IN THE UNITED STATES BANKRUPTCY COURT
FOR THE NORTHERN DISTRICT OF CALIFORNIA
|DO NOT PUBLISH
This case disposition has no value as precedent and is not intended for publication. Any publication, either in print or electronically, is contrary to the intent and wishes of the court.
RICHARD and JOANN O'NEIL, No. 96-12610
v. A.P. No. 96-1317
Memorandum and Order
This case is rapidly becoming a procedural sinkhole. The complaint includes claims for
breach of contract and constructive fraud, which are not assertable as to the debtors and are
assertable against the estate only by filing a proof of claim. The complaint seeks imposition of
a constructive trust against non-exempt assets, yet the trustee is not a party (nor should he be).
The complaint alleges defalcation in a fiduciary party, but there is no indication of any express
The debtors scheduled no claim against plaintiff nor claimed any such rights against plaintiff
as exempt, yet have filed a counterclaim.
The only legitimate issue in this
adversary proceeding is whether the debtors owe a
nondischargeable debt to plaintiff. There is no right to a jury in a dischargeability action.
IT IS THEREFORE ORDERED as follows:
1. The first and fifth claims in the complaint are dismissed, without prejudice to the filing of
a proof of claim.
2. The third claim is dismissed without prejudice to an action against the trustee, if such an
action can be maintained in good faith.
3. The sixth claim is dismissed with leave to amend because it fails to allege the existence
of an express trust.
4. The jury demand is stricken.
5. The counterclaim is dismissed, without prejudice at such time as the claim is duly
scheduled and either exempted or abandoned. The counterclaim may not be prosecuted as part
of this adversary proceeding in any event.
6. The stipulation to allow the filing of an amended reply to the counterclaim is not approved.
7. Any portion of this order may be reconsidered on 20 days notice. However, any motion
seeking such reconsideration must be adequately supported by applicable federal authority.
Dated: March 19, 1997 _______________________