Schoonover v. Elford (In re Elford)

Decision Date24 August 2020
Docket NumberAdv. Proc. No. 20-2014,Case No. 14-30222-E-13
CourtUnited States Bankruptcy Courts. Ninth Circuit. U.S. Bankruptcy Court — Eastern District of California
Parties IN RE Cameron ELFORD, Debtor. David Schoonover, Plaintiff, v. Cameron Elford, Defendant.

Peter G. Macaluso, Sacramento, CA, for Defendant.

Barry H. Spitzer, Sacramento, CA, for Plaintiff.

Docket Control No. BHS-1

MEMORANDUM OPINION AND DECISION MOTION FOR SUMMARY JUDGMENT

Ronald H. Sargis, Judge

On May 27, 2020, David Schoonover, the "Plaintiff," filed a Motion for Summary Judgment pursuant to Federal Rule of Civil Procedure 56 and Federal Rule of Bankruptcy Procedure 7056 and supporting pleadings thereto.1 Dckts. 23-28. On June 23, 2020, Cameron Elford, "Defendant-Debtor," filed an Opposition and related opposition pleadings. The above relief is requested in Plaintiff's First Amended Complaint filed on February 19, 2020. Dckt. 7. Defendant-Debtor filed his Answer on March 26, 2020. Dckt. 13. No trial has been set in this Adversary Proceeding.

Overview of Complaint and Answer

Plaintiff commenced this Adversary Proceeding for a determination that the obligations owing on the Amended Judgment on Verdict for $2,962,902.77 ("Amended Judgment on Verdict") in David Schoonover et al. v. Cameron Elford and Lisa Pashanee , California Superior Court Case, County of Sacramento, No. 34-2012-00131228 ("State Court Action"); and the order for restitution in the amount of $376,200.00 ("Restitution Order") in In Matter of Cameron Elford , Minor, California Superior Court Juvenile Case, County of Sacramento, No. 132824 ("Juvenile Case"), are nondischargeable in the Chapter 13 Case filed by Cameron Elford, 14-2014.

These monetary claims arise out of a head-on collision that occurred in July 2012, for which Defendant-Debtor pleaded no contest to felony drunk driving by a minor and for which corroborating testimony was provided by a passenger in the car being driven by the Defendant-Debtor at the time of the accident. The court reviews the evidence presented and the findings and conclusions in the State Court Action and the Juvenile Case in this Decision.

Defendant-Debtor's Answer begins with a general denial of "any allegation that Plaintiff has been, is, or will be damaged in the amount alleged, or any manner or sum whatsoever, or entitled to any recovery or remedy of any type whatsoever, be [sic] or any act, conduct, or omission of Defendant[-Debtor]." This general denial was made as to Plaintiff suffering any damages due to the head-on collision when Defendant-Debtor, a 17 year old, was driving while intoxicated, notwithstanding the Restitution Order for $376,200.00 having been entered six years earlier on April 25, 2014, and the State Court Judgment for $2,962,902.77 having been entered December 19, 2015, four and one-half years earlier. Both the Restitution Order and the State Court Judgment are expressly for the damages caused Plaintiff by Defendant-Debtor in the head-on collision of Defendant-Debtor's vehicle into Plaintiff's vehicle.2

The Answer continues, in which Defendant-Debtor asserts that he need not respond to the allegations in the first seven paragraphs of the Amended Complaint. However, if required to respond, Defendant-Debtor denies such to the extent that they are an allegation of fact. These statements that no response is required, and if so, that each such allegation is affirmatively denied by Defendant-Debtor, includes the following allegations:

Paragraph 1 of the Amended Complaint which alleges that Defendant-Debtor filed a voluntary Chapter 13 case – which Defendant-Debtor denies.
Paragraph 2 of the Amended Complaint which alleges that Defendant-Debtor's voluntary bankruptcy case is pending in the Eastern District of California – which Defendant-Debtor denies.
Paragraph 3 of the Amended Complaint which alleges that Defendant-Debtor is an individual – which Defendant-Debtor denies.
Paragraph 4 of the Amended Complaint which alleges the federal court jurisdiction which arises under 28 U.S.C. § 1334, the exercise of that jurisdiction by bankruptcy judges, and the reference of all matters for which jurisdiction exists pursuant to 28 U.S.C. § 1334 – which Defendant-Debtor denies.
Paragraph 5 of the Amended Complaint which alleges that this Adversary Proceeding is a core matter proceeding for which the bankruptcy judge issues all final orders and the judgment – which Defendant-Debtor denies.
Paragraph 6 of the Amended Complaint which alleges that Defendant is a resident of Sacramento County, California, which is situated within the Eastern District of California – which Defendant-Debtor denies.

Answer ¶¶ 1, 2, 3, 4, 5, and 6; Dckt. 13.

It is questionable as to how Defendant-Debtor can deny that he commenced the identified voluntary bankruptcy case and that he is a living, breathing individual. Also, the court cannot identify any good faith basis for Defendant-Debtor asserting that the determination of whether a discharge of these debts are proper arising under the Bankruptcy Code ( 11 U.S.C. §§ 523(a)(9) and 1328(a)(3) and (a)(4) ) is not a core matter proceeding.

With respect to the allegations of federal court jurisdiction and whether this is a core matter proceeding, the U.S. Supreme Court has adopted Federal Rule of Civil Procedure 8 and Federal Rule of Bankruptcy Procedure 7008, which incorporates and expands Federal Rule of Civil Procedure 8 into bankruptcy adversary proceedings.

Defendant-Debtor's general denial does not appear to comply with the Federal Rule of Civil Procedure 8(b)(3) [emphasis added], which allows for a general denial only when,

A party that intends in good faith to deny all the allegations of a pleading—including the jurisdictional grounds ...."

Federal Rule of Civil Procedure 8(b)(1)(B) further requires that the responding defendant "[m]ust ... (B) admit or deny the allegations asserted against it by an opposing party." Defendant-Debtor has failed to comply with these provisions of Federal Rule of Civil Procedure 8(b).

Federal Rule of Bankruptcy Procedure 7012, which incorporates Federal Rule of Civil Procedure 12 into adversary proceedings, requires the Defendant-Debtor in this Adversary Proceeding to include in the responsive pleading "a statement that the party does or does not consent to entry of final orders or judgment by the bankruptcy court." Fed. R. Bank. P. 7012(b). This is to document early on whether for non-core matters the parties consent to the bankruptcy judge issuing all final orders and judgment. Defendant-Debtor neglected to comply with this provision of Federal Rule of Bankruptcy Procedure 7012(b). See Answer, Dckt. 13.

Admissions in Answer Relating to The Restitution Order and The Amended Judgment on Verdict

The First Amended Complaint includes the following Exhibits which are identified in the following paragraphs of the Complaint:

Exhibit A, Restitution Order; Dckt. 27.
9. On July 22, 2012, Plaintiff suffered grievous injuries caused by a head-on traffic accident with Defendant. See, Exhibit "A," page 1: 13-15, Order Re: Restitution, Sacramento Superior Court, R. Steven Lapam, Judge of the Superior Court, April 25, 2014.
Complaint ¶ 9, Dckt. 7.
Exhibit B - The Amended State Court Judgment on Verdict; Id. at 16.
16. On December 9, 2015, nunc pro tunc to October 23, 2015, Judge Gerrit W. Wood of the Sacramento Superior Court issued an Amended Judgment on Verdict in case no. 34-2012-00131228 entitled David Schoonover and Thuy Bich Van v. Cameron Taylor Elford and Lisa J. Pashanee . See, Exhibit "B."
Complaint ¶ 16; Id.

In his Answer, Defendant-Debtor makes the following admissions and denials with respect to these two exhibits:

9. Answering paragraph 9 of the Complaint, Defendant admits only that the pleadings filed with the court are writings that speak for themselves. To the extent the allegations contained in Paragraph 9 of the Complaint differ from, are inconsistent with, or improperly characterized the content of these writings, those allegations are denied.
Answer ¶ 9; Dckt. 13.
16. Answering paragraph 16 of the Complaint, Defendant admits only that the pleadings filed with the court are writings that speak for themselves. To the extent the allegations contained in Paragraph 16 of the Complaint differ from, are inconsistent with, or improperly characterized the content of these writings, those allegations are denied.
Answer ¶ 16; Id.

Defendant-Debtor admits that the Restitution Order and Amended State Court Judgment are what they state they are and that they state what they state, denying only the allegations in the Amended Complaint that may misstate the terms in the Restitution Order and the Amended Judgment.

The court considers the Restitution Order and the Amended Judgment on Verdict in the discussion below.

July 23, 2020 Final Hearing on Motion for Summary Judgment

On July 23, 2020, this court conducted the continued hearing on the Motion for Summary Judgment. In the court's posted tentative ruling the court addressed a number of issues with counsel for Defendant-Debtor concerning a number of the opposition grounds asserted. Counsel for Defendant-Debtor did not advocate for the positions asserted on those issues, but indicated that he acquiesced to the analysis in the tentative ruling. This court states its final ruling on those oppositions in this Decision. Counsel for the Defendant-Debtor did elaborate and provide oral argument for the opposition based on there being no criminal conviction of the Defendant-Debtor who was a minor at the time of the collision for purposes of 11 U.S.C. § 1328(a).

The court addressed at the hearing issues concerning the Motion, evidence, and applicable law with counsel for Plaintiff. The court requested/offered Plaintiff several opportunities to file supplemental pleadings clearly tying together the evidence and legal grounds into a simple (as the court described it) "see Spot, see Spot run" analysis of the facts not in bona fide material dispute and the applicable law connecting the dots showing that Plaintiff prevails....

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