Genta et al v. Leiper et al

MEMORANDUM OF DECISION - 1
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF IDAHO
IN RE 	)
)
STEVEN J. LEIPER & 	) 	Case No. 04-02052-TLM
LOREE ANNE LEIPER, 	)
)
Debtors. 	) 	MEMORANDUM OF DECISION
)
________________________________ )
)
THOMAS E. GENTA & 	)
GENTA MANAGEMENT, INC., 	)
)
Plaintiffs, 	)
)
vs. 	) 	Adversary No. 04-6193
)
STEVEN J. LEIPER & 	)
LOREE ANNE LEIPER, 	)
)
Defendants. 	)
)
________________________________ )
On September 2, 2004, the above Plaintiffs sued chapter 7 debtors and
Defendants alleging nondischargeability of debt under § 523(a)(6). Defendants
answered the complaint, representing themselves pro se, and the matter was set for
trial. On the date of trial, May 19, 2005, counsel for Plaintiffs and Defendants
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MEMORANDUM OF DECISION - 2
orally advised the Court that the matter had been resolved by agreement. They
told the Court that they agreed a debt of $13,000.00 would be nondischargeable,
be secured by a deed of trust on Defendants’ residence, bear interest at 7½% and
be amortized over 10 years. They indicated that settlement pleadings and
documents would be forthcoming.
When a dispute arose between the parties over the exact language of the
agreement and settlement documentation, Plaintiffs moved in October, 2005, to
“compel” the entry of a judgment consistent with the oral statements in May,
2005; to compel Defendants to sign a note and deed of trust in “standard form”
and, if they did not do so, to appoint an individual to sign on their behalf; and for
an award of attorneys’ fees and costs against Defendants. See Doc. No. 15.
Defendants failed to appear at a scheduled and noticed hearing on this
motion on October 31. The Court, however, declined to grant the motion at that
time, and instead issued its own “order to show cause” to Defendants. The Court
thus tried to encourage Defendants to make an appearance and deal with the
several issues presented.
At hearing on the Order to Show Cause, Plaintiffs appeared through
counsel, but Defendants once again failed to appear at all. Nor have they
responded in writing to any of the motions, pleadings or orders over the past
several months.
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MEMORANDUM OF DECISION - 3
Defendants’ elected course is risky, but the Court is required to consider
not only their default and failure to appear, but also whether the relief sought by
Plaintiffs is appropriate. In considering the entirety of the record, and in particular
the dialogue between the Court and the parties at the time of the trial in May,
2005, the Court concludes that the settlement terms orally stated were not so clear
and complete that the Court can enter judgment thereon or order a note and a deed
of trust executed by someone on Defendants’ behalf, as was requested in
Plaintiffs’ motion. The Court reaches this conclusion with full understanding of
its own precedent on the importance of settlements and the enforcement of
settlements. But it also does so with appreciation for the fact that exceptions to
discharge are construed narrowly and must be established by creditors.
Since the Court determines Plaintiffs’ motion cannot be granted, the Court
can and will order this matter to again be set for trial. Plaintiffs and Defendants
will be advised by the Clerk of the date of trial, and they shall then and there
appear, present testimony through witnesses and present their documentary
evidence, on all causes and claims. Both parties are entitled to their day in court
on the merits of the matter. Defendants are specifically advised that, should they
fail to appear at the time set for trial, the Court will hear the presentation of
Plaintiffs’ evidence and proceed to determine the merits of the nondischargeability
claim under those facts and applicable law.
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MEMORANDUM OF DECISION - 4
An order will be entered denying the motion, Doc. No. 15, and directing
that a notice of trial be issued.
DATED: December 14, 2005
TERRY L. MYERS
CHIEF U. S. BANKRUPTCY JUDGE
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MEMORANDUM OF DECISION - 5
CERTIFICATE RE: SERVICE
A “notice of entry” of this Decision, Order and/or Judgment has been
served on Registered Participants as reflected by the Notice of Electronic Filing.
A copy of the Decision, Order and/or Judgment has also been provided to non-
registered participants by first class mail addressed to:
Steven J. Leiper
LoRee Anne Leiper
4900 N. Paynton Way
Boise, ID 	83713
Case No. 04-6193 (Genta v. Leiper)
Dated: December 14, 2005
/s/ Jo Ann B. Canderan
Judicial Assistant to Chief Judge Myers
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