United States District Court, E.D. Kentucky, Central Division, Lexington
In re M. STEPHEN MINIX, SR., Debtor.
CHARITY STONE, Appellee. M. STEPHEN MINIX, SR., Appellant,
MEMORANDUM OPINION AND ORDER
C. Reeves United States District Judge.
M. Stephen Minix, Sr., has filed a pro se appeal of
a United States Bankruptcy Court judgment, excepting a state
court judgment against him from discharge under 11 U.S.C.
§ 523(a)(6). [Record No. 1] The parties have fully
briefed the matter, and having considered their respective
positions, the undersigned concludes that the bankruptcy
court's denial of discharge and denial of reconsideration
should be affirmed.
Charity Stone was awarded $40, 000 in damages after obtaining
a default judgment against Minix in the Floyd Circuit Court
(the “state court”). The judgment was based on a
claim of battery. Minix asserts that he did not receive
proper service and appealed the judgment (the “state
court appeal”). Minix then filed a petition for Chapter
7 bankruptcy relief while the state court appeal was pending.
Bankr. E.D. Ky. No. 17-51915-tnw, ECF No. 1. Stone responded
with an adversary proceeding, asking that the state court
judgment be excepted from discharge under 11 U.S.C. §
523. Bankr. E.D. Ky. No. 18-05003-tnw, ECF No. 1.
a period of discovery in the adversary proceeding, Minix
moved to dismiss the action while Stone moved for summary
judgment. Applying the doctrine of collateral estoppel, the
bankruptcy court determined that Stone was entitled to
summary judgment on her claim under 11 U.S.C. §
523(a)(6). Minix then filed a motion to alter, amend, or
reconsider the judgment. He claimed that: (i) the bankruptcy
court lacked jurisdiction to enter the judgment; (ii) there
was an issue of fact regarding notice of the state
court's judgment; and (iii) he did not receive notice of
various orders and motions in the state court proceeding.
Bankr. E.D. Ky. No. 18-05003-tnw, ECF No. 97. The bankruptcy
court denied the motion to alter, amend, or reconsider and
Minix filed the present appeal. He now challenges the
bankruptcy court's denial of discharge and its denial of
his motion to reconsider.
district court reviewing a bankruptcy court's decision
functions as an appellate court, applying the standards of
review normally applied by federal appellate courts. In
re H.J. Scheirich Co., 982 F.2d 945, 949 (6th Cir.
1993). Findings of fact are reviewed under a clearly
erroneous standard. In re Gardner, 360 F.3d 551, 557
(6th Cir. 2004). A bankruptcy court's findings of fact
will not be disturbed absent the “most cogent evidence
of mistake or miscarriage of justice”. In re Edward
M. Johnson and Assoc., Inc., 845 F.2d 1395, 1401 (6th
Cir. 1988) (internal quotations omitted).
a reviewing court will not overturn the bankruptcy
court's decision denying discharge unless it is clearly
erroneous. Westerfield v. World Inv. Corp., No.
6:06-cv-020-DCR, 2006 WL 1206386, at *2 (E.D. Ky. May 2,
2006) (citing In re D'Agnese, 86 F.3d 732, 734
(7th Cir. 1996)). “A finding is clearly erroneous when
although there is evidence to support it, the reviewing court
on the entire evidence is left with the definite and firm
conviction that a mistake has been committed.”
United States v. United States Gypsum Co., 333 U.S.
364, 395 (1948).
of law made by the bankruptcy court are reviewed de
novo. In re Gardner, 360 F.3d at 557. Issue
preclusion is a question of law. Therefore, a
bankruptcy court's decision regarding issue preclusion is
reviewed de novo. Stemler v. City of
Florence, 350 F.3d 578, 585 (6th Cir. 2003). This Court
will also apply a de novo standard of review to the
bankruptcy court's decision regarding a motion for
reconsideration of a grant of summary judgment. Smith v.
Wal-Mart Stores, Inc., 167 F.3d 286, 289 (6th Cir.
1999). A de novo review requires a court to review
the legal conclusions reached without regard to the
bankruptcy court's prior findings of law. In re
Eubanks, 219 B.R. 468, 469 (B.A.P. 6th Cir. 1998).
appeal challenges the bankruptcy court's denial of
Minix's motion to alter, amend, or reconsider in the
adversary proceeding. [Record No. 2] However, documents filed
by pro se litigants are liberally construed.
Erickson v. Pardus, 551 U.S. 89, 94 (2007). As a
result, the appeal will be viewed as a challenge to the
bankruptcy court's order granting Stone's motion
summary judgment and its denial of Minix's motion to
alter, amend, or reconsider. However, Minix has not explained
why he believes the bankruptcy court erred in denying his
motion to reconsider. Therefore, the Court will briefly
address the issue. See McPherson v. Kelsey, 125 F.3d
989, 995-96 (6th Cir. 1997) (“It is not sufficient for
a party to mention a possible argument in the most skeletal
way, leaving the court to . . . put flesh on its
bones”). Instead, the undersigned will focus on
Minix's claim that the bankruptcy court erred by
concluding, in the first instance, that Stone's state
court judgment against him was non-dischargeable.
Validity of Default Judgment
argues that the state court default judgment is void and
should not be relied upon for collateral estoppel because he
did not receive notice of state court filings. But this
argument ignores the previous order clearly explaining why
the state court judgment is “valid and in effect for
purposes of determining the issues of collateral estoppel and
non-dischargeability on appeal in this Court.” [Record
No. 10, p. 3] As the Court further explained, “a
judgment that is unreserved and unmodified remains ‘in
full force and effect, constituting a bar to the institution
of [a] second suit between the same parties upon the same
issues,' despite its pendency in the court of
appeals.” [Id.] (citing Small v.
Reeves, 76 S.W. 395, 397 (Ky. 1903). Thus, the state
court default judgment is valid for the purposes of
determining collateral estoppel and non-dischargeability on