Court Opinion

ID: 154435
Source: CourtListenerOpinion
Date Created: 2010-08-14 03:56:44+00
Date Added: 2024-06-11T15:03:03.303032
License: Public Domain

UNITED STATES COURT OF APPEALS
Filed 1/24/97
                           FOR THE TENTH CIRCUIT

    IN RE: MARSHA MCQUARRIE
    LANG,

              Debtor.
                                                       No. 95-4198
                                                   (D.C. No. 95-CV-370)
    ROBERT F. LANG, M.D.,                                (D. Utah)

              Appellant,

    v.

    MARSHA MCQUARRIE LANG,

              Appellee.

                           ORDER AND JUDGMENT *

Before PORFILIO, BALDOCK, and HENRY, Circuit Judges.

*
      This order and judgment is not binding precedent, except under the
doctrines of law of the case, res judicata, and collateral estoppel. The court
generally disfavors the citation of orders and judgments; nevertheless, an order
and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3.
      After examining the briefs and appellate record, this panel has determined

unanimously that oral argument would not materially assist the determination of

this appeal. See Fed. R. App. P. 34(a); 10th Cir. R. 34.1.9. The case is therefore

ordered submitted without oral argument.

      This case arises from an adversary proceeding brought in defendant Marsha

Lang’s bankruptcy. Plaintiff Robert Lang and defendant were divorced in 1980,

after eleven years of marriage. During their marriage, defendant gave birth to two

children. The divorce decree ordered plaintiff to pay child support, which he did

for many years. In December of 1991, defendant revealed to plaintiff that the

children were not his, but were fathered by a man with whom defendant had an

ongoing extramarital affair. Plaintiff brought an action in state court against

defendant for injuries alleged as a result of defendant’s conduct. Defendant filed

for bankruptcy, seeking discharge of debts, including any judgment which might

be entered against her in the action brought by plaintiff. Plaintiff then filed an

adversary proceeding in the bankruptcy action, seeking judgment on his claims of

fraud and intentional and malicious infliction of emotional distress, as well as a

determination of nondischargeability on those claims. Partial summary judgment

was entered for plaintiff, to the effect that he is not the biological father of the

two children born during his marriage.

                                           -2-
      The bankruptcy court conducted a bench trial and, acting as fact finder,

found that defendant deceived plaintiff regarding the paternity of the children and

that plaintiff relied on the false representations to the extent he cared for and

supported the children. The court went on to find that the specific purpose of

defendant’s actions was not to harm plaintiff, and that plaintiff suffered no

damage or detriment and there was, therefore, no action in fraud. Reiterating its

finding that defendant did not intend to harm plaintiff, the court found no

malicious or intentional infliction of emotional distress. Because the court found

for defendant on plaintiff’s claims, it also found that there was no cause of action

under 11 U.S.C. §§ 523(a)(2)(A), 523(a)(4), and 523(a)(6) for

nondischargeability.

      The district court affirmed the bankruptcy court’s decision, reviewing the

legal questions de novo and the factual findings for clear error. We also review

the bankruptcy court’s factual findings for clear error and its legal determinations

de novo, see Phillips v. White (In re White), 25 F.3d 931, 933 (10th Cir. 1994),

and we affirm in part and reverse and remand in part. 1

      The bankruptcy court, sitting as fact finder, specifically found that

defendant had no intent to harm plaintiff, but that her actions were, instead, “to

satisfy her own foolish emotional desires.” Appellant’s App. at 320. The

1
      Defendant has not filed a brief in this appeal.

                                          -3-
bankruptcy court heard and observed all the testimony, and, like the district court,

we cannot say it clearly erred in this finding. Specific intent is a necessary

element of intentional infliction of emotional distress. See Jackson v. Brown, 904

P.2d 685, 687 (Utah 1995). We, therefore, affirm the bankruptcy court’s finding

that plaintiff has no cause of action for intentional or malicious infliction of

emotional distress and, therefore, no action under 11 U.S.C. § 523(a)(6). 2

      We are troubled, however, with both the district and bankruptcy courts’

treatment of the fraud claim. First, the bankruptcy court’s oral ruling is less than

clear as to which element of fraud it found lacking. The court found that

defendant deceived plaintiff by representing to him that he was the father of the

children and that defendant relied on her representation. The court then found

that defendant’s misrepresentation was not for the purpose of harming plaintiff

and that plaintiff suffered no damage or detriment because of the

misrepresentation. The district court relied on the bankruptcy court’s finding of

no specific intent to harm in affirming the finding of lack of fraud. Reliance on

this finding in the fraud context is error. Intent to harm is not an element of

fraud. See Masters v. Worsley, 777 P.2d 499, 501-02 (Utah Ct. App. 1989)

(holding that necessary elements of fraud are a false representation concerning a

2
      Although it affirmed the bankruptcy court decision, the district court did
not specifically address the intentional infliction of emotional distress claim or
the bankruptcy court findings relating thereto.

                                          -4-
presently existing material fact, which the representor either knew to be false or

made recklessly without sufficient knowledge, or omission of a material fact

when there was a duty to disclose, for the purpose of inducing action, with actual,

justifiable reliance, resulting in damage).

      The bankruptcy court also found that plaintiff suffered no damage or

detriment as a result of his reliance on defendant’s misrepresentation. In making

this finding, the court focused on plaintiff’s testimony that he has always loved

and supported the children and that he will continue to do so. The court spoke of

the positive qualities of the son and of the fact that plaintiff’s life has been

enriched by the birth of the children. The bankruptcy court stated:

              I believe the claim for monetary damages is inconsistent with
      [channeling energy toward the children instead of attempting to
      punish defendant]. Bob claims to be damaged in the dollar amount
      of all support heretofore given and to be given in the future for both
      children, together with interest on the money he spent. If I am to
      believe that Bob truly loves and cares for these children, this is a
      shameful request. I find that Bob has suffered no monetary damage
      as a result of the fraud and deceit of Marsha.

Appellant’s App. at 321. The district court reiterated the bankruptcy court’s

findings regarding the relationship between plaintiff and the children in its

affirmance of the finding of lack of injury.

      To focus on the dynamics of the relationship between plaintiff and the

children in the context of damages confuses the issue. Whether or not plaintiff

was damaged by his reliance on the false representation made by defendant has

                                           -5-
nothing whatsoever to do with his relationship with the children. His contention

is that, as a result of his reliance on defendant’s false representation regarding the

paternity of the children, he has been obligated to pay large sums of money for

support that he would not have otherwise had to pay, had he known he was not the

children’s biological father. The fact that plaintiff loves the children and that his

life may have been enriched by their birth does not vitiate the monetary detriment

he has incurred as a result of defendant’s false representation. The bankruptcy

court’s finding that plaintiff suffered no damage or detriment as a result of his

reliance on defendant’s false representation because he has good children with

whom he has a close relationship and who have enriched his life is clearly

erroneous.

      The bankruptcy court made no mention in its disposition of Masters v.

Worsley, 777 P.2d 499 (Utah Ct. App. 1989), a Utah case which appears

particularly relevant. However, the district court referred to Masters and holds

that Masters did not control this case because the bankruptcy court did not find

that defendant made a false representation during the divorce proceedings. It

went on to hold that testimony of plaintiff’s divorce counsel as to a statement

made by defendant in a divorce deposition that she had never engaged in any

extramarital affairs was inadmissible. The bankruptcy court made no mention of

                                          -6-
the divorce counsel’s testimony, and we have no way of knowing whether the

court considered the evidence in its ruling or not.

      The district court’s holding regarding the admissibility of the divorce

counsel’s testimony of his recollection of the deposition is in error. The district

court held that the testimony was inadmissible hearsay and in violation of Fed. R.

Evid. 1002, the best evidence rule, because neither the written transcript of the

deposition nor the divorce counsel’s notes were produced. The testimony of what

defendant allegedly said during her deposition is not hearsay because it is an

admission by a party-opponent. See Fed. R. Evid. 801(d)(2). Further, the

testimony does not run afoul of Rule 1002 because it was not offered to prove the

contents of a writing. See Fed. R. Evid. 1002 advisory committee notes (“Thus an

event may be proved by nondocumentary evidence, even though a written record

of it was made.”). 3

      The fraud claim must go back to the bankruptcy court so that it can

reconsider the evidence in light of the elements of fraud. In addition, the court

should consider the testimony of plaintiff’s divorce counsel regarding defendant’s

false representation in her deposition taken in the divorce proceeding in its

3
      We also note that defendant did not object to the testimony at trial, thus
depriving the bankruptcy court of the opportunity to rule on its admissibility. See
United States v. Mitchell, 613 F.2d 779, 782 (10th Cir. 1980).

                                         -7-
evaluation of the fraud claim. Finally, the bankruptcy court should consider the

applicability of Masters, 777 P.2d 499.

      In sum, we AFFIRM the district court judgment to the extent it affirms the

bankruptcy court’s finding that plaintiff has no action for intentional or malicious

infliction of emotional distress. We REVERSE the district court’s holding as to

the admissibility of the divorce counsel’s testimony, as well as its affirmance of

the bankruptcy court’s finding that plaintiff has no action for fraud. We

REMAND to the district court with instructions that it remand to the bankruptcy

court for consideration of the applicability of Masters, 777 P.2d 499, and for

further consideration in light of our reversal of the district court’s holding as to

the admissibility of the divorce counsel’s testimony.

                                                      Entered for the Court

                                                      Bobby R. Baldock
                                                      Circuit Judge

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