Van Vuuren v. Berrien , 280 F. App'x 762 ( 2008 )


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  •                                                                           FILED
    United States Court of Appeals
    Tenth Circuit
    June 4, 2008
    UNITED STATES COURT OF APPEALS Elisabeth A. Shumaker
    Clerk of Court
    TENTH CIRCUIT
    In Re:
    WILLIAM DANIEL THOMAS                                  No. 07-1294
    BERRIEN, also known as William                            BAP
    Thomas Berrien, also known as W.D.                 (BAP No. CO-06-107)
    Thomas Berrien, also known as
    William T. Berrien, also known as
    Tom Berrien, Officer, Director,
    Shareholder of Centaur Mountain
    Farms, Inc.,
    Debtor,
    v.
    LIZELLE J. VAN VUUREN, CEDRIC
    G. TYLER, and VERONICA VAN
    VUUREN TYLER,
    Plaintiffs-Appellees,
    WILLIAM DANIEL THOMAS
    BERRIEN,
    Defendant-Appellant.
    ORDER AND JUDGMENT *
    *
    This order and judgment is not binding precedent except under the
    doctrines of law of the case, res judicata and collateral estoppel. It may be cited,
    however, for its persuasive value consistent with Fed. R. App. P. 32.1 and 10th
    Cir. R. 32.1.
    Before KELLY, TYMKOVICH, Circuit Judges, and FRIZZELL, District
    Judge. **
    Debtor William Daniel Thomas Berrien and his wife, Joanne, fabricated a
    hit-and-run accident, hoping for financial gain. The fabrication targeted eighteen-
    year-old high school student Lizelle J. Van Vuuren. Based on the false
    accusation, she was criminally prosecuted on misdemeanor and felony charges for
    leaving the scene of an accident. Although Lizelle successfully defeated the
    criminal charges, that was not before her parents, Cedric G. Tyler and Veronica
    Van Vuuren Tyler, had spent substantial sums defending Lizelle in the criminal
    cases.
    Following the prosecutions, the Tylers and Lizelle filed a civil complaint in
    Colorado state court against the Berriens, 1 alleging a number of torts, including
    abuse of process, civil conspiracy to defraud, extreme and outrageous conduct,
    and intentional infliction of emotional distress. Just prior to trial, Mr. Berrien
    filed for Chapter 7 bankruptcy. The Tylers filed an adversary proceeding in
    bankruptcy court, alleging some of Mr. Berrien’s debt was nondischargeable
    under 
    11 U.S.C. § 523
    (a)(6) as a result of his malicious conduct. After trial, the
    **
    Hon. Gregory K. Frizzell, United States District Court, Northern District
    of Oklahoma, sitting by designation.
    1
    The Berriens apparently divorced in February 2002. For convenience we
    refer to them collectively as the “Berriens.” The Tylers later settled their claims
    against Mrs. Berrien.
    -2-
    bankruptcy court agreed, concluding Mr. Berrien owed the Tylers
    nondischargeable debt in the amount of the criminal defense costs because his
    conduct caused “willful and malicious injury.” § 523(a)(6). The bankruptcy
    appellate panel (BAP) affirmed.
    The question presented in this appeal is whether the Tylers could recover
    under § 523(a)(6) damages for Mr. Berrien’s misconduct, including the costs
    incurred in defending Lizelle. We conclude the parents had numerous legally
    cognizable interests that support a finding of nondischargeability under
    § 523(a)(6) in these bankruptcy proceedings.
    We therefore AFFIRM the BAP’s order and judgment.
    I. Background
    Fabricated Hit-and-Run
    After a three-day trial, the bankruptcy court made the following findings of
    fact, which are not disputed in this appeal.
    Hoping to gain financially, the Berriens fabricated a hit-and-run accident.
    Their false accusation targeted Lizelle, a citizen of South Africa, who at the time
    of the accusations was an eighteen-year-old high school student living with her
    parents in Evergreen, Colorado.
    On the afternoon of April 3, 2000, Lizelle was driving her parents’ car. For
    reasons not relevant here, the car was uninsured. Lizelle, with a friend in the car,
    drove to a Safeway store to pick up school supplies. The Berriens falsely accused
    -3-
    Lizelle of hitting Mrs. Berrien with a car while she was walking in Safeway’s
    parking lot.
    According to the fabricated story, Mr. Berrien stood in the parking lot when
    he saw Lizelle’s car race up and down the rows of cars. Then he saw the car hit
    his wife on the left leg, causing her to twist and fall. Mr. Berrien allegedly ran to
    help his wife and, while running, wrote down the car’s license plate number.
    Although they knew about a nearby doctor’s office, located only about 200
    to 300 feet away, the Berriens did not immediately go there for medical help. Nor
    did they ask any of the people around them for help. And they did not seek help
    from the Safeway store. Despite the alleged hit-and-run’s location—near the
    front of the store—nobody apparently volunteered assistance.
    Indeed, except for an individual named Shawn DePauw, nobody witnessed
    the alleged accident. DePauw, who may have been acquainted with Mr. Berrien
    prior to April 3, 2000, testified he had witnessed some 400 accidents in his
    lifetime, but never once came to assistance or called for help. He claimed that,
    from about two rows away, he saw Lizelle’s car hit Mrs. Berrien. According to
    him, Mrs. Berrien’s feet flew up in the air before she fell. But having just
    witnessed what is alleged to be a fairly serious accident, DePauw did absolutely
    nothing to help. He did not call 911, report the accident to Safeway, or approach
    either Mr. Berrien or his then-wife to offer help. He apparently got into his car
    -4-
    and left. The Berriens claim they happened to run into DePauw a week later in
    the same Safeway store. And so DePauw became a witness.
    Either later on the day of the alleged accident or the next day, the Berriens
    reported the fabricated story to the police. Mrs. Berrien also visited a doctor.
    Criminal and Civil Cases in Colorado State Courts
    The false accusations resulted in two criminal prosecutions against
    Lizelle—one misdemeanor and one felony case. Although the cases were
    dismissed on April 12, 2001 and February 12, 2002, respectively, Lizelle’s
    parents had spent slightly over $96,000 in defending Lizelle against the charges.
    As the bankruptcy court noted, had she been convicted, Lizelle faced potential
    deportation to South Africa.
    In addition, the Tylers had to defend two civil lawsuits filed against them.
    In one, Mrs. Berrien’s insurance company sought subrogation for uninsured
    motorist payments the company made to her in connection with the fabricated
    accident. After investigating the facts surrounding the fabricated accident, the
    insurance company dropped its claim against the Tylers.
    The second civil case was Mrs. Berrien’s April 2, 2002 lawsuit against
    Lizelle and her parents for damages from the fabricated hit-and-run. By the
    parties’ stipulation, the action was dismissed with prejudice on October 25, 2002.
    After resolving Mrs. Berrien’s lawsuit against them, Lizelle and her parents
    filed their own lawsuit against the Berriens in Colorado state court. They alleged,
    -5-
    among other claims, abuse of process, civil conspiracy to defraud, extreme and
    outrageous conduct, and intentional infliction of emotional distress. As part of
    their damages, the Tylers claimed expenses incurred in defending the civil and
    criminal matters, including over $96,000 they had spent defending Lizelle’s
    criminal charges. Before the trial scheduled for November 2004, however, Mr.
    Berrien filed for bankruptcy, thus staying the Tylers’ civil case.
    Bankruptcy Proceedings
    The Tylers then filed adversary proceedings in the bankruptcy court to
    establish the nondischargeability of Mr. Berrien’s debt for damages caused by the
    false hit-and-run accusation. Among other allegations, the complaint charged Mr.
    Berrien with making false statements “willfully and maliciously for the purpose
    of monetary gain,” abusing “the criminal justice system for the ulterior purpose of
    obtaining money fraudulently from” the Tylers, and engaging “in extreme and
    outrageous conduct.” Aplt. App. 16–22.
    After a three-day trial, comparing the credibility and reliability of Lizelle,
    her parents, and other plaintiff witnesses with that of the Berriens and other
    witnesses for the defense, the bankruptcy court unequivocally concluded “the
    plaintiffs win by a reasonably wide and deep margin.” Id. at 1033. The court
    then awarded the Tylers $96,049.41 for expenses in defending Lizelle’s criminal
    charges and a nominal sum of $1 for lost business opportunity and emotional
    -6-
    distress. All damages represented nondischargeable debt under 
    11 U.S.C. § 523
    (a)(6) (“willful and malicious injury”). The BAP affirmed.
    II. Analysis
    “On appeal from BAP decisions, we independently review the bankruptcy
    court’s decision.” Educ. Credit Mgmt. Corp. v. Mersmann (In re Mersmann), 
    505 F.3d 1033
    , 1041 (10th Cir. 2007). When, as here, the only dispute is a matter of
    law, our review is de novo. 
    Id.
    Unlike in his appeal to the BAP, Mr. Berrien does not now challenge the
    bankruptcy court’s conclusion that his conduct caused “willful and malicious
    injury” within the meaning of § 523(a)(6). Rather, he repeats the argument that
    Lizelle’s parents could not recover the cost of defending Lizelle’s criminal
    charges. Mr. Berrien contends the parents were merely volunteers, with no legal
    obligation whatsoever to pay for their eighteen-year-old daughter’s legal
    expenses. He thus reasons the parents have no legally cognizable claim for which
    the bankruptcy court could have awarded them over $96,000 in damages. We
    disagree.
    A.
    In the first place, we cannot accept Mr. Berrien’s characterization of
    Lizelle’s parents as mere volunteers. The Tylers were defending their own legal
    interest in paying for Lizelle’s criminal defense. Had she been convicted, her
    criminal responsibility could have collaterally estopped the parents from arguing
    -7-
    the opposite in defending a potential civil lawsuit against them, a lawsuit Mrs.
    Berrien in fact commenced in short order. See, e.g., A-1 Auto Repair & Detail,
    Inc. v. Bilunas-Hardy, 
    93 P.3d 598
    , 602 (Colo. Ct. App. 2004) (holding “that
    issue preclusion will bar litigation in a civil trial of an issue that has been
    previously litigated in a criminal trial, provided the requisites for the application
    of issue preclusion are satisfied”). Had Lizelle been convicted, the conviction
    would have helped Mrs. Berrien prove her civil case against the Tylers.
    Moreover, the car Lizelle was driving was uninsured, and the Tylers faced
    significant exposure for their own liability if Lizelle were convicted of a hit-and-
    run. See, e.g., 
    Colo. Rev. Stat. § 10-4-619
    (1) (“Every owner of a motor vehicle
    who . . . knowingly permits the operation of the motor vehicle on the public
    highways of this state shall have in full force and effect a complying [insurance]
    policy . . . covering the said motor vehicle . . . .”); Am. Family Mut. Ins. Co. v.
    DeWitt, No. 05CA2687, 
    2008 WL 451742
    , at *3 (Colo. Ct. App. Feb. 21, 2008)
    (“The family car doctrine imputes liability to the head of a household when he or
    she has control over the vehicle and the vehicle is used by a person who is a
    member of the household”).
    We thus cannot agree Lizelle’s parents were legally disinterested volunteers
    when they paid for her criminal defense.
    -8-
    B.
    In any event, the Tylers had independent claims against Mr. Berrien that
    they sought to vindicate in bankruptcy court.
    Section 523(a)(6) excepts from discharge any debt “for willful and
    malicious injury by the debtor to another entity or to the property of another
    entity.” The debtor’s conduct, in other words, must have caused “willful and
    malicious injury.” As explained by the Supreme Court, this language means “that
    the actor intend the consequences of an act, not simply the act itself.”
    Kawaauhau v. Geiger, 
    523 U.S. 57
    , 61–62 (1998) (quotation marks omitted). For
    debt to become nondischargeable under § 523(a)(6), “the debtor must desire to
    cause the consequences of his act or believe that the consequences are
    substantially certain to result from it.” Panalis v. Moore (In re Moore), 
    357 F.3d 1125
    , 1129 (10th Cir. 2004) (quotation and alteration marks omitted); see also 4
    Collier on Bankruptcy ¶ 523.12[2] (15th ed. rev. 2008) (noting most courts
    require an injury inflicted “either with the intent to cause the harm complained of,
    or in circumstances in which the harm was certain or almost certain to result from
    the debtor’s act”).
    The “willful and malicious injury” language, “[b]y its terms, . . . may apply
    to a broad range of [tortious] conduct causing harm to people or property.” Id.
    ¶ 523.12[1]. Thus, for example, not only does this exception apply to liabilities
    “arising from assault or assault and battery,” but claims “based on . . . intentional
    -9-
    infliction of emotional distress . . . have [also] typically been held
    nondischargeable.” Id. ¶ 523.12[4] (collecting authorities).
    The Tylers easily satisfy the “willful and malicious injury” requirement.
    Prior to the bankruptcy filing, Lizelle and her parents filed a civil lawsuit against
    the Berriens seeking damages for, among others, abuse of process, civil
    conspiracy, extreme and outrageous conduct, and intentional infliction of
    emotional distress. When Mr. Berrien stayed the case by petitioning for
    bankruptcy, the Tylers intervened in his bankruptcy proceedings. In their
    discharge complaint, the Tylers again broadly alleged Mr. Berrien’s outrageous
    and malicious conduct, though this time tying the allegations, as they should
    have, to the “willful and malicious injury” requirement of § 523(a)(6).
    Ruling in favor of the Tylers, the bankruptcy court concluded Mr. Berrien’s
    outrageous conduct caused injury not only to Lizelle’s but also to her parents’
    legal interest to be free from intentionally inflicted emotional distress and from
    the abusive civil process directed against them. These tort claims all arose from
    the pattern of abusive conduct employed by the Berriens against Lizelle and her
    parents collectively, ranging from the false criminal charges, to the filing of civil
    proceedings, to false claims against the Berriens’ insurance company, which
    might have bolstered the credibility of the accusations.
    Under Colorado law, the Tylers were entitled to compensatory and punitive
    damages for Mr. Berrien’s numerous torts. These damages include, among other
    -10-
    things, emotional distress, lost business opportunity, and costs of defending
    frivolous civil and criminal proceedings. See, e.g., Technical Computer Servs,
    Inc. v. Buckley, 
    844 P.2d 1249
    , 1256 (Colo. Ct. App. 1992) (explaining “that, in
    an action for malicious prosecution or abuse of process, a plaintiff may recover
    attorney fees incurred in defending against the earlier wrongful litigation”). The
    criminal proceedings were but a part of the larger scheme to abuse the legal
    process and inflict emotional injuries on the Tylers and Lizelle. Thus, the
    amounts expended by the Tylers in combating the fraudulent scheme necessarily
    include the costs of defending Lizelle.
    The BAP correctly concluded, “Debtor’s statements to Safeway, the police,
    and investigators were clearly intended to support a claim for damages, in which
    Debtor believed he would share.” Aplt. Br. Att. at 8. Seeking “to fraudulently
    obtain money from whatever source he could find,” Mr. Berrien “caused the
    Tylers to incur the expense of defending Lizelle against his false allegations.” 
    Id.
    at 8–9. 2
    2
    Mr. Berrien also challenges the award of criminal defense costs to
    Lizelle. He argues Lizelle, who did not herself pay the cost of criminal defense,
    should not be able to recover for these expenses. Because we conclude the
    bankruptcy court did not err in awarding damages jointly to Lizelle’s parents, any
    error would be harmless. See Fed. R. Civ. P. 61 (“At every stage of the
    proceeding, the court must disregard all errors and defects that do not affect any
    party’s substantial rights.”); Fed. R. Bankr. P. 9005 (incorporating Rule 61 in
    bankruptcy proceedings).
    -11-
    We therefore agree with the bankruptcy court’s conclusion awarding the
    parents and Lizelle damages for emotional distress and compensatory expenses in
    the amount of approximately $96,000.
    III. Conclusion
    For the foregoing reasons, we AFFIRM the BAP’s order and judgment. 3
    Entered for the Court
    Timothy M. Tymkovich
    Circuit Judge
    3
    We DENY the Tylers’ motion to dismiss the appeal and motion for
    attorney’s fees. Both rely on a written agreement between the Tylers and Mrs.
    Berrien, stipulating that only Mrs. Berrien would consider the BAP’s decision to
    be final and non-appealable. As best we can tell from the record, Mr. Berrien was
    not a party to the agreement, and we thus cannot enforce it against him.
    -12-
    

Document Info

Docket Number: 07-1294

Citation Numbers: 280 F. App'x 762

Judges: Kelly, Tymkovich, Frizzell

Filed Date: 6/4/2008

Precedential Status: Non-Precedential

Modified Date: 10/19/2024