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IN RE BOUCHER

United States Bankruptcy Court, D. Connecticut.
Sep 12, 2005
ORDER OFFERING OPPORTUNITY TO BRIEF ISSUE

LORRAINE WEIL, Bankruptcy Judge

WHEREAS, the above-referenced plaintiff (the "Plaintiff") seeks in this adversary proceeding a determination that a certain judgment debt owed by the above-referenced debtor (the "Debtor") to the Plaintiff is nondischargeable pursuant to Bankruptcy Code § 523(a)(2);

WHEREAS, to prevail in this action the Plaintiff relies entirely upon the collateral estoppel effect of the referenced judgment (rendered as a default judgment by the Superior Court of the State of Connecticut, the "Judgment");

WHEREAS, it appears that the Judgment was rendered on various alternative grounds: some grounds were based on fraud theories (and thus relevant for Bankruptcy Code § 523(a)(2) purposes) and some grounds were based on theories that were not fraud based such as breach of contract (and thus irrelevant for Bankruptcy Code § 523(a)(2) purposes); WHEREAS there is an issue (the "Issue") as to whether, under applicable (Connecticut) law, a default judgment rendered on alternative grounds (one a fraud ground and one a contract ground) would be given collateral estoppel effect on the issue of fraud. See Dowling v. Finley Associates, Inc., 248 Conn. 364, 370-379 (1999) (discussing, inter alia, Restatement (Second) of Judgments § 27 cmt. i (1982)). See also Gilmore v. Gilmore (In re Gilmore), No. 02-15992-7, 2004 WL 2044116, at *6 (Bankr. D. Kan. July 16, 2004) ("[T]he Plaintiff's [default] judgment should not be given preclusive effect here unless each of its two legal bases (that is, the one contained in Count I and the one contained in Count IV), standing alone, would satisfy the requirements of either § 523(a)(2), (4), or (6)."). But see Harmon v. Kobrin, 242 B.R. 183, 186-188 (E.D. Cal. 1999), rev'd, 250 F.3d 1240 (9th Cir. 2001). Cf. Jackson v. R.G. Whipple, Inc., 225 Conn. 705, 718 (1993) ("Our decision . . . indicates that had there been a full and fair opportunity to litigate issues and such issues were necessary to a default judgment, that judgment should put to rest subsequent litigation of all issues necessary for the rendering of the default judgment." (emphasis added));

WHEREAS, the court desires to afford the parties an opportunity to brief the Issue;

NOW, THEREFORE, it is hereby ORDERED that, on or before October 21, 2005, the respective parties may (but are not required to) file and serve a brief in respect of the Issue, provided, however, any such brief shall not exceed five (5) pages in length (exclusive of caption); and it is further ORDERED that the Clerk's Office shall serve a copy of this order upon counsel for the Plaintiff and upon the Debtor.

With respect to filing and service of papers in this case, counsel should take note of the Administrative Procedures for Electronic Case Filing effective August 1, 2005 and available for review on this court's external website (www.ctb.uscourts.gov) under "CM/ECF News-n-Info."