Johnson v. District of Columbia et al

UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF COLUMBIA
In re
JAMES F. JOHNSON,
Debtor.
____________________________
JAMES F. JOHNSON,
Plaintiff,
v.
DISTRICT OF COLUMBIA, et
al.,
Defendants.
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Case No. 08-00311
(Chapter 7)
Adversary Proceeding No.
08-10036
Not for Publication in
West’s Bankruptcy Reporter
MEMORANDUM DECISION RE MOTION TO DISMISS
The plaintiff, James F. Johnson, received a discharge in his
bankruptcy case. 	He has sued the District of Columbia and
related entities for allegedly violating the discharge injunction
by attempting to collect fines imposed by the Department of Motor
Vehicles (“DMV”). 	The plaintiff has failed to allege any facts
establishing that such fines were discharged notwithstanding 11
U.S.C. § 523(a)(7) which provides that a debt is
nondischargeable:
The document below is hereby signed.
Signed: June 08, 2009.
_____________________________
S. Martin Teel, Jr.
United States Bankruptcy Judge
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to the extent such debt is for a fine, penalty, or
forfeiture payable to and for the benefit of a
governmental unit, and is not compensation for actual
pecuniary loss, other than a tax penalty--
(A) relating to a tax of a kind not specified
in paragraph (1) of this subsection; or
(B) imposed with respect to a transaction or
event that occurred before there years before the
date of the filing of the petition.
I
Before turning to the specific challenges the complaint
makes to the propriety of the District of Columbia’s collecting
the fines at issue after the plaintiff’s receiving a discharge,
it is worth mentioning what the complaint does not allege as
grounds for treating the collection of the debts as violating the
discharge injunction. 	The complaint does not allege that the
fines at issue are not the types of fines described in §
523(a)(7).
Parking and driving violation fines owed a municipality are
generally not designed to compensate for actual pecuniary loss,
and instead are designed to deter drivers from failing to observe
parking and driving regulations. 	See Caggiano v. Office of the
Parking Clerk of the City of Boston (In re Caggiano), 34 B.R.
449, 450 (Bankr. D. Mass. 1983). 	The complaint does not allege
that the fines at issue were “compensation for actual pecuniary
loss,” and the plaintiff has not challenged the District of
Columbia’s assertion in its motion to dismiss that the fines fit
within § 523(a)(7).
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The exhibits to the complaint list amounts owed for tickets
without any indication that the ticketed amounts include any
charge for actual pecuniary loss. 	Beyond the ticketed amounts,
the complaint does not allege that the District of Columbia is
seeking to collect any other debts that, in contrast, might be
considered compensation for actual pecuniary loss. 	There is, for
example, no indication in the complaint that the plaintiff went
to a hearing before the DMV for which he has been charged the
costs the DMV incurred in conducting such a hearing.
II
The first basis that the complaint does raise as a grounds
for enjoining collection of the fines is that the fines are time-
barred. 	The fines are nondischargeable regardless of their age.
In contrast, 523(a)(7)(B) denies such nondischargeability status,
generally bestowed by § 523(a)(7) on non-pecuniary loss fines, to
a tax penalty relating to “a transaction or event that occurred
before there years before the date of the filing of the
petition.” 	Section 523(a)(7)(A) and (B) are directed to only a
tax penalty as those paragraphs of § 523(a)(7) relate to the
immediately preceding clause (“other than a tax penalty”) and are
intended to specify when a tax penalty is disqualified from
enjoying nondischargeability status.
To the extent that the plaintiff contends that the fines are
time-barred under District of Columbia law, that is not an issue
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of nondischargeability over which this court has jurisdiction.
Instead, that contention presents a defense under nonbankruptcy
law to the District of Columbia’s claim that the fines are owed.
The plaintiff may raise that defense in an appropriate forum
elsewhere.
III
The complaint contends that the defendants failed to file
anything in the bankruptcy case after notice of its pendency, and
that they have waived their claims. 	Nothing in the Bankruptcy
Code or the Federal Rules of Bankruptcy Procedure required the
District of Columbia to file anything in the case in order to
preserve the nondischargeable character of the fines. 	The fines
are not debts of a character described in 11 U.S.C. § 523(c) for
which a complaint must be filed by the deadline specified by Fed.
R. Bankr. P. 4007(c) in order to preserve the nondischargeability
of the debt.
IV
The complaint finally contends that the District of
Columbia, pursuant to the home rule powers bestowed upon it by
Congress, is not authorized to override a federal law, to wit,
the discharge provisions of the Bankruptcy Code that grant a
debtor a discharge. 	This contention is frivolous. 	Congress
empowered the District to enact parking and driving regulations,
including fines for violation of those regulations. 	Enactment of
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5	O:\TEEL\Judge Temp Docs\Johnson v DC (In re James Johnson) Mem Decsn re MTD.wpd
such fines does not transgress the Bankruptcy Code’s provisions
for the bestowal of a discharge on an individual debtor. 	The
fines are debts, and the Bankruptcy Code’s discharge provisions
do not bar the creation of debts pursuant to nonbankruptcy law.
Instead, a discharge granted under the Bankruptcy Code gives rise
to an injunction under 11 U.S.C. § 524 that bars collection of
such debts after entry of the discharge unless they are excepted
from discharge. 	Here, Congress has provided in § 523(a)(7) an
exception to the discharge for punitive parking and driving fines
imposed as a result of regulations adopted under nonbankruptcy
law, including those imposed under the parking and driving
regulations enacted by the District of Columbia.
V
For the foregoing reasons, the motion to dismiss this
adversary proceeding will be granted via a judgment that follows
dismissing this adversary proceeding.
[Signed and dated above.]
Copies to: All counsel of record; Office of United States
Trustee.
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