Court: United States Bankruptcy Court, M.D. Alabama; February 10, 1986; Us Bankruptcy; United States Bankruptcy Court
In this Chapter 13 bankruptcy case, the debtor filed a complaint regarding the dischargeability of a debt for child support assigned to Santa Clara County and the Family Support Trustee prior to August 13, 1981. A trial took place on February 5, 1986, in Alabama, with the debtor, his attorney, and a representative from the district attorney's office present.
Key undisputed facts include:
1. The debtor filed for Chapter 13 bankruptcy on January 17, 1985.
2. An amended Schedule A-3 was filed on December 9, 1985, adding a claim of $18,385.89 for child support payments to the former wife, Nancy Erlene Petty, made before September 1979.
3. Mrs. Petty assigned her rights to support payments to the defendants under 42 U.S.C. § 602(a)(26) before the specified date.
4. The Alabama District Attorney acts as an agent for the defendants under the Uniform Reciprocal Enforcement of Support Act.
The primary issue was whether the debt's dischargeability is determined by the bankruptcy law effective prior to August 13, 1981. The debtor contended that the 1981 amendment to 11 U.S.C. § 523(a)(5)(A), which made certain child support debts nondischargeable, was not retroactive, thus allowing the debt to remain dischargeable since it was incurred before the amendment.
The defendants argued for nondischargeability based on the existing Code at the petition filing time and cited case law, including a Seventh Circuit ruling. There was a split among circuit courts regarding the retroactive application of the 1981 amendment, with the Ninth Circuit favoring application to pending cases and the Tenth Circuit supporting prospective enforcement.
The court concluded that, despite the controversy, the law at the time of the petition's filing governs the case, affirming the defendants' argument. Consequently, the court determined that the debt owed to the defendants is nondischargeable, and an appropriate order will be issued accordingly.
