Conway v. Heyl, No. 18-6001 (8th Cir. 2018)
Annotate this CaseThe Bankruptcy Appellate Panel affirmed the bankruptcy court's order dismissing plaintiffs' adversary complaint and an order denying their motion to reconsider the dismissal order. The panel held that plaintiffs failed to state a claim upon which relief can be granted under 11 U.S.C. 523(a)(19). In this case, a prior Consent Order requiring debtor to pay a fine and costs did not result in a debt owed to plaintiffs. Plaintiffs were not a party to or a signatory on the Consent Order and the debt to plaintiffs did not result from the Consent Order.
Court Description: Saladino, Chief Judge, Author, with Dow and Sanberg, Bankrupty Judges] Bankruptcy Appellant Panel - Discharge under 11 U.S.C. sec. 523(a)(19). After Steven Conway lost money in real estate development scheme managed by debtor, he filed a complaint with the Enforcement Division of the Missouri Securities Division of the Secretary of State, which resulted in a Consent Order requiring debtor to pay a fine and costs. Conway's subsequent adversary proceeding, asserting the debt owed him was excepted from discharge under section 523(a)(19), was properly dismissed by the bankruptcy court, as of the debt at issue did not "result . . .from" the Consent Order. Conway was not a party to or signatory on the Consent Order and the debt to Conway did not result from the Consent Order. [ October 17, 2018
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