We follow orders, son. We follow orders or people die. It’s that simple. - Colonel Nathan R. Jessep, A Few Good Men
While the consequences are not nearly as dire, debtors in bankruptcy proceedings and litigants in general would be well-advised to heed Colonel Jessep’s admonition. Such obvious lessons should go without saying. But occasionally, litigants and attorneys need a reminder.
On January 9, 2017, United States Bankruptcy Judge Joan M. Feeney issued a memorandum and order denying a bankruptcy debtor’s discharge petition because he repeatedly refused to follow the Court’s directives. The debtor’s disobedience allowed one of his creditors to preserve a $23 million dollar claim against him that was obtained through prior civil litigation. The Order comes after a six-day trial wherein the creditor introduced evidence and proved by a preponderance of the evidence that debtor had, among other things, “willfully and intentionally refused to obey a lawful order of [the] Court.”
Though a cautionary tale to be sure, litigants need not fret that this case is the start of a trend where by every instance of non-compliance will be cause for an adverse finding. As the Court explained in great detail (and in accordance with First Circuit case law), a failure to obey caused by inadvertence, mistake, or inability should not give rise to such a penalty. But when a litigant engages in a prolonged, willful and intentional practice of defying numerous court orders and warnings, he should expect a judge’s gavel to fall on him, and fall hard.
One imagines that the bankruptcy debtor in this case may have finally learned his lesson. Unfortunately for him, it cost $23 million to do so.
A copy of the Order may be found here: