United States Bankruptcy Appellate Panel
                                   FOR THE EIGHTH CIRCUIT




                                                 00-6102EA


In re: Samuel Jesse Fellner                         *
                                                    *
        Debtor.                                     *
                                                    *
Kim Fellner,                                        *
                                                    *   Appeal from the
        Plaintiff - Appellee,                       *   United States Bankruptcy Court
                                                    *   for the Eastern District of Arkansas
                  v.                                *
                                                    *
Samuel Jesse Fellner,                               *
                                                    *
        Defendant - Appellant                       *



                                       Submitted: January 3, 2001
                                        Filed: January 24, 2001


Before, KOGER, Chief Judge, HILL and DREHER, Bankruptcy Judges


KOGER, Chief Judge

        Debtor Samuel Jesse Fellner appeals from the judgment of the Bankruptcy Court1 determining that
certain debts he was ordered to pay pursuant to his divorce decree were excepted from his discharge under
11 U.S.C. § 523(a)(15). Because the Bankruptcy Court applied the correct legal standard and its findings
of fact were not clearly erroneous, we affirm.




        1
            The Honorable Mary D. Scott, Bankruptcy Judge for the Eastern District of Arkansas.
                                         Factual Background
         Samuel Fellner and Kim Fellner were divorced on July 13, 1999. Among other things, the divorce
decree provided that each party was to pay certain individual and marital debts. As relevant here, the
divorce decree required Samuel to pay a debt in the amount of $11,306.00 to MBNA MasterCard
Platinum and a debt in the amount of $10,500.00 to First Arkansas Bank and Trust.


         The MBNA MasterCard account which Samuel was required to pay was actually in Kim’s
mother’s name and Kim was an “authorized user” of the card. Kim’s mother had given this credit card,
along with two other credit cards, to the Fellners shortly after they were married because they had not
established credit of their own. It was understood between them that the Fellners would pay for any
charges they incurred on the accounts. Thus, although Kim’s mother was the party liable to MBNA as
such, Samuel was ordered in the divorce decree to pay that obligation.2


         The debt to First Arkansas Bank and Trust was the result of a renewable loan for which the
Fellners had pledged a Certificate of Deposit as collateral. Kim had bought the $10,000 CD from
proceeds she received in the settlement of a lawsuit which she initiated prior to the parties’ marriage. The
Fellners bought the CD with the intention of using the money to fund their child’s education. After their
credit card debts began to mount, they started taking loans, pledging the CD as collateral, and used the
proceeds to pay some of the credit card debts. Samuel was ordered in the divorce decree to repay that
loan so that the Certificate of Deposit would not be forfeited and used to set off the balance due on the
loan.3
         The Debtor made a few payments on the obligations pursuant to the divorce decree prior to filing
his Chapter 7 bankruptcy petition on December 10, 1999. Kim filed an adversary complaint seeking to
have these two debts declared nondischargeable under §§ 523(a)(5) and 523(a)(15).




         2
          The divorce decree required Kim to pay the debts she and the Debtor had incurred on the two
other credit cards which, like the MBNA account, she had permission to use but on which Kim’s mother
was solely liable. These included a debt to First USA Visa in the amount of $13,300.00 and a debt to
Montgomery Wards in the amount of $420.00.
         3
          At the time of the trial on the nondischargeability action, the Certificate of Deposit had apparently
been forfeited and used to set off the loan at First Arkansas Bank.

                                                      2
        The evidence at trial showed that the parties are both employed at a local grocery store, each
earning approximately $9.65 per hour. The Debtor has a high school education and works mostly full time
at the store as a night stocker. His Schedule I reveals that he earns $1,672.67 per month, less $401.44
in social security and payroll taxes and $268.67 in child support paid to Kim, leaving him with a net monthly
income of $1,002.56. The Debtor lives with his parents and his Schedule J reveals the following monthly
expenses:

        Telephone                                                   $ 75.00
        Food                                                         200.00
        Clothing                                                      50.00
        Laundry and Dry Cleaning                                      15.00
        Medical and Dental expenses                                   40.00
        Transportation (not including car payments)                  200.00
        Auto insurance                                               100.00
        Truck payment (in parents’ name)                             311.80
        Medical Bill                                                  20.00

        Total monthly expenses                                    $1,011.80

This leaves the Debtor with a monthly deficit of $8.24.


        Kim works approximately twenty-five hours per week. She testified that after the divorce, she
reduced the number of hours she worked so that she could pursue a college degree and because she has
custody of the parties’ only child who is disabled. She testified that without a college degree, she is unable
to make enough money to pay her bills and that due to the circumstances concerning her school schedule
and her child’s care, as well as her employer’s scheduling needs, she is unable to work more than the
twenty-five hours per week. Kim receives $62.00 per week in child support and the child receives
supplemental social security income in the approximate amount of $274.00. The child attends a private
school which costs Kim $150.00 per month. Kim testified that since she is no longer able to borrow
against the CD, she is paying for the child’s tuition out of the student loans she has incurred to fund her own
education.




                                                      3
        According to the documentation she filed with the Bankruptcy Court, Kim’s income as a cashier
at the grocery store is $1,045.00 per month, less payroll taxes and social security deductions in the amount
of $261.00. With the child support payments in the amount of $248.00 per month and the monthly social
security benefits in the amount of $274.00 which she receives on behalf of her child, Kim has a net monthly
income of $1,306.00. Her monthly expenses are as follows:
        Rent                                                      $ 325.00
        Electricity and heating fuel                                135.00
        Water and sewer                                              60.00
        Telephone                                                    65.00
        “Arkla Gas”                                                  35.00
        Cable                                                        40.00
        Home Maintenance                                             15.00
        Food                                                        325.00
        Clothing                                                     50.00
        Laundry and dry cleaning                                     15.00
        Medical and dental expenses                                  30.00
        Transportation (not including car payments)                 160.00
        Recreation, clubs and entertainment, etc.                    50.00
        Renter’s insurance                                           44.00
        Life insurance                                              120.00
        Auto insurance                                               33.00
        Personal Property Tax                                        10.00
        Medical Bills                                                50.00

                Total monthly expenses                            $1,562.00

According to these figures, Ms. Fellner operates at a monthly deficit of $256.00.


        Based in the evidence and testimony submitted at trial, the Bankruptcy Court found that the
Debtor’s obligation on the two debts he was ordered to pay in the divorce constituted a property division
and not support; that the Debtor had the ability to pay the obligations, particularly if he was not required
to make the payments on his truck; that the detriment to Kim outweighed the benefit to the Debtor if the




                                                     4
debts were discharged; and that therefore, the debt should be declared nondischargeable under §
523(a)(15).4 The Debtor appeals.


                                                Discussion
        We review findings of fact for clear error and legal conclusions de novo. See O’Neal v.
Southwest Mo. Bank (In re Broadview Lumber Co.), 

, 1250 (8th Cir. 1997); Hartford Cas.
Ins. Co. v. Food Barn Stores, Inc. (In re Food Barn Stores, Inc.), 

, 199 (B.A.P. 8th Cir.
1997); see also Fed. R. Bankr. P. 8013. “A finding is ‘clearly erroneous’ when although there is evidence
to support it, the reviewing court on the entire evidence is left with a definite and firm conviction that a
mistake has been committed.” Anderson v. Bessemer City, 

, 573, 

, 1511,

(1985) (quoting United States v. U.S. Gypsum Co., 

, 395, 

,
542, 92 L.Ed.746 (1948)); accord In re Waugh, 

, 711 (8th Cir. 1996); Chamberlain v. Kula
(In re Kula), 

, 735 (B.A.P. 8th Cir. 1997). “If the bankruptcy court’s account of the
evidence is plausible in light of the entire record viewed, it must be upheld even though we may have
weighed the evidence differently had we been sitting as the trier of fact.” Forbes v. Forbes (In re Forbes),

, 187 (B.A.P. 8th Cir. 1997) (citing 

, 105 S.Ct. at 1511).
When there are two permissible views of the evidence, we may not hold that the choice made by the trier
of fact was clearly erroneous. In re Lemaire, 

, 1349 (8th Cir. 1990).


        “Section 523(a)(15) excepts from discharge those debts arising out of marital dissolution
proceedings that do not constitute nondischargeable alimony, maintenance or support under § 523(a)(5);
i.e., property settlement awards.” Moeder v. Moeder (In re Moeder), 

, 54 (B.A.P. 8th Cir.
1998). Specifically, § 523(a)(15) renders nondischargeable any debt:
        not of the kind described in paragraph (5) that is incurred by the debtor in the course of
        a divorce or separation or in connection with a separation agreement, divorce decree or



        4
            The Bankruptcy Court announced its decision and the reasons therefor from the Bench following
the trial and subsequently entered an Order memorializing the decision announced from the Bench.

                                                     5
         other order of a court of record, a determination made in accordance with State or
         territorial law by a governmental unit unless –

                 (A) the debtor does not have the ability to pay such debt from income or property
                 of the debtor not reasonably necessary to be expended for the maintenance or
                 support of the debtor or a dependant of the debtor and, if the debtor is engaged
                 in business, for the payment of expenditures necessary for the continuation,
                 preservation, and operation of such business; or

                 (B) discharging such debt would result in a benefit to the debtor that outweighs the
                 detrimental consequences to a spouse, former spouse, or child of the debtor.

11 U.S.C. § 523(a)(15). The Debtor in this case does not contest the Bankruptcy Court’s finding that the
obligations at issue here constituted a property division and therefore fall within § 523(a)(15) and not within
§ 523(a)(5). Rather, the Debtor asserts that the exceptions enumerated in subparagraphs (A) and (B)
apply.


         We have addressed this provision in previous decisions:
         the burden of proof, both in terms of going forward with the evidence and the burden of
         persuasion is on the creditor, [here Kim Fellner], to show only that the debt owed to her
         by the debtor, [Samuel Jesse Fellner], is a debt that arises from a divorce, other than one
         in the nature of alimony, maintenance, or support. The burden of going forward with the
         evidence and the burden of persuasion then shifts to the debtor, [here Samuel], to prove
         either of the defenses.

Rush v. Rush (In re Rush), 

, 475 (B.A.P. 8th Cir. 1999) (citing In re 

). Since it is uncontested that Kim met her burden of showing that the debt was of the kind described
in § 523(a)(15), the burden shifted to the Debtor to show either that he does not have the ability to pay the
debt or that on balance, the debts should be discharged because doing so would result in a benefit to him
that outweighs the detriment to Kim. 

If he can prove that either of these exceptions exists,
then the debt should be discharged. See In re 

.




                                                      6
         In its decision announced from the Bench, the Bankruptcy Court correctly stated the law:
                  If I find that [the debt to Kim is] not in the nature of a support obligation under
         (a)(5) then I’d look at (a)(15); and Congress intended in the first instance that property
         settlements not be discharged, that debtors shouldn’t use bankruptcy to do that; however,
         they did give the debtors the possibility of discharging the debt but only in certain
         circumstances.

                 If the debtor can show no ability to pay the debt, then I go no further, and the debt
         can be discharged. If the debtor can afford to pay the debt, then I have to do some kind
         of balancing.

The Court then found, in effect, that if the Debtor eliminated the $311.80 truck payment from his monthly
expenses, he would have the ability to pay the debt. The Court determined that although the Debtor’s
monthly expenses in general were not extravagant, the expense for his Ford Ranger pickup truck was
excessive or unnecessary under the circumstances and that if this expense were eliminated or reduced, it
would free up funds to pay the debts as ordered in the divorce decree. The Debtor asserts clear error in
this finding.


         Regarding the truck, the evidence showed that the Debtor acquired the Ford Ranger pickup truck
in May 1999, while the Fellners were separated but before their divorce. The truck was financed in the
Debtor’s parents’ name and they appear to be the title-holders: the Debtor did not list the truck as an asset
in his bankruptcy schedules and although he lists the payment amount (which he pays directly to Ford
Motor Credit) on his Schedule J, he did not list a debt to either his parents or to Ford in his schedules
pertaining to secured and unsecured debts.5 In addition, although not specifically mentioned by the
Bankruptcy Court, we note that the Debtor’s Schedule J reflects not only $311.80 for the truck payment,
but also $200.00 per month in transportation (not including car payments) and $100.00 per month for
automobile insurance, thus indicating that the Debtor actually incurs monthly expenses totaling over $600.00
in relation to the truck.


         5
            Other than Schedules I and J, the Debtor’s bankruptcy schedules are not contained in the record
on appeal; we have gleaned from the testimony and other documents in the record that the Debtor did not
list the truck as an asset, nor did he list any debt related to the truck in his other schedules.

                                                      7
        The crux of Debtor’s argument is that the Bankruptcy Court erred in finding the truck payment
expense was unnecessary. He suggests that if he were to lose this vehicle, he would not have transportation
to work and that without reliable transportation, it is doubtful he could remain gainfully employed. The
Debtor claims, in effect, that the Bankruptcy Court erred because Kim offered no evidence that the truck
is unnecessary or that a lesser expensive form of transportation was available.


        However, because it is the Debtor who bears the burden of proving that he does not have the
ability to pay the obligations, it was his burden to show that his truck expenses were necessary; it was not
Kim’s duty to show they were unnecessary. The Debtor presented no evidence to suggest that his vehicle
expenses were reasonable and necessary, that lesser expensive transportation was unavailable, or that the
truck payments would not fall to his parents if he did not make them. As a result, in light of the fact that the
Debtor presented no evidence regarding the necessity or reasonableness of his truck expenses, and in light
of the discretion we are to afford the Bankruptcy Court on issues of fact, we cannot say that the
Bankruptcy Court clearly erred in finding that the truck expense was excessive and that the Debtor
therefore failed in his burden of proving that he could not afford to pay the obligations assigned in the
divorce decree. In sum, we simply are not left with a firm and definite conviction that the Bankruptcy
Court’s decision was erroneous. See Anderson v. Bessemer 

, 105 S. Ct. at 1511.6


        In his second point, the Debtor asserts that the Bankruptcy Court erred in finding that on balance,
discharging the debt would result in detriment to Kim that outweighed any benefit to the Debtor. See 11



        6
          We note that this case is distinguishable from our decision in In re Moeder, 

. In that
case, we determined that the Bankruptcy Court erred in declaring a property settlement debt
nondischargeable under § 523(a)(15) because the Bankruptcy Court did so despite finding that the debtor
lacked the ability to pay the obligation. In other words, the Bankruptcy Court in Moeder applied
subsections (A) and (B) of § 523(a)(15) in the conjunctive rather than the disjunctive, and we determined
that this was error: we held that if the debtor proves either of those affirmative defenses to
nondischargeability, the debt should be discharged. 

In contrast, in the case at bar, the
Bankruptcy Court ruled that the Debtor failed to prove either of the affirmative defenses, specifically
determining that the Debtor has the ability to repay the debts at issue.

                                                       8
U.S.C. § 523(a)(15)(B). Primarily, the Debtor suggests that the Bankruptcy Court ignored the fact that
Kim is not personally liable on the MBNA Platinum MasterCard or on the two other credit card accounts
which were in Kim’s mother’s name. He contends that if he is discharged of the obligation to pay the
MBNA debt, the creditors cannot come after Kim, nor does Kim’s mother have a legally enforceable right
to collect from Kim. Thus, he asserts, discharging the debts in his bankruptcy will result in no detriment
to Kim and that the balance therefore tips in his favor.


        Even assuming that Kim is not legally responsible on the MBNA account, the evidence and
testimony reveal other detrimental consequences to Kim if the debt was not repaid. Specifically, Kim lives
with her child on property adjacent to land on which her mother lives in a mobile home. Kim pays her
mother $325.00 per month in rent which is intended to cover Kim’s mother’s mortgage and insurance
payments on the property on which Kim lives. Kim testified that her mother sometimes helps her with the
rent and that she actually pays rent only about half the time because she cannot afford to pay the rent every
month. Kim also testified that in September 1999, her mother evicted her from the property because she
and her mother had had a disagreement about her being behind on the rent. Kim’s mother apparently
permitted Kim to move back to the property after Kim had some trouble with her replacement housing,
but it can be inferred from the testimony that Kim faces eviction if she does not stay somewhat current with
the rent. In addition, Kim testified that she has not been able to pay the First USA Visa debt (on which
her mother is liable and which Kim was ordered to pay in the divorce) and that First USA was harassing
her mother for payment. Kim’s testimony indicated that her mother is in no position to absorb the debts the
Fellners incurred in her name. Consequently, the evidence showed that if Kim’s financial circumstances
deteriorate much further, it is likely that her mother would evict her and the child and it seems unlikely that
Kim would be able to obtain other housing on terms as favorable as the situation she currently has. Thus,
although Kim may not be legally liable on the debt to MBNA, Kim certainly faces detrimental
consequences if the Debtor’s obligation to pay that debt is discharged.




                                                      9
        In sum, we cannot say that the Bankruptcy Court clearly erred in finding that in light of Kim’s
responsibility for caring for the parties’ child and the Debtor’s fairly recent purchase of a relatively
expensive vehicle, the balance tipped in favor of Kim under § 523(a)(15)(B).


        As the Bankruptcy Court commented, this is a difficult case and, arguably, there are two
permissible views of the evidence. Nevertheless, because the Bankruptcy Court’s finding was plausible
in light of the entire record, we cannot say it was clear error for the Court to rule the way it did. See In re

; In re 

. As a result, we must affirm.


                                                 Conclusion
        Because the Bankruptcy Court applied the correct legal standard and because we cannot say that
its factual findings were clearly erroneous, the judgment of the Bankruptcy Court is affirmed.


        A true copy.


                 Attest.


                           CLERK, UNITED STATES BANKRUPTCY APPELLATE PANEL
                           FOR THE EIGHTH CIRCUIT




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