Macy v. Macy
Macy v. Macy
Opinion
UNITED STATES COURT OF APPEALS FOR THE FIRST CIRCUIT
No. 96-2185
ROBERT D. MACY,
Plaintiff - Appellant,
v.
ANNA LOWELL MACY,
Defendant - Appellee.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Edward F. Harrington, U.S. District Judge]
Before
Torruella, Chief Judge,
Selya, Circuit Judge,
and Saris,* District Judge.
James F. Coffey, with whom Carolyn A. Bankowski and Coffey & Shea were on brief for appellant. Mark G. DeGiacomo, with whom Barbara J. Kroncke and Roche, Carens & DeGiacomo, P.C. were on brief for appellee.
May 23, 1997
* Of the District of Massachusetts, sitting by designation.
TORRUELLA, Chief Judge.
R
Anna Lowell Macy, the debtor's ex-spouse, brought an action under
and (a)(15),2 seeking a ruling that the 7 of the Bankruptcy Code on October 31, 1994. On March 17, 1995, U.S.C. SS 523(a)(5)1
A discharge under section 727 . . . The debtor in this case, obert D. Macy, filed a voluntary bankruptcy petition under Chapter 11 1 Section 523(a)(5) provides, in relevant part: not discharge an individual debtor from any debt-- . . . does (a) (5) to a spouse, former spouse, or child of the debtor, for alimony to, maintenance for, or support of such spouse or child, in connection with a separation agreement, divorce decree or other order of a court of record, determination made in accordance with State or territorial law by a governmental unit, or property settlement agreement, but not to the extent that -- . . . (B) such debt includes a liability designated as alimony, maintenance, or support, unless such liability is actually in the nature of alimony, maintenance, or support.
11 U.S.C. S 523(a)(5).
2 Section 523(a)(15) provides, in relevant part:
(a) A discharge under section 727 . . . does not discharge an individual debtor from any debt -- . . . (15) not of the kind described in paragraph (5) that is incurred by the debtor in the course of a divorce or separation or in connection with a separation agreement, divorce decree or other order of a court of record. . . .
11 U.S.C. S 523(a)(15).
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payments required by the parties' separation agreement were
nondischargeable. At trial it was agreed "that no issues of fact
remain in dispute and the only issue before the court is the
dischargeabil ity of $33,706.98 in pre-petition attorneys' fees and
disbursements." In re Macy,
192 B.R. 802, 803(Bankr. D. Mass.
1996). The plaintiff filed her action within the time prescribed
for
11 U.S.C. S 523(a)(5), but beyond the somewhat shorter period
prescribed for
11 U.S.C. S 523(a)(15). The parties have agreed
throughout the litigation, therefore, that if the debt is not of
the kind described in
11 U.S.C. S 523(a)(5), but falls instead
under section 523(a)(15), then it is dischargeable.
The bankruptcy court held that the attorneys' fees and
disbursements incurred in connection with the plaintiff's efforts
to collect alimony, maintenance, or child support are governed by
section 523(a)(5) of the Bankruptcy Code and, on the facts of this
case, are not dischargeable. Macy,
192 B.R. at 806. On appeal to
the United States District Court for the District of Massachusetts,
the decision was affirmed. The debtor-appellant now appeals to
this court.
The only issue on appeal is whether section 523(a)(5)
or section 525(a)(15) furnishes a vehicle for testing the non-
dischargeabil ity of attorneys' fees incurred by a former spouse in
an effort to enforce payments required by a divorce decree.
Holding that attorneys' fees incurred by a former spouse in the
course of seeking to enforce support-related payments required by
a divorce decree are properly nondischargeable under
11 U.S.C. S 523(a)(5), we affirm.
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We find that the reasoning of the decisions below is
sound, and affirm for substantially the reasons put forth therein.
See Macy v. Macy,
200 B.R. 467, 468-69 (Bankr. D. Mass. 1996); In
re Macy,
192 B.R. at 802-03. See generally Lawton v. State Mut.
Life Assurance Co.,
101 F.3d 218, 220(1st Cir. 1996) ("[W]hen a
lower court produces a comprehensive, well-reasoned decision, an
appellate court should refrain from writing at length to no other
end than to hear its own words resonate"). We add only the
following brief discussion.
The foundation of appellant's argument is that the
Bankruptcy Reform Act of 1994,
Pub. L. No. 103-394, 108Stat. 4106
(1994), by adding section 523(a)(15), has impliedly amended the
appropriate interpretation of section 523(a)(5), changing the way
in which attorneys' fees should be classified. By its terms,
section 523(a)(15) includes only debt that is "not of the kind
described in [section 523(a)](5)." Furthermore, it is not disputed
that prior to the enactment of the Bankruptcy Reform Act, fees of
the sort at issue were nondischargeable under section 523(a)(5).
See , e.g. , In re Coleman,
37 B.R. 120, 123(Bankr. W.D. Wisc. 1984)
("There has been virtual unanimity among bankruptcy courts and
appellate courts . . . that attorney's fees incurred by a spouse
are nondischargeable so long as the primary debt is excepted from
discharge.") The question, therefore, is whether the Bankruptcy
Reform Act had the effect of removing attorneys' fees of the sort
at issue here from the reach of section 523(a)(5).
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A review of existing case law and the legislative history
of section 523(a)(15) leads us to the conclusion that attorneys'
fees continue to be governed by section 523(a)(5). There is a
strong policy interest in protecting ex-spouses and children from
the loss of alimony, support and maintenance owed by a debtor who
has filed for bankruptcy. See Shine v. Shine,
802 F.2d 583, 585-88(1st Cir. 1986). This policy is emphasized in the legislative
history of section 523(a)(15), which reads:
This section is intended to provide greater protection for alimony, maintenance, and support obligations owing to a spouse, former spouse, or child of a debtor in bankruptcy. . . .
[Section 523(a)(15)] adds a new exception to discharge for some debts that are not in the nature of alimony, maintenance or support. In some instances, divorcing spouses have agreed to make payments of marital debts, holding the other spouse harmless from those debts, in exchange for a reduction in alimony payments. In other cases, spouses have agreed to lower alimony based on a larger property settlement. If such "hold harmless" and property settlement obligations are not found to be in the nature of alimony, maintenance, or support, they are dischargeable under current law. The non-debtor spouse may be saddled with substantial debt and little or no alimony or support. This section will make such obligations nondischargeable. . . .
H.R. Rep. No. 103-835 at S 304 (1994). This legislative history
demonstrates that Congress sought to apply section 523(a)(15) to
debts that had previously been construed as property obligations.
See, e.g., In re Kritt,
190 B.R. 382, 385 n.4 (9th Cir. B.A.P.
1995) ("Section 523 has subsequently been amended to add a new
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section 523(a)(15), which provides that property settlements are
now generally nondischargeable in bankruptcy.") There is no
indication that Congress intended to affect the liberal
interpretation of section 523(a)(5). It follows, then, that
Congress did not intend to apply section 523(a)(15) to debts that
were, prior to the Bankruptcy Reform Act, considered to be non-
dischargeable under section 523(a)(5).
Affirmed.
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Reference
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