CHARLES W. STRUNCK, III, Plaintiff-Appellant,
v.
CARMEN M. FIGUEROA, Defendant-Respondent.No. A-1224-14T4. Superior Court of New Jersey, Appellate Division.
Begelman, Orlow & Melletz, attorneys for appellant (Marc M. Orlow and Daniel S. Orlow, on the briefs).
The Micklin Law Group, attorneys for respondent (Brad M. Micklin and Richard M. Muglia, on the brief).
Before Judges Fisher and Espinosa.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
PER CURIAM.
Plaintiff Charles W. Strunck, III, appeals from an order that denied his motion to enforce litigant's rights. We affirm.
On August 31, 2011, plaintiff and defendant Carmen M. Figueroa were granted a divorce by the Court of Common Pleas in Pennsylvania. The divorce decree awarded plaintiff the sum of $23,369 to be transferred from defendant's "Fidelity account" by way of a qualified domestic relations order (QDRO). The divorce decree directed that plaintiff be responsible for the preparation and cost for the QDRO. However, defendant withdrew all funds from the Fidelity account before the divorce decree was entered and filed a Chapter 7 bankruptcy petition on December 6, 2011.
Schedule F (Creditors Holding Unsecured Nonpriority Claims) of defendant's bankruptcy petition lists plaintiff as a creditor, states the $23,269 claim was incurred in August 2011 and provides the following description: "Matrimonial judgment — This judgment is not a domestic support obligation under Section 523(a)(5) of the Code." Plaintiff does not dispute that he received notice of the bankruptcy petition and the inclusion of the $23,369 as an unsecured claim in that petition.
Plaintiff states he consulted with a bankruptcy attorney who advised him that, "as a practical matter, [he] was better off not pursuing legal action against the Defendant for her failure to comply with the terms of the [divorce decree]."
Pursuant to the Federal Rules of Bankruptcy Procedure, a creditor may contest the dischargeability of a debt by filing "a complaint . . . objecting to the debtor's discharge . . . no later than 60 days after the first date set for the meeting of creditors under § 341(a)," or as extended by the court. Fed. R. Bankr. P. 4004(b).
Plaintiff did not file an adversary complaint to challenge the dischargeability of the $23,369 claim. See Fed. R. Bankr. P. 4007(a). Defendant was granted a discharge of this and all other debts listed on her petition in March 2012. See 11 U.S.C.A. § 727.
Plaintiff elected to pursue an alternative course to attempt to recover the $23,369 due to him pursuant to the divorce decree. In July 2013, more than one year after defendant's discharge, he filed a complaint against defendant in the Law Division, alleging conversion. After this complaint was dismissed without prejudice, plaintiff docketed the Pennsylvania divorce decree in New Jersey. Thereafter, more than two years after defendant's discharge, plaintiff filed a motion to enforce litigant's rights based on that divorce decree, seeking to compel defendant to pay him $23,369. He contended that defendant had falsely stated in her bankruptcy petition that she was not holding the property of another, i.e., the funds taken from the Fidelity account, and that, as a result, the debt was not dischargeable. After this motion was denied without prejudice in June 2014, plaintiff filed a second motion to enforce litigant's rights seeking the same relief on the same grounds.[1] That motion was denied by order dated September 26, 2014.
In his appeal, plaintiff presents the following issues for our consideration:
POINT I
THE PLAINTIFF DID NOT COMMIT LACHES, ESTOPPEL, OR AN IMPLICIT WAIVER OF HIS RIGHTS TO ENFORCE THE PENNSYLVANIA DECREE.
POINT II
THE BANKRUPTCY DISCHARGE RECEIVED BY THE DEFENDANT HAS NO LEGAL BEARING ON THE DEFENDANT'S OBLIGATIONS UNDER THE DECREE OF DIVORCE.
POINT III
SOUND PUBLIC POLICY AND PRECENDENT WEIGH IN FAVOR OF REVERSING THE TRIAL COURT'S RULING.
After reviewing these arguments in light of the record and applicable legal principles, we conclude that all lack sufficient merit to warrant discussion in a written opinion, R. 2:11-3(e)(1)(E), beyond the following brief comments.
Pursuant to 11 U.S.C.A. § 727, "[t]he court shall grant the debtor a discharge" unless one of the enumerated exceptions applies. Plaintiff does not argue that any of these exceptions apply. Rather, he contends the discharge "has no legal bearing" on the obligation created by the divorce decree. He asserts the divorce decree created a statutory interest in the $23,369 prior to the filing of the bankruptcy petition that must be honored by the bankruptcy court, a position he never advanced in the bankruptcy court. Plaintiff's argument rests upon the flawed premise that he could utterly ignore the bankruptcy proceeding and pursue the funds awarded to him in the divorce decree through enforcement proceedings in family court.
It is undisputed that plaintiff had notice that defendant's obligation under the divorce decree was included in her bankruptcy petition. Even when the argument against dischargeability is that the claim is based upon an intentional tort, the general rule is that
a creditor . . . must initiate a proceeding in the bankruptcy court to determine the dischargeability of its claim within a specific time period. If the creditor fails to file a complaint within the time limit, the claim will be discharged. This procedure effectively grants the bankruptcy court exclusive jurisdiction to determine the dischargeability of an intentional tort debt. [In re Strano, 248 B.R. 493, 495 (Bankr. D.N.J. 2000) (citations omitted).]
The bankruptcy court's decision to grant defendant a discharge was a final order that could be appealed either to a district court or to a bankruptcy appellate panel. In re Hill, 562 F.3d 29, 32 (1st Cir. 2009) (citing 28 U.S.C.A. § 158).
The arguments plaintiff makes regarding the dischargeability of the $23,369 claim could have and should have been made in an adversary proceeding filed in bankruptcy court. If his challenge failed, he could pursue review pursuant to federal statute. He did not do so.
As it stands, the discharge is a final order that:
(1) voids any judgment at any time obtained . . .
(2) operates as an injunction against the commencement or continuation of an action . . . to collect, recover or offset any such debt as a personal liability of the debtor, whether or not discharge of such debt is waived; and
(3) operates as an injunction against the commencement or continuation of an action . . . to collect [from community property held by the debtor and spouse] . . . that is acquired after the commencement of the case. . . .
[11 U.S.C.A. § 524(a).]
Plaintiff was, therefore, enjoined from pursuing the enforcement actions he commenced to collect the discharged $23,369 claim and not entitled to the relief he sought.
Affirmed.
[1] In the certification plaintiff submitted in support of this second enforcement motion, he asserts he filed a pro se motion to enforce the terms of the divorce decree in Pennsylvania in December 2011 and that he was successful in that motion. He has not provided any proof to support that assertion.
