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Sells v. Porter (In re Porter) - 539 F.3d 889 (8th Cir. 2008)

Rule:

Debts arising from recklessly or negligently inflicted injuries do not fall within the compass of 11 U.S.C.S. § 523(a)(6). Nondischargeability takes a deliberate or intentional injury, not merely a deliberate or intentional act that leads to injury. A willful injury is a deliberate or intentional invasion of the legal rights of another, because the word "injury" usually connotes legal injury in the technical sense. Further, a debtor need not intend the consequences of his conduct to cause a willful injury. It is enough if the debtor knows that the consequences are certain, or substantially certain, to result from his conduct. Maliciousness is conduct targeted at a creditor, at least in the sense that the conduct is certain or almost certain to cause harm. 

Facts:

Michael Allen Porter filed for bankruptcy under Chapter 7 of the Bankruptcy Code. Holly Sells filed an adversary complaint against Porter, seeking to bar the discharge of a judgment debt that she had obtained against him in an employment retaliation case wherein Sells had filed a case for sexual harassment, retaliation, and constructive discharge. The bankruptcy court gave collateral estoppel effect to the judgment, finding that the jury in the retaliation case necessarily found that Porter willfully and maliciously injured Sells. Accordingly, the bankruptcy court excepted the judgment debt from discharge under 11 U.S.C. § 523(a)(6). The Bankruptcy Appellate Panel affirmed, and Porter appealed. 

Issue:

Should the judgment debt be discharged?

Answer:

No

Conclusion:

The court of appeals held that the judgment in the harassment and retaliation case had collateral estoppel effect on the determination that the judgment debt was nondischargeable under § 523(a)(6) because the debt arose from willful and malicious injury. The jury in the retaliation suit necessarily found that the debtor willfully and maliciously injured the creditor by forcing her to choose between recanting her harassment claim and losing her job. According to the facts found by the jury, although the debtor did not sexually harass the creditor, he condoned his partner's actions and retaliated against the creditor. Thus, the bankruptcy appellate panel's judgment was affirmed.

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