# Petition for Writ of Certiorari — Brown v. Sanford

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition for Writ of Certiorari
- **Published:** January 1, 1996
- **Citation:** 519 U.S. 1010

## Text

Supreme Oourt, U.S.

FILED

96 538 0CT 2 19%
NO. ____OSFICe OF THE CLERK

In the
Supreme Court of the United States
October Term 1996

KAY BROWN, Petitioner
VS.

TOMMIE RAY SANFORD, INDIVIDUALLY
AND DBA TOMMIE RAY'S, Respondent

On Petition for a Writ of Certiorari
To the United States Court of Appeals
For the Fifth Circuit

PAR ARR RRRAA RAR ARAL AD AAD EDD DD

PETITION FOR A WRIT OF CERTIORARI

PARR RRR ARRAS ARRAS ERE R EEA

Mynde S. Eisen

State Bar No. 06503950

Law Office of Mynde S. Eisen, P.C.
P. O. Box 630749

Houston, Texas 77263

(713) 266-2955

(713) 266-3008 (facsimile)

ATTORNEYS FOR PETITIONER
KAY BROWN

~

ae,
oe -

QUESTIONS PRESENTED FOR REVIEW

1. | WHETHER A DEBT WHICH AROSE FROM
A JUDGMENT AWARDED UNDERA STATE'S DRAM SHOP
ACT AGAINST THE SELLER, PROVIDER AND/OR SERVER
OF ALCOHOLIC BEVERAGES SHOULD BE EXEMPT
FROM DISCHARGEABILITY PURSUANT TO
11 U.S.C. § 523(a)(6).

LIST OF ALL PARTIES

PETITIONER:

Counsel for Petitioner:

Counsel for Respondent:

Kay Brown
Mynde S. Eisen

Law Office of Mynde
Eisen, P.C.

P. O. Box 630749
Houston, TX 77263
(713) 266-2955
(713) 266-3008 (Fax)

RESPONDENT:
Tommie Ray Sanford,
Individually and dba
Tommie Ray's

Don J. Knabeschuh
Parker & Knabeschuh
55 Waugh Drive,
Suite 601

Houston, TX 77007
(713) 868-1212

(713) 868-1575 (Fax)

QUESTIONS PRESENTED FOR REVIEW ................:0008
a UI i ci ss othcanawunebetnncebubdnsevebenioctenen
PN TIRED sesechcidecscedsssalel ledastbvinesnsecsanssecessen
TABLE OF CITED AUTHORITIES. ............cccccccccscsessessessees
I EDT sonst ck iciccines aca eaalbintnnbakiadveracsateevinesbents
Ps Siadel dei cad pin dusliliabbsncunevnaerasesosenicoesecestesp
STATUTORY PROVISION INVOLVED ............:cccceeeeee
STATEMENT
I. STATEMENT OF FACTS. ...........:.ccceeceeeees
il. FEDERAL JURISDICTION ...............0008
iH. PROCEEDINGS BELOW ...............000065
REASONS FOR GRANTING THE PETITION ................
I. JUDGMENTS UNDER STATE DRAM
SHOP ACTS SHOULD BE EXCEPTED
FROM DISCHARGE nw. ..cccscsscesssscccssseeess
A. Claims Arising Under Violation of a
State's Dram Shop Act Are Analogous

to Claims that are Nondischargeable
Under 11 U.S.C. § 523(a)(9) ............

B. Negligent Actions Can Give Rise to
Willful and Malicious As Defined by
11 U.S.C. § SZS(aNG) .........cccrccesreeess 9

C. Dram Shop Acts Place Primary Liability
On the Provider of the Alcoholic

PME sietantrhtincscentecsnctnkcehcaindoninin 11
Hl. The Decision of the Court of Appeals is
VOT IIOU. ocsncevianceserssdvtcbedsvertebvoeescabieldalied 12
Hil. This Case Is Important ..................cceee 17
MA PUTLAE sicbiicishveidiniatrcutaiicghesonascannadinkaisetacivbasennaia 19

Cases

Chrysler Credit Corp. v. Perry Chrysler
Plymouth, Inc., 783 F. 2d 480 (5th Cir.
be ee EAS AS RRS BRD 3S 1 Lt la ORS a 9

Fuller v. Maxus Energy Corp.
841 S.W.2d 881 (Tex. Civ. App. — Waco 1992, no writ) ... 8

Garner v. Lehrer
36 F. Srd 677 (Sth Cir. 1905)................cccccoeses 15, 16

Impulsora Del Territorio Sur., S.A. v. Cecchini
780 F.2d. 1440, (9th Cir.

UN aaciteadiitsnie taille ckcsas cee <ominckets sabedbdombobccaneicaktle 9
In re Adams
761 F.2d 1422 (Sth Cir. 1985) ..................c.cc00000 6,7

In re Austin
36 B.R. 306 (Bankr. N.D. Tenn.
TPE GisivbcckbicG ecb nasi aie 14, 15

In re Callaway
41 B.R. 311 (Bankr. E.D. Penn.
Ba pre eee ma ee Sch eh ant oe eB alr Bl lp OO 7

In re Cloutier
33 B.R. 18 (Bankr. D. Me.
BOD vinctls nae ieaend Setbclich ses sendcvnaaacnuia cca ceaees 8

In re Dean

79 B.R. 659 (Bankr. N.D.

fg Rr ME votes eh Fr RC A 10, 13
In re Eggers

51 B.R. 452 (Bankr. E.D. Tenn.

TEED ssccinsidmnslonnsestlbtiatabastneabccieneascuamenagcthianl 14, 15

In re Franklin
726 F.2d 606 (10th Cir. 1984) ..0000... eee 10

In re Greenwail
21 B.R. 419 (S.D. Ohio
TEUISEER sininvancbinkes aceleialbhetentansieeiaeksimaiiedl ie einen 7

In re Horne
46 B.R. 814 (Bankr. N.D. GA
TODD sscsssonsesnasensivsunhidhospithiesibiadciasnbdiatheD ieee 14,15

In re Keller
106 B.R. 639 (9th Cir.
TIPUED ancscvccccccnaikshnpisbscndtesoettitendcadubabcbuiuceriee 9, 10, 17

In re Pineau
149 B.R. 522, (Bankr. D. Me.
1992), rev'd on other grounds,

149 B.R. 239 (D. Me. 1993) .......... eee 13, 15
In re Quezada

716 F.2d 427 CGR CR, TRGB) vasccccccesccnsccaiatainxessecciss 9
In re Rex

150 B.R. 505 (Bankr. D. Mass. 1993)............ 14, 15

vi

ery A

In re Strauss
99 B.R. 396 (Bankr. N.D.

RS RRS Saas

In re Taneff
901 B.R. 501 (W.D.N.Y 1996)

In re Wooten

30 B.R. 357 (Bankr. N.D. Ala.
PSR ca CM

Parklane Hosiery Co. v. Shore
439 U.S. 322, 9 S. Ct. 645

) LORI SEGNS SaaS eae

Perkins v. Scharffe
817 F. 2d 392 (6th Cir. 1987),
cert. denied, 484 U.S. 853

PRUNE P aitirsjpiiacin cal tatabessscesves

Sewell v. Smith

819 S.W.2d 565 (Tex. Civ. App.—
Dallas 1991) aff'd 858 S.W.2d 350

EE ESE ROUL en tress Mesa ROPE PTD

vii

SU OO a

44 U5.C. § SEONG) isiecnnccnrcn

414 B.C. S SLND) siincisincsocesssoss
USE OU
USC. 618i...

SUSE Bt oo

Tex. Alco. Bev. Code § 2.01

(Vernon 1992)..............cccceeee

Tex. Alco. Bev. Code § 2.02

VOTTION CTE Pac cscisecsscsuisas chet

viii

Saisiniesiinaditvin i, iv, 4, 6, 7,

pedaieeeneteayeneds 4, 3, #, 8,

11, 12, 18

Pcanbhbebicestin 2,8, 11, 13

14, 16

NO.

IN THE
SUPREME COURT OF THE UNITED STATES
OCTOBER TERM 1996

KAY BROWN, Petitioner
v.

TOMMIE RAY SANFORD, INDIVIDUALLY
AND DBA TOMMIE RAY’S, Respondent

PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT

Kay Brown respectfully petitions for a writ of certiorari
to review the judgment of the United States Court of Appeals
for the Fifth Circuit.

OPINIONS BELOW

The opinion of the Court of Appeals for the Fifth Circuit
is unreported. (App. 1-4). The opinion of the United States
District Court (App. 5-10) and the judgment of the Bankruptcy
Court (App. 11-12) are unreported. The bankruptcy findings
were made on the record and are provided in the Appendix.
(App. 13-20). The judgment from the 295th Judicial District

Court of Harris County, Texas is unreported and is set forth
in the Appendix. (App. 21-24).

JURISDICTION

The Court of Appeals entered its judgment on July 5,
1996. The jurisdiction of this Court is invoked under 28 U.S.C.
§ 1254(1).

STATUTORY PROVISION INVOLVED

# 11 U.S.C. § 523 - Due to its length, the entire statute
is reprinted in the Appendix pursuant to Supreme
Court Rule 14. See App. 25-33.

2. Tex. Alco. Bev. Code §§ 2.01, 2.02 Due to its length,
the entire statute is reprinted in the Appendix pursuant
to Supreme Court Rule 14. See App. 34-35.

STATEMENT
I. STATEMENT OF FACTS

On October 2, 1990, Petitioner Kay Brown
(“Petitioner”) was seriously injured when her automobile was
struck by an automobile being driven by Ed Reasoner
(“Reasoner"). The accident occurred at approximately
9:45 p.m.

At the time of the accident, Reasoner was legally
intoxicated. Prior to the accident, Reasoner had been drinking
continuously at Respondent Tommie Ray's for a period of
over 10 hours.

)

Respondent is Tommie Ray Sanford, individually, and
Tommie Ray Sanford in his capacity as the bar Tommie Ray's
(“collectively Respondent”). Respondent provided and sold
alcoholic drinks to Reasoner' at a time when Respondent
knew Reasoner was intoxicated and presented a danger to
himself and others.

Respondent further testified that he did not carry any
type of liability insurance and made no provision to have funds
in case anyone was injured due to Respondent's negligence
and/or violations of the Texas Dram Shop Act. Respondent
also admitted that it was his responsibility as the owner of
the bar and provider of the liquor to supervise his employees.
Respondent Tommie Ray Sanford still owns the bar.

Petitioner sued Respondent and Reasoner in the
295th Judicial District Court of Harris County, Texas. On
April 2, 1993, Petitioner was awarded a judgment against
Respondent by the 295th Judicial District Court. The 295th
Judicial District Court found that Respondent was liable for
providing or selling alcoholic beverages to an obviously
intoxicated person pursuant to Tex. Aico. Bev. Code Ann.
§ 2.01 et.seg. (Vernon 1992) (the “Texas Dram Shop Act’).
The 295th Judicial District Court further found that
Respondent's violation of the Texas Dram Shop Act was the
proximate cause of Petitioner's injuries.

‘Respondent argued that his employees actually
served the drinks, but for the purposes of liability under the
Texas Dram Shop Act, Tex. Aico. Bev. Code § 2.01 ef. seq.
(Vernon 1992), Respondent is liable because he provided
the alcoholic beverages for sale under his liquor license.

3

Ee ee a ee

ll. FEDERAL JURISDICTION

This case arose under Title 11 of the United States
Code. The Bankruptcy Court's decision was appealed to the
District Court pursuant to 28 U.S.C. §§ 157 and 158(a). The
District Court affirmed the Bankruptcy Court and this decision
was appealed to the Fifth Circuit Court of Appeals pursuant
to 28 U.S.C. §§ 157 and 158(a).

lil. PROCEEDINGS BELOW

On April 29, 1993, Respondent filed a voluntary
petition for relief under Chapter 7 of Title 11 of the United
States Code (the “Bankruptcy Code”). On July 20, 1993,
Petitioner timely brought a cause of action seeking to hold
Respondent's debt to Petitioner nondischargeable pursuant
to 11 U.S.C. § 523(a)(6).

After a trial on the merits, the Bankruptcy Court found
that Reasoner went to Respondent Tommie Ray's intending
to and succeeding to get drunk. The Bankruptcy Court also
found that Respondent Tommie Ray's, served Reasoner
alcoholic beverages and that Reasoner was drunk at the time
the drinks were being served. However. the Bankruptcy Court
found that Respondent Tommie Ray Sanford, in his individual
capacity, did not serve the drinks to Reasoner, therefore the
liability was only vicarious and the debt to Petitioner was
dischargeable..

The Bankruptcy Court granted the Final Judgment in
favor of Respondent which was entered of record on
January 25, 1996. -Petitioner perfected her appeal to the

United States District Court on June 22, 1994. The United
States District Court affirmed the Final Judgment of the
Bankruptcy Court, and Petitioner perfected her appeal to the
United States Court of Appeals for the Fifth Circuit. The Fifth
Circuit issued its opinion affirming the holdings of the District
Court and the Bankruptcy Court on July 5, 1996.

REASONS FOR GRANTING THE PETITION

This Petition for Writ of Certiorari should be granted
because the decision of the Fifth Circuit Court of Appeals
involves an important question of federal law that has not
been and should be settled by this Court.

I. JUDGMENTS UNDER STATE DRAM SHOP ACTS
SHOULD BE EXCEPTED FROM DISCHARGE

The question presented involves. the
nondischargeability of debts which arise from judgments
pursuant to a Dram Shop Act. This issue has not been
addressed, by any Bankruptcy Court, United States District
Court or this Court that has been reported, and the Bankruptcy
Code is silent on this issue.

The Bankruptcy Code specifically addresses the
nondischargeability of debts which arise from injuries cause
by drunk drivers, but the debts that arise from the actions of
those who help the drunk become more intoxicated are not
specifically dealt with. The debts that arise from violations of
a state’s Dram Shop Act should receive the same treatment
as those debts that arise from the injuries caused by drunk
drivers.

A. Claims Arising Under Violation of a State’s
Dram Shop Act Are Analogous to Claims
that are Nondischargeable Under 11 U.S.C.
§ 523(a)(9)

Prior to the enactment of 11 U.S.C. § 523(a)(9),
judgments or debts caused by injuries from intoxicated drivers
were held nondischargeable under 11 U.S.C. § 523(a)(6).
See in re Adams, 761 F.2d 1422 (9th Cir. 1985). At the time

that Congress enacted 11 U.S.C. § 523(a)(9), most of the
existing dram shop statutes did not exist. For example, the
Texas Dram Shop Act, the statute at issue in the case at bar,
was not enacted until 1987, and has not, prior to the present
case, been challenged in the Bankruptcy Court in any type
of reported opinion.

The policy behind holding debts arising out of injuries
by drunken drivers nondischargeable involves the voluntary
nature of the act by the driver. See Adams, 761 F.2d 1422.
Although this act may be considered one of negligence, the
“voluntary acts of drinking and driving while intoxicated
constitute conduct sufficiently intentional to support a finding
of willfulness and malice as contemplated by 11 U.S.C.
§ 523(a)(6) . . .." Adams, 761 F.2d at 1427. See also In re
Greenwall, 21 B.R. 419, 421 (S.D. Ohio 1982) (liabilities
incurred as a result of drunk driving held nondischargeable
because the “voluntary drinking by defendant constituted an
intentional act sufficient to support the conclusion that the
injury caused by the defendant was willful and malicious”);
In re Callaway, 41 B.R. 311, 346 (Bankr. E.D. Penn. 1984)
(voluntary act of drinking and driving in an intoxicated state
is sufficiently intentional and deliberate to make debt
nondischargeable); /n re Wooten, 30 B.R. 357, 358 (Bankr.
N.D. Ala. 1983) (debt is nondischargeable because act of
drinking is intentional act).

The reasoning that was applied in Adams and its
progeny should be applied in cases involving judgments
arising from Dram Shop Act violations. The voluntary act of
serving an already intoxicated person is sufficiently intentional
and deliberate to make the debt nondischargeable.

Under a Dram Shop Act, a person who has provided,
sold or served alcoholic beverages to an already intoxicated

person who presents a clear danger to himself or others can
be liable for the injuries caused by the intoxicated person.
See e.g., Tex. Alco. Bev. Code § 2.02. The voluntary act of a
debtor in providing, selling or serving alcoholic beverages to
a person whom he knows is obviously intoxicated to the extent
that person presents a clear danger to himself and others
which results in injury should certainly fall within the willfulness
and malice as contemplated by 11 U.S.C. § 523(a)(6).

Dram Shop statutes provide exclusive statutory
remedies and usually preclude any remedy for a common
law cause of action under negligence. See Tex. Alco. Bev.
Code § 2.01 et. seq.; Sewell v. Smith, 819 S.W.2d 565 (Tex.
Civ. App.—Dallas 1991) aff'd 858 S.W.2d 350 (Tex. 1993)
(Although the Texas Supreme Court implied that the statute
was one of negligence, Sewell only dealt with the comparative
negligence of determining liability between the provider of
the alcoholic beverages and the intoxicated person. Sewell
did not deal with the liability between the provider of the
alcoholic beverages and innocent third parties injured by the
intoxicated person.) See a/so Fuller v. Maxus Energy Corp..,
841 S.W.2d 881 (Tex. Civ. App. — Waco 1992, no writ).

Holding that violations of state Dram Shop Acts would
be consistent with the public policy behind the enactment of
the Dram Shop Acts. The voluntary act of an entity or person
who willfully provides for sale or sells beverages under his
liquor license to a person whom he knows is already
intoxicated should not be able to absolve his intentional act
by filing bankruptcy. See /n re Cloutier, 33 B.R. 18, 20 (Bankr.
D. Me. 1982) (debt resulted from driving while intoxicated
held nondischargeable because substantial certainty of injury
resulted from judgment debtor's drinking gave rise to
inference of intent to injure).

B. Negligent Actions Can Give Rise to
Willful and Malicious As Defined by 11
U.S.C. § 523(a)(6)

Although, the argument may be made that a person's
violation under a Dram Shop Act is merely one of negligence,
this is not sufficient to take the debtor entirely out of the willful
and malicious standard that is set forth in 11 U.S.C.
§ 523(a)(6). It is the nature of the action that will determine
whether it meets the willful and malicious standard of 11
U.S.C. § 523(a)(6).

Willful means deliberate or intentional. Malicious
means a conscious disregard of one's duties or without just
Cause or excuse and does not require ill will or specific intent
todo harm. Chrysler Credit Corp. v. Perry Chrysler Plymouth,
Inc., 783 F. 2d 480 (Sth Cir. 1986); in re Quezada, 718 F.2d
121 (5th Cir. 1983); Perkins v. Scharffe, 817 F. 2d 392 (6th
Cir. 1987), cert. denied, 484 U.S. 853 (1987). The standard
for determining whether a debt should be discharged is
“[w]hen a wrongful act, . . . done intentionally, necessarily
produces harm and is without just cause or excuse, it is ‘willful
and malicious’ even absent proof of specific intent to injure.”
In re Keller, 106 B.R. 639, 643 (9th Cir. 1989) (citing /mpulsora
Dei Territorio Sur., S.A., v. Cecchini, 780 F.2d. 1440, 1442-
1443 (9th Cir. 1986). Courts have held negligent actions in
malpractice cases to be nondischargeable if certain elements
are present. See Keller, 106 B.R. 639.

The requisite elements that need to be found are: 1)
that the debtor know, expected or should have known, form
an objective perspective, that his conduct was certain or
almost certain to cause harm; 2) the debtor’s conscious
disregard of his duties without just cause or excuse in a
manner that he should have known presented a risk of harm;
and 3) the debtor's willingness to risk a creditor's loss due to

9

SESE ee a ae ee oe

the prospect of personal benefit. Keller, 106 B.R. at 644.
See also In re Strauss, 99 B.R. 396, 399-400 (Bankr. N.D. Ill.
1989) (debtor's knowledge that an act could cause
foreseeable injury, but refuses to take steps to prevent same
is malicious. Failure to procure worker’s compensation
insurance is malicious injury). These elements give rise to
subjective intent and implied malice. When intent and malice
are present, even though the state court judgment is one of
negligence, the debt should be nondischargeable. See /n re
Dean, 79 B.R. 659, 662 (Bankr. N.D. Tex. 1987); See a/so
Scharffe, 817 F.2nd 392; In re Franklin, 726 F.2d 606 (10th
Cir. 1984).

Like the malpractice cases and the cases involving
injuries caused by drunk drivers, debts arising out violations
of state Dram Shop Acts should be nondischargeable. The
voluntary act of the debtor providing or selling alcoholic
beverages to a person whom he knows is obviously
intoxicated which results in an injury should certainly fall
within the willfulness and malice as contemplated by 11 U.S.C.
§ 523(a)(6). The voluntary act of an entity or person who
willfully provides for the sale or sells alcoholic beverages
under his liquor license should not be absolved from all liability
simply because he personally did not serve the drink to the
already intoxicated person.

Just as the intoxicated person cannot relieve its !iability
for injuries he causes by filing Chapter 7, neither should the
person who provided the liquor to the intoxicated person be
able to absolve his liability. The Bankruptcy Code specifically
exempts debts caused by injuries from intoxicated drivers.
See 11 U.S.C. § 523(a)(9). The Bankruptcy Code should
also exempt from discharge the debts of those individuals
who provided additional alcoholic beverages to the already
intoxicated person.

10

” a a

On the Provider of the Alcoholic
Beverages

Dram Shop Acts, such as the Texas Dram Shop Act
are not statutes of vicarious or imputed liability, as both the
Fifth Circuit and the Bankruptcy Court interpreted, but rather
are direct liability statutes. The statutes place direct liability
on the person who provides, sells or serves the liquor. See
e.g., Tex. Alco. Bev. Code § 2.02. Therefore, even if the debtor
did not actually serve the drink but provided such beverages
for sale under his liquor license, he is directly responsible for
the injuries caused. See Tex. Alco. Bev. Code § 2.02.

A provider of alcoholic beverages is defined as a
person who sells or serves an alcoholic beverage under
authority of a license or permit or someone who otherwise
sells an alcoholic beverage to an individual. See e.g. Tex.
Alco Bev. Code § 2.01.

Therefore, a person who violates a state Dram Shop
Act, voluntarily and intentionally provides for the sale of
alcoholic beverages to an already intoxicated person which
causes injuries to an innocent third party. This person should
not be able to walk away from his liabilities simply by filing a
proceeding in bankruptcy and claiming that he did not actually
serve the drinks to the intoxicated person. To reach this
conclusion flies in the face of the public policy behind the
Dram Shop statutes.

11

il. The Decision of the Court of Appeals is
Erroneous

The Fifth Circuit affirmance of the Bankruptcy Court's
finding that Sanford's debt should be dischargeable cause
he 1) “did not personally sell any drinks to Reasoner,” and 2)
that “Sanford’s actions, because he had no personal
involvement, were not willful, but rather, at worst negligent”
(App. at 3-4) is erroneous for several reasons.

First, the Bankruptcy Court misinterpreted the liability
under the Texas Dram Shop Act. The Texas Dram Shop Act
put direct liability upon Respondent in his capacity as Tommie
Ray's for providing and selling the liquor, even if he did not
serve the liquor. Thus, contrary to the Bankruptcy Court's
interpretation, this was not a case of vicarious liability. See
Section IC supra.

Second, negligence in certain circumstances such as
in drunk driving cases and malpractice actions can be willful
and malicious for the purposes of 11 U.S.C. § 523(a)(6).
When the requisite elements that give rise to a subjective
intent and implied malice, it is sufficient to bar the
dischargeability of the debt under 11 U.S.C. § 523(a)(6). See
Section IB supra.

The 295th Judicial District Court of Harris Count found
that Tommie Ray Sanford dba Tommie Ray’s was liable to
Appellant because he provided or sold the alcoholic
beverages to an already intoxicated person. (App. at 21-22)
Based upon the fact that Respondent held the liquor license
for Tommie Ray's, the 295th Judicial District Court awarded
judgment for Petitioner against Respondent, individually and
doing business as Tommie Ray's. (App. 21-24)

12

aati ata ii

In the present case, Respondent filed a Chapter 7
bankruptcy individually and for his dba, Tommie Ray’s.
Respondent testified that he never supervised any of his
employees even though he knew it was is responsibility not
to serve or sell alcoholic beverages to already intoxicated
) persons, and that he did not carry any liability insurance to
cover any risk. Further, the 295th Judicial District Court found
him primarily liable for selling alcohol beverages to Reasoner,
which was the proximate cause of Petitioner's injuries. These
findings alone give rise to the intent and malice that would
make this case nondischargeable under the standards in
similar cases. See /n re Pineau, 149 B.R. 522, 527 (Bankr.
D. Me. 1992), rev'd on other grounds, 149 B.R. 239 (D. Me.
1993); Strauss, 99 B.R. at 399-400; Dean, 79 B.R. at 662.

The Fifth Circuit found no error in the Bankruptcy
Court's finding that Sanford did not personally sell any drinks
to Reasoner; therefore his actions were only vicarious and
not willful and malicious under 11 U.S.C. § 523(a)(6). This
| analysis ignores the plain intent of the Texas Dram Shop Act
) which placed direct liability on Sanford as the owner of
Tommie Rays for providing the liquor for sale to Reasoner.
See Tex. Alco. Bev. Code § 2.02.

There is no case law on point which has interpreted
a Dram Shop statute as to whether the liability is imputed
and whether a violation under the statute is willful and
malicious as defined by 11 U.S.C. § 523(a)(6). The cases
that were relied on by the Bankruptcy Court and the District
Court to show that imputed or vicarious liability cannot
necessarily give rise to the malicious and willful standard
required to hold a debt nondischargeable are all
distinguishable from the facts in the present case. These
cases are all distinguishable because in all of the cases, either
no judgment had been rendered in the state court against

13

the debtor, or the judgment which was rendered in the state
litigation against the debtor was based solely on a statute
that imputed only financial responsibility and not direct liability
against the debtor. See e.g. /n re Austin, 36 B.R. 306 (Bankr.
N.D. Tenn. 1984) (No state judgment existed. Bankruptcy
court found no evidence that minors were being served and
state statute being sued under only placed financial
responsibility on bar for serving the alcohol); /n re Rex, 150
B.R. 505 (Bankr. D. Mass. 1993) (State Court judgment was
rendered solely upon a theory of vicarious liability flowing
from the actions of debtor’s sons and no attempt to show
that debtors had direct liability); In re Horne, 46 B.R. 814
(Bankr. N.D. Ga 1985) (underlying basis was financial
responsibility for parent when son was driving while
intoxicated and no independent liability found); /n re Eggers,
51 B.R. 452 (Bankr. E.D. Tenn. 1985) (liability imputed to
defendant's mother because of financial responsibility, but
no independent cause of action against mother debtor).

The United States District Court relied heavily on /n
re Taneff, 901 B.R. 501, 503 (W.D.N.Y. 1996). However, in
Taneff, the debtor did not specifically remember selling
alcoholic beverages to the injured party. Additional, in Taneff,
there was no existing Dram Shop statute or a state court
finding that found the debtor in Taneff directly liable as in the
case at bar. Unlike the statutes in the cases cited above, the
Texas Dram Shop Act provided direct liability on Respondent
for his act of providing and selling alcoholic beverages to
Reasoner. See Tex. Alco. Bev. Code § 2.02. Under the Texas
Oram Shop Act, Respondent had the responsibility to ensure
that Respondent Tommie Ray’s, his dba, did not provide for
sale or sell liquor to an already intoxicated person. As the
holder of the license or permit, Respondent had the
responsibility and ability to ensure that when he provided the
alcoholic beverages for sale, they did not get sold to an

14

already intoxicated persons. Despite Respondent's direct
responsibility, he chose not to exercise this responsibility by
failing to secure liability insurance and failing to properly
supervise his employees and see that they did not sell or
serve liquor to already intoxicated person. See Pineau, 141
B.R. at 527.

Also, unlike the facts in Austin, Rex, Horne, or Eggers,
where the liability of the Debtors was caused solely by the
act of another, Respondent's act of providing the alcoholic
beverages for sale in the present case was the proximate
cause of Petitioner's injuries. See App. 21-22. Although
Debtor did not specifically serve the drinks, he was directly
liable for providing for the sale the liquor that was served. It
is this act which the Bankruptcy Court should have evaluated
and not the liability of the Respondent.

Further, unlike Taneff, a judgment in this case had
already been entered against Respondent. The Bankruptcy
Court went beyond this State Court Judgement to determine
the basis of liability. The Fifth Circuit's affirmance of this
finding is directly contrary to its findings in Garner v. Lehrer,
56 F.3d 677, 677 (Sth Cir. 1995). See also Parklane Hosiery
Co. v. Shore, 439 U.S. 322, 9 S. Ct. 645 (1978). The Fifth
Circuit should not have affirmed the Bankruptcy Court's
finding of liability other than to determine whether the actual
act of providing the alcoholic beverages for sale constituted
a willful and malicious injury to Petitioner. See Parklane
Hosiery Co., 439 U.S. at 326, 9 S. Ct. at 648; Garner, 56
F.3rd 677.

The Fifth Circuit also erred by allowing the Bankruptcy
Court to go behind the State Court judgment to render its
finding that Respondent did not individually serve the drinks
to Reasoner. Liability had already be established in the state

15

lawsuit and was barred from relitigation by collateral estoppel.
See Parkiane Hosiery Co., 439 U.S. at 326, 9 S.Ct. at 648;
Gamer, 56 F. 3rd 677.

Lastly, the Fifth Circuit erred in affirming the
Bankruptcy Court's findings because the Respondent in this
case is not only Tommie Ray Sanford individually, but Tommie
Ray's the dba which provided for and sold the alcoholic
beverages to Reasoner when he was already intoxicated.
Tommie Ray's was merely a dba and there is no corporate
shield for Respondent Tommie Ray Sanford to hide behind.
By finding only vicarious liability, the Bankruptcy Court and
the District Court absolved Respondent of all of his liability
for providing for the sale of alcoholic beverages to an already
intoxicated person in direct contravention of the Texas Dram
Shop Act. See Tex. Alco Bev. Code § 2.02.

Additionally, Respondent was even more culpable for
his acts of providing and selling alcoholic beverages because
Respondent did not carry liability insurance for his dba.
Respondent knew he had direct liability for selling and
providing alcoholic beverages to the general public, but
intentionally did not carry any type of insurance or provide
any funds to cover any risk. Now he is able to discard all risk
by filing for Chapter 7 bankruptcy.

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lll. This Case ts important

Public policy dictates that owners of establishments
that serve alcoholic beverages should be aware of the
dangers imposed by providing such beverages to an already
intoxicated person. The enactment of the Dram Shop statutes
placed the responsibility on business owners to help insure
the safety of the streets from intoxicated drivers. When a bar
owner, such as Respondent in this case, intentionally sells
alcoholic beverages to a person that he knows is already
intoxicated he should not be able to discharge this
responsibility merely by filing a Chapter 7 proceeding. In
the present case, the Respondent is even more culpable
because of his failure to carry liability insurance and to
supervise his employees from serving the alcoholic
beverages he provided. Public policy dictates that these types
of debts should be nondischargeable.

A person who willfully provides alcohol to an already
intoxicated person is no different that the drunk person who
voluntarily drives the car. The risk to third parties is the same.
When a wrongful act is done intentionally without just cause
or excuse, and such act produces harm, then the act is willful
and malicious. Keller, 106 B.R. at 643.

In the present case, the requisite intent and implied
malice are present. Respondent provided alcohol to
Reasoner when Reasoner was obviously intoxicated to the
extent that Reasoner presented a clear danger to himself
and others, and the intoxication of Reasoner was the
proximate cause of Petitioner's injuries. Therefore, the debt
of Respondent to Petitioner's should be held to be
nondischargeable pursuant to 11 U.S.C. § 523(a)(6).

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Accordingly, the Court is respectfully requested to
grant the petition and reverse the judgment of the Court of
Appeals.

CONCLUSION

. At first blush, this case would appear to rest on a
very special set of facts. However, unless this Court decides
the dischargeability of debts which arise out of the Dram Shop
statutes, restaurants and bars may begin to drop their liability
insurance because they know that debts will be able to be
discharged in bankruptcy. This would fly in the face of the
public policy behind the enactment of the Dram Shop statutes,
the “fresh start” policy behind the Bankruptcy Code, and the
public awareness to stop accidents resulting from drunk
drivers. Only this Court can reverse the erroneous
interpretation of the Fifth Circuit and the Bankruptcy Court of
the dischargeability of the debt that arose from the Texas
Dram Shop Act.

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Therefore, Petitioner respectfully requests the
Court to grant her petition for a writ of certiorari to the
United States Court of Appeals for the Fifth Circuit.

Respectfully submitted,

LAW OFFICE OF MYNDE EISEN,
P.C.

By: Drip d lidine
Mynde S. Eisen
State Bar No. 06503950
P. O. Box 630749
Houston, Texas 77263
(713) 266-2955
(713) 266-3008 (Fax)

ATTORNEYS FOR PETITIONER
KAY BROWN

e:\jamison\brown\appeal\certiora bn

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386004_1573%3A1. Public record. Not legal advice.