Satterfield-Price v. Parrish
Filing
14
OPINION AND ORDER affirming Order granting summary judgment. The Clerk shall enter judgment accordingly, transmit a copy of this Opinion and Order and the Judgment to the Clerk of the Bankruptcy Court, terminate the appeal, and close the file. Signed by Judge John E. Steele on 3/20/2014. (RKR)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
IN RE:
JULIE SATTERFIELDPRICE aka Julie S. Price aka
Julie Price
Debtor.
JULIE SATTERFIELD-PRICE
Appellant,
v.
Case No: 2:13-cv-501-FtM-29
Bankr. No. 9:12-BK-11704-FMD
Adv. No. 9:12-ap-00152-FMD
JON DOUGLAS PARRISH,
Appellee.
OPINION AND ORDER
This matter comes before the Court on an appeal from the
Bankruptcy Court’s May 21, 2013, Order Granting Summary Judgment
(Doc. #1-2; Adv. Doc. #26)1.
(appellant
or
Appellant Julie Satterfield-Price
Satterfield-Price)
filed
her
Amended
Initial
Appellate Brief of Appellant (Doc. #6) on July 30, 2013; appellee
Jon Douglas Parrish (appellee or Parrish) filed his Appellee Brief
(Doc. #10) on September 9, 2013; and appellant filed her Reply
1
The Court will hereinafter cite documents filed with the
District Court as “Doc.”, documents filed in the Bankruptcy case
as “Bankr. Doc.”, and documents filed in the Adversary Proceeding
as “Adv. Doc.”. Copies of the relevant documents are included in
the record transmitted by the Bankruptcy Court or otherwise
available through PACER and judicially noticed.
Brief (Doc. #13) on October 3, 2013.
The sole issue is whether
the Bankruptcy Court properly granted summary judgment concluding
that the debt owed to Parrish was nondischargeable in bankruptcy.
I.
The United States District Court functions as an appellate
court in reviewing decisions of the United States Bankruptcy Court.
28 U.S.C. § 158(a); In re JLJ, Inc., 988 F.2d 1112, 1116 (11th
Cir. 1993).
The legal conclusions of the bankruptcy court are
reviewed de novo, while findings of fact are reviewed for clear
error.
In re Globe Mfg. Corp., 567 F.3d 1291, 1296 (11th Cir.
2009).
This appeal arises from the resolution of a motion for
summary
judgment,
established.
and
these
legal
principles
are
also
well
Summary judgment is appropriate only when the Court
is satisfied 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).
In ruling on a motion for
summary judgment, the Court views all evidence and draws all
reasonable inferences in favor of the non-moving party.
Scott v.
Harris, 550 U.S. 372, 380 (2007); Tana v. Dantanna’s, 611 F.3d
767, 772 (11th Cir. 2010).
The entry of summary judgment involves
no findings of fact and therefore a summary judgment ruling is
reviewed de novo.
In re Optical Techs., Inc., 246 F.3d 1332,
1334-1335 (11th Cir. 2001).
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II.
In
April
2007,
Julie
S.
Parrish,
now
known
as
Julie
Satterfield-Price, and Jon D. Parrish dissolved their marriage
pursuant to a Final Judgment of Dissolution of Marriage, which
incorporated a Marital Settlement Agreement.
p. 15, ¶ F(i).)
(Doc. #1-6, Exh. 1,
The Marital Settlement Agreement required the
parties to share decision-making responsibilities and information
impacting their minor children, including education.
F(ii), (iii).)
(Id. at ¶¶
Parrish was awarded full custody of the two minor
children, and the third child was no longer a minor during the
child custody litigation.
(Doc. #1-7, p. 2.)
Acrimonious child
custody proceedings commenced, which eventually led to an Omnibus
Order entered by the state court imposing unspecified amounts of
attorney fees and costs against Satterfield-Price in favor of
Parrish.
In February, 2012, the attorney fees and costs in favor
of Parrish were stipulated to be $135,000 by Satterfield-Price,
and a final judgment in that amount was entered.
On
July
31,
2012,
Satterfield-Price
filed
a
Chapter
13
Voluntary Petition (Doc. #1-5) and a proposed Chapter 13 Plan
(Bankr. Doc. #2).
Parrish filed a Proof of Claim (Doc. #1-6) in
the amount of $135,000, plus interest.
Parrish later filed an
Objection (Bankr. Doc. #18) and Amended Objection (Bankr. Doc.
#31) to the confirmation of the Plan.
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On December 13, 2012, Parrish filed an adversary Complaint
(Doc. #1-6; Bankr. Doc. #30) seeking a determination that the
$135,000 debt, plus interest, was nondischargeable in bankruptcy
because it was a domestic support obligation within the meaning of
11 U.S.C. § 523(a)(5).
dismiss
was
denied,
affirmative defenses.
(Doc. #1-6, ¶ 3.)
Satterfield-Price
After a motion to
filed
her
Answer
and
(Adv. Doc. #15.)
On May 2, 2013, Satterfield-Price filed a notice of voluntary
dismissal of her Chapter 13 Petition, to which Parrish filed an
objection and motion to convert the case to a Chapter 7 case.
(Bankr. Docs. ## 59-60.)
On May 15, 2013, the Bankruptcy Court
heard arguments on the motion for voluntary dismissal of the
Chapter 13 case and the motion for summary judgment.
11.)
(Doc. #1-
The Bankruptcy Court orally granted the motion to dismiss
the Chapter 13 case, and exercised its discretion to retain
jurisdiction over the adversary proceeding as allowed by In re
Morris, 950 F.2d 1531 (11th Cir. 1992).
The Bankruptcy Court also
granted summary judgment finding that under § 523(a)(5) the debt
was nondischargeable.
(Doc. #1-11, p. 17.)
On May 16, 2013, the Bankruptcy Court entered a written order
dismissing the Chapter 13 case and retaining jurisdiction over the
adversary proceeding.
(Bankr. Doc. #68.)
On May 21, 2013, the
Bankruptcy Court entered a written order granting Parrish’s motion
for
summary
judgment.
(Doc.
#1-2.)
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Parrish’s
request
for
attorney’s fees was denied without prejudice to the state court
considering whether Parrish was entitled to attorney’s fees for
the bankruptcy litigation.
(Doc. #1-2; Adv. Doc. #26.)
Satterfield-Price filed a timely Notice of Appeal (Doc. #11) on June 4, 2013.
III.
In a Chapter 13 bankruptcy, a debtor can discharge most of
her debts after she completes her bankruptcy plan payments. 11
U.S.C. § 1328.
A discharge under Chapter 13 “operates as an
injunction against the commencement or continuation of an action,
the employment of process, or an act, to collect, recover or offset
any [discharged] debt as a personal liability of the debtor.” 11
U.S.C. § 524(a)(2).
A discharge cannot be obtained, however, “for
a domestic support obligation” under 11 U.S.C. § 523(a)(5).
In
re Diaz, 647 F.3d 1073, 1089 (11th Cir. 2011)(“Thus, [11 U.S.C.]
§ 1328 indicates that a debt of the kind specified in § 523(a)(5)
is not discharged by the bankruptcy court's discharge order in a
Chapter 13 case.”); In re Benson, 441 F. App’x 650, 651 (11th Cir.
2011).
was
a
The Bankruptcy Court found the $135,000 debt to Parrish
“domestic
support
dischargeable in bankruptcy.
obligation”
and
therefore
not
Whether a pre-petition debt is a
domestic support obligation is a legal conclusion which is reviewed
de novo. In re Strickland, 90 F.3d 444, 446 (11th Cir. 1996).
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Satterfield-Price argues that summary judgment was improper
because there were disputed issues of material fact as to whether
the debt was a non-dischargeable domestic support obligation or a
dischargeable
sanction
by
the
court,
Bankruptcy Court misapplied the law.
and
in
any
event,
the
Satterfield-Price filed an
Affidavit from her state court attorney with the Bankruptcy Court
attesting that none of the fees, costs or other monies awarded to
Parrish were in connection with any litigation over child support,
alimony, or other issues of support or maintenance.
(Doc. #1-9.)
The debt at issue is based upon the state court Omnibus Order
and the resulting Final Judgment.
Therefore, the Court begins by
examining those documents in some detail.
A. State Court Omnibus Order
On February 3, 2012, the Honorable Lauren L. Brodie, Collier
County Circuit Court Judge, issued a thirty-four page Omnibus Order
(Doc. #1-6, pp. 6-39) making various findings of fact and ruling
on seventeen pending matters and motions.
As relevant, those
findings and rulings are summarized as follows:
1. Reservation of Fees and Costs in February 10, 2011 Order (Order
#1) and the June 17, 2011 Order:
portion
of
the
costs
and
fees
Judge Brodie allocated a
related
to
the
parenting
evaluation by Dr. Carter, which Parrish had been required to
pay, to Satterfield-Price because her conduct greatly increased
the cost; found that Satterfield-Price’s conduct constituted
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contempt
of
the
court’s
prior
orders;
and
awarded
Parrish
attorney’s fees for prosecution of the issue in an amount to be
determined later.
2. Reservation of Fees and Costs in February 10, 2011 Order (Order
#2):
Judge Brodie awarded costs and fees to Parrish related to
the appointment of a person to perform a needed educational
evaluation of a minor child, and attorney’s fees incurred in
pursuit of an Order for the educational evaluation, in an
amount to be determined later.
3. Reservation of Allocation of Fees and Costs in July 5, 2011
Order to Show Cause:
Judge Brodie found that Parrish was
entitled to attorney fees and costs, including the additional
costs incurred as a result of Satterfield-Price’s misconduct in
connection with the transportation of a minor child to Dr.
Carter for a parental evaluation, in an amount to be determined
later.
4. Reservation of Fees and Costs in August 4, 2011 Order and Ninth
Emergency Motion for Contempt and Injunctive Relief:
Brodie
enjoined
Satterfield-Price
from
continuing
Judge
to
communicate with the minor children about the litigation and
granted Parrish’s request for attorney’s fees and costs incurred
for pursuing the motion, in an amount to be determined later,
and reserved jurisdiction as to the allocation of Guardian Ad
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Litem fees.
Satterfield-Price was also found in contempt of
the court’s previous orders.
5. Reservation
of
Allocation
of
Representing Guardian Ad Litem:
Attorney
Fees
For
Attorney
Judge Brodie apportioned fees
paid by Parrish and entered judgments against Satterfield-Price
and in favor of counsel for the Guardian Ad Litem and of the
Guardian Ad Litem in specific amounts, and reserved jurisdiction
to determine at a later date the amount of Parrish’s fees
incurred for filing the motion for allocation.
6. Tenth Motion for Contempt:
Judge Brodie found Satterfield-
Price in contempt for violation of the Settlement Agreement
regarding a minor child’s education, and granted Parrish’s
motion
and
the
request
for
attorney’s
fees
and
costs
for
pursuing the motion, with the amount to be determined later.
7. Eleventh, Twelfth, and Thirteenth Motions for Contempt:
Judge
Brodie denied the motions.
8. Fourteenth
Motion
for
Contempt:
Judge
Brodie
found
Satterfield-Price in contempt for discussing pending litigation
with the minor children in violation of previous orders, and
awarded Parrish fees and costs for prosecution of the motion,
including costs of the Guardian Ad Litem and/or evaluator and
Affidavit, with the amount to be determined later.
9. Fifteenth Emergency Motion for Contempt:
Judge Brodie found
Satterfield-Price in contempt for violation of a no contact
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order,
and
granted
Parrish
attorney’s
fees
and
costs
for
prosecution of the motion and Guardian Ad Litem fees incurred,
in an amount to be determined later.
10.
Emergency Sixteenth Motion for Contempt and Amended Motion
for Temporary Custody of Minor Child AP or for Placement with a
Third Party:
Judge Brodie granted the motion for temporary
custody and for contempt for discussing pending litigation with
the minor child, and held Satterfield-Price in contempt for her
failure to comply with orders precluding the involvement of the
minor child in the litigation and attempting to influence and
manipulate the testimony of the minor child.
Parrish was
awarded fees and costs for the investigation and prosecution of
the motion, in an amount to be determined later.
11.
Emergency Seventeenth and Eighteenth Motions to Compel and
for Contempt:
Judge Brodie found that Satterfield-Price was in
contempt for failure to complete her deposition, and awarded
Parrish attorney’s fees and costs for the prosecution of the
motions, including court reporter fees for the depositions, in
an amount to be determined later.
12.
Emergency
Nineteenth
Motion
to
Compel
and
for
Contempt:
Judge Brodie found Satterfield-Price in contempt in connection
with her deposition and granted Parrish attorney’s fees and
costs for the prosecution of the motion, in an amount to be
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determined later, as well as court report fees and videographer
fees for depositions in the amount of $615.
Determination of the amount of Parrish’s attorney fees and
costs was set for hearing.
On April 18, 2012, Judge Brodie issued
a largely hand-written Stipulated Final Judgment entering judgment
against Satterfield-Price and in favor of Parrish “for attorney
fees, expert fees and court costs” in the amount of $135,000, with
interest accruing from the date of judgment.
(Doc. #1-6, pp. 40-
41.)
B. Domestic Support Obligation
Effective October 17, 2005, the Bankruptcy Abuse Prevention
and Consumer Protection Act (“BAPCPA”) amended § 523(a)(5) to
delete the subsection's previous verbiage and to simply state that
a bankruptcy court may deny a debtor discharge “for a domestic
support obligation.” Bankruptcy Abuse Prevention and Consumer
Protection Act of 2005, Pub.L. No. 109–8, § 211, 119 Stat. 23
(2005). The BAPCPA defines “domestic support obligation” as a debt
(A)
owed to or recoverable by—
(i)
(ii)
(B)
a spouse, former spouse, or child of
the debtor or such child's parent,
legal
guardian,
or
responsible
relative; or
a governmental unit;
in the nature of alimony, maintenance, or
support (including assistance provided by a
governmental unit) of such spouse, former
spouse, or child of the debtor or such child's
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parent, without regard to whether such debt is
expressly so designated;
(C)
established or subject to establishment
before, on, or after the date of the order for
relief in a case under this title, by reason
of applicable provisions of—
(i)
(ii)
11
an order of a court of record; or
(iii)
(D)
a
separation
decree,
or
agreement;
agreement,
divorce
property
settlement
a determination made in accordance
with applicable nonbankruptcy law by a
governmental unit; and
not assigned to a nongovernmental entity,
unless that obligation is assigned voluntarily
by the spouse, former spouse, child of the
debtor,
or
such
child's
parent,
legal
guardian, or responsible relative for the
purpose of collecting the debt.
U.S.C.
§
101(14A).
The
definition
thus
creates
four
requirements which must be satisfied for a debt to be a “domestic
support obligation.”
In re Taylor, 737 F.3d 670, 676 (10th Cir.
2013).
There
is
no
dispute
that
the
first,
requirements are satisfied in this case.
third,
and
fourth
The $135,000 debt was
owed to the debtor’s former spouse, was established by reason of
an
order
of
a
court
nongovernmental entity.
of
record,
and
was
not
assigned
to
a
The only issue was whether the debt was
“in the nature of alimony, maintenance, or support . . . of such
. . . former spouse, or child of the debtor . . . without regard
- 11 -
to whether such debt is expressly so designated.”
11 U.S.C. §
101(14A)(B).
To fall within this provision, a debt does not literally have
to be “alimony, maintenance, or support,” but only “in the nature
of” those items.
In determining whether a debt is a domestic
support obligation, a court looks beyond the label given to a
particular debt and determines whether the debt is actually in the
nature of alimony, maintenance, or support. Cummings v. Cummings,
244 F.3d 1263, 1265 (11th Cir. 2001).
While this is an issue of
federal law, the court is also informed by state law. Id.
“[A]
domestic obligation can be deemed actually in the nature of support
under § 523(a)(5) even if it is not considered ‘support’ under
state law,” but state law can provide guidance in determining
whether an obligation constitutes support.
In re Strickland, 90
F.3d at 446 (citing In re Harrell, 754 F.2d 902, 905 (11th Cir.
1985)).
In the more typical situation the debt at issue is the result
of an agreement between the parties.
In that situation, a “court
conducts a ‘dual inquiry’ looking first to the intent of the
parties at the time they entered into their agreement, and then to
the substance of the obligation.”
(citations omitted).
In re Taylor, 737 F.3d at 676
Here, the debt was created by court order,
with the amount being stipulated by the parties.
As the Sixth
Circuit recently stated, “[n]othing in the statute precludes an
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attorney’s fee award from being treated as ‘in the nature of . .
. support.’”
In re Rugiero, 502 F. App’x 436, 439 (6th Cir. 2012).
Rugiero cites to nine circuit courts of appeal which have treated
fee awards as “support” payments, including the Eleventh Circuit.
Id.
See also In re Rogers, 189 F. App’x 299, 302-03 (5th Cir.
2006)(citing cases).
The Court agrees, and concludes, that a
court ordered obligation to pay attorney fees and costs incurred
in child support litigation can be “in the nature of support” and
therefore not dischargeable in bankruptcy.
Satterfield-Price argues that the Bankruptcy Court erred in
part because it ruled that attorney fees and costs incurred as
part of a custody dispute are always a domestic support obligation,
and such a brightline approach is contrary to law.
The Court
finds no such holding in either the Bankruptcy Court’s verbal
ruling or its subsequent written order.
stated at oral argument:
Summary
Judgment
.
.
.
The Bankruptcy Court
“I’m going to grant the Motion for
and
find
dischargeable support obligation.”
that
the
debt
is
a
non-
(Doc. #1-11, p. 17.)
The
Order Granting Summary Judgment (Doc. #1-2) stated “that the debt
owed to John D. Parrish as a result of the Stipulated Final
Judgment entered in Collier County Circuit on April 18, 2012 shall
be deemed a domestic support obligation as defined in 11 U.S.C. §
101(14A) and 11 U.S.C. § 523(a)(5); .. .”
Neither order adopts a
brightline approach as asserted by appellant.
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The question still remains whether these attorney fees and
costs were in the nature of support.
The First Circuit has stated
that “support payments are, roughly speaking, what is given to
provide for the upkeep of the recipient spouse and children.”
In
re Smith, 586 F.3d 69, 73 (1st Cir. 2009)(quoting In re Werthen,
329
F.3d
269,
273
(1st
Cir.
2003)).
One
of
the
principal
considerations is the purpose the obligation was intended to serve,
that is, whether the judge intended the award to be for support or
something else.
Smith, 586 F.3d at 73-74.
To discern this
intent, “courts look to a range of factors, including the language
used by the divorce court and whether the award seems designed to
assuage need, as discerned from the structure of the award and the
financial circumstances of the recipients.”
Id. at 74 (citation
omitted).
The language of the Omnibus Order is clear that the attorney
fees
and
costs
awarded
to
Parrish
were
not
sanctions
for
Satterfield-Price’s various acts of misconduct but were in the
nature of support.
The Omnibus Order allocated and re-allocated
fees and costs for a needed parenting evaluation of a minor child
and transportation of a minor child for a parental evaluation;
awarded the costs and attorney fees involved in bringing various
motions to enforce the ex-wife’s obligations in connection with
child custody and education matters; and awarded costs and attorney
fees in connection with bringing motions necessary to complete the
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ex-wife’s deposition in the child support litigation.
None of the
costs and attorney fees were imposed as a sanction for contempt,
and all were tied to specific actions taken by Parrish to enforce
obligations in connection with child custody and support.
None
of the fees or costs set a flat amount intended to be punitive,
and the amounts were to be determined in a separate hearing.
Both
parties were represented by counsel, and the parties stipulated to
the amount of attorney’s fees in the amount of $135,000, thus
obviating the need for a court determination of the relative
financial resources of the parties under Fla. Stat. § 61.16(1).
The Final Judgment confirms that the amounts were for costs,
attorney fees, and expert fees, and were not part of any punitive
sanction
by
the
state
court.
The
Affidavit
submitted
in
opposition does not create any issues of disputed material facts.
The intent of the state court is clear from the face of the state
court order and final judgment.
Therefore, as the attorney fees
and costs were in the nature of support, and summary judgment was
appropriate.
Accordingly, it is hereby
ORDERED AND ADJUDGED:
1.
The Order Granting Summary Judgment (Adv. Doc. #26) is
affirmed.
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2.
The Clerk shall enter judgment accordingly, transmit a
copy of this Opinion and Order and the Judgment to the Clerk of
the Bankruptcy Court, terminate the appeal, and close the file.
DONE and ORDERED at Fort Myers, Florida, this
of March, 2014.
Copies:
Hon. Caryl E. Delano
Clerk, Bankr. Court
Counsel of Record
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20th
day
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