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     1.  PROCEDURAL AND FACTUAL BACKGROUND - The plaintiffs are Terilyn Taylor and Ketchikan Credit Bureau, Inc. (KCBI), who filed a complaint asking for alternative remedies, either to deny the discharge of the debtor, Paul Curtis Howell, under 11 USC § 727(a)(3),(4) for failing to keep books and records (¶ 8 of the complaint, Docket Entry No. 1), and making a deliberate false oath (¶ 9 of the complaint), or to deny dischargeability of the specific claims of Taylor and KCBI.

(A) Taylor asks that a state court criminal restitution judgment in a case filed by the state against the debtor       3 ABR 412  be declared nondischargeable under 11 USC § 523(a)(7) (¶ 5 of the complaint);

(B) Taylor asks that a state court civil judgment brought by Taylor as plaintiff against the debtor as defendant in the amount of $16,539.51, based, among other things, on harassment, trespass, malicious prosecution, back rent, and advances for groceries, be declared nondischargeable pursuant to § 523(a)(6) (¶ 6 of the complaint); and

(C) KCBI asks that various checks assigned to KCBI, written by defendant to various merchants in the Ketchikan area, totalling $ 485.38, be declared nondischargeable pursuant to § 523(a)(4) of the Bankruptcy Code (¶ 7 of the complaint, although KCBI probably meant to cite § 523(a)(2)(A)).

     2.  LEGAL ANALYSIS -

     2.1.  Criminal Restitution (Taylor) - On November 24, 1992, in criminal case number 1KE S92-1087 CR, debtor was ordered to pay $10,025.00 to the Clerk of the District Court in Ketchikan by November 24, 1995. He was to assign his permanent fund dividends for each year on probation (3 years), and work out a payment schedule with probation and Mary Guss, counsel for the victim, Terilyn Taylor.

The debtor has admitted the nondischargeability of this debt to Taylor in his answer. Although the summary judgment and complaint are not crystal clear, the criminal complaint was for second degree theft, AS 11.46.130(a)(1), and, by debtor's admission in the complaint, the party entitled to restitution is Terilyn Taylor. See, Kelly v. Robinson, 479 US 36, 107 SCt 353 (1986). Thus, the imposition of restitution in the amount of $10,025.00 is nondischargeable under § 523(a)(7) of the Bankruptcy Code.

     2.2.  Nondischargeability of NSF Checks (KCBI) - KCBI has submitted, in support of its summary judgment motion, a copy of debtor's bank statements at National Bank of Alaska in Ketchikan, for several       3 ABR 413  months in the middle of 1989. (Exhibit 2 to the Motion For Summary Judgment, Docket No. 13). Copies of the checks are attached as Exhibit 6. In the course of these proceedings, the plaintiffs obtained copies of the bank statements through discovery and their requirement that the debtor authorize plaintiffs to receive these statements from NBA.

Not every issuance of an NSF check is grounds for nondischargeability, and an NSF check does not conclusively imply a representation that there are sufficient funds to cover the check. See, e.g., In re Mahinske, 155 BR 547 (Bankr SD Ind 1992); In re Scarlata, 127 BR 1004 (ND Ill 1991), affd 979 F2d 521; and, In re Weitzel,, 85 BR 612 (Bankr ND Ohio 1988). However, the pattern shown by these checks and deposits lead to a clear inference of misrepresentation by debtor to obtain numerous goods and services from a number of different creditors with checks issued by debtor at a time when the account was insufficient to pay them. In re Damiani, 157 BR 17 (Bankr ND Ohio 1993) (under Ohio law, issuance of an NSF check was a prima facie showing of fraud). KCBI has made a prima facie case for nondischargeability under § 523(a)(2)(A) (obtaining services or property by misrepresentation), and debtor has offered no explanation. Therefore, summary judgment will be entered for KCBI in the amount of $485.38. Celotex Corp. v Catrett, 477 US 317, 322-24 (1986).

     2.3.  Nondischargeability of State Court Judgment (Taylor) - The Findings Of Fact And Conclusions Of Law, (Exhibit 3 to plaintiffs' Motion For Summary Judgment) indicate that the judgment in favor of Taylor against debtor in state court civil case number 1KE-91-1205 CI is composed of the following:

Rent	$2,400.00
Groceries (after an offset for labor)	450.00
Hawaii trip	1,718.00
Int. on groceries, rent, HI trip to 8/4/92	1,776.89
Harassment	5,000.00
Malicious prosecution	1,230.22
General damages for malicious prosecution	2,500.00
Int. on harassment, etc. to 8/4/92	1,464.40
Amount shown on judgment as of 8/4/92	$16,539.51

Interest was calculated at 15½% per year on the judgment. In the judgment (Exhibit 4 to the Motion For Summary Judgment) there was an award of $4,144.88 for attorney fees which should have been added to the       3 ABR 414  $16,539.51, but was apparently overlooked. The actual judgment should have been $20,684.39.

To the extent that matters were adjudicated in that state court action, which decided an issue under § 523(a) of the Bankruptcy Code, this court will give them a collateral estoppel effect. Grogan v. Garner, 498 US 279, 285, 111 SCt 654, 658 fn 11 (1991).

Matters which appear to be clearly the subject of collateral estoppel are the award for harassment, malicious prosecution, general damages, the interest on those items, and a prorated portion of the attorney fee award.

With respect to the award for nonpayment of rent, the trip to Hawaii, and the nonpayment for groceries, nothing in the findings indicates grounds that would make the debt nondischargeable under § 523(a)(6) of the Bankruptcy Code. See, In re Riso, 978 F2d 1151, 23 BCD 1073 (9th Cir 1992) (holding that a breach of an agreement granting a right of first refusal was not grounds for a § 523(a)(6) action).

     3.  CONCLUSION - The following claims are nondischargeable:

For Taylor:
Restitution	$ 10,025.00
Harassment	5,000.00
Malicious prosecution	1,230.22
Int. per judgment	1,464.40
Prorata $4,144.88 attorney fees	2,579.30
Total as of 8/4/92	$12,774.30
For KCBI
NSF checks (w/o calculating interest)	$485.38

Interest on these amounts should be calculated at the state rate to the date of the bankruptcy court nondischargeability judgment, and then bear interest on the bankruptcy court judgment at the federal judgment rate provided under 28 USC § 1961.

Plaintiff's counsel should submit a spreadsheet for the KCBI judgment showing the interest calculation for the numerous individual NSF checks unless it is willing to round off at a conservative figure to begin interest on the total amount using the most recent check as the date to calculate all the interest on all the checks.

There are genuine issues of fact regarding the other claims by plaintiff Taylor, and no summary judgment has been attempted regarding the § 727(a), discharge allegations. Therefore, only a partial summary       3 ABR 415  judgment will be entered.

The court will hold further pre-trial proceedings to determine if plaintiffs want to proceed with a trial on the remaining issue or, in the alternative, if they are willing to dismiss the balance of the claims.

It should be noted the dismissal of a § 727(a) action is not automatic. See, FRCP 7041. If the trustee does not oppose dismissal, however, the court will approve dismissal of the § 727(a) claims.

DATED: June 7, 1994

HERBERT A. ROSS
U.S. Bankruptcy Judge