United States Court of Appeals,

Eleventh Circuit.

No. 94-8768.

In re: Keith WALKER, Debtor.

Frank B. HOPE, Plaintiff-Appellant,

v.

Keith WALKER, Defendant-Appellee.

March 30, 1995.

Appeal from the United States District Court for the Northern

District of Georgia. (2:93-cv-145-WCO), William C. O'Kelley, Chief

Judge.

Before BIRCH and DUBINA, Circuit Judges, and MORGAN, Senior Circuit

Judge.

BIRCH, Circuit Judge:

In this appeal, we decide whether an employer's failure to

obtain statutorily required workers' compensation insurance

constitutes a willful and malicious injury under 11 U.S.C. §

523(a)(6). The district court held that such failure was not a

willful and malicious injury; thus, the employer's resulting debt

to an injured employee was dischargeable in bankruptcy. We AFFIRM.

I. BACKGROUND

Debtor-appellee Keith Walker hired creditor-appellant Frank

Hope to perform construction work on a house. In the course of his

employment, Hope fell from a height of eight feet and broke his

forearm and elbow, resulting in medical expenses, lost wages, and

permanent partial disability. Although Georgia state law requires

general contractors to obtain workers' compensation insurance for
 1

O.C.G.A. § 34-9-8. Refusal or willful neglect to obtain

workers' compensation insurance where required is a misdemeanor. 

O.C.G.A. § 34-9-126. 

their subcontractors,1 Walker had failed to obtain such coverage by

the time of Walker's accident. Walker claims that he did not

insure his workers because he did not consider himself the general

contractor for the construction project and because he believed

that Hope and his coworkers were responsible for securing their own

insurance.

Hope sued Walker for compensation for his injuries, and the

State Board of Workers' Compensation awarded Hope $27,939.41 in

temporary and permanent partial disability benefits, medical costs,

mileage, attorneys' fees, interest, and penalties, plus reasonable

future medical costs related to Hope's injuries. After paying a

fraction of the ordered amount, Walker filed for Chapter 7

bankruptcy. Hope countered with a complaint requesting that his

award be declared nondischargeable under 11 U.S.C. § 523(a)(6) as

a debt resulting from a willful and malicious injury. On

cross-motions for summary judgment, the bankruptcy court dismissed

Hope's claim, reasoning that Walker's failure to obtain insurance

was not the direct cause of Hope's injuries and citing the policy

of strictly construing exceptions to discharge. The district court

affirmed for the same reasons.

II. DISCUSSION

A court must grant summary judgment "if the pleadings,

depositions, answers to interrogatories, and admissions on file,

together with the affidavits, if any, show that there is no genuine

issue as to any material fact and that the moving party is entitled
 2

The distinction between an intentional act and an

intentional injury, while critical to the present case, was not

at issue in In re Ikner. Thus, we do not consider our use of the

word "act" in In re Ikner, 883 F.2d at 991, to be controlling

here. 

to judgment as a matter of law." Fed.R.Civ.P. 56(c). A moving

party is entitled to summary judgment if the nonmoving party has

"failed to make a sufficient showing on an essential element of her

case with respect to which she has the burden of proof." Celotex

Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 2552, 91

L.Ed.2d 265 (1986). We review the bankruptcy court's grant of

summary judgment de novo, applying the same legal standards used by

the trial court. Fitzpatrick v. City of Atlanta, 2 F.3d 1112, 1117

(11th Cir.1993).

 Section 523(a)(6) of the Bankruptcy Code excepts from

discharge in bankruptcy "any debt ... for willful and malicious

injury by the debtor to another entity or to the property of

another entity." 11 U.S.C. § 523(a)(6). We have interpreted

"willful" to require "a showing of an intentional or deliberate

act, which is not done merely in reckless disregard of the rights

of another." Lee v. Ikner (In re Ikner), 883 F.2d 986, 991 (11th

Cir.1989)2

; Chrysler Credit Corp. v. Rebhan, 842 F.2d 1257, 1263

(11th Cir.1988). As used in section 523(a)(6), "malicious" means

" "wrongful and without just cause or excessive even in the absence

of personal hatred, spite or ill-will.' " In re Ikner, 883 F.2d at

991 (quoting Sunco Sales, Inc. v. Latch (In re Latch), 820 F.2d

1163, 1166 n. 4 (11th Cir.1987)). Malice may be implied or

constructive. Id. ("Constructive or implied malice can be found

if the nature of the act itself implies a sufficient degree of
 3

See, e.g., Conte v. Gautam (In re Conte), 33 F.3d 303, 307

(3rd Cir.1994) ("We hold that actions are willful and malicious

within the meaning of § 523(a)(6) if they either have a purpose

of producing injury or have a substantial certainty of producing

injury."); Dorr, Bentley & Pecha, CPA's, P.C. v. Pasek (In re

Pasek), 983 F.2d 1524, 1527 (10th Cir.1993) (" "[W]illful and

malicious injury' occurs when the debtor, without justification

or excuse, and with full knowledge of the specific consequences

of his conduct, acts notwithstanding, knowing full well that his

conduct will cause particularized injury. Such a standard is

consistent with our rule that § 523(a)(6) requires not only

intentional conduct on the part of the debtor, but also

intentional or deliberate injury."); Vulcan Coals, Inc. v.

Howard, 946 F.2d 1226, 1228-29 (6th Cir.1991) (explicitly

rejecting the very strict view that § 523(a)(6) requires an

intent to cause injury, but adopting a narrow interpretation of

"willful and malicious" that requires "a wrongful act done

intentionally, which necessarily produces harm and is without

just cause or excuse"); Cassidy v. Minihan, 794 F.2d 340, 343-44

(8th Cir.1986) ("We believe that the [legislative history of §

523(a)(6) ] persuasively indicates congressional intent to allow

discharge of liability for injuries unless the debtor

intentionally inflicted an injury."); Kelt v. Quezada (In re

Quezada), 718 F.2d 121, 123 (5th Cir.1983) (holding that a

creditor must demonstrate "conduct designed to cause deliberate

or intentional injury" to establish a "willful and malicious

injury" under § 523(a)(6)). 

malice."). In other words, "a showing of specific intent to harm

another is not necessary." Id.

 It is undisputed that Walker's failure to obtain insurance

was a willful act in that it was not the result of an accident or

inadvertence, but was founded upon a putatively mistaken belief.

Thus, the central issue in this case is whether a deliberate and

intentional act that results in injury may constitute a "willful

and malicious injury " under section 523(a)(6), or whether the

debtor must intend the actual injury before the resulting debt may

be nondischargeable. The majority of circuits that have addressed

this issue have strictly interpreted section 523(a)(6) to require

that the debtor either intend the resulting injury or intentionally

take action that is substantially certain to cause the injury.3
Only the Ninth Circuit has held that an intent to do the act at

issue is sufficient to render the resulting injury "willful" under

section 523(a)(6). Britton v. Price (In re Britton), 950 F.2d 602,

605 (9th Cir.1991). Even this disagreement is minimized, however,

as the Ninth Circuit interpreted "malicious" to require a showing

that the act in question " "necessarily produces harm and is

without just cause or excuse ... even absent proof of a specific

intent to injure.' " Id. (quoting Impulsora del Territorio Sur v.

Cecchini (In re Cecchini), 780 F.2d 1440, 1443 (9th Cir.1986)).

 We follow our sister courts in concluding that, in order to

be "willful" under section 523(a)(6), the debtor must have intended

more than merely the act that results in injury. Congress has been

very clear in expressing its intention in section 523(a)(6). The

plain language of section 523(a)(6) excepts from discharge debts

arising from "willful and malicious injury" rather than "willful

and malicious acts which cause an injury." Eaves v. Hampel (In re

Hampel), 110 B.R. 88, 93 (Bankr.M.D.Ga.1990); see also Farmers

Insurance Group v. Compos (In re Compos), 768 F.2d 1155, 1158 (10th

Cir.1985) (" "Willful' modifies "injury.' Section 523(a)(6) does

not except from discharge intentional acts which cause injury; it

requires instead an intentional or deliberate injury."). In

reenacting this language in the Bankruptcy Reform Act of 1978, both

houses of Congress stated that "[u]nder this paragraph "willful'

means deliberate or intentional. To the extent that Tinker v.

Colwell, 193 U.S. 473[, 485, 24 S.Ct. 505, 508, 48 L.Ed. 754]

(1902) [ (1904) ] held that a less strict standard is intended, and

to the extent that other cases have relied on Tinker to apply a
"reckless disregard' standard, they are overruled." S.Rep. No.

989, 95th Cong., 2d Sess. 79 (1978), reprinted in 1978 U.S.C.C.A.N.

5787, 5865 (citation omitted); see also H.R.Rep. No. 595, 95th

Cong., 2d Sess. 365 (1978), reprinted in 1978 U.S.C.C.A.N. 5963,

6320-21. Mindful of our obligation to construe strictly exceptions

to discharge in order to give effect to the fresh start policy of

the Bankruptcy Code, Equitable Bank v. Miller (In re Miller), 39

F.3d 301, 304 (11th Cir.1994), we hold that section 523(a)(6)

requires a deliberate or intentional injury.

 As the Third Circuit noted in Conte v. Gautam (In re Conte),

33 F.3d 303, 308 (3rd Cir.1994), however, intent is not limited to

the consequences that an actor consciously desires: "under the

common law "[t]he word "intent ... denote[s] that the actor desires

to cause consequences of his act, or that he believes that the

consequences are substantially certain to result from it." ' " Id.

(quoting Restatement (Second) of Torts § 8A (1979) (alterations and

emphasis in original)). Because Congress reenacted section

523(a)(6) in the context of the common law, we conclude that a

debtor is responsible for a "willful" injury when he or she commits

an intentional act the purpose of which is to cause injury or which

is substantially certain to cause injury. See id. Applying the

rule in this case, it is clear that Hope's physical injury was not

substantially certain to result from Walker's failure to obtain

workers' compensation insurance. While Walker's failure to act did

result in Hope's lack of coverage after the latter's accident, it

cannot be said that Walker intended for Hope to suffer a fall or

that there was an unbroken chain of events leading from Walker's
intentional act to Hope's physical injury.

 Hope's secondary argument is that his true injury was the

loss of his statutory right to workers' compensation insurance

protection. Thus, because Hope's economic injury was a necessary

and direct result of Walker's failure to obtain such coverage,

Walker must have intended that economic injury. There is some

support for this view among the bankruptcy courts. See, e.g.,

Strauss v. Zielinski (In re Strauss), 99 B.R. 396, 399

(N.D.Ill.1989) ("[T]he injury to be concentrated on in the instant

case is not the injury to the appellee's eye but to his statutory

right to insurance protection from monetary loss due to injuries

suffered at work. Undoubtedly, this right of the appellee was

injured by the appellant's failure to procure workman's

compensation insurance." (citation omitted)); Hester v. Saturday

(In re Saturday), 138 B.R. 132, 135 (Bankr.S.D.Ga.1991) ("[I]t is

foreseeable that workers will sustain on-the-job injuries and to

the extent that an employer fails to provide insurance as required

by law that failure necessarily causes economic injury to any

worker who sustains a physical one."); Vig v. Erickson (In re

Erickson), 89 B.R. 850, 853 (Bankr.D.Idaho 1988); Juliano v.

Holmes (In re Holmes), 53 B.R. 268, 270 (Bankr.W.D.Pa.1985).

However, Hope has failed to cite, and we cannot locate, any

persuasive or binding authority to convince us that statutorily

required workers' compensation benefits are property,

distinguishable from the rights of any other creditor against a

debtor.

 More importantly, this type of "injury" is nothing more than
a recasting of the "reckless disregard" standard expressly rejected

by Congress and by this court. American Cast Iron Pipe Co. v.

Wrenn (In re Wrenn), 791 F.2d 1542, 1544 (11th Cir.1986) (per

curiam) ("[A]n act in reckless disregard of the rights of others is

insufficient to constitute "willful and malicious' conduct for

purposes of 11 U.S.C. § 523(a)(6)."); Chrysler Credit Corp., 842

F.2d at 1263; S.Rep. No. 989, at 79, 1978 U.S.C.C.A.N. at 5865;

H.R.Rep. No. 595, at 365, 1978 U.S.C.C.A.N. at 6320-21. Operating

without insurance is a clear example of recklessness: the failure

to insure does not guarantee that an employee will suffer a

physical or economic injury while on the job. The employer's

failure to secure workers' compensation coverage mandated by the

state legislature may subject him to criminal penalties including

imprisonment, see O.C.G.A. §§ 34-9-126(b), 17-10-3(a), but it does

not follow that his discharge in bankruptcy is to be denied as an

additional penalty. Moreover, we reject the argument that a loss

of workers' compensation insurance per se is an injury under

section 523(a)(6).

III. CONCLUSION

Hope argues that Walker's intentional failure to obtain

statutorily required workers' compensation insurance constitutes a

"willful and malicious injury" under section 523(a)(6). We

conclude that Walker did not intend to injure Hope and that Hope's

physical injuries were not substantially certain to occur as a

result of Walker's failure to act. Accordingly, we AFFIRM the

district court's decision to dismiss Hope's claim on summary

judgment.