In re Capozziello
| Decision Date | 20 December 1985 |
| Docket Number | Bankruptcy No. 5-84-00221,Adv. No. 5-84-0078. |
| Citation | 55 BR 951 |
| Court | U.S. Bankruptcy Court — District of Connecticut |
| Parties | In re Alfred M. CAPOZZIELLO, Debtor. C.B.C. CONSTRUCTION COMPANY, Plaintiff, v. Alfred M. CAPOZZIELLO, Defendant. |
William F. Dow, III, Jacobs, Grudberg & Belt, P.C., Peter L. Ressler, Groob, Ressler & Mulqueen, P.C., New Haven, Conn., for plaintiff.
Stuart M. Sheiman, Bridgeport, Conn., for defendant.
ALAN H.W. SHIFF, Bankruptcy Judge.
The plaintiff, C.B.C. Construction Company ("C.B.C."), an unsecured creditor, alleges that Alfred M. Capozziello, the defendant-debtor ("Capozziello"), willfully and maliciously damaged its property, consisting of two tractor type trucks, and seeks a determination that the resulting debt is nondischargeable under Code § 523(a)(6)1 and an award of money damages in satisfaction of that debt.
The jurisdiction of this court is now founded upon Section 157(a), Title 28, U.S.C., added by Section 104(a) of the Bankruptcy Amendments and Federal Judgeship Act of 1984, P.L. 98-353, July 10, 1984, the congressional response to Northern Pipeline Construction Co. v. Marathon Pipe Line Co., 458 U.S. 50, 102 S.Ct. 2858, 73 L.Ed.2d 598 (1982) which held that the grant of power to bankruptcy judges under section 241(a), P.L. 95-598 was unconstitutional. Since, however, 28 U.S.C. § 157 was not effective until July 10, 1984 and the petition in this case was filed prior to that date, the jurisdiction of this court in this proceeding rests upon the Emergency Resolution For The Administration of Bankruptcy System ("Emergency Resolution"), adopted by the United States District Court for the District of Connecticut, effective December 25, 1982. See White Motor Corp. v. Citibank, N.A., 704 F.2d 254 (6th Cir.1983); In re Hansen, 702 F.2d 728 (8th Cir.1983), cert. denied sub nom., First Nat'l Bank of Tekamah, Neb. v. Hansen, 463 U.S. 1208, 103 S.Ct. 3539, 77 L.Ed.2d 1389 (1983); In The Matter of Braniff Airways, Inc., 700 F.2d 214 (5th Cir.1983), aff'g 27 B.R. 231 (N.D.Tex.1983), cert. denied sub nom., American Airlines, Inc. v. Braniff Airways, Inc., 461 U.S. 944, 103 S.Ct. 2122, 77 L.Ed.2d 1302 (1983); In re Q1 Corporation, 28 B.R. 647, 10 B.C.D. 522 (E.D.N.Y.1983); Moody v. Martin, 27 B.R. 991, 10 B.C.D. 575 (W.D.Wis.1983); In re Color Craft Press, Ltd., 27 B.R. 962, 10 B.C.D. 182 (D.Utah 1983); In re Northland Point Partners, 26 B.R. 1019 (E.D.Mich. 1983) (). Contra In the Matter of Seven Springs Apartments, 33 B.R. 458, 10 B.C.D. 634 (Bkrtcy.N.D.Ga. 1983) (). While the underpinnings of the various resolutions adopted by the district courts are subject to divergent opinion, the consensus of the circuit courts which have reviewed the resolutions appears to be that 28 U.S.C. § 1471 was not completely rejected, leaving the district court with jurisdiction, inter alia, to refer matters to bankruptcy judges. In re Hansen, supra; In re Braniff Airways, Inc., supra; White Motor Corp. v. Citibank, N.A., supra.
Paragraph (c)(1) of the Emergency Resolution, which tracks 28 U.S.C. § 1471, provides:
In all civil proceedings thus referred, a bankruptcy judge may enter final orders and judgments except in related proceedings where the parties have not consented to such entry. Emergency Resolution ¶¶ (d)(2), (d)(3)(B).
"Related proceedings" are defined, for purposes of determining when a bankruptcy judge may enter a dispositive order, as "those civil proceedings that, in the absence of a petition in bankruptcy, could have been brought in a District Court or a State Court."
I conclude that the instant adversary proceeding is not a related proceeding, as defined by the Emergency Resolution ¶ (d)(3)(A). That paragraph specifically excludes proceedings to determine dischargeability of particular debts from related proceedings. As to C.B.C.'s claim for damages, the Emergency Resolution ¶ (d)(3)(A) lists several nonexclusive categories of proceedings that are not related proceedings, including the "allowance of and objection to claims against the estate ... and similar matters." Paragraph (d)(3) further states: "A proceeding is not a related proceeding merely because the outcome will be affected by state law." Here C.B.C.'s claim for damages is nothing more than the assertion of a claim by a creditor against a debtor which is denied by the debtor.
It is preferable to permit parties to litigate their entire claim against a debtor's estate in a single forum. To require a creditor, who succeeds in a dischargeability proceeding, to litigate the damages aspect of his claim in another forum would serve no useful purpose, but rather would delay the efficient administration of justice and waste the time, effort, and resources of both parties. For that reason, the parties consented, during a pretrial conference, to the entry of a judgment on the damages issue in the event that the dischargeability issue was decided in C.B.C.'s favor. Therefore, even if the litigation of C.B.C.'s claim for damages is a related proceeding, this court has jurisdiction to enter judgment on that issue. See Emergency Resolution ¶ (d)(3)(B).
During the early morning hours of July 10, 1981, Leamond Suggs was walking in the side lot of The United Church located on Dixwell Avenue, New Haven, Connecticut near the intersection of Admiral Street. The area where Suggs was walking was close to C.B.C.'s place of business. As Suggs was walking in a westerly direction toward a fence abutting C.B.C.'s property, he saw flames from a fire on that property and then he noticed two men jumping down from C.B.C.'s fence.
As the two men approached him, he saw one of them make a throwing gesture toward the ground. When the two men were within six or seven feet from him, they turned to their right and began to walk toward Dixwell Avenue. Suggs followed. When the men reached Dixwell Avenue, an automobile drove up behind them near Christ Church and sounded its horn. The automobile then stopped, and the two men got in. As the men were getting into the automobile, Suggs walked behind and within three or four feet of the vehicle.
Dixwell Avenue in the area of Christ Church was very well illuminated by mercury street lights, and because of that illumination and his close proximity to the vehicle, Suggs was able to see the driver and the vehicle's Connecticut license plate number, 200 AFK.
When members of the New Haven arson squad, which consists of police officers and fire fighters, arrived at the scene, Suggs identified himself and described what he saw. After giving a statement, Suggs accompanied an investigating officer to the area where he saw one of the men make the throwing gesture. A pair of gloves was observed at that location. The gloves were described as relatively new, light weight, white canvas work gloves with an unusual red stitching. The gloves contained an odor of a flammable liquid.
The investigating officers thereafter ascertained that the vehicle was registered to Capozziello's wife, and that it had been located in Bridgeport. Members of the arson squad then drove Suggs to the area where the vehicle was parked to see if he could positively identify the vehicle. By then it was about 6:00 A.M., and when Suggs and the officers reached an intersection which was some distance from the subject vehicle, he exclaimed, "That's the car," meaning that a vehicle parked ahead was the vehicle he had seen on Dixwell Avenue in the area of the fire. As the arson squad vehicle got closer to the subject vehicle, Connecticut license plate 200 AFK could be observed. Shortly thereafter, Capozziello was escorted from his residence, and Suggs identified him as the driver of the vehicle he had seen earlier that morning in New Haven. The vehicle was then parked in front of Capozziello's residence. A subsequent search of the trunk of that vehicle revealed a pair of white canvas work gloves with red stitching of the same type as was found behind The United Church.
Evidence during the trial further established that C.B.C. was the owner of two tractor type trucks, that each truck had been totally destroyed by a separate, rapid burning, accelerated fire, and that a flammable liquid was present at the point of origin of each of the fires which, according to the expert witnesses, supported the conclusion that the damage to each truck was caused by arson.
The evidence also demonstrated that C.B.C. was a small business, minority contractor engaged in the demolition business in the New Haven area and that Capozziello's family was involved in the demolition business in the Bridgeport area. C.B.C.'s business had grown in the immediately preceding years to the point where it was able to break into the Bridgeport market and to compete with the Capozziello family for jobs in that area. Within a short time before the fire, C.B.C. had submitted successful rival bids to bids submitted by the Capozziello family for demolition contracts.
The evidence recounted here, is sufficient to establish the following facts:
Under Code § 523(a)(6), an individual debtor may not obtain a discharge from any debt for a willful and malicious injury by the debtor to another entity or its property.2 The legislative history of that section indicates that the term willful means "deliberate or intentional," S.Rep. No. 989, 95th Cong., 2nd Sess. at 79 (1978), U.S.Code Cong. & Admin.News 1978, pp. 5787, 5864. The legislative history...
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