JON E. DEGUILIO, Judge, United States District Court
This is an appeal from an adversary proceeding relating to the Chapter 7 bankruptcy of Steven Bobinski. Mr. Bobinski's bankruptcy follows litigation between himself and his former spouse Julie Thomas (f.k.a. Julie Bobinski) regarding their three children. During that litigation, Martha Wischmeyer served as a guardian ad litem. In a stipulation approved by an Indiana state court, Mr. Bobinski and Ms. Thomas each agreed to assume responsibility for half of Ms. Wischmeyer's fees (subject to judicial reallocation). After Mr. Bobinksi filed for bankruptcy, Ms. Wischmeyer filed an adversary proceeding contending that Mr. Bobinksi's share of her guardian ad litem fees is not dischargeable in bankruptcy under 11 U.S.C. § 523(a)(5). The bankruptcy court reached the opposite conclusion. Ms. Wischmeyer now appeals the bankruptcy court's decision to this Court.
This appeal presents a single question of law: whether a debtor's direct obligation to a guardian ad litem is a domestic support obligation such that it cannot be discharged in Chapter 7 bankruptcy under 11 U.S.C. § 523(a)(5). Since this is a question of law, the Court reviews it de novo. See Kovacs v. United States, 739 F.3d 1020, 1023 (7th Cir.2014). The Court has
In Chapter 7 bankruptcy, a trustee liquidates a debtor's assets and distributes the proceeds to the debtor's creditors. Debts not satisfied through the liquidation process are usually then discharged. But certain types of debt are nondischargeable, including debt owed as a domestic support obligation. This discharge exception is located in 11 U.S.C. § 523(a)(5) of the Bankruptcy Code, but its scope turns on the definition of "domestic support obligation" located in 11 U.S.C. § 101(14A):
Subpoints A, B, C and D of this definition thus represent four requirements which must be satisfied for a debt to constitute a domestic support obligation. This appeal concerns the first of those requirements: that the obligation be owed to or recoverable by a spouse, former spouse, or child of the debtor (or that child's parent, legal guardian or responsible relative) or a governmental unit. The parties do not dispute that the other requirements are satisfied here. In particular, they agree that the debt at issue is in the nature of support of Mr. Bobinski and Ms. Thomas' children. [DE 4 at 6].
Ms. Wischmeyer argues that Mr. Bobinski's obligation to her is a domestic support obligation. She says that if Mr. Bobinski does not pay his share of guardian ad litem fees, Ms. Thomas can be required to pay them. Mr. Bobinski does not dispute that contention. Alternatively, Ms. Wischmeyer contends that she served as an agent of the court and so her fees constitute
At least one district court in the Seventh Circuit has already addressed this issue. In Levin v. Greco, the Northern District of Illinois considered an appeal from a bankruptcy court, which had held that a debt to a child representative (similar to a guardian ad litem
In this case, the bankruptcy court reached a result similar to the bankruptcy court in Levin. It held that a debt must be payable directly to a payee listed in § 101(14A) to be nondischargeable.
In contrast, the Levin district court's reasoning — which emphasizes the inquiry of whether a debt is in support of a party listed in § 101(14A) over the payee requirement — is rooted in appellate precedent. See, e.g. Miller, 55 F.3d at 1490; Beaupied v. Chang (In re Chang), 163 F.3d 1138, 1141 (9th Cir.1998); Hudson v. Raggio (In re Hudson), 107 F.3d 355, 357 (5th Cir.1997) (holding reaffirmed by Lauderdale v. Papadopoulos (In re Lauderdale), 460 Fed.Appx. 361 (5th Cir.2012) (interpreting § 523(a)(5) after it was amended in 2005) (unpublished)); see also In re Anderson, 463 B.R. 871, 875 (Bankr.
This conclusion is also supported by another rationale. Even if the support inquiry were not emphasized over the payee requirement, Ms. Wischmeyer would still be able to satisfy the payee requirement. While she may not be a spouse or child of the debtor, courts have not read the payee requirement literally. In In re Rios, the Seventh Circuit noted that § 523(a)(5) may except from discharge debts not directly payable to parties listed in the domestic support exception. 901 F.2d at 72 ("awards of attorneys' fees for services in obtaining support orders have been held nondischargeable even though the attorney is neither a spouse, a former spouse, nor a child of the debtor."). In that case, the court held legal fees incurred by a debtor in a child support suit were dischargeable. While that holding is not directly apposite to this case, the court's analysis is:
Id. So, where a debtor incurs attorney's fees in furtherance of a legal obligation to collect a debt in support of his child, that obligation-while not payable directly to his child — nevertheless satisfies the § 101(14A)(A) payee requirement.
This case is sufficiently analogous to such a scenario to preclude discharge. In a June 6, 2011 stipulated order, Mr. Bobinski agreed to the appointment of Ms. Wischmeyer and to pay half of Ms. Wischmeyer's fees. [DE 1 at 30-31]. So, Mr. Bobinski had a legal obligation to hire a guardian ad litem for the benefit of his children. Moreover, that guardian ad litem provided services in support of Mr. Bobinski's children: she represented the children's best interest in contested legal proceedings. So, Mr. Bobinski acted in accordance with a legal obligation to provide services in support of his children. As such, his debt to Ms. Wischmeyer satisfies the domestic support exception's payee requirement.
Thus, even if this Court did not emphasize the support inquiry over the payee requirement, Ms. Wischmeyer would still be able to satisfy the latter. That provides further support for the conclusion that, consistent with § 523(a)(5), Mr. Bobinski is not able to discharge Ms. Wischmeyer's fees in bankruptcy.
For the above reasons, the decision of the bankruptcy court is REVERSED. This matter is remanded for further proceedings consistent with this opinion.
SO ORDERED.