Not what you're
looking for? Try an advanced search.
Buy This Entire Record For
Cavagnetto v. Stoltz
United States District Court, Seventh Circuit
November 4, 2013
DAWN CAVAGNETTO, Appellant,
WILLIAM STOLTZ, Appellee.
MEMORANDUM OPINION AND ORDER
ELAINE E. BUCKLO, District Judge.
In this action, Dawn Cavagnetto appeals two summary judgment decisions the bankruptcy court entered in favor of her ex-husband, William Stoltz, in the adversary proceedings Stoltz initiated in Cavagnetto's Chapter 7 bankruptcy case. Cavagnetto asserts that the bankruptcy court erroneously concluded: (1) that Stoltz was entitled to summary judgment on his claims that three divorce-related debts Cavagnetto owed to him were nondischargeable under Sections 523(a)(5) and (a)(15) of the Bankruptcy Code, and (2) that Stoltz was entitled to summary judgment on Cavagnetto's counterclaim for indemnity and damages. For the following reasons, I affirm the bankruptcy court's judgment with respect to Stoltz's claims but reverse and remand for further proceedings on Cavagnetto's counterclaim.
Because neither party alleges any error in the bankruptcy court's concise summary of the undisputed facts culled from over a decade of tangled litigation between them, I excerpt and adopt that summary below by way of background.
Stoltz and Cavagnetto were married on September 1, 1996. One child was born of that marriage. The parties acquired a parcel of real estate located in Berwyn, Illinois, which, from July 1998 to July 2002, they operated as a rental property (the "Berwyn Property").
Stoltz's mother and step-father, Clare and Fred Barton (the "Bartons") loaned Stoltz and Cavagnetto the funds necessary to purchase the Berwyn Property and took a mortgage to secure their loan. Payments on the loan of $503.75 per month came due beginning on April 1, 1996. The Bartons did not record the mortgage until January 2, 2001.
On January 4, 2000, Cavagnetto filed a petition for dissolution of marriage. In January 2004, the state court entered a judgment dissolving the marriage.
The judgment of dissolution required Stoltz to pay child support and half of Cavagnetto's work-related daycare expenses. It required Cavagnetto to pay her daycare expenses in the first instance and then to seek reimbursement from Stoltz for his half.
On May 16, 2000, Cavagnetto obtained a court order allowing her to sell the Berwyn Property. On July 10, 2000, the state court granted Stoltz's motion to vacate that order and reconsider the disposition of the Berwyn Property. Thereafter, in early 2002, Stoltz sought leave from the state court to sell the Berwyn Property. On February 1, 2002, the state court granted the motion and ordered that the Berwyn Property be listed for sale at fair market value.
Cavagnetto, however, refused to sign the sales agreement for the Berwyn Property, for which the state court held her in contempt and ordered her to pay Stoltz $2, 202.50 in attorney's fees.
In response to Stoltz's motion to sell the Berwyn Property, Cavagnetto also filed a lawsuit seeking to quiet title and alleging that Stoltz and the Bartons committed fraud in connection with obtaining the mortgage. In that lawsuit, Cavagnetto argued that the Bartons' mortgage was invalid. That lawsuit was originally filed in the chancery division of the state court, but was then consolidated with the Divorce Proceedings.
After a trial on Cavagnetto's complaint, the state court found her complaint baseless and ordered her to pay Stoltz $1, 500.00 as a sanction under Illinois Supreme Court Rule 137. Upon resolution of Cavagnetto's complaint, the Bartons received $101, 292.08 in proceeds from the sale of the Berwyn Property as payment on their mortgage loan.
On August 23, 2006, the state court held a hearing on a motion for contempt filed by Stoltz in the Divorce Proceedings claiming that Cavagnetto had submitted false childcare invoices for reimbursement by Stoltz. The state court found that Cavagnetto had submitted false invoices and held her in contempt. On October 2, 2006, the state court entered judgment on Stoltz's motion and found that he had over-paid his share of daycare expenses in the amount of $5, 952.85.
Rather than order Cavagnetto to pay Stoltz this amount, the state court gave Stoltz a $5, 952.85 credit against future daycare expenses. In addition to this credit, the state court ordered Cavagnetto to pay Stoltz and/or his attorneys $7, 375.43 "as and for contempt findings."
Cavagnetto filed her bankruptcy case on December 31, 2009.
In re Cavagnetto, 2012 WL 6585560 *1-*3 (Bkrtcy. ...
Buy This Entire Record For