi- understand context in the been the which sion was drafted and therefore the lan- (3) good the been in has guage itself. Midlantic National Bank v. by any faith and law; means forbidden not Department Jersey New Environmen- of Protection, 755, 474 106 tal U.S. S.Ct. date of (4) value, of the effective the (1986); Robinson, Kelly 88 L.Ed.2d 859 v. distributed plan, property the under ‍‌‌‌‌‌‌​​‌​‌‌​‌​​‌​​​​‌​​​​​​​​​‌‌‌‌​​‌​​​‌‌​‌‌​​‍the of to be 479 U.S. 107 S.Ct. 93 L.Ed.2d 216 of each al- account (1986). less than claim is not lowed unsecured good requirement on such paid would Because the faith the amount that be were is neither in if estate of the debtor of defined the claim the in chapter legis this title on Code nor discussed the liquidated 7 of under date; history, struggled lative courts have set such 523(a)(6) expressly prohibits discharge 7. Section payment on which the final the 1328(b). under 11 U.S.C. 1141 or 523(a)(5), §§ exception, prohibits due. The other alimony debts based on 1322(b)(5) pertains curing 8. Section defaults support. child where the after the date last will occur 1378 (3) probable expected or duration of requisite parameters for the appropriate plan; motives and inten inquiry the debtor’s into (4) 13 Most proposing accuracy tions in plan’s of the statements appeals debts, expenses which examined issue percentage courts of of the prior 1984 amendments held that a repayment er to the of unsecured debt and wheth- inquiring into a bankruptcy good any debtor’s attempt inaccuracies are an totality court; must examine the of the faith mislead the Freeman, circumstances.9 (5) preferential the extent of treatment Neufeld (4th Cir.1986); Flygare v. Boul F.2d 149 creditors; between classes (10th Cir.1983); den, Kitchens, In re (6) the extent to which secured claims Cir.1983); (11th (8th 702 F.2d 885 In modified; Cir.1982); Estus, 695 F.2d 311 De re ans v. (7) type sought of debt to be dis- (4th O’Donnell, 692 Cir. F.2d charged and whether such debt is 1982); (7th Rimgale, re F.2d 426 In nondischargeable 7; Cir.1982); Goeb, In re F.2d 1386 (8) special existence circumstances court, Estus, Cir.1982). This re In such expenses; as inordinate medical 316, adopted

F.2d at definition (9) frequency with which the debtor faith used 11 of old Bank sought has relief under the Bankruptcy ruptcy Act: Act; Reform A comprehensive (10) definition faith sincerity the motivation and рractical. Broadly is not speaking, the seeking relief; debtor in Chapter 13 inquiry basic under the there has been an should whether or be (11) the burden which plan’s adminis- circumstances the case place upon tration would the trustee. provi- abuse 695 F.2d at 317. sions, purpose, spirit Chapter] of [the * * Congress part amended as 1325 of the § in proposal plan the of the *. Bankruptcy Amendments and Federal 11 766(4) (1976) U.S.C. (repealed). § 1984, Judgeship Act of 98-353, No. Pub.L. (1984)(BAFJA). 98 Stat. ed new limited question the of whether 333 addressed BAFJA add- Estus requires 1325(b),10 1325(a)(3) good per faith se code in Congress which § § repayment. may of The court the factors minimum level which be con- only sidered for repayment purposes is relevant of found that substantial one factor in establish- ing good good analysis. 1325(a)(3). the faith under faith See Section § 1325(b) Deans, 972; that if Rimgale, F.2d at 669 F.2d states an unsecured 692 creditor 432; Goeb, objects confirmation, to bankruptcy at 675 F.2d at Other the court making may approve in not plan factors courts to consider the for unless that creditor good of include: is payment, determination faith receive full or, 1325(b)(1)(A), alternatively, the § debtor (1) the amount of proposed payments the test; “ability is, meets the commits all pay” he and the amount of the surplus; debtor’s his projected of income to the (2) employment the debtor’s history, plan abil- at for least years, three ity to earn and likelihood of future in- 1325(b)(1)(B). This court § reevaluated the income; creases in good Estus in light faith test of BAFJA in three-year period the only beginning appeals 9. The D.C. Circuit was the on court of the date that payment depart general the first applied analyz- plan the is due from trend toward under the will be ing payments totality a list facts as the to make of relevant to of under the the (2) Whelan, subsection, 193, purposes For ‘disposa- circumstances. Barnes of v. 689 F.2d this (D.C.Cir.1982) ble (defining good 200 income' means income faith as "hon- which is received intention”). esty the debtor reasonably of and which is not neces- sary expended— to be 1325(b) provides: 10. Section (A) support for the maintenance or of the (1) dependent debtor; If trustee or debtor or a the holder of an allowed of the (B) objects business, engaged claim if the unsecured to the debtor is confirmation of plan, expenditures the continuation, approve necessary then court not of for the unless, plan preservation, as plan— operation of effective date of the (A) property such the value to be business. distributed 1325(b). plan under 11 on account U.S.C. § of such claim is not claim; less amount than the of such or (B) provides that all of the debtor’s projected disposable to be income received in

1379 Corporation including Education Assistance Zellner, ‍‌‌‌‌‌‌​​‌​‌‌​‌​​‌​​​​‌​​​​​​​​​‌‌‌‌​​‌​​​‌‌​‌‌​​‍the circumstances under ments— (8th Cir.1987), 827 F.2d 1222 stat- which a debt was incurred and whether a ing: debt dischargeable would be 7—to determine whether a proposed debtor 1325(b)’s]“ability pay” criteria sub [§ sumes most his good 13 faith. factors and Estus plan in the court to confirm a allows court’s determina disposa all of his which the debtor uses ble income for three ments to his good tion of a debtor’s faith for purposes years pay to make is a finding factual which Thus, inquiry our creditors. this court clearly reviews under a errone into whether the “constitutes an ous Caldwell, standard. In re 851 F.2d provisions, purpose spirit abuse of the or 852, (6th Cir.1988); Metz, 858 Matter 820 13,” Estus, 316, 695 F.2d at 1495, (9th Cir.1987) F.2d cases). (collecting bankrupt has a more narrow focus. The court, having had cy court must look at factors such the benefit hearings of several and testimo whether the debtor has stated his debts ny from parties, uniquely qualified expenses accurately; whether he has judge the credibility of the debtor and to misrepresentation made fraudulent ascertain his motivation. We must affirm court; to mislead the the bankruptcy finding court’s unfairly manipulated whether he has long faith so as the court’s Estus, Bankruptcy Code. See 695 F.2d light reasonable in of the evidence and are 317; Johnson, at (2d Cir.1983); In re 708 F.2d 868 supported by law. See In re Branding Whelan, Barnes v. Motel, Iron Cir. (D.C.Cir.1982); F.2d In re Rim 1986). (7th Cir.1982); gale, 669 F.2d 1325.-04[2], see also 5 If Collier find We court’s de [3 ]. termination that Although recog Chapter 827 F.2d at 1227. Zellner faith is clearly 1325(b) impact nizes the on the deter erroneous. Handeen has suffered serious good faith, preserves hand, mination of the the case harm at LeMaire’s and we do not “totality lightly traditional of the circumstanc take the civil awarded to The bank approach respect es” with to areas which Handeen to injury. redress his Congress specifically ruptcy has not recognized addressed. gravity of Han inquiry necessary Such an is injury to determine deen’s and the vicious nature of Le unfairly manipulated whether a debtor has Maire’s attack. all the properly After considering the Smith, Code. See Matter by factors set forth this court in of Estus, however, 848 F.2d 820 n. 8 Cir. the bankruptcy court de 1988).11 Therefore, BAFJA, even after termined that in proposed LeMaire’s was bankruptcy factors not court must at look Estus faith and was not an abuse of the provisions, addressed the amend- purpose spirit Chapter of 13. Smith, suggestion In Matter the Seventh in Smith with interest the We note very might Circuit considered a situation similar to appropriate classify judg- that it be to that in the current case. Smith owned and arising intentionally ment debt out of tortious operated repair a home business in Indiana ordinary separately conduct from consumer by making which fleeced senior citizens essary repairs. unnec- debt. Smith states: judg- The state obtained a civil a debt is reasonable to view incurred as a "[i]t against required pay ment Smith which him to illegal activities as different from a result penalties totalling nearly civil and restitution private persons. debt between two The nature $50,000. bankrupt- Smith then filed require, of the does not but could cy attempting to the debt incurred as reclassifying support, the debt owed to the a result of his "willful and malicious” fraudu- separate State from Smith’s other unsecured lent conduct. The Seventh Circuit held that the debt, along higher payment with of the debt totality of the circumstances test continued to owed to the State.” be valid after BAFJA and that whether a debt (citations omitted). 848 F.2d at 822 The current dischargeable would be and Smith, however, in that Le- cаse differs from is circumstances under which a debt incurred Handeen, directly not to Maire owes his debt to are factors a court must consider in determin- ing Furthermore, the state. does not at- a debtor’s faith. Because the bank- tempt classify separately to the debts and the factors, ruptcy court had not considered these parties argument appeal. do not raise the the Seventh Circuit remanded for reconsidera- tion. Therefore, we determination, in this case. the bank- rect part As of its decision bankruptcy court’s factual that principle find findings support ruptcy court сonsidered Le- its conclusion that which is the cornerstone fresh start not an abuse of Le- Maire’s was bankruptcy Maire, The court noted that law. sentence, bankruptcy laws. getting serving his after and professionally feet back on his financially, both repay plan proposes that III. portion judgment, and significant 1325(b)(1)provides that if a 11 U.S.C. § make parents LeMaire and his will that objects plan’s to a confirmation creditor The plan. under the sacrifices substantial court also noted that pay- plan proposes less than full and the modify may claim, bankruptcy ment of a creditor’s condition if LеMaire’s financial plan only if it in- may approve the 1329(a). changes substantially. 11 U.S.C. § projected disposa- cludes all of the debtor’s ble income Disposable for the duration of the improve bankruptcy We cannot on the income, pur- eloquent court’s of the statement of its resolution * * * poses, means “income which is not competing equities: ‍‌‌‌‌‌‌​​‌​‌‌​‌​​‌​​​​‌​​​​​​​​​‌‌‌‌​​‌​​​‌‌​‌‌​​‍* * * expended reasonably necessary to be Handeen’s certainly I can understand support of the debt- for the maintenance or grievously has feelings; he been 1325(b)(2)(A). or.” argues U.S.C. § wronged, seriously injured, and now plan proposed agrеed on com- only part receive disposa- all of LeMaire’s does not dedicate However, injury. it is pensation for that repayment Spe- ble income to of his debts. pro- very the vide a debtor with essence cifically, Handeen attacks unreasonable a fresh start. The parents, LeMaire’s subscriptions of rent to his very concept of fresh is one that is start professional journals, overworked, ap- is one which much plies to the crime that he committed paid but professional conferences. books and guilty pled this case. debtor court took note of Han- and has objections, found each of deen’s but that but, society unfortunate- his debt disputed expenses was reasonable un- pay his debt to ly, has not been able project- and that “all der ed circumstances he made appears his victim. It every attempt that has disposable applied to income will be to reorder his life and payments plan.” make that under the We find the fresh start obtain court’s Having the rest of his promises. to live supported by the record and therefore not significant judgment which life with clearly erroneous. forever accrue interest result would in endless against garnishments original plan LeMaire’s listed rent accumulating wages keep him from per paid parents. month to be to his $400 any property mimical to such a I feel that he has made a would be LeMaire testified that his reduced fresh start. per the rent to month to enable him to $240 attempt pay to Handeen as wholehearted payments make more substantial bankruptcy plan. Maire’s rent on his able, is which turns out to be much as he objects to Le significant these cir- amount. Under living LeMaire is because with cumstances, I is find that his motivation parents, paid prior his he whom no rent proper sincerity аnd his real. essence, January In Handeen ar gues paid that because LeMaire no rent to LeMaire, 4-87-164, slip op. Handeen v. No. parents filing Chapter his case, before 13 12, 1987). (Bankr.Minn. at 13 November pay any he should not have to rent years. for the next five These indicate that the bank- ruptcy court made its portions testimony support determination on Various only faith after bankruptcy careful consideration the finding court’s that Le- circumstances, totality payment per and based Maire’s month to his $240 its decision on LeMaire’s parents motivation and was ex- reasonable. LeMaire sincerity. implore While bankruptcy plained required we pay that he was not great courts to take debtor’s seeks to sult of criminal ascertaining care in graduate rent while he was in father, school. His LeMaire, faith where the Henry debts he testified that he were incurred as pay by a re- allowed LeMaire to ing ate school in 1986. his rent work- activity, we are finishing gradu- confident around the house after bankruptcy that the court reached the Henry cor- testi- further, however, expected regular that he his Maire has a monthly sup- fied income is 1987, pay beginning January rent son to ported by the record. Gregory pay

and that if LeMaire did not rent he would be asked leave $240 V. express- the house. ly found that there was no collusion in Handeen relies on Minn.Stat. pay agreeing LeMaire’s the rent. “Fur- argue 541.05 to that parents’ LeMaire’s thermore, what Handeen asks is not for the $3,600 claim based on a loan to their son of sacrifices, make further financial debtor to legal six-year fees is barred stat required parents but that his be to make ute of agree limitations. We with the by waiving any further financial sacrifices bankruptcy court’s conclusion that Lemaire proper rent. I do not think that that is a waived the statute. See State v. Hart Mo prop- purpose code nor a Inc., Express, tor 270 Minn. inquiry by er a court in that context.” (1964) (defense N.W.2d 391 based on stat January Court Order of waived). ute of limitations be agree. at 2. We supports record court’s con agree findings by We also with the clusion parents that LeMaire and his con professional court that the sidered the family obligation loans a to be expenses professional necessity, awere al repaid regardless of the statute. Further though expressly required not under the more, under Bannitz v. Hardware Mutual fellowship. terms of the Co., Casualty 219 Minn. 17 N.W.2d (1945), thе statute of limitations had IV. yet begun to run because the argues bankrupt- payment. never demanded Id. 17 N.W.2d cy by approving court erred LeMaire’s (where parties agree at 373 express either reg- when LeMaire had no ly impliedly payable that a debt is income, ular but rather received a research demand, begin debt does not to run until stipend. plan may A ap- be made). demand for proved if the has an income “suffi- debtor ciently regular stable and to enable such argument Handeen also raises an payments individual to make under a frauds, based on the statute of which bars * * 101(29). 11 U.S.C. § year more dеbts than one old on the date of Estus, In this court noted that filing they writing. appli unless are in If 13 relief is available to individual with cable, preclude the statute of frauds would income, regular wages whether from or nearly the entire claim made LeMaire’s other sources. 695 F.2d at 314. The court parents. argument Handeen’s fails to rec specifically recognized “Chapter that however, ognize, that the statute of frauds security recipi- debtors would include social application has no where verbal contract ents, self-employed people, pensioners or performed year could be within one even professionals.” agree Id. at n. 3. We with though it runs for an indefinite time. Ek the district court refusing to consider lund v. Brass and Vincent Aluminum regular monthly stipend as income would Co., (Minn.App.1984). 351 N.W.2d 371 Le impose unduly an interpretation restrictive repaid Maire could have each of his debts light in language the term of the broad year, though to his within one even reading of the statute and our of it in he did not. facts, The Estus. found the bank- court, ruptcy averaged reveal that LeMaire Finally, bankruptcy find the we $16,000 an annual taxable income of from $8,772 court’s conclusion that the allowed fellowship during past years, two parents’ аs the amount of LeMaire’s claim fellowship that his would renewed for a be loan, gift, fully supported not a to be was year, third and that he has been offered a by the record. post-fellowship position research with a The court University $18,500. decisions salary scientist at a affirmed. court’s conclusion that Le- and district court are GIBSON, incurred is a fact that Judge, which the debt was JOHN R. Circuit I dissenting. ignored. have no hesitation be bankruptcy court and holding in much of respectfully I dissent. While in clearly were erroneous the district court body reflects the the court’s discussion ignoring the circumstances under which develоped approach on the law that has was incurred and whether it would the debt eases, Chapter 13 enthusiasm court’s I dischargeable Chapter 7. would be avoiding judicial causes it to stand activism judgment for the in- reverse and hold justice on its head. tentionally nondischarge- injuries inflicted properly The district court observes able. proceeding in a under U.S.C. judgment resulting from an dischargeable. intentional tort would not be gloss imparted judicial

In the that has been nondischargeability

to the issue context, specifically 1325(a),

requirements of 11 U.S.C. we totality ‍‌‌‌‌‌‌​​‌​‌‌​‌​​‌​​​​‌​​​​​​​​​‌‌‌‌​​‌​​​‌‌​‌‌​​‍to the of the circum-

have looked inquiry stances. We include in our America, Appellee, UNITED STATES of discharged, type sought to be debt v. nondischargeable whether such debt is BEAR, Dunn, sincerity Tayron the motivation and Loren GREY Dale special of the debtor and existence of Terry Dunn, George Leonard a/k/a circumstances, with illustrative reference Perez, Fox and Emmanuel John a/k/a expenses. to inordinate medical Perez, Appellants. John Zellner, In our decisions in Estus we America, Appellee, UNITED STATES also indicated that consideration should be given as to whether the debtor has “unfair- ly manipulated Code.” See CAVANAUGH, Henry Dean Jesse Paul circumstances, ante at 1379. I Under these Cavanaugh, Maynard Dunn, James

think the court and district Timothy Sylvester Longie, Jr., Roger clearly court were erroneous in their deter- Charboneau, Dwayne Darrel Allen judgment mination that the debt for inten- Charboneau, LaFuente, Richard John fatal, tionally inflicting nearly gunshot LaFuente, Ricky Appellants. a/k/a wound on the creditor Handeen should be 86-5264, Nos. 86-5265. discharged. today swayed by court’s concern with the Appeals, United States Court of having debtor to live the rest of his life Eighth Circuit. significant judgment with a that would be Submitted Feb. 1989. inimical to a fresh start. ante See at 1380. completely equation This leaves out of the Aug. Decided intentionally injured the fact that the credi- tor has live the rest of his life with the

injuries partial inflicted and with the paid

amount on the only as his

balm.

As the Seventh Circuit in Matter of

Smith, (7th Cir.1988),

observed, totality of the circumstances

test can lead to a conclusion that the bank-

ruptcy in failing court erred to consider the

circumstances which the debt arose and they

the fact that nondischargeable were 7. The circumstances under

Case Details

Case Name: In Re Gregory A. Lemaire, Debtor. Paul Handeen v. Gregory A. Lemaire

Court Name: Court of Appeals for the Eighth Circuit

Date Published: Jul 5, 1989

Citation: 883 F.2d 1373

Docket Number: 88-5275

Court Abbreviation: 8th Cir.