NOT FOR PUBLICATION

UNITED STATES BANKRUPTCY APPELLATE PANEL

OF THE NINTH CIRCUIT

In re:

NEAL JONES and AMY JONES, 

 Debtors. 

BAP No. AZ-21-1203-FLS

BAP No. AZ-22-1104-FLS

(Related Appeals)

Bk. No. 4:15-bk-00508-BMW

 

Adv. No. 4:15-ap-00283-BMW

NEAL JONES,

 Appellant, 

v.

RUCHIR PATEL, 

Appellee.

NEAL JONES; AMY JONES,

 Appellants, 

v.

RUCHIR PATEL,

Appellee.

MEMORANDUM*

Appeal from the United States Bankruptcy Court

for the District of Arizona

Brenda Moody Whinery, Bankruptcy Judge, Presiding

Before: FARIS, LAFFERTY, and SPRAKER, Bankruptcy Judges.

INTRODUCTION

Dr. Neal Jones hired Dr. Ruchir Patel to work at his incorporated 

* This disposition is not appropriate for publication. Although it may be cited for 

whatever persuasive value it may have, see Fed. R. App. P. 32.1, it has no precedential 

value, see 9th Cir. BAP Rule 8024-1. 

FILED

MAR 14 2023

SUSAN M. SPRAUL, CLERK

U.S. BKCY. APP. PANEL

OF THE NINTH CIRCUIT
2

orthodontic practice in Illinois. Shortly thereafter, Dr. Jones relocated to 

Arizona and directed the corporation’s business manager to withhold 

Dr. Patel’s salary. Dr. Patel eventually obtained an Illinois state court 

judgment against Dr. Jones and the corporation for unpaid wages.

Dr. Jones and his wife, Amy Jones, filed for chapter 71 bankruptcy 

protection in Arizona, and Dr. Patel sought to have the Illinois judgment 

declared nondischargeable. After a trial, the bankruptcy court denied 

discharge of the judgment debt under § 523(a)(6). It held that the judgment 

was enforceable against the Joneses’ community property and that the 

Illinois state interest rate, rather than the federal rate, applied to the 

judgment.

In these related appeals, Dr. Jones argues that the bankruptcy court 

erred by finding that he intended to injure Dr. Patel and did so without just 

cause or excuse. The Joneses also argue that the court erred in holding that 

the Illinois judgment is enforceable against the marital community and 

accrues interest at the Illinois state rate.

All of the Joneses’ arguments are meritless. We AFFIRM.

FACTS

A. Dr. Patel’s employment at Dr. Jones’ orthodontic practice

Dr. Patel entered into a two-year employment agreement with Sauk 

1 Unless specified otherwise, all chapter and section references are to the 

Bankruptcy Code, 11 U.S.C. §§ 101-1532, and all “Rule” references are to the Federal 

Rules of Bankruptcy Procedure.
3

Valley Orthodontics, P.C. (“SVO”), a corporation owned by Dr. Jones in 

Illinois.2 SVO agreed to pay Dr. Patel a monthly salary and did not 

condition his compensation on the corporation’s cashflow.

Around the time Dr. Patel began working at SVO, Dr. Jones relocated 

from Illinois (which is not a community property state) to Arizona (which 

is a community property state) and set up an orthodontic practice under 

two entities. Dr. Patel became SVO’s sole practicing orthodontist.

About a year and a half into Dr. Patel’s employment, SVO fell behind 

on Dr. Patel’s monthly compensation. Although Dr. Patel was “begging” to 

be paid, Dr. Jones directed Michael Squires – SVO’s accountant and the 

person largely responsible for office management at Dr. Jones’ direction –

to withhold payment to Dr. Patel and instead pay SVO’s other debts and 

obligations.

In an e-mail to Mr. Squires dated March 21, 2013, Dr. Jones stated that

SVO would not pay Dr. Patel in full before the end of his employment 

term, so Dr. Patel was “trapped into playing along [with] us.” In the same 

e-mail, Dr. Jones directed Mr. Squires to withhold payment to Dr. Patel: 

[C]ontinue to not pay his full monthly salary; without 

communicating this to him, pay him relative to collections; we 

can select some figure that allows us to keep paying everyone 

else, grow a reserve, and stay afloat; don’t budge on [this]

position; when [Dr. Patel] is motivated to be paid more 

(including to get his back pay), he’ll help the office do better; 

2 At the time the parties entered into the agreement, the business was known as 

Neal Jones, D.D.S., M.S., P.C., an Illinois Corporation.
4

pay [Dr. Patel] less, not more until things get better; ensure 

creditors are paid, but not [Dr. Patel]; [Dr. Patel] will likely 

change his attitude and behavior (major source of SVO’s 

problems) when he gets less pay, not more . . . . 

In later e-mails, Dr. Jones told Mr. Squires: “You must be paid, I must 

be paid, the [office staff] must be paid, the suppliers must be paid, and the 

creditors must be paid[;]” and “I’ve learned that [Dr. Patel] unless [sic] has 

to fear something (generates motivation) or he’ll continue being apathetic.”

Mr. Squires followed Dr. Jones’ direction and did not pay Dr. Patel timely 

or in full. Dr. Patel ceased working at SVO in September 2013.

B. The Illinois litigation and judgment

After SVO defaulted in making payments under a mediated 

resolution, Dr. Patel obtained an arbitration award against Dr. Jones and 

SVO for $68,455. The Illinois state court confirmed the award and entered a 

judgment against Dr. Jones and SVO for $73,254 (the “Illinois Judgment”).3

Shortly thereafter, SVO ceased operations.

C. The Joneses’ bankruptcy proceedings

On January 20, 2015, Dr. Jones and Mrs. Jones filed a joint chapter 7 

petition in the District of Arizona. The Joneses scheduled the Illinois 

Judgment and described the debt as a non-contingent, liquidated, 

undisputed community obligation.

3 The parties agree that the Illinois Judgment is a final judgment entitled to full 

faith and credit.
5

Dr. Patel filed an adversary complaint against Dr. Jones, seeking to 

deny discharge and have the Illinois Judgment declared nondischargeable

under §§ 523(a)(2)(A), (a)(4), and (a)(6). Dr. Patel later filed the operative

amended complaint that sought judgment against both Dr. Jones and “the 

community composed of Neal LeBaron Jones and Amy Melissa Jones.” He 

alleged that Dr. Jones’ actions “were undertaken on behalf of the 

community of Neal LeBaron Jones and Amy Melissa Jones and [the debt] is 

therefore a community obligation.”

In his answer to the complaint, Dr. Jones admitted that all of the 

conduct alleged in the adversary complaint was undertaken on behalf of 

the marital community and that the debt was therefore a community 

obligation.

The Joneses moved to dismiss the amended complaint. Among other 

things, they argued that Mrs. Jones should be dismissed with prejudice. 

The court granted the motion as to the § 727(a) claim and all claims against 

Mrs. Jones. The order did not address the claims against the “community” 

of Dr. Jones and Mrs. Jones.

1. The trial on the nondischargeability claims

The bankruptcy court held a two-day trial on Dr. Patel’s amended 

complaint. Mr. Squires, Dr. Patel, and Dr. Jones testified.

Mr. Squires testified about SVO’s operations and financial affairs. He

read e-mails into the record, including the e-mail in which Dr. Jones stated
6

that “we have [Dr. Patel] trapped into playing along with us.”4 Dr. Jones’ 

counsel did not ask Dr. Jones any questions about the e-mails; at oral 

argument before this Panel, counsel explained that he made a tactical 

judgment not to highlight the e-mails.

Dr. Jones testified that he did not intend to harm Dr. Patel. Rather, he 

explained that he, SVO, and Mr. Squires tried their best to pay everyone, 

but they had many expenses and Dr. Patel “was the one that had the 

biggest expenditure.”

2. The nondischargeability ruling

On September 1, 2021, the bankruptcy court issued its memorandum 

decision holding that the Illinois Judgment was nondischargeable. It

addressed only the § 523(a)(6) claim: whether the Illinois Judgment was a 

debt for willful and malicious injury. It stated that, under Petralia v. Jercich 

(In re Jercich), 238 F.3d 1202, 1205 (9th Cir. 2001), a debt is nondischargeable 

if (1) the debtor’s conduct was tortious under state law; and (2) the debtor’s 

conduct was both willful and malicious.

First, the bankruptcy court held that Dr. Jones’ conduct was tortious 

under Illinois law. It considered the five-part test for the tort of intentional 

interference with a contract laid out in HPI Health Care Services, Inc. v. Mt.

Vernon Hospital, Inc., 545 N.E. 2d 672, 676 (Ill. 1989). In particular, the court 

discussed the third prong: “the defendant’s intentional and unjustified 

4 Dr. Jones initially objected to the admission of the e-mails, including the 

“trapped” e-mail. He later withdrew his objection.
7

inducement of a breach of contract.” The court referenced Dr. Jones’ 

written communication and found that he “intended to induce SVO to 

breach the Agreement. Dr. Jones expressly and unambiguously instructed 

Mr. Squires, acting on behalf of SVO, to withhold wages to Dr. Patel, which 

wages Dr. Jones knew were due and owing under the agreement.” It

further stated that Dr. Jones’ actions were unjustifiable:

Dr. Jones’s intentional inducement was unjustifiable given that 

Dr. Jones induced SVO to breach the Agreement for the 

primary purpose of causing injury to Dr. Patel. In the March 

2013 Directives, Dr. Jones explicitly directed Mr. Squires to 

withhold wages from Dr. Patel, while continuing to pay the 

other debts of SVO, in order to cause financial injury to 

Dr. Patel, whereby [sic] generating “fear” and/or “motivation.” 

Although Dr. Jones suggests that his conduct was justified 

because it was guided by his business judgment and was 

dictated by the inability of SVO to make the agreed-upon 

payments to Dr. Patel, Dr. Jones’s actions were contrary to the 

best interests of SVO, and any alleged inability of SVO to pay 

Dr. Patel pursuant to the Agreement is unpersuasive. During 

the period of time during which SVO was, at Dr. Jones’s 

direction, withholding Dr. Patel’s wages, Dr. Jones was 

withdrawing funds from SVO for his own benefit, including in 

the form of distributions and loans, and directing SVO to pay 

costs related to such things as his personal vacation timeshare.

The bankruptcy court found that “SVO breached the Agreement as a direct 

result of Dr. Jones’s wrongful conduct.”

The bankruptcy court next considered whether the injury was 

“willful.” It found both that Dr. Jones had a subjective motive to injure 
8

Dr. Patel and that he believed injury was substantially certain to occur as a 

result of his actions. The evidence established “a deliberate and malicious 

pattern of conduct aimed at inflicting willful injury upon and causing 

economic distress to Dr. Patel.” The court found that “Dr. Jones took steps 

to ‘trap’ Dr. Patel into continuing to perform services for SVO without 

being paid pursuant to the terms of the Agreement, all the while 

continuing to siphon funds out of SVO for his personal benefit.”

Finally, the bankruptcy court considered whether the injury was 

malicious. It concluded that “Dr. Jones fraudulently engaged in wrongful 

conduct by intentionally inducing SVO to repeatedly breach the terms of 

the Agreement, Dr. Jones’s conduct was unjustified, and Dr. Jones’s 

wrongful conduct caused injury to Dr. Patel.” Based on “the entire record 

before the Court,” it determined that Dr. Jones acted with malice.

The bankruptcy court entered judgment in favor of Dr. Patel on the 

§ 523(a)(6) claim (“Nondischargeability Judgment”). It ordered “that 

interest shall accrue on this Judgment at the rate specified in 28 U.S.C. 

§ 1961 from entry of this Judgment, until paid.”

Dr. Jones timely appealed the Nondischargeability Judgment.

3. Dr. Patel’s postjudgment motions

Dr. Patel filed two motions after the bankruptcy court entered the 

Nondischargeability Judgment.

In his first motion, Dr. Patel sought fees and costs and clarification

that the Nondischargeability Judgment did not alter his right to recover 
9

postjudgment interest on the Illinois Judgment under Illinois statute. The 

bankruptcy court granted this motion, concluding that the 

Nondischargeability Judgment only determined dischargeability and did 

“not establish the amount of the debt or constitute a new money judgment 

under federal law sufficient to trigger 28 U.S.C. § 1961.” Accordingly, 

Dr. Patel was entitled to postjudgment interest at the Illinois statutory rate.

In his second motion, Dr. Patel sought a declaratory judgment that 

the Joneses’ marital community was liable for the Illinois Judgment. The 

court granted this motion for two reasons. First, the court noted that the 

Joneses admitted in their bankruptcy schedules that the Illinois Judgment 

was a community debt, and Dr. Jones admitted in his answer to the 

complaint in the adversary proceeding that all of his actions were done for 

the benefit of the community. Second, even putting aside the admissions, 

the bankruptcy court held that the debt is a community obligation under 

Arizona state law. It applied the Arizona standard that “[d]ebt incurred by 

one spouse while acting for the benefit of the marital community is a 

community obligation whether or not the other spouse approves it.” 

Lorenz-Auxier Fin. Grp., Inc. v. Bidewell, 772 P.2d 41, 43 (Ariz. Ct. App. 1989). 

The court found that Dr. Jones was the primary source of income for his 

family and the debt was incurred for the benefit of Dr. Jones and his family.

The bankruptcy court held that it did not matter that Mrs. Jones was 

not joined in the Illinois proceedings. It relied on Gagan v. Sharar, 376 F.3d 

987 (9th Cir. 2004), and held that Arizona Revised Statutes (“ARS”) § 25-
10

215(D) does not mandate that joinder is an absolute prerequisite to an 

execution of community property. It rejected the Joneses’ argument that 

Mrs. Jones had not received due process, because she had an opportunity 

to participate in the adversary proceeding but had moved the court to 

dismiss her from it.

Finally, the bankruptcy court held that, “because the debt is 

nondischargeable, and because the debt is a community debt under 

applicable state law, pursuant to § 524(a)(3) of the Bankruptcy Code, the 

Community does not receive the benefit of the Chapter 7 discharge as to 

the debt at issue.”

The bankruptcy court entered an amended judgment (“Amended 

Judgment”). It ordered that the Illinois Judgment and any interest under 

Illinois state law are nondischargeable under § 523(a)(6). It further ordered 

that “this Judgment is enforceable against the marital community of Neal 

LeBaron Jones and Amy Melissa Jones.”

The Joneses timely appealed the Amended Judgment.

5

JURISDICTION

The bankruptcy court had jurisdiction under 28 U.S.C. §§ 1334 and 

157(b)(2)(I). We have jurisdiction under 28 U.S.C. § 158.

5 Dr. Patel filed a motion to supplement the record on appeal to include 

documents filed in the Joneses’ subsequent chapter 11 case. We DENY his motion: the 

events in the post-appeal chapter 11 case were not before the bankruptcy court when it 

ruled, and they have no bearing on any issue in these appeals.
11

ISSUES

1. Whether the bankruptcy court erred in finding that Dr. Jones

acted intentionally and without just cause or excuse.

2. Whether the bankruptcy court erred in holding that the Illinois 

Judgment was nondischargeable as to the Joneses’ marital community.

3. Whether the bankruptcy court erred in holding that 

postjudgment interest on the Illinois Judgment accrues at the Illinois 

statutory rate, rather than the federal rate.

STANDARDS OF REVIEW

We review de novo the bankruptcy court’s legal conclusions, 

including its construction of § 523(a)(6). Hamilton v. Elite of L.A., Inc. (In re 

Hamilton), 584 B.R. 310, 318 (9th Cir. BAP 2018), aff’d, 785 F. App’x 438 (9th 

Cir. 2019). Additionally, “[w]hether an appellant’s due process rights were 

violated is a question of law we review de novo.” DeLuca v. Seare (In re 

Seare), 515 B.R. 599, 615 (9th Cir. BAP 2014). “De novo review requires that 

we consider a matter anew, as if no decision had been made previously.” 

Francis v. Wallace (In re Francis), 505 B.R. 914, 917 (9th Cir. BAP 2014).

We review the bankruptcy court’s factual findings for clear error. In 

re Hamilton, 584 B.R. at 318. Factual findings are clearly erroneous if they 

are illogical, implausible, or without support in the record. Retz v. Samson 

(In re Retz), 606 F.3d 1189, 1196 (9th Cir. 2010). If two views of the evidence 

are possible, the court’s choice between them cannot be clearly erroneous. 

Anderson v. City of Bessemer City, 470 U.S. 564, 573-74 (1985).
12

When considering the “malicious” prong of § 523(a)(6)’s “willful and 

malicious” inquiry, the Ninth Circuit has instructed that

[t]he first three elements . . . of “malicious” are all questions of 

fact which we review for clear error. The fourth element, “just 

cause or excuse,” however, presents a mixed question of law 

and fact. A mixed question of law and fact occurs when the 

historical facts are established; the rule of law is undisputed, 

i.e., “just cause or excuse”; and the issue is whether the facts 

satisfy the legal rule.

Murray v. Bammer (In re Bammer), 131 F.3d 788, 791-92 (9th Cir. 1997) (en 

banc). Such mixed questions are reviewed de novo: “The question of 

whether a cause is ‘just’ is a textbook example of a legal conclusion 

informed by historical facts.” Id. at 792. 

Nevertheless, the parties agree that determinations that are primarily

fact-based are entitled to clear error review. The United States Supreme 

Court has clarified that some

mixed questions immerse courts in case-specific factual 

issues—compelling them to marshal and weigh evidence, make 

credibility judgments, and otherwise address what we have . . .

called “multifarious, fleeting, special, narrow facts that utterly 

resist generalization.” And when that is so, appellate courts 

should usually review a decision with deference. In short, the 

standard of review for a mixed question all depends—on 

whether answering it entails primarily legal or factual work.

U.S. Bank Nat’l Ass'n ex rel. CWCapital Asset Mgmt. LLC v. Vill. at Lakeridge, 

LLC, 138 S. Ct. 960, 967 (2018) (citations omitted) (holding that, where a 

determination depends on the “historical facts,” the finding “rests with a 
13

bankruptcy court, subject only to review for clear error”). Thus, we apply 

the clear error standard to the arguments that the bankruptcy court ignored 

or misinterpreted evidence regarding factual questions such as the status of 

SVO’s finances, payments to Dr. Patel, and Dr. Jones’ intent.

DISCUSSION

A. The bankruptcy court did not err in determining that the Illinois 

Judgment was nondischargeable under § 523(a)(6).

Dr. Jones argues that the bankruptcy court erred in holding that the 

Illinois Judgment was a debt for willful and malicious injury excepted from

discharge under § 523(a)(6). He limits his arguments to three discrete 

points: (1) due process as to a single e-mail; (2) SVO’s financial problems as 

a just cause or excuse for harming Dr. Patel; and (3) Dr. Jones’ lack of intent 

to harm Dr. Patel. We reject these arguments.

Section 523(a)(6) excepts from discharge any debt arising from 

“willful and malicious injury by the debtor to another entity or to the 

property of another entity[.]” The creditor must prove both willfulness and 

malice. Ormsby v. First Am. Title Co. of Nev. (In re Ormsby), 591 F.3d 1199, 

1206 (9th Cir. 2010). “Under Ninth Circuit law, willfulness and malice are 

two distinct elements that must not be conflated.” Comcast of L.A., Inc. v. 

Sandoval (In re Sandoval), 341 B.R. 282, 296 (Bankr. C.D. Cal. 2006).

The “willful injury requirement is met only when the debtor has a 

subjective motive to inflict injury or when the debtor believes that injury is 

substantially certain to result from his own conduct.” Carrillo v. Su (In re 
14

Su), 290 F.3d 1140, 1142 (9th Cir. 2002); see Barboza v. New Form, Inc. (In re 

Barboza), 545 F.3d 702, 706 (9th Cir. 2008) (“A ‘willful’ injury is a ‘deliberate 

or intentional injury, not merely a deliberate or intentional act that leads to 

injury.’” (citation omitted)). This analysis requires an inquiry into the 

debtor’s subjective state of mind. See In re Su, 290 F.3d at 1145-46. In other 

words, it is not enough to prove that the debtor acted intentionally and 

caused an injury. Kawaauhau v. Geiger, 523 U.S. 57, 61 (1998).

“A ‘malicious’ injury involves ‘(1) a wrongful act, (2) done 

intentionally, (3) which necessarily causes injury, and (4) is done without 

just cause or excuse.’” In re Jercich, 238 F.3d at 1209 (quoting In re Bammer, 

131 F.3d at 791).

Where, as here, the underlying injury stems from an alleged breach of 

contract, the debt is only nondischargeable if the “intentional breach of 

contract is accompanied by tortious conduct which results in willful and 

malicious injury . . . .” Id. at 1205. In other words, a bankruptcy court must 

“undert[ake] a two-part inquiry to determine whether the breach of 

contract rendered the debt excepted from discharge, first examining 

whether the debtor’s conduct was ‘tortious,’ and then asking whether the 

debtor’s conduct was both ‘willful’ and ‘malicious.’” Lockerby v. Sierra, 535 

F.3d 1038, 1040-41 (9th Cir. 2008).

As noted above, Dr. Jones does not challenge the bankruptcy court’s 

determinations that his conduct was tortious or that the injury was 

“willful.” He only challenges the bankruptcy court’s ruling that the injury 
15

was “malicious.”

1. Dr. Jones was not denied due process as to the

“trapped” e-mail.

First, Dr. Jones argues that he did not have notice and opportunity to 

be heard on the issue of malice. He contends that the court’s determination 

was based “primarily” on the March 21, 2013 e-mail in which he told 

Mr. Squires that he and SVO had Dr. Patel “trapped.” He complains that he 

was denied due process because counsel and the court did not examine 

him on the meaning of his “trapped” statement.

Dr. Jones’ arguments are misguided at best. “The fundamental 

requirement of due process is the opportunity to be heard at a meaningful 

time and in a meaningful manner.” Mathews v. Eldridge, 424 U.S. 319, 333 

(1976) (cleaned up). The bankruptcy court did not preclude Dr. Jones from 

testifying as to the e-mail or any other matter related to “malice.” The

record shows that Dr. Jones was afforded both notice and an opportunity 

to be heard: as the Joneses concede, the March 21, 2013 e-mail was included 

in the parties’ exhibit list and admitted at trial without objection;

Mr. Squires read the e-mail into the record; and Dr. Jones’ counsel had the 

opportunity to question Dr. Jones about the e-mail but chose not to. 

There is no basis for Dr. Jones’ suggestion that the court or Dr. Patel’s 

counsel somehow had an obligation to ask Dr. Jones about the e-mail. The

court never has an obligation to ask any questions of any witness.

Dr. Patel’s lawyer had no duty to help his adversary explain away a 
16

damning piece of evidence. At oral argument, Dr. Jones’ counsel candidly 

admitted that he made a tactical decision not to ask Dr. Jones about the email. Dr. Patel’s counsel was entitled to make a similar tactical decision 

that it was best to let the e-mail speak for itself.

Dr. Jones implies that the bankruptcy court should have indicated in 

advance that it would rely on the e-mail to support one of its findings. He

offers no authority for the novel proposition that the bankruptcy court had 

any such obligation to give a preview of its ruling.

Additionally, even if the bankruptcy court did deny Dr. Jones due 

process as to his “trapped” statement (and it did not), the court based its 

finding of malice on a host of other evidence. For example, the court cited 

other correspondence between Dr. Jones and Mr. Squires, including the 

“directives” to pay all other debts and employees except for Dr. Patel; 

Dr. Jones’ stated intent to make Dr. Patel experience “fear” and 

“motivation”; and the withholding of payment to Dr. Patel while Dr. Jones 

took money for himself. Even ignoring the March 21, 2013 e-mail, there was 

ample evidence to support a finding of malice.

2. The bankruptcy court’s determination that there was no “just 

cause or excuse” was not error.

Second, Dr. Jones contends that the bankruptcy court erred in ruling

that there was no just cause or excuse for breaching the employment 

agreement. He argues that the breach of contract was justified due to SVO’s 

diminished cashflow.
17

The bankruptcy court considered the extensive evidence concerning 

SVO’s finances and operations, and in particular Mr. Squires’ testimony. It 

found that SVO had trouble collecting its accounts receivable even prior to 

Dr. Patel’s employment; that Dr. Jones directed Mr. Squires to pay down 

Dr. Jones’ credit card debt rather than Dr. Patel’s salary; that Dr. Jones said 

that they had “trapped” Dr. Patel into working for late, reduced, or no 

payment; that Dr. Jones instructed Mr. Squires to pay all office staff, 

Dr. Jones, and Mr. Squires, but not Dr. Patel; that Dr. Jones implied that 

they needed to instill “fear” in Dr. Patel; that, during the time that Dr. Patel 

was not paid his full wages, Dr. Jones received distributions and loans 

from SVO, made contributions to his retirement accounts, and was still 

receiving a monthly salary for “orthodontic services” from SVO, even 

though he was no longer practicing in Illinois; and that SVO had cash on 

hand at the end of 2011, 2012, and 2013. Based on these detailed findings, 

the bankruptcy court found Dr. Jones’ position unpersuasive.

We discern no error. The bankruptcy court considered Dr. Jones’ 

arguments that his actions were justified because SVO was simply unable 

to pay Dr. Patel. Based on the evidence, it found that SVO was able to pay 

Dr. Patel and that Dr. Jones was not acting in SVO’s best interest. The 

court’s findings were not “illogical, implausible, or without support in the 

record.” See In re Retz, 606 F.3d at 1196.

6

6 Dr. Jones suggests that his explanation about SVO’s finances must be believed 

because the bankruptcy court did not find him uncredible. But the court was not 
18

3. The bankruptcy court’s findings of intent and injury were not 

clearly erroneous.

Third, Dr. Jones argues that the record does not support a finding 

that he intended to harm Dr. Patel. He points out that SVO paid Dr. Patel in 

part after the “trapped” e-mail and implies that only a “zero dollar figure” 

would support a “true intent to harm” Dr. Patel.

In the first place, Dr. Jones ignores the difference between willfulness 

and malice. This is important because Dr. Jones only contests the 

bankruptcy court’s finding of malice, and not willfulness. Willfulness 

requires a finding of intent to injure (or subjective knowledge that one’s 

conduct is substantially certain to inflict injury). In contrast, malice does 

not require an intent to cause an injury, only an intent to do a wrongful act, 

which then results in injury. In re Bammer, 131 F.3d at 791 (Malice “does not

require a showing of biblical malice, i.e., personal hatred, spite, or ill-will. 

Nor does it require a showing of an intent to injure, but rather it requires 

only an intentional act which causes injury.” (citations omitted)). Dr. Jones

does not dispute that he intentionally directed Mr. Squires to cause SVO to 

breach the employment agreement by withholding Dr. Patel’s

compensation. This is enough to support a finding of malice.

Further, we reject the argument that there was no injury because SVO 

paid part of Dr. Patel’s salary. It is true that Dr. Jones could have caused 

required to make explicit credibility findings. The court’s decision leaves us with no 

doubt that it weighed the evidence and did not believe Dr. Jones’ version of events. 
19

SVO to withhold all of Dr. Patel’s salary, but the fact Dr. Jones could have 

inflicted even more injury on Dr. Patel is no defense. Therefore, the 

bankruptcy court did not err in finding that the injury was malicious and 

otherwise satisfied the nondischargeability standard under § 523(a)(6).7

B. The bankruptcy court correctly held that the Illinois Judgment is 

nondischargeable as to the marital community.

The Joneses argue that the bankruptcy court erred as a matter of law 

in concluding that the Nondischargeability Judgment was applicable to the 

marital community, not just Dr. Jones. They contend that, after they 

initiated the appeal, the Arizona Supreme Court issued a decision 

dispositive of this issue that is at odds with the bankruptcy court’s 

decision. The Joneses misrepresent both the content and the timing of the 

supreme court’s decision.

As the bankruptcy court noted, Arizona is a community property 

state, while Illinois is not. ARS § 25-215 provides:

C. The community property is liable for a spouse’s debts 

incurred outside of this state during the marriage which 

would have been community debts if incurred in this state.

D. Except as prohibited in § 25-214, either spouse may contract 

debts and otherwise act for the benefit of the community. In an 

action on such a debt or obligation the spouses shall be sued 

jointly and the debt or obligation shall be satisfied: first, from

the community property, and second, from the separate 

7 The evidence supporting the court’s decision is so overwhelming that we would 

affirm even on de novo review.
20

property of the spouse contracting the debt or obligation.

Ariz. Rev. Stat. § 25-215 (emphases added).

Thus, ARS § 25-215(C) provides that the Joneses’ marital community 

is liable for Dr. Jones’ debt incurred outside of Arizona, if it would have 

been community debt under Arizona law. The bankruptcy court found that 

the Illinois Judgment was a community debt under Arizona law because it 

was incurred for the benefit of Mrs. Jones and the Jones family. The Joneses 

do not challenge this determination on appeal.

Rather, the Joneses focus their argument on ARS § 25-215(D). They 

maintain that the Illinois Judgment is ineffective in Arizona, because 

Mrs. Jones was not joined in the Illinois proceedings. We disagree.

The bankruptcy court correctly relied on Gagan. In that case, the 

Ninth Circuit examined Arizona precedent including Oyakawa v. Gillett, 854 

P.2d 1212, 1218 (Ariz. Ct. App. 1993), and National Union Fire Insurance Co. 

v. Greene, 985 P.2d 590, 595 (Ariz. Ct. App. 1999), and held that a creditor 

could enforce an Indiana federal court judgment against the debtor’s 

marital property in Arizona, even though the debtor’s spouse was not 

named in the Indiana proceeding. The Ninth Circuit also held, however, 

“that a non-party spouse must be given an opportunity at some time to 

challenge enforcement of a judgment against community property in 

Arizona.” Gagan, 376 F.3d at 992.

We agree with the bankruptcy court that Gagan is on point and that 

the Illinois Judgment was applicable to the Joneses’ marital community in 
21

Arizona, in spite of ARS § 25-215(D). We also agree that Mrs. Jones had an 

opportunity to challenge enforcement of the Illinois Judgment because she 

had notice of and an opportunity to participate in the adversary 

proceeding, but she actively sought to be dismissed from the case.

We are not persuaded by the Joneses’ argument on appeal, that the 

Arizona Supreme Court’s decision in Lattin v. Shamrock Materials, LLC, 503 

P.3d 116 (Ariz. 2022), effectively overruled Gagan. Ms. Lattin sued 

Shamrock and lost. The court awarded Shamrock attorneys’ fees against 

Ms. Lattin, but not her husband. When Shamrock sought to garnish the 

couple’s joint bank account, the trial court quashed the garnishment, 

because Ms. Lattin’s husband was not named in the judgment. The Arizona 

Supreme Court held that the trial court should have allowed the 

garnishment. It held that “seeking an award of attorney fees for the 

successful defense of a complaint filed by a married plaintiff is not an 

‘action on [a community] debt or obligation’ under § 25-215(D).” 503 P.3d 

at 119. The court also held:

If the court enters a judgment for attorney fees and costs in 

favor of the defendant, the plaintiff’s spouse may intervene in 

any subsequent attempt to execute the judgment against 

community assets to argue the judgment is the plaintiff’s sole 

and separate obligation, and community assets cannot be used 

to satisfy the judgment.

Id. at 120 (emphasis added). 

Lattin is readily distinguishable from the present case. In the first 
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place, unlike in Gagan, there was no foreign judgment in Lattin. The 

Arizona Supreme Court did not address the full faith and credit due to 

foreign judgments or otherwise overrule Oyakawa, Greene, or Gagan.

8

In the second place, Lattin only holds that the non-party spouse is

entitled to intervene in the enforcement action against the community 

property. The Arizona Supreme Court held that Ms. Lattin’s husband did 

not have to be joined in the proceeding that led to the judgment. If 

anything, Lattin merely stands for the proposition that Mrs. Jones had the 

right to participate in the adversary proceeding if she chose to do so. As the 

bankruptcy court correctly held, Mrs. Jones was not denied that right; she

explicitly turned down the opportunity to participate when she sought 

dismissal from the case.

Furthermore, the Joneses fail to address the bankruptcy court’s other 

reason for holding that that the marital community was liable for the 

Illinois Judgment: that the Joneses had admitted as much in the answer to 

the complaint and their bankruptcy filings. The Ninth Circuit has 

acknowledged that “[j]udicial admissions are formal admissions in the 

pleadings which have the effect of withdrawing a fact from issue and 

dispensing wholly with the need for proof of the fact. Judicial admissions 

8 Additionally, Lattin was published in February 2022, three months prior to the 

bankruptcy court’s May 2022 Amended Judgment. Thus, it is disingenuous to suggest 

that this is a “new” decision that could not have been raised before the bankruptcy 

court.
23

are conclusively binding on the party who made them.” Spokane Law Enf’t 

Fed. Credit Union v. Barker (In re Barker), 839 F.3d 1189, 1195 (9th Cir. 2016) 

(cleaned up).

As the bankruptcy court explained, the Joneses were bound by their 

admissions: (1) the designation of the Illinois Judgment as a community 

obligation in the Joneses’ schedules and (2) Dr. Jones’ answer to the 

amended complaint that admitted that all actions were undertaken on 

behalf of the community and that the debt is a community obligation. The 

Ninth Circuit has “never declared that a bankruptcy schedule constitutes 

the ‘formal admission’ required for the application of the doctrine[,]” id. at 

1195-96, but there is no doubt that an assertion in an answer meets that 

requirement.

C. The bankruptcy court correctly held that the Nondischargeability 

Judgment does not change the rate of interest on the Illinois 

Judgment.

The Joneses also appeal the bankruptcy court’s determination that the 

Illinois Judgment continues to accrue interest at the Illinois statutory rate, 

as opposed to the lower federal rate. They are wrong. As we held in 

Hamilton, “interest on a nondischargeable judgment debt should continue 

to accrue at the state rate, even after the bankruptcy court determines the 

nondischargeability of the debt.” 584 B.R. at 323. We concluded that “[t]he 

Nondischargeability Judgment was not a new money judgment under 

federal law. It simply determined that the State Court Judgment was not 
24

dischargeable. As such, the bankruptcy court lacked authority to override 

the state court’s award of interest.” Id. The Ninth Circuit affirmed our 

ruling. 785 F. App’x at 439.

This case compels the same result. Neither the Nondischargeability 

Judgment nor the Amended Judgment created a new money judgment or 

altered Dr. Patel’s rights under the Illinois Judgment.

The Joneses completely ignore Hamilton and instead rely exclusively 

on Onink v. Cardelucci (In re Cardelucci), 285 F.3d 1231 (9th Cir. 2002). But 

Cardelucci has no bearing on the present appeal. In that case, the Ninth 

Circuit considered the meaning of “interest at the legal rate” within 

§ 726(a)(5) for the purposes of distribution to an unsecured creditor 

holding a state court judgment debt. See id. at 1234. That case has nothing 

to do with a nondischargeability judgment.

D. We deny Dr. Patel’s request for fees and other sanctions.

In both appeals, Dr. Patel requests that we summarily affirm the 

bankruptcy court’s decisions or impose sanctions against the Joneses for 

incomplete briefs and excerpts that do not comply with the applicable BAP 

rules. Although we agree that the Joneses’ submissions are lacking, we are 

able to understand the arguments and record on appeal. Further, Dr. Patel 

did not file a separate motion seeking fees for a frivolous appeal as Rule 

8020(a) requires. Therefore, we DENY his request for summary affirmance 

or sanctions.

Dr. Patel urges us to award him his fees and costs under the Illinois 
25

Wage Payment Act, 820 Ill. Comp. Stat. § 115/14. However, he provides us 

with no argument or authority that he is entitled to recover fees and costs 

in this bankruptcy appeal under that statute. We deny his request without 

prejudice, and we express no opinion on his entitlement to fees or costs 

under the Illinois statute.

CONCLUSION

The bankruptcy court did not err in holding that the Illinois 

Judgment was nondischargeable under § 523(a)(6), is enforceable against 

the marital community, and accrues interest at the Illinois statutory rate. 

We AFFIRM.