Hagmaier v. Cooley (In re Cooley), Case No. 15–10555–SAH

551 B.R. 498

In re: Brent C. Cooley, Debtor.

Stacey Hagmaier, Plaintiff

v.Brent Cooley, Defendant.

Case No. 15–10555–SAH

Adv. Pro. 15–01214–SAH

United States Bankruptcy Court, W.D. Oklahoma.

Signed May 12, 2016

Gaylon C. Hayes, Hayes Legal Group, Oklahoma City, OK, for Plaintiff.

Gary D. Hammond, Oklahoma City, OK, for Defendant.

FINDINGS OF FACT AND CONCLUSIONS OF LAW

Sarah A Hall, United States Bankruptcy Judge

After considering the pleadings filed, the stipulations contained in the Joint Final Pretrial Order [Doc.28], and the evidence and testimony presented at the trial held on March 28, 2016, the Court adopts the following as its findings of fact and conclusions of law pursuant to Rule 7052 of the Federal Rules of Bankruptcy Procedure.

I. PROCEDURAL HISTORY.

To a degree, this case is “an unfortunate tale of poor lawyering.” Smith v. McCord , 707 F.3d 1161, 1162 (10th Cir.2013). Plaintiff Stacey Hagmaier (“Hagmaier”) claims that in March 1996 defendant Brent Cooley (“Cooley”) raped her. In the aftermath, Hagmaier filed a state court action (the “Civil Action”) and obtained a $400,000 summary judgment against Cooley (the “Judgment”). After Cooley filed bankruptcy, Hagmaier filed an adversary Complaint [Doc. 1] against Cooley initiating the above-captioned adversary proceeding in order to except the Judgment from his discharge pursuant to 11 U.S.C. § 523(a)(6).

A Scheduling Order [Doc. 20] was entered on November 18, 2015, establishing the following deadlines:

The first lawyering problem was encountered when the Court returned the original Joint Final Pretrial Order to Hagmaier's counsel on Monday, March 21, 2016, because Hagmaier's trial exhibits were generically identified and needed to be separately identified and numbered. Hagmaier ignored the Court's instructions (the second lawyer problem). Finally, on Friday, March 25, 2016, the Court was forced to notify Hagmaier's counsel that, in spite of clear instructions in the Scheduling Order, a pretrial order had not been signed and no exhibits had been provided to the Court (the third lawyering problem). Hagmaier's counsel then uploaded a revised Joint Final Pretrial Order (which was entered on March 25, 2016, [Doc. 28] ), and copies of Hagmaier's trial exhibits were delivered to the Court late that afternoon.

At trial on Monday, March 28, 2016, Cooley objected to the admission of Hagmaier's trial exhibits for two reasons: (i) Hagmaier never exchanged exhibits with Cooley prior to the February 17, 2016, deadline; and (ii) Hagmaier failed to deliver the trial exhibits to Cooley until the morning of trial. Based on the language of the Scheduling Order,¹ and the prejudice to Cooley, the Court refused to admit Hagmaier's trial exhibits.²

Plaintiff called a Canadian County Deputy Court Clerk to testify concerning the contents of the record in the Civil Case. The Court declined to allow the testimony because Hagmaier would not be able to elicit testimony concerning any of the documents that comprise the Civil Case's docket; therefore, all of her testimony that might have bearing on the issue preclusive effect of the Judgment would be inadmissible hearsay.

Findings of Fact

1. Prior to March 8, 1996, Hagmaier and Cooley were more than acquaintances; they dated and even co-habitated for a number of years.

2. On March 7, 1996, after Cooley failed to show up for a planned lunch with Hagmaier,³ Hagmaier went to Cooley's parents' house where she found him with another woman.

3. Angry and hurt, Hagmaier left Cooley's parents' house, returned to her house to remove Cooley's toiletries and then drove back to Cooley's parents' house where she spoke to Cooley and threw his belongings out of her car.

4. Hagmaier returned to her house and was awakened by a call from Cooley, who had been drinking, sometime after 10:00 p.m. Hagmaier told Cooley to leave her alone.

5. Cooley then went to Hagmaier's house.

6. Hagmaier answered the door. Although at trial she testified that he kicked the door in, Hagmaier's testimony at the Preliminary Hearing was that she unlocked the door and turned around and Cooley entered. Her prior testimony is consistent with Cooley's testimony at trial.

7. An argument ensued, and Cooley pushed Hagmaier onto the couch.

8. The noise from their argument awakened her daughter, and Cooley got up and went to check on her, then returned.⁴

9. Thereafter, Hagmaier claims Cooley raped her. Cooley denies raping her or even having sex with Hagmaier that night.

10. While Cooley was in her house, Hagmaier had access to a telephone in her living room but did not use it.

11. Hagmaier reported a rape to the Yukon police department the following day.

12. Criminal charges were filed against Cooley but were later dismissed for lack of evidence.

13. There is no evidence that Cooley's semen was found on any item that the police took from Hagmaier's house.

14. Hagmaier filed the Civil Case against Cooley on July 20, 1998.

15. On May 23, 2000, the Judgment was entered in the Civil Case in Hagmaier's favor and against Cooley as follows: $200,000 actual damages and $200,000 punitive damages. Cooley claims that he lacked notice of the filing of the motion for summary judgment; therefore, he did not object to the motion for summary judgment.

16. Thereafter, Cooley filed a motion to vacate the Judgment in the Civil Action, which was denied. Subsequently, Hagmaier pursued enforcement of the Judgment.

17. Cooley filed a voluntary petition under chapter 7 of the Bankruptcy Code on February 20, 2015.

18. On May 4, 2015, Hagmaier commenced this adversary proceeding to except the Judgment from Cooley's discharge.

Conclusions of Law

19. The denial of a debtor's discharge is a harsh remedy, reserved only “for a truly pernicious debtor.” Duff v. Ayala (In re Ayala) , 516 B.R. 645, 650 (Bankr.D.N.M.2014) (citing Soft Sheen Products, Inc. v. Johnson (In re Johnson) , 98 B.R. 359, 367 (Bankr.N.D.Ill.1988) (citing In re Shebel , 54 B.R. 199, 204 (Bankr.D.Vt.1985) )). Accordingly, the provisions of Section 523(a) are construed liberally in favor of the debtor and strictly against the creditor. Ayala , 516 B.R. at 650 (citing Soft Sheen Products, Inc. v. Johnson (In re Johnson) , 98 B.R. 359, 364 (Bankr.N.D.Ill.1988) ).

20. 11 U.S.C. § 523(a)(6) excepts from discharge a debt “for willful and malicious injury by the debtor to another entity or to the property of another entity.”

21. At trial, Hagmaier testified that she recovered the Judgment against Cooley based on the alleged rape on March 7, 1996,⁵ and this is the debt she seeks to except from Cooley's discharge pursuant to Section 523(a). Because the Court did not have the Judgment or the judgment roll from the Civil Action, this Court cannot rely on the entry of the Judgment to prove that it arose as a result of a willful and malicious injury but instead must look only to the evidence presented at trial to determine if Section 523(a)(6) applies.

22. The United States Supreme Court holds that, to be nondischargeable under Section 523(a)(6), the “judgment debt must be ‘for willful and malicious injury. ’ ” Kawaauhau v. Geiger , 523 U.S. 57, 63, 118 S.Ct. 974, 140 L.Ed.2d 90 (1998). Section 523(a)(6) requires proof of both willful and malicious conduct. Mitsubishi Motors Credit of America, Inc. v. Longley (In re Longley) , 235 B.R. 651, 655 (10th Cir. BAP 1999) (failure of a creditor to establish either willfulness or malice renders the debt dischargeable). Thus, Section 523(a)(6) encompasses only acts done with the actual intent to cause injury. Via Christi Reg'l Medical Ctr. v. Englehart (In re Englehart ), 229 F.3d 1163 (10th Cir.2000) (unpub.) (citing Kawaauhau v. Geiger , 523 U.S. 57, 61, 118 S.Ct. 974, 140 L.Ed.2d 90 (1998) ).

23. Accordingly, Hagmaier was required to prove that Cooley raped her on March 7, 1996. Hagmaier's testimony about the events leading up to the alleged rape was conflicting at best. During the trial, Hagmaier's recounting of the day and night of the alleged rape included no contact from Cooley during the immediate past 6–7 months, Cooley kicking in her front door, Cooley going down the hallway to do unknown things to her daughter, and Hagmaier begging him to harm her instead.

24. However, during Cooley's Preliminary Hearing in 1996,⁶ Hagmaier testified that she had regular contact with Cooley and called Cooley the day before to make lunch plans for March 7, 1996. She also testified that Cooley did not show up for lunch, so she went to his parents' house and found him to be with another women. Hagmaier then went to her house, got his toiletries, went back to his parents' house and threw them out. Hagmaier also stated, during the Preliminary Hearing, that, when Cooley showed up at her house on March 7, 1996, she opened the door to Cooley and turned and walked away with the door open so that Cooley was able to walk into the house rather than kick the door down. Finally, she also testified at the Preliminary Hearing that Cooley went to check on her daughter after she awakened due to their argument rather than suggesting he was going to do something insidious to her daughter.

25. The wildly different accounts of March 7, 1996, seriously undermine Hagmaier's credibility, given that her current version of the facts, some 20 years after the alleged rape, contains obvious enhancements to Cooley's behavior that would have been critical to, and seemingly more readily recalled during, the Preliminary Hearing in 1996. Hagmaier was not able to offer a plausible explanation for the inconsistencies and, due to her counsel's ineptitude, she could not offer evidence to corroborate her current version of the events that occurred March 7, 1996. This Court believes that Hagmaier's rendition of the events of March 7, 1996, during the Preliminary Hearing, an event only six months after the alleged rape, is more credible than Hagamier's more recent testimony. Rhodes v. Ayala (In re Ayala) , 335 B.R. 763, 765 (Bankr.D.Wyo.2005).

26. Cooley denies that he raped Hagmaier and...