17 B 07037, 17 A 00319
Plaintiff and judgment creditor Nick Boscarino filed an adversary complaint against debtor-defendant Lewis J. Borsellino, seeking (1) a determination that the debt owed to him by Borsellino was not dischargeable pursuant to § 523(a)(6), and (2) denial of Borsellino’s bankruptcy discharge pursuant to § 727(a)(2)(A).  Boscarino subsequently filed a motion for summary judgment, arguing that principles of claim and issue preclusion precluded Borsellino from relitigating the factual issues decided in prior state court proceedings. According to Boscarino, the state court found that (1) Borsellino was the owner of a boat which was subject to Boscarino’s citation lien at the time it was sold, and (2) Borsellino committed perjury in his state court trial testimony and backdated an agreement to shield ownership of the boat. In response, Borsellino argued that neither of those issues had been decided by the state court and claimed that he did not own the boat, as it had been transferred to an LLC that he managed. After reviewing the state court record and considering the elements of the statutory provisions at issue, the Court concluded that the necessary facts had been previously decided in Boscarino’s favor to support his § 523(a)(6) claim. Specifically, the Court held that the record established that (1) Borsellino had intentionally transferred the boat in violation of the citation lien, (2) the transfer caused injury to a property interest held by Boscarino, and (3) the transfer was made without just cause or excuse. Thus, summary judgment was granted as to the § 523(a)(6) count. The Court further held that, although the state court found that Borsellino owned the boat at the time of the transfer, it did not find that he had fraudulently created the agreement or committed perjury. As such, summary judgment was denied on the § 727(a)(2)(A) count.