IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

_____________________

No. 97-10454

_____________________

In The Matter Of: SIM MICHAEL GAMBLE,

Debtor.

_____________________________

SIM MICHAEL GAMBLE,

Appellant,

versus

ARCINA ANN GAMBLE,

Appellee.

_________________________________________________________________

Appeal from the United States District Court for the

Northern District of Texas

_________________________________________________________________

Junw 22, 1998

Before JOLLY, DUHÉ, and PARKER, Circuit Judges.

E. GRADY JOLLY, Circuit Judge:

Sim Michael Gamble apparently concluded that he was unable to

pay his ex-wife on an obligation arising out of the property

settlement incident to their divorce. Upon her serious demands for

payment, he headed for the bankruptcy court. Once there, he argued

that the debt was dischargeable. The bankruptcy court disagreed

and so do we. In particular, we hold that the bankruptcy court did

not err in concluding that Mr. Gamble failed to meet either

exception to the nondischargeability of such debts as provided in

11 U.S.C. § 523(a)(15), and therefore affirm its judgment.
2

I

In 1986, while he and Arcina Ann Gamble were married, Mr.

Gamble went to work at Security National Bank of Quanah in Quanah,

Texas. In support of his position at the bank, the couple

purchased some bank stock for $216,000. Of this money, $116,000

was borrowed from an Abilene bank; the other $100,000 came from an

inheritance belonging to Ms. Gamble. In 1990, the Gambles

divorced. In the divorce decree, Mr. Gamble was awarded the bank

stock. In return, he assumed sole responsibility for the $116,000

loan, and, in addition, signed a note to Ms. Gamble for $100,000.

This note carried no interest, and was set to become due and

payable three years from July 19, 1990.

II

By June 20, 1995, the $100,000 note was twenty-three months

overdue and still unpaid. Ms. Gamble therefore went to state court

and reduced the note to judgment, which was entered August 3. On

September 1, Mr. Gamble filed for bankruptcy liquidation under

Chapter 7. In response, Ms. Gamble filed an adversary proceeding

in the bankruptcy court to prevent discharge of the judgment on the

$100,000 note. She argued that it fell within the exception for

property settlement debts contained in 11 U.S.C. § 523(a)(15).

Section 523(a)(15), under the general heading of “Exceptions to

discharge,” provides, in relevant part:

A discharge . . . does not discharge an individual debtor

from any debt . . . [not in the nature of alimony or

child support as exempted under § 523(a)(5)] that is
3

incurred by the debtor in the course of a divorce or

separation . . . unless--

(A) the debtor does not have the ability to pay

such debt from income or property of the debtor not

reasonably necessary to be expended for maintenance

or support of the debtor or a dependent . . .; or 

(B) discharging the debt would result in a benefit

to the debtor that outweighs the detrimental

consequences to a . . . former spouse of the

debtor.

After verifying that the debt in question was in fact incurred

in the course of a divorce, the bankruptcy court addressed the two

listed exceptions. On the evidence before it, the court found that

Mr. Gamble had not shown that he lacked the ability to pay the debt

from his disposable income or that the benefit to him of discharge

would outweigh the detriment to Ms. Gamble under the totality of

the circumstances. In support of its findings, the court noted

that Mr. Gamble had manipulated his finances, by continuing to pay

off another $100,000 unsecured and dischargeable note to his

father, by including some questionable expenses in the formulation

of a monthly budget, and by deleting his new wife’s income from his

characterization of the total family income used to defray joint

expenses. For these reasons, the court concluded that the $100,000

debt to Ms. Gamble was not subject to discharge. The district

court affirmed the bankruptcy court’s ruling, from which final

decision Mr. Gamble timely appeals.

III
4

We review the bankruptcy court’s findings of fact for clear

error and its conclusions of law de novo. In re Hamilton, 125 F.3d

292, 295 (5th Cir. 1997).

IV

In appealing the bankruptcy court’s ruling, Mr. Gamble asserts

no less than seventeen points of reversible error. The actual

issues are fewer in number. Essentially, Mr. Gamble challenges the

determinations made by the bankruptcy court under § 523(a)(15) and

the methods used to reach those determinations. He makes four

distinct arguments.

A

First, Mr. Gamble argues that § 523(a)(15) was not meant to

apply to all property settlement debts between husband and wife,

but instead only to those situations where the debtor has agreed to

indemnify his former spouse against a marital debt owed to a third

party in exchange for lower alimony payments or a more favorable

property settlement. In Mr. Gamble’s view, Congress enacted

§ 523(a)(15) after realizing that allowing discharge of these

indemnification agreements (which are not exempt under § 523(a)(5)

as they are not in the nature of alimony or child support) often

left the former spouse to pay marital debts on her own, and with an

unfairly reduced amount of property and/or alimony to do so.

Section 523(a)(15) came into being, Mr. Gamble contends, to right

this single specific wrong.
5

Although Mr. Gamble’s position finds express support in the

legislative history, see H.R. Rep. No. 103-835, at 54 (1994),

reprinted in 1994 U.S.C.C.A.N. 3363; In re Macy, 200 B.R. 467, 471

(D. Mass. 1996), it is clearly contrary to the statutory language

and thus unpersuasive. Section 523(a)(15) purports to apply to

“any debt . . . [not in the nature of alimony or child support]

that is incurred in the course of a divorce or separation,” and the

bankruptcy court was clearly correct to give this provision the

full reach implicated by its plain language. See BFP v. Resolution

Trust Corp., 511 U.S. 531, 566 (1994) (Scalia, J.) (in interpreting

the Bankruptcy Code, “‘as long as the statutory scheme is coherent

and consistent, there generally is no need for a court to inquire

beyond the plain language of the statute’”) (quoting United States

v. Ron Pair Enterprises, Inc., 489 U.S. 235, 240 (1989)). As there

is no dispute that the debt in question was incurred in the course

of a divorce and is not in the nature of alimony or child support,

there can be no dispute that § 523(a)(15) is controlling and

dispositive as to that debt’s dischargeability.

B

Mr. Gamble next complains that, even if § 523(a)(15) is the

relevant provision, the bankruptcy court erred in its allocation of

the burden of proof under that section. In assessing the evidence,

the bankruptcy court assigned Ms. Gamble the initial burden of

showing that § 523(a)(15) was applicable to the debt in question,

whereupon Mr. Gamble had the burden of proving that one of the
6

exceptions applied to take it out. We find nothing amiss in this

arrangement. It accords with traditional notions of the prima

facie case and affirmative defense, is in line with the rulings of

the majority of courts to have considered the issue, see, e.g., In

re Custer, 208 B.R. 675, 681-82 (Bankr. N.D. Ohio 1997) (citing

cases); In re Stone, 199 B.R. 753, 760-62 (Bankr. N.D. Ala. 1996)

(collecting, summarizing, and analyzing twenty-eight cases applying

the rule), and is completely consistent with the statutory

language. There is accordingly no error to be found on this point

either.

C

Third, Mr. Gamble insists that, even if § 523(a)(15) is the

relevant provision and he correctly bore the burden of proof as to

the exceptions, the bankruptcy court nonetheless clearly erred in

finding that he had the ability to pay under the first exception,

§ 523(a)(15)(A). In support of this contention, Mr. Gamble notes

that the debt in question had long since become due in full, and

that he undisputedly did not have $100,000 in available funds at

the time of the bankruptcy.

Contrary to Mr. Gamble’s semantic intimations, the plain

language of the statute speaks of an “ability to pay . . . from

income” as well as from property. We therefore find that the

bankruptcy court was correct to focus its investigation of ability

to pay on whether Mr. Gamble could make reasonable payments on the

debt from his disposable income. See In re Jodoin, 209 B.R. 132,
7

142 (B.A.P. 9th Cir. 1997); In re Dressler, 194 B.R. 290, 304

(Bankr. D. R.I. 1996). After an independent review of the record,

we further hold that the court was not clearly in error in

determining that he had not shown an inability to make such

payments. In this regard, we note particularly the findings that

Mr. Gamble had been voluntarily making payments on a dischargeable

debt to his father and that he attempted to conceal his new wife’s

contribution to household income. As to the latter, see

particularly In re Haines, 210 B.R. 586, 590-91 (Bankr. S.D. Cal.

1997), and In re Adams, 200 B.R. 630, 633-34 (N.D. Ill. 1996),

which discuss the correctness of counting a new spouse’s

contribution to household income under § 523(a)(15)(A). For all of

these reasons, we conclude that there was no error in the court’s

assessment of the first exception.

D

Finally, Mr. Gamble pleads that, even if § 523(a)(15) is the

relevant provision and he correctly bore the burden of proof as to

the exceptions, and even if the bankruptcy court correctly found

that he had not shown an inability to pay under the first

exception, it nonetheless clearly erred in finding that he had

failed to show that the benefit of discharge outweighed the

detriment to Ms. Gamble under the second exception,

§ 523(a)(15)(B). In support of this last point, Mr. Gamble notes

that Ms. Gamble currently has a net worth of approximately

$500,000, while he is significantly in the red. As the bankruptcy
8

court correctly determined, however, an assessment of benefit and

detriment under the second exception implicates an analysis of the

totality of the circumstances, not just a comparison of the

parties’ relative net worths. See In re Haines, 210 B.R. at 594;

In re Morris, 193 B.R. 949, 954 n.8 (Bankr. S.D. Cal. 1996); In re

Hill, 184 B.R. 750, 756 (Bankr. N.D. Ill. 1995). After an

independent review of the record on this point, we cannot say that

the bankruptcy court clearly erred in its analysis of these

circumstances. In this respect, we note particularly the

bankruptcy court’s findings that Mr. Gamble had a much greater

earning capacity than Ms. Gamble, as she lacked a college

education, and that Ms. Gamble had need of her admittedly

substantial assets to provide for the care of her ailing mother.

For these reasons, we find no error in the court’s assessment of

the second exception either.

V

Having found no error in the determinations made by the

bankruptcy court under § 523(a)(15) or the methods used to reach

those determinations, for the foregoing reasons, the judgment of

the district court is

A F F I R M E D.