Ortiz v. Ovalles (In re Ovalles)
| Decision Date | 18 June 2020 |
| Docket Number | ADVERSARY NO. 15-00270 (EAG),CASE NO. 15-06006 (EAG) |
| Citation | 619 B.R. 23 |
| Parties | IN RE: Jose Rafael Velez OVALLES, Debtor. Herbalbert Emil Cofresi Ortiz, Plaintiff, v. Jose Rafael Velez Ovalles, Defendant. |
| Court | U.S. Bankruptcy Court — District of Puerto Rico |
Lirio Del Mar Torres, Mayaguez, PR, for Plaintiff
Nydia Gonzalez Ortiz, Santiago & Gonzalez, Yauco, PR, for Defendant
Mayra M. Arguelles Alvarez (ZF), San Juan, PR, for Trustee
Debtor/defendant Jose Rafael Velez Ovalles ("Mr. Velez," "defendant," or "debtor") and plaintiff Herbalbert Emil Cofresi Ortiz ("Mr. Cofresi" or "plaintiff") cross-moved for summary judgment in an adversary proceeding to except from discharge Mr. Cofresi's claim based on a lawsuit he filed in local court. For the reasons stated below, the court grants Mr. Velez's motion and denies Mr. Cofresi's.
This court has jurisdiction over the subject matter and the parties pursuant to 28 U.S.C. §§ 1334 and 157(a), Local Civil Rule 83K(a), and the General Order of Referral of Title 11 Proceedings to the United States Bankruptcy Court for the District of Puerto Rico dated July 19, 1984 (Torruella, C.J.).1 This is a core proceeding in accordance with 28 U.S.C. § 157(b)(2)(I) ().
Mr. Velez filed a voluntary petition for relief under chapter 13 of the Bankruptcy Code on August 6, 2015. (Bankr. Dkt. No. 1.) The debtor listed Mr. Cofresi's claim in schedule F in the amount of $4,000,000.00 corresponding to a tort action filed in local court on December 30, 2014. (Bankr. Dkt. No. 1 at p. 15.) On September 15, 2015, Mr. Cofresi filed a proof of claim in the amount of $4,000,000.00, wholly unsecured, concerning the lawsuit. (Claims Register No. 2-1.) The proof of claim attaches a copy of the complaint filed in local court, in which Mr. Cofresi alleges that he was severely injured when Mr. Velez lost control of a vehicle and collided with several individuals and parked vehicles. Id. The court has since confirmed Mr. Velez's chapter 13 plan. (Bankr. Dkt. Nos. 104 & 133.)
On November 16, 2015, Mr. Cofresi filed an adversary complaint against the debtor seeking to except from discharge under section 1328(a)(4) any damages awarded to him in the local court lawsuit. (Adv. Dkt. No. 1.) The debtor answered the adversary complaint on December 9, 2015. (Adv. Dkt. No. 9.) This court subsequently modified the automatic stay to enable the local court to proceed to judgment and stayed the adversary proceeding pending the resolution of that litigation. (Bankr. Dkt. No. 67; Adv. Dkt. No. 11.)
On February 5, 2018, the debtor moved for summary judgment in the adversary proceeding, informing that the local court had entered judgment on November 27, 2017 in favor of the plaintiff, but contending that the local court's ruling did not meet the standard for an exception from discharge under section 1328(a)(4). (Adv. Dkt. No. 15.) On April 6, 2018, the plaintiff Mr. Cofresi filed an opposition and cross motion for summary judgment. (Adv. Dkt. Nos. 23 & 24.) The debtor replied on June 7, 2018, and subsequently submitted to the court a certified translation in English of the local court judgment. (Adv. Dkt. Nos. 28 & 32.)
On October 10, 2019, the court heard oral arguments on the cross motions for summary judgment. (Adv. Dkt. Nos. 47 & 48.) At the hearing's conclusion, the court ordered Mr. Cofresi to supplement the statement of uncontested facts under Rule 56(e) to provide support for his assertions of fact regarding the circumstances of the incident, "such as the road conditions at the time of the incident, as well as any facts regarding aggravating factors that would support a finding that the defendant acted with malice." Id. Mr. Cofresi filed his supplement on November 14, 2019, and Mr. Velez filed his response on February 7, 2020. (Adv. Dkt. Nos. 50 & 58.)
The following facts are uncontested pursuant to Rule 56 and Local Civil Rule 56, made applicable to these proceedings by Bankruptcy Rules 9014(c) and 7056 and Local Bankruptcy Rules 1001-1(b) and (d).
On December 30, 2014, Mr. Cofresi and several family members filed suit against the debtor and others in the Puerto Rico Court of First Instance, Ponce Ward. The suit sought to recover damages, under Puerto Rico's tort statute, suffered as a result of a collision caused when Mr. Velez lost control of a vehicle and struck several parked cars and pedestrians, including the plaintiff, who were attending to a broken down vehicle on the shoulder of the road.
The local court issued a judgment in favor of Mr. Cofresi and his family members on November 27, 2017, awarding him the sum of $1,200,000.00 for physical and emotional damages, plus $2,401,600.00 in lost wages.2 (Adv. Dkt. No. 32-1 at pp. 17-22.) In so doing, the court first noted that the parties had stipulated as to the facts of the case "exactly as alleged in the complaint" and to the defendant's "gross and reckless negligence." (Adv. Dkt. No. 32-1 at pp. 1-2.)
The local court judgment made the following findings of fact as to the incident, which this court adopts in full:
On January 4, 2014, at around 12:20 a.m., [Mr. Velez], driving the 2012 Honda Civic vehicle, impacted another Honda vehicle that was parked in the shoulder of the road with mechanical trouble. With the force of the impact, several pedestrians who were providing assistance to the vehicle with mechanical problems were injured, among them [Mr. Cofresi].
(Adv. Dkt. No. 32-1 at p. 3.) The complaint provides several other details, which this court also adopts as facts, namely that per the accident report, Mr. Velez "was driving at a speed that did not allow him to have good control and command of the steering wheel" and that the vehicle he was driving was operating with a spare tire. (Adv. Dkt. No. 22 at p. 12.) The complaint also states:
[d]ue to the manner and speed co-defendant [Mr. Velez] was driving the vehicle, the car went off the main roadway, collided against and dragged three (3) vehicles that were parked in the emergency stopping lane, trapping co-plaintiff [Mr. Cofresi], collided against the security railing on the left side of the road, and turned over.
(Adv. Dkt. No. 22 at p. 13.) According to one of the injured pedestrians and a tow truck operator who witnessed the incident, driving conditions at the time in question were good: the road was dry, the traffic was light, and the vehicles stopped in the emergency lane were well illuminated by the highway's lamp posts. (Adv. Dkt. No. 50 at pp. 2-3.) The road leading up to the place of impact is a long straightaway. (Adv. Dkt. No. 50 at p. 4.) Mr. Velez admitted at the scene of the incident that he had fallen asleep behind the wheel. (Adv. Dkt. No. 50 at p. 2.)
The 25-year-old Mr. Cofresi suffered serious injuries as a result of the incident, including the amputation of his right leg. (Adv. Dkt. No. 22 at pp. 15-17; Adv. Dkt. No. 50 at p. 3.) Mr. Cofresi was hospitalized for more than five months and endured a number of surgical procedures and life-threatening complications. Id. Following his release from the hospital, Mr. Cofresi continues to receive various treatments and therapies and has been unable to live on his own. (Adv. Dkt. No. 22 at pp. 20-23.)
The standard for summary judgment is well-known. Pursuant to Rule 56, made applicable to these proceedings by Bankruptcy Rules 7056 and 9014(c), summary judgment is available "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c) ; Borges ex rel. S.M.B.W. v. Serrano-Isern, 605 F.3d 1, 4 (1st Cir. 2010). The moving party bears the burden of showing that "no genuine issue exists as to any material fact" and that he is "entitled to judgment as a matter of law." Vega-Rodríguez v. P.R. Tel. Co., 110 F.3d 174, 178 (1st Cir. 1997).
Once a properly supported motion has been presented before the court, the opposing party "can shut down the machinery only by showing that a trial-worthy issue exists" that would warrant the court's denial of the motion for summary judgment. McCarthy v. Northwest Airlines, 56 F.3d 313, 315 (1st Cir. 1995). For issues where the opposing party bears the ultimate burden of proof, that party cannot merely "rely on the absence of competent evidence, but must affirmatively point to specific facts that demonstrate the existence of an authentic dispute." Id. However, not every factual dispute is sufficient to frustrate summary judgment; the contested fact must be material and the dispute over it must be genuine. Id. An issue is "genuine" if it could be resolved in favor of either party. A fact is "material" if it is potentially outcome-determinative. See Calero-Cerezo v. United States DOJ, 355 F.3d 6, 19 (1st Cir. 2004).
In assessing a motion for summary judgment, the court "must view the entire record in the light most hospitable to the party opposing summary judgment, indulging in all reasonable inferences in that party's favor." Griggs-Ryan v. Smith, 904 F.2d 112, 115 (1st Cir. 1990) (citations omitted). The court may safely ignore "conclusory allegations, improbable inferences, and unsupported speculation." Medina-Munoz v. R.J. Reynolds Tobacco Co., 896 F.2d 5, 8 (1st Cir. 1990) (citations omitted). However, there is "no room for credibility determinations, no room for the measured weighing of conflicting evidence such as the trial process entails, [and] no room for the judge to superimpose his own ideas of probability and likelihood (no matter how reasonable those ideas may be) ...." Greenburg v. P.R. Mar. Shipping Auth., 835 F.2d 932, 936 (1st Cir. 1987) ; see also Mulero-Rodriguez v. Ponte, Inc., ...
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... ... Printy , 110 F.3d at 859). See also In re ... Ovalles , 619 B.R. 23 at 31 (Bankr. D.P.R. 2020) (noting ... continued vitality of pre- Geiger ... ...