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The Bankruptcy StrategistFeaturesBankruptcyLitigation

Nondischargeability Judgment Requires Willful and Malicious Injury Under Section 523(a)(6)

By Rudolph J. Di Massa Jr. and Keri L. Costello
November 01, 2020

In In re Smith, (B.A.P. 10th Cir., Aug. 18, 2020), the U.S. Bankruptcy Appellate Panel for the U.S. Court of Appeals for the Tenth Circuit recently joined the majority of circuit courts of appeals in finding that a creditor seeking a judgment of nondischargeability must demonstrate that the injury caused by the prepetition debtor was both willful and malicious under Section 523(a)(6) of the Bankruptcy Code.

Factual Background

Michael Smith, an attorney, worked for 22 years for Equity Title Insurance Company (Equity Title) and served as Equity Title's chief operating officer and general counsel. In 2008, First American Title Co. and an affiliate (First American), a competitor of Equity Title, acquired a majority interest in Equity Title and changed Smith's title to "State Underwriting and Legal Counsel." In 2012, First American and Equity Title officially completed their merger.

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