Tampa Bankruptcy Court Decision on Discharge of Construction Contractor Debt to Customer

Bankruptcy and ConstructionThe Bankruptcy Court in Tampa rendered an important decision on whether a contractor employed to perform construction or repair services to a customer could Discharge such debt in Bankruptcy. In the case of Hollman v Morales (In re Morales) an individual hired the debtor, a handyman, to conduct repairs on his mobile home. The customer paid $25,000 for such services to be performed.

Evidently, such services were not fully performed, and the handyman, and subsequently, the debtor, in the Bankruptcy, argued that the mobile home was inhabited by evil spirits and suggested he conduct a séance on the customer’s behalf to rid the property of such spirits. However, the customer rejected such séance when he learned that such service would involve the use of animal sacrifice. The customer subsequently sued the debtor handyman in State Court, arguing that the debtor was in breach of contract, and acted in a fraudulent manner.

Bankruptcy Judge Colton on August 26, 2022, found that the claims brought by the homeowner did not constitute nondischargeable obligations under Bankruptcy Code Sections 523(a)(2) and 523(a)(6). Judge Colton finding was that the debtor did not deceive the homeowner. The debtor was a licensed handyman, his company was insured, and the debtor did possess the necessary skills to perform the work requested. Additionally, there was no finding that the debtor was purposely seeking to deceive the homeowner when he represented that the home was possessed.

Picture Credit: VistaCreate