In re Cohen, Bankruptcy No. 87-30122

CourtUnited States Bankruptcy Courts. Second Circuit. U.S. Bankruptcy Court — Southern District of New York
Writing for the CourtJEREMIAH E. BERK
Citation92 BR 54
PartiesIn re Martin COHEN, Debtor. Frank PERINO, Plaintiff, v. Martin COHEN, Defendant.
Docket NumberBankruptcy No. 87-30122,Adv. No. 87-7018.
Decision Date30 September 1988

92 B.R. 54 (1988)

In re Martin COHEN, Debtor.
Frank PERINO, Plaintiff,
Martin COHEN, Defendant.

Bankruptcy No. 87-30122, Adv. No. 87-7018.

United States Bankruptcy Court, S.D. New York.

September 30, 1988.

Mid-Hudson Legal Services, Inc., Poughkeepsie, N.Y., for plaintiff; Howard Schell Reilly, and Michael J. Sinsky, of counsel.

92 BR 55

Chester G. Krom, Kingston, N.Y., for defendant.


JEREMIAH E. BERK, Bankruptcy Judge.


This is an adversary proceeding pursuant to Section 523(a)(6) of the Bankruptcy Code ("Code"), 11 U.S.C. § 523(a)(6), by Frank Perino, plaintiff, against Martin Cohen, the debtor-defendant. By motion for summary judgment, Perino here seeks a determination that his claim against the debtor in the sum of $5,000.00, representing compensatory damages pursuant to a default judgment by a state administrative agency, is nondischargeable under the doctrine of collateral estoppel.

Simply put, we hold that the proceedings before the administrative tribunal, the New York State Division of Human Rights, lacked the requisite attributes to permit this court to invoke the doctrine of issue preclusion on the question of debt dischargeability. The determination of whether or not Perino's "injury" was the result of Cohen's "willful and malicious" conduct was neither presented to, nor decided by, the Division of Human Rights. Indeed, even if all of the allegations of Perino's discrimination complaint were deemed true by virtue of Cohen's failure to respond, there would still be insufficient reason to here conclude that Perino's "injury" was caused by Cohen's "willful and malicious" conduct.


The events leading to the claim Perino here seeks to establish as nondischargeable occurred nearly six years ago. The parties dispute most of the facts pertaining to these events. However, they agree that at all times relevant hereto: (1) the plaintiff was legally blind; (2) that he was accompanied by a trained guide dog; and (3) that Cohen was the owner of the Cafe Expresso, a public accommodation in Woodstock, New York.

By verified complaint dated January 12, 1983, Perino filed an action with the New York State Division of Human Rights charging the debtor with unlawful discrimination in violation of Article 15 of the Executive Law. Perino claimed that Cohen unlawfully discriminated against himself and his dog because of his disability. The complaint's sole factual allegation consisted of the statement that "Marty Cohen owner of Cafe Expresso refused to serve us declaring that Frank Perino is not blind and that his dog is not a legal seeing eye dog."

After investigation, the Human Rights Division determined that "it had jurisdiction over the complaint and that probable cause existed to believe that Cohen had engaged in an unlawful discriminatory practice." The events which transpired after this determination are unclear. Apparently, during the summer of 1983, some attempt to settle the complaint was undertaken by the debtor who at this juncture was represented by counsel. A settlement, however, was never reached. The debtor, by affidavit filed February 23, 1988, states that although the settlement offer was ultimately "refused" by Perino, the debtor was "unaware" that Perino had rejected the settlement.

Nearly three years later, on December 6, 1986 the debtor received a notice to appear for a hearing to be held in New York City on December 15, 1986 before the Division of Human Rights. The purpose of this hearing was to determine whether Cohen unlawfully discriminated against Perino by denying him the "accommodations, advantages, facilities and privileges" of the cafe because of Perino's disability and use of a guide dog. The nearly three-year hiatus between the settlement negotiations and the hearing date is unexplained.

Cohen sought an adjournment of the hearing. He claimed that the notification of the hearing caught him by surprise as he thought the matter was settled, and asked for additional time to collect his records and retain counsel. This was his first request for an adjournment. He stated, "Since I had very little time to put a

92 BR 56
defense together and I was now unrepresented, I requested in writing an adjournment. . . . I had never asked for any adjournment of this proceedings sic previously." In addition to claiming that he needed the adjournment to prepare for the hearing and obtain counsel, the debtor testified that he was unable to attend due to a physical disability caused by a degenerative joint disease

Cohen's request for adjournment was denied and he was so notified by a mailgram received on the Friday before the Monday hearing. On the day of the hearing, Cohen states that he again sought an adjournment by telephone, but was unsuccessful.

The hearing before the state administrative tribunal went forward as scheduled, without Cohen. Perino testified before an administrative law judge who, by opinion and order entered February 24, 1987, made the following findings:

3. On or about December 12, 1982, at approximately 1 p.m., Complainant, accompanied by his wife Cathy and his guide dog Mountain entered the Cafe Expresso and sat down at a table. A waitress Lisa told them that Respondent Martin Cohen had instructed her to inform Complainant that he could not be served because he had his guide dog present.
4. When Complainant protested that under the law he was permitted to have his dog present, Respondent Cohen came over and told Complainant to "get that house pet out, you\'re not blind." When Complainant informed Respondent that the law permitted him to be accompanied by his guide dog, Respondent replied by stating that he made his own rules and asked Complainant to leave.
5. Complainant was very upset and "felt he was assaulted, . . . raped . . . taken advantage of." He decided to leave the premises, especially since his wife was equally upset.
6. On or about January 11, 1983, at approximately 2 p.m., Complainant returned to the Expresso Cafe sic again accompanied by his wife and his guide dog Mountain; Complainant demanded to be served.
7. When Respondent Cohen again refused to serve him, Complainant got angry and Respondent Cohen threatened to call the police.
8. When Complainant continued to demand service, cited the law and offered to show Respondent identification showing that Mountain was a trained guide dog, Respondent did call police from the Town of Woodstock.
9. The policeman who responded identified by Complainant as Richard, after speaking to Complainant and Respondent Cohen told Complainant that Cohen could make his rules as to serving patrons and asked Complainant to leave, which Complainant did.
10. Complainant was very upset by Respondent\'s failure to serve him. He was also very upset by Respondent\'s remarks about Complainant not being blind and his guide dog being a house pet.
11. Complainant\'s emotional stress was heightened by the fact that his wife was also upset and crying at the time of Respondent Cohen\'s actions.
12. I find that Respondent Martin Cohen unlawfully discriminated against Complainant by denying to him the facilities of the Cafe Expresso, a place of public accommodations sic, because of Complainant\'s guide dog.
13. I find that Complainant suffered mental anguish and humiliation as a result of Respondent\'s discriminatory acts.
14. I find that the awarding of compensatory damages to the Complainant will further the purposes of the Human Rights Law.

Cohen disputes these findings. Among his principal assertions are that: (1) there was only one incident with Perino, which occurred on December 13, 1982; (2) Cohen and his staff simply asked Perino to move his dog under the table as it was blocking the aisle; Perino over-reacted to this request, became loud, profane and threatened Cohen with a lawsuit; (3) subsequent to this episode Perino and his dog visited the

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cafe on other occasions, all without incident

Apparently none of these assertions were before the administrative tribunal. The administrative law judge concluded that Cohen violated Sections 296(2)(a) and 296(14) of the Human Rights Law, N.Y. Exec. Law §§ 296(2)(a) and 296(14) (McKinney 1988). These provisions state in pertinent part:

(2)(a). It shall be an unlawful discriminatory practice for any person being the owner, lessee, proprietor, manager, superintendent, agent or employee of any place of public accommodation, resort or amusement, because of the . . . disability . . . of any person, directly or indirectly, to refuse, withhold from or deny to such person any of the accommodations, advantages, facilities or privileges thereof. . . .
(14). It shall be an unlawful discriminatory practice for any person engaged in any activity covered by this section to discriminate against a blind person . . . on the basis of his use of a guide dog. . . .

Cohen was ordered to pay Perino the sum of $5,000.00 as "compensatory damages." A "Notice of Order After Hearing" was issued which informed him of his right to appeal. Cohen neither paid the compensatory damages nor filed an appeal. On March 17, 1987, he filed for relief under Chapter 7 and his bankruptcy discharge was entered on November 16, 1987.


A. Summary Judgment

Federal Rule of Civil Procedure 56(c) ("FRCP") provides that summary judgment should be granted if the pleadings, affidavits and other papers submitted in support of the motion show that there is no genuine triable issue of material fact and that the moving party is entitled to summary judgment as a matter of law. Celotex Corp. v. Catrett, 477 U.S. 317, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Matsushita Electric Industrial Co. v. Zenith Radio Corp., 475 U.S. 574, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986); Corselli v. Coughlin, 842 F.2d 23 (2d Cir.1988); Donahue v. Windsor Locks Board of Fire...

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