GABRIEL, Bankruptcy Judge
That portion of the bankrupt's joint income tax refund which represented wages earned by his wife from whom he was separated was maliciously converted when the bankrupt disposed of the funds from the tax refund check in their entirety such that the portion owing to the wife was a nondischargeable debt under Section 17a (2) of the Bankruptcy Act.
The bankrupt and his wife were separated. While the bankrupt was out of town, federal and state tax refund checks arrived by mail at his residence and his housekeeper, who had authority to deposit checks, deposited the refund checks in the bankrupt's checking account. Although the bankrupt was not initially aware that the deposit had been made, once he was made aware of it he continued to draw on the balance until it was depleted. The creditor-wife contended that she had a property interest in one-half of the tax refund pursuant to the terms of a separation agreement which provided that the bankrupt would pay her "an amount equal to one-half of the tax refund." She further contended that this amount was maliciously converted by the bankrupt and therefore nondischargeable.
Under Section 17a(2) of the Bankruptcy Act, a discharge in bankruptcy releases a bankrupt from all his provable debts, except those which are for "willful and malicious conversion of the property of another." Malice under the Act is "an intentional disregard for a known duty." The court found that the creditor did not have a one-half ownership right in the tax refund check but rather that the bankrupt was to pay the creditor a lump sum amount equivalent to half of the refund. This is a property settlement, not alimony, and is dischargeable in bankruptcy. However, the court noted that the property interest of each spouse to a tax refund check is equal to the amount each spouse contributed to the over paid tax. Because the court found sufficient evidence to support the allegation that the bankrupt willfully and maliciously converted the creditor's interest in the funds because he knew that the tax refund check was deposited and that he was drawing on it, and that his wife was entitled to at least a portion of the tax refund, the amount the creditor contributed to the over paid tax was willfully and maliciously converted and therefore was a debt not dischargeable in bankruptcy. See Sec. 17a (2) [§ 523(a)(2)] at ¶ 9228.