Gerlich v. Barwick (In re Barwick)

Decision Date04 March 2021
Docket NumberAdv. Pro. 19-01060-SAH,Case No. 19-11787-SAH
PartiesIn re: LORI BARWICK, Debtor. MELANIE GERLICH, Plaintiff, v. LORI BARWICK, Defendant.
CourtU.S. Bankruptcy Court — Western District of Oklahoma

The following is ORDERED:

Chapter 7

FINDINGS OF FACT AND CONCLUSIONS OF LAW

On January 21, 2021, the following matters came on for trial in the captioned adversary proceeding:

1. Amended Complaint [Doc. 3], filed on July 3, 2019, by plaintiff Merlanie Gerlich ("Plaintiff");

2. Answer to Complaint [Doc. 4], filed on August 7, 2019, by debtor Lori Barwick ("Defendant"); and

3. Final Pretrial Order [Doc. 29], entered on January 12, 2021 (the "Pretrial Order").

Plaintiff appeared in person and by and through her attorney, Tom Cummings; and Defendant appeared in person pro se. The parties presented a story of past friendship gone bad and an assault and battery fueled by alcohol, resulting in acrimonious feelings, ruined lives, and Plaintiff's quest for retribution.

JURISDICTION

The Court has jurisdiction to hear the trial of this matter pursuant to 28 U.S.C. § 1334(b), and venue is proper pursuant to 28 U.S.C. § 1409. Reference to the Court of this matter is proper pursuant to 28 U.S.C. § 157(a), and this is a core proceeding as contemplated by 28 U.S.C. § 157(b)(2)(I). Additionally, the parties have consented to this Court's entry of final orders pursuant to Federal Rules of Bankruptcy Procedure 7008 and 7012.

BACKGROUND

Plaintiff and Defendant are former friends who liked to go to "Graham Central Station" ("GCS"), a bar and dance hall in Oklahoma City. For unknown reasons, Plaintiff and Defendant had a falling out previously. One evening after their falling out, both visited GCS though they remained separated while inside. Nevertheless, when Plaintiff and her husband left GCS, Defendant and her friends followed them to their car where they pulled Plaintiff out of the car and beat her. Plaintiff sustained significant injuries and was taken to the hospital for treatment.

Plaintiff commenced an action in Oklahoma County District Court (the "State Court Action") against Defendant and others to recover her damages. A judgment was entered against Defendant as to liability as a sanction for her unwillingness to cooperate in discovery. A jury trial was later conducted on damages, and Plaintiff recovered a judgment against Defendant, inher absence, for $350,000.00 in actual damages, $100,000.00 in punitive damages, and $1,638.02 in costs. Defendant never appealed or sought to vacate the judgments entered in the State Court Action.

Thereafter, Defendant filed her voluntary petition under chapter 7 of the Bankruptcy Code on May 2, 2019. Plaintiff then commenced this adversary proceeding seeking to except the judgments obtained in the State Court Action from Defendant's discharge pursuant to 11 U.S.C. § 523(a)(6).1

In making the following Findings of Fact and Conclusions of Law, the Court considered:

a. The Pretrial Order; and
b. The trial record, including exhibits introduced and admitted by the Court, and the testimony of Plaintiff, her husband Nicholas Gerlich ("Husband"), and Defendant.

The Court found Plaintiff and Husband to be straightforward and credible witnesses. Defendant was not as credible, giving only general denials and deflecting any blame while having no corroborating witnesses, for which she also took no blame. Moreover, Defendant focused more on her own hardships before and after the incident rather than the facts of Plaintiff's beating and resulting injuries and Defendant's involvement therein to the detriment of her defense presentation.

FINDINGS OF FACT

1. On the night of December 11, 2011, Plaintiff, Husband, and Defendant patronized GCS but remained separated due to acrimonious relations and management's request.

2. After having a good time, Plaintiff and Husband left GCS and went to their vehicle in the parking lot.

3. Defendant and two friends followed Plaintiff and Husband out of GCS. They approached Plaintiff as she was entering her vehicle, pulled her out,2 pushed her to the ground, and beat her. Plaintiff was hit in the head, stomach, and knee (collectively, the "Beating") and sustained injuries.3 Plaintiff Ex. 2.

4. Plaintiff heard Defendant and the two friends yelling about intentionally targeting and hitting her knee.

5. Husband took Plaintiff to the emergency room for treatment following the Beating, and Plaintiff later required additional surgery on her injured knee as a result thereof.

6. Alcohol and animosity between former friends played a role in the Beating of Plaintiff.

7. Plaintiff brought a personal injury assault and battery lawsuit against Defendant and others in the State Court Action, Case No. CJ-2012-6217 in the District Court of Oklahoma County, Oklahoma (the "State Court").

8. In the State Court Action, Plaintiff, among others, had been granted an extended deadline to respond to Plaintiff's discovery requests (having failed to timely serve any answers or responses thereto) and was notified by the State Court that judgment on the issue of liability would be entered against her as a sanction if she failed to timely comply.

Plaintiff Ex. 1, State Court Action Journal Entry of Judgment entered December 18, 2015.

9. Defendant did not comply, and on December 18, 2015, a Journal Entry of Judgment was entered on Plaintiff's motion for sanctions in the State Court Action (the "Liability Judgment") finding Defendant liable for Plaintiff's injuries. Plaintiff Ex. 1, State Court Action Journal Entry of Judgment entered December 18, 2015.

10. With Defendant's liability established, the State Court scheduled a trial on the issue of damages. Defendant was represented in the State Court Action by counsel, Robert P. Moore, Jr. ("Moore"). However, on the first date set for the damages trial, Moore was granted leave to withdraw as attorney for Defendant and her then-husband.4 Trial on damages was consequently continued to August 27, 2018, so Defendant and her then-husband could hire new counsel. Plaintiff Ex. 1, State Court Action, Court Minute dated June 4, 2018.

11. On August 27, 2018, a jury trial on damages was conducted in the State Court Action with Plaintiff and her counsel present and Defendant's then-husband also present. Defendant did not appear or participate in the trial on damages. Plaintiff Ex. 1, State Court Action Journal Entry of Judgment for Damages entered December 14, 2018.

12. As a result of the jury trial, at which Plaintiff called witnesses and presented documentary evidence, a jury verdict was rendered in favor of Plaintiff and against Defendant, among others, as follows:

Jury finds clear and convincing evidence Defendants acted in reckless disregard of the rights of others and Defendants acted intentionally and with malice towards others; Jury finds in favor of Plaintiff in the amount of $350,000.00 for actual damages . . . and sets punitive damages at $100,00.00.
State Court Action Docket Entry dated August 27, 2018.

13. A Journal Entry of Judgment for Damages was entered in the State Court Action on December 14, 2018 (the "Damages Judgment"), against Defendant, among others, and in favor of Plaintiff as follows:

Three Hundred Fifty Thousand Dollars ($350,000.00) actual damages with statutory pre-judgment interest thereon at the rate of .31 % from October 2, 2014, which date is two (2) years after the date of the filing of the Plaintiff's Petition herein, October 2, 2012, until the date of the filing of this Order, and with statutory post-judgment interest thereon at the rate of 5.75% from the date of the filing of this Order until paid, pursuant to 12 O.S. §727.1. Judgment is further rendered in favor of the Plaintiff, Melanie Gerlich, and against the Defendants Lori Frair (now known as Lori Barwick) . . . for One Hundred Thousand Dollars ($100,000.00) punitive damages with statutory interest thereon at the rate 5.75% from the date of the filing of this Order until paid, pursuant to 12 O.S. §727.1, for all of which let execution issue.
Plaintiff Ex. 1, State Court Action Journal Entry of Judgment entered December 14, 2018.

14. In January 2019, the State Court also awarded $1,638.02 for costs related to the action (the "Costs Judgment"). Plaintiff Ex. 1, State Court Action Journal Entry of Judgmentfor Costs entered on January 18, 2019 (the Liability Judgment, the Damages Judgment, and the Costs Judgment, collectively the "State Court Judgments").

15. Defendant never appealed or sought reconsideration or vacation of the State Court Judgments. State Court Docket generally.5

16. Defendant then filed a voluntary petition under chapter 7 of the Bankruptcy Code in the Western District of Oklahoma on May 2, 2019.

17. Plaintiff filed her Amended Complaint herein on July 3, 2019.

APPLICABLE CODE PROVISION

Section 523(a)(6) provides as follows:

a) A discharge under section 727, 1141, 1228(a), 1228(b), or 1328(b) of this title does not discharge an individual debtor from any debt-
(6) for willful and malicious injury by the debtor to another entity or to the property of another entity[.]
CONCLUSIONS OF LAW

"[A] central purpose of the [Bankruptcy] Code is to provide a procedure by which certain insolvent debtors can reorder their affairs, make peace with their creditors, and enjoy 'a new opportunity in life with a clear field for future effort, unhampered by the pressure and discouragement of preexisting debt.'" Grogan v. Garner, 498 U.S. 279, 286 (1991) (quoting Local Loan Co. v. Hunt, 292 U.S. 234, 244 (1934)). But a completely fresh start is limited to the"'honest but unfortunate debtor.'" Grogan, 498 U.S. at 286-87 (quoting Local Loan Co., 292 U.S. at 244). Section 523(a) reflects Congress' decision to exclude certain categories of debts from a debtor's discharge. Burris v. Burris (In re Burris), 598 B.R. 315, 333 (Bankr. W.D. Okla. 2019) (citing Grogan, 498 U.S. at 287). Many of the subsections of Section 523(a) aim to prevent discharge of debts involving a debtor's unacceptable conduct, such as dishonesty,...

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