Attorneys’ Fees for Family Court Litigation that Adversely Affected Children Constitutes a Non-Dischargeable Domestic Support Obligation
Contributing Editors: Alex Beeby, Karl Johnson, and Kesha Tanabe
In Amos v Carpenter (In re Amos), 624 B.R. 657 (B.A.P. 8th Cir. Feb. 1, 2021), the BAP affirmed confirmation of a chapter 13 plan over the debtor’s objection that it improperly treated an award of attorneys’ fees as a domestic support obligation.
Prior to the petition date, a family court made several findings of fact about how the debtor’s conduct in a divorce proceeding had adversely affected his children. The family court awarded substantial attorneys’ fees to the attorney who represented the debtor’s ex-spouse in protracted litigation related to his interference with custody of their minor child and his willful refusal to pay child support, among other issues. When the debtor filed for bankruptcy, he scheduled the attorneys’ fee award as a general unsecured claim. The attorney responded by filing three proofs of claim, each of which asserted a domestic support obligation under § 507(a)(1) and he commenced an adversary proceeding under § 523(a)(5) asserting such claims were nondischargeable. The bankruptcy court granted summary judgment in favor of the attorney, held that the attorneys’ fees constituted a domestic support obligation, and directed the debtor to file a plan that treated the attorneys’ fees as a domestic support obligation.
On appeal, the BAP noted that “domestic support obligation” is a defined term in the bankruptcy code and whether a debt qualifies for such treatment under the code is strictly a question of federal law. The BAP confirmed that a majority of courts have held that if attorneys’ fees are awarded due to the debtor’s conduct on child support, visitation, or custody issues that negatively impact the welfare of minor children, such fees do qualify as “domestic support obligations.” The BAP rejected the balance of the debtor’s arguments, including his claim that the bankruptcy court erred by not making specific findings about the relative financial condition of the parties to determine support obligations in bankruptcy.