Court Opinion

ID: 9744260
Source: CourtListenerOpinion
Date Created: 2023-08-26 21:58:39.638356+00
Date Added: 2024-06-11T07:24:48.044260
License: Public Domain

STATON, Judge,
dissenting.
I dissent. The issue presented in this appeal is simple:
Whether Dennis's discharge in bankruptcy prevents the collection of certain property settlements debts owed to Tamara.
I.
Bronco
From the outset of the divorcee proceeding, Dennis maintained that he has no ownership rights in the Bronco, and that it is now owned by his father and sister. Eventually, Tamara agreed that Dennis did not own the Bronco, alleging that Dennis fraudulently conveyed the Bronco to his father. Tamara sought to join the father as an additional defendant and have the conveyance set aside. Curiously, the trial court denied Tamara's motion to join the father, made no finding that the conveyance was fraudulent, but found that the Bronco was marital property. From this sequence of events the majority concludes that the law of the case is that Dennis owns the Bronco. As interesting as this conclusion is, it is entirely irrelevant, because with regard to the Bronco the trial court gave Dennis the following option:
"With regard to the following items, the following items only, hisband [sic] shall have the following options:
The Husband is ordered to surrender the possession of the title to the Ford Bronco vehicle of the parties to the wife within thirty (80) days of entry of this decree or pay her the sum of $4,000.00 in lieu of said vehicle within the same period of time....
Although this Court has approved the use of alternative judgments under certain circumstances, Cox v. Schlachter (1970), 147 Ind.App. 530, 262 N.E.2d 550, 554, as a *273general rule, they are viewed with disfavor. 49 C.J.S. Judgments § 74. Unfortunately, the majority has seized the opportunity to use this alternative judgment to unnecessarily confuse and otherwise simple issue.
The trial judge gave Dennis the option to discharge this particular property settlement obligation in one of two ways-by transferring the Bronco or by paying $4,000. This option belonged to Dennis and he elected to treat the obligation as a $4,000 money debt. As a property settlement obligation, this debt was dischargea-ble in bankruptcy. Nichols v. Hensler (7th Cir.1976), 528 F.2d 304. Dennis listed that debt in his bankruptey petition and his discharge thereon enjoins its collection. 11 U.S.C. § 524(a)(2) (Supp.V 1981).1 The trial court's finding that
"[Dennis's] filing of a bankruptcy petition and his discharge thereon does not negate this Court's power to enforce compliance of previous orders of this Court wherein the marital assets were divided and an equitable division of the marital debts was allocated between the parties...."
flies in the face of § 524(a) of the Bank-ruptey Code and should be reversed. The majority's resort to contrived legal arguments is an attempt to cireumvent the ef-feet of Dennis's discharge in bankruptcy is regrettable.
IL.
Hammond National Debt
Having discovered that Dennis failed to separately list in his bankruptcy petition his obligation to hold Tamara harmless from the Hammond National debt, the majority affirms the trial court's conclusion that Dennis's discharge in bankruptcy does not prevent it from enforcing that obligation. In so doing, the majority misconstrues section 5283(a)(8) of the Bankruptcy Code.
11 U.S.C. § 523(a)(8)(A) provides:
"(a) A discharge under section 727, 1141, or 1828(b) of this title ... does not discharge an individual debtor from any debt-
[[Image here]]
"(8) neither listed nor scheduled under section 521(1) of this title ... with the name, if known to the debtor, of the creditor to whom such debt is owned, in time to permit-
(A) if such debt is not of a kind specified in paragraph (2), (4), or (6) of this subsection, timely filing of a proof of claim, unless such creditor had notice or actual knowledge of the case in time for such timely filingl.]" (Emphasis added.)
A creditor who seeks to employ this section to avoid the effect of the debtor's discharge in bankruptcy must first come forward with proof that the debt was not properly scheduled. If the creditor meets that burden, the debtor may nonetheless retain the protection of his discharge by showing that the creditor had notice or actual knowledge of the bankruptey proceeding. Hill v. Smith (1923), 260 U.S. 592, 594-95, 43 S.Ct. 219, 219-220, 67 L.Ed. 419; In re Brown (Bkrtcy.Ohio 1982), 27 B.R. 151, 153.
Tamara never sought to have Dennis's obligation to hold her harmless declared not-dischargeable under section 523(a)(8);2 *274thus, it is not surprising that she did not introduce evidence that this debt was not duly scheduled.3 Because Tamara failed to come forward with proof that this debt was not duly scheduled,4 the majority's reliance .on section 523(a)(3) to declare the debt not dischargeable is erroneous. The obligation to hold Tamara harmless was discharged in bankruptey. 11 U.S.C. § 727(b). The judgment of the trial court should be reversed.

. 11 U.S.C. § 524(a)(2) reads:
"(a) A discharge in a case under this title...
La # # # * #
(2) operates as an injunction against the commencement or continuation of an action, the employment of process, or any act, to collect, recover or offset any such debt as a personal liability of the debtor, or from property of the debtor, whether or not discharge of such debt is waived[.]"

. Throughout this case, Tamara's theory has been that regardless of Dennis's discharge in bankruptcy, the trial court has the power to enforce the property settlement obligations it imposed upon Dennis. In support of this theory, Tamara relies on a case called Peters v. Peters. In that case, a bankruptcy court held that even though a debt is discharged in bankruptcy, a court can compel the debtor to pay those debts. That ruling was appealed to a federal district court which held that it was not error for the bankruptcy court to refuse to stay the related state court proceeding. Neither of these decisions is published; thus, they are of no precedential value.

. The following testimony of Tamara constitutes all of the evidence she presented regarding this debt:
"Q. Now have you been required since your husband's bankruptcy to pay another bill that your husband was ordered to pay and save and hold you harmless on?
"A. Yes, I was.
"Q. What bill was that?
"A. Hammond National.
"Q. How much was that bill for?
"A. It was a little over Eight Hundred Dollars.
"Q. And have you paid on that?
"A. Yes, Sixty Dollars a month.
"Q. And how much have you paid so far?
"A. Over seven hundred.
"Q. And you have one or two payments left?
"A. Right."

. The majority was able to discover that this debt was not listed separately because a copy of Dennis's bankruptcy petition is included in the record. It is attached as an exhibit to a brief, filed by Dennis, addressing the issue whether the trial court could enforce obligations which were discharged in bankruptcy. However, a copy of Dennis's bankruptcy petition was not offered into evidence at trial. Therefore, it may not be relied upon by this Court as evidence supporting the trial court's judgment. Cf. Bowling v. Holdeman (1980), Ind.App., 413 N.E.2d 1010, 1013 (interrogatories not offered into evidence may not be considéred for the purpose of determining whether there was sufficient evidence to avoid a judgment on the evidence).