Case Type:
Case Status:
BAP No. AZ-17-1308-BaFS (9th Circuit, Oct 22,2018) Not Published
BAP for 9th Circuit affirmed judgment of bankruptcy court (D. Az.) in favor of plaintiff creditor on 11 USC 523(a)(6) claim. Defendant's conduct was tortious under Arizona state law and willful and malicious. Bankruptcy court's calculation of $864,000 in damages not clearly erroneous. Husband waived complete defense by failing to raise it at trial. Appellants' failure to file Statement of Issues, designation of record, or transcript did not preclude ruling on the merits. Appellee had notice of arguments from appellants' opening brief, and BAP provided additional time for appellee's briefing.
Procedural context:
Bankruptcy court (D. Az.) entered judgment in favor of creditor plaintiff to except debt from discharge. Debtor defendants appealed to BAP for 9th Circuit.
Mr. Huynh and Ms. Le were co-owners of a gas station, car wash, and market ("LLC"). LLC leased the real property on which it operated from Mr. Huynh. Ms. Le shut down the business without notice to Mr. Huynh, resulting in Chevron de-branding the gas station. Mr. Huynh attempted to reopen the business with Chevron, find another franchisor, or continue the business as an unbranded gas station, but those efforts were unsuccessful and the business failed. Ms. Le also removed the market's inventory, gas, equipment, computer, books, records, and locked Mr. Huynh out of the premises. Ms. Le's action caused gas station to go "dark," and prevented Mr. Huynh from reopening it soon enough to persuade Chevron not to terminate the LLC's franchise. That prevented Mr. Huynh from obtaining a new franchise to lease the gas station. Mr. Huynh attempted to operate the gas station without a franchise, but was unsuccessful and the business failed.
Bason, Faris, Spraker

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