Moxley v. Perry (In re Perry)

Summarized by Joel Newell , Ballard Spahr, LLP
11 years 6 months ago

Citation:

9th Circuit BAP No. AZ-13-1438-TaPaKi (August 26, 2014)

Tag(s):

Ruling:

In the unpublished opinion the BAP ruled that record supported the determination that Mychelle Moxley ("Moxley") did not diligently prosecute the asserted 11 U.S.C. Sec. 523 claims for relief, and affirmed the bankruptcy court's ruling denying Moxley's motion for reconsideration. The reference to 11 U.S.C. Sec. 523 in Moxley's motion for summary judgment in the adversary commenced pursuant to 11 U.S.C. Sec. 727 did not properly assert nor preserve Moxley's asserted Sec. 523 claims.

Procedural context:

Moxley filed an adversary proceeding against the Debtor seeking denial of the Debtor's discharge. The bankruptcy court denied Moxley's motion for summary judgment, and Moxley sought to amend her adversary to include a claim pursuant to 11 U.S.C. Sec. 523(a). The bankruptcy court denied Moxley's motion based on the doctrine of laces; and, dismissed the adversary with prejudice. Moxley further sought reconsideration of the bankruptcy court's ruling twice, and appealed the bankruptcy court's denial of the second motion for reconsideration.

Facts:

Pre-petition Moxley and the Debtor were in a relationship. Moxley was a co-signor on various car loans and asserts that she took a second mortgage on her property to pay the Debtor's outstanding obligations. Moxley commenced state court action against the Debtor to collect. Moxley was not originally scheduled as a creditor; however, upon learning of the bankruptcy Moxley filed a Proof of Claim. In the interim, the Debtor had received a Chapter 7 discharge. After the Proof of Claim was filed by Moxley, the Debtor amended the schedule to list the obligation owed to Moxley. Approximately four months after receiving her pro rata distribution from the Chapter 7 trustee, Moxley withdrew her Proof of Claim and sought leave from the court to commence an claim of non-dischargeability against the Debtor. Moxley obtained a default judgment against the Debtor vacating the Chapter 7 discharge. Debtor later sought to have the judgment set aside based on the representation that the Debtor was deployed during the litigation. The bankruptcy court denied Moxley's motion for summary judgment.

Judge(s):

Honorable Taylor, Pappas, and Kirscher

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