Salvatore v. Salvatore (In re Salvatore)
Salvatore v. Salvatore (In re Salvatore)
Opinion of the Court
On May 28, 2015 (the "Petition Date"), Matthew B. Salvatore (the "Defendant"), filed a voluntary Chapter 7 petition. The deadline to file objections to discharge or dischargeability of a debt was set as August 24, 2015. No objections were filed, and the Debtor received a discharge on August 26, 2015. (ECF No. 17). On January 9, 2016, the Chapter 7 Trustee filed a report of no distribution and the bankruptcy case was closed on January 13, 2016.
On June 19, 2017, Michele Salvatore (the "Plaintiff"), filed a motion to reopen the case. After a hearing held on June 27, 2017, the Court entered an Order Granting the Plaintiff's Motion to Reopen Bankruptcy Case in Order to Obtain Determination of Nondischargeability Pursuant to
On August 24, 2017, the Plaintiff filed an adversary complaint against the Defendant (the "Complaint," Adv. Pro. ECF No. 1), seeking a determination of nondischargeability of a debt owed to her pursuant to
The Motion to Dismiss asserts that Count One and Count Two should be dismissed for lack of jurisdiction, lack of notice, and failure to state a claim upon which relief may be granted. The Defendant also asserts that dismissal of Count Three is appropriate due to a "lack of disclosure," and because the claim is time-barred. On November 1, 2017, the Plaintiff filed an Objection to the Motion to Dismiss (Adv. Pro. ECF 14), and a Memorandum of Law in Opposition to the Motion to Dismiss (Adv. Pro. ECF 15) (collectively, the "Objection"). On November 20, 2017, the Defendant filed a Reply to the Objection (the "Reply," Adv. Pro. ECF 17). After reviewing all relevant submissions by both parties, and for the reasons set forth below, the Motion to Dismiss is hereby GRANTED in part and DENIED in part.
II. Jurisdiction
The Court has subject matter jurisdiction over this adversary proceeding pursuant to
III. Standard
A. Federal Rule of Civil Procedure 12(b)(1) -subject matter jurisdiction
Federal Rule of Civil Procedure 12(b)(1) is made applicable in bankruptcy proceedings through Bankruptcy Rule 7012(b). See Fed. R. Bankr. P. 7012(b). "A case is properly dismissed for lack of subject *374matter jurisdiction under Rule 12(b)(1) when the district court lacks the statutory or constitutional power to adjudicate it." In re Ener1, Inc. ,
B. Federal Rule of Civil Procedure 12(b)(6) -failure to state a claim upon which relief can be granted
Rule 12(b)(6) of the Federal Rules of Civil Procedure is made applicable in bankruptcy proceedings through Bankruptcy Rule 7012(b). See Fed. R. Bankr. P. 7012(b). To survive a motion to dismiss under Fed. R. Civ. P. 12(b)(6), a pleading must contain a short, plain statement of the claim showing the pleader is entitled to relief,
In Iqbal , the United States Supreme Court described a two-step analysis to evaluate the sufficiency of a complaint. First, all allegations contained in the complaint, except legal conclusions or "naked assertions," must be accepted as true, and second, the complaint must state a plausible claim for relief.
C. Federal Rule of Civil Procedure 9(b) -pleading fraud with particularity
Federal Rule of Civil Procedure 9(b) is made applicable in bankruptcy proceedings through Bankruptcy Rule 7009. See Fed. R. Bankr. P. 7009. Rule 9(b) requires a party to state with particularity the circumstances surrounding an allegation of fraud. Fed. R. Civ. P. 9(b) ; Fed. R. Bankr. P. 7009. Pleading fraud with particularity "ordinarily requires a complaint alleging fraud to (1) specify the statements that the plaintiff contends were fraudulent, (2) identify the speaker, (3) state where and when the statements were made, and (4) explain why the statements were fraudulent." United States ex rel. Chorches for Bankr. Estate of Fabula v. Am. Med. Response, Inc. ,
IV. Facts Alleged in the Complaint
The Complaint alleges the following facts, which pursuant to Iqbal and other controlling case law, the Court must accept as true for the purposes of the Motion to Dismiss:
1. The Plaintiff and the Defendant were married in April 2003. Compl. at ¶ 6.
2. On October 16, 2014, the Defendant was arrested for an altercation with the Plaintiff where the Defendant spit on and yelled at the Plaintiff in front of their children, pretended the Plaintiff hit him with her car, and called the police on the Plaintiff to falsely report the same (the "October 2014 incident"). Id. at ¶¶ 14-24.
3. On May 31, 2015, the Court's BNC Certificate of Mailing (ECF No. 6) regarding the notice of commencement of the Defendant's Bankruptcy Case was docketed. Id. at ¶ 32.
4. The Plaintiff was not listed on the May 31, 2015 BNC Certificate of Mailing. Id. at ¶ 34.
5. On June 18, 2015, the Defendant filed an Amended List of Creditors with the Plaintiff's name listed (ECF No. 11), but no certification appears on the docket regarding service of the Amended List of Creditors, and the Plaintiff did not receive notice. Id. at ¶¶ 35-6.
6. On June 18, 2015, the Defendant filed his bankruptcy schedules, listing the Plaintiff as a "Notice Party" on Schedule F, with a claim amount listed as "N/A," but did not serve the Plaintiff with the schedules. Id. at ¶ 37.
7. The Plaintiff's claims for alimony and child support payments were not listed on the Defendant's schedules, and Schedule E stated that the Defendant had no creditors holding unsecured priority claims. Id. at ¶ 38.
8. The Defendant listed no claim relating to the October 2014 Incident. Id.
9. The Defendant's Schedule J lists a $1,000.00 "Guardian Ad Litem" expense and $2,600 "Support/Alimony" expense. Id. at ¶ 39.
10. The first notice the Plaintiff received of the Defendant's bankruptcy case was receipt of the Court's August 28, 2015 BNC Certificate of Mailing (ECF No. 18) regarding the Defendant's discharge. Id. at ¶¶ 41-3.
V. Analysis of Claims raised in the Motion to Dismiss for Lack of Jurisdiction
A. Pleading Deficiencies
At the outset, and as noted in the Objection, the Motion to Dismiss fails to provide any procedural basis upon which the Defendant relies to obtain the relief requested. The Reply cites to Federal Rule of Bankruptcy Procedure 9024, which specifically states that actions to revoke a discharge must be brought within one year pursuant to
*376the grounds for seeking relief, this rule is meant to give notice of the claims to the court and the opposing party and to provide the opposing party an opportunity to respond. Feldberg v. Quechee Lakes Corp. ,
B. Subject Matter Jurisdiction
The Defendant further argues that the "Adversary Proceeding be dismissed for lack of Jurisdiction." The Court has determined that it has subject matter jurisdiction over the adversary proceeding pursuant to
C. Adequate Notice
The Defendant predominately argues that that the Plaintiff had notice of his bankruptcy case and therefore this action must be dismissed.
D. Dismissal of Counts One and Two
Although the arguments advanced in the Motion to Dismiss Counts One and Two are limited to whether the Plaintiff received notice of the bankruptcy case prior to the Defendant receiving a discharge (addressed above), the Defendant also argues in his Reply that the Plaintiff only pleaded "mere allegations" of the elements of
i. Count One-Nondischargeability of Debt Pursuant to
Section 523(a)(3)(B) provides, in relevant part:
(a) A discharge under section 727... of this title does not discharge an individual debtor from any debt-
(3) neither listed nor scheduled under section 521(a)(1) of this title, with the name, if known to the debtor, of the creditor to whom such debt is owed, in time to permit-
(B) if such debt is of a kind specified in paragraph (2), (4), or (6) of this subsection, timely filing of a proof of claim and timely request for a determination of dischargeability of such debt under one of such paragraphs, unless such creditor had notice or actual knowledge *377of the case in time for such timely filing request.
In this case, the first element of the Bartomeli test is met. Although the Defendant listed the Plaintiff's name on his Schedule F as a "Notice Party" and listed the amount of the claim as "N/A," Scheduled F was not served on the Plaintiff before the deadline to file an objection to discharge and/or a nondischargeability action. Compl. at ¶ 37. Additionally, alimony and child support payments were not listed on the Defendant's schedules, and neither was any reference to the October 2014 incident. Id. at ¶ 38. Taking these allegations as true, the first requirement of
ii. Count Two-Nondischargeability of Debt Pursuant to
The third element of an
(a) A discharge under section 727... of this title does not discharge an individual debtor from any debt-
(6) for willful and malicious injury by the debtor to another entity or to the property of another entity.
With respect to the first element, the Plaintiff relies on the facts of the October 2014 incident where the Defendant publically shouted at and insulted the Plaintiff, spit on her, pretended to be hit by her car, and called the police to make a false report, all in front of the parties' minor children. Compl. at ¶¶ 15-21. The Plaintiff *378alleges that this led to an injury amounting to intentional infliction of emotional distress, false imprisonment, slander per se, and assault. Id. at ¶ 56. In accepting these allegations as true, the Court finds these actions allege a cause of action of deliberate and intentional injury within the meaning of Section 523(a)(6). The Defendant's alleged conduct during the October 2014 incident also satisfies the second element of maliciousness, as defined by Stelluti , because the Defendant's actions that day were "without just cause" and "excessive." Finally, the Plaintiff properly alleged that the Defendant's conduct and actions, which were willful and malicious, caused her harm.
Therefore, the Plaintiff has pleaded a legally sufficient claim under
A. Dismissal of Count Three
The Defendant argues there was a "lack of disclosure" that the Plaintiff would be seeking to revoke his discharge, that Count Three is time barred by
The Defendant next argues that Count Three is time barred by
Because Count Three is time-barred pursuant to
VI. Conclusion
For the reasons set forth above, it is hereby
ORDERED: Pursuant to Fed. R. Civ. P. 12 and Fed. R. Bankr. P. 7012, the Defendant's Motion to Dismiss as to Count One and Two of the Complaint is DENIED ; and it is further
ORDERED: Pursuant to
ORDERED: A Pretrial Conference shall be held in this adversary proceeding on July 24, 2018 at 11:00 a.m. to discuss, among other things, the entry of a Pretrial Order in this adversary proceeding.
Fed. R. Civ. P. 8(a)(2).
The Defendant cites to In re Greenberg , a case where a creditor and counsel similarly argued they lacked notice.
Reference
- Full Case Name
- IN RE: Matthew B. SALVATORE, Debtor. Michele Salvatore v. Matthew B. Salvatore
- Cited By
- 9 cases
- Status
- Published