Bankr. No.:
93-50232
Adv. No.:
93-5018
Chapter:
7
Date of Decision:
October 20, 1994
Issue:
Whether judgment debt against Debtor-Defendant should be declared non dischargeable as one obtained fraudulently where Debtor persuaded Plaintiff to invest in corporation that was unsuccessful and where Debtor's statements about the business's status and profit potential were overstated?
Ruling:
Debt was declared dischargeable. Debtor overcame Plaintiff's showing that debt was incurred fraudulently under § 523(a)(2)(A) by showing Debtor's efforts to manufacture and market products through the corporation, because Plaintiff had access to the business premises and records, and because Plaintiff and Debtor had a long-term business relationship. Plaintiff did not show that Debtor stood in a fiduciary relationship to Plaintiff to allow the debt to be declared non dischargeable under § 523(a)(4).
Full Bankruptcy Court Decision:
