Bankruptcy: Franks v. Thomason

Information that should and should not be reported where there is a bankruptcy.
David A. Szwak

Bankruptcy: Franks v. Thomason

Postby David A. Szwak » Mon Oct 24, 2005 6:22 pm

Franks v. Thomason
4 B.R. 814
D.C. Ga., 1980.

Bankruptcy action was brought to determine dischargeability of judgment. The Bankruptcy Court denied bankrupt's motion for new trial and rehearing of creditor's motion for summary judgment, and bankrupt appealed.

The District Court, Newell Edenfield, J., held that: (1) doctrine of collateral estoppel is inapplicable to the ultimate question of dischargeability of state or federal court judgment; however, Bankruptcy Court may not relitigate the entire case, and those facts that were actually litigated and necessary to the decision in the court that rendered the judgment, and that are discernable from the record of the case, should not be reopened absent a compelling reason to avoid injustice; (2) in determining dischargeability of federal district court judgment which had been entered against bankrupt based on finding that he had violated the Fair Credit Reporting Act, Bankruptcy Court erred in refusing to consider both extrinsic evidence and evidence within the record of the underlying suit in determining whether violation of the Act was willful and malicious so as to preclude discharge, especially where issues necessary to the underlying judgment were not actually litigated in that bankrupt failed to appear for trial; and (3) even if violation of the Fair Credit Reporting Act was found to have been willful, it would be necessary to consider whether the injury to the judgment creditor may have been merely negligent and thus dischargeable.

Reversed and remanded.

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