United States District Court, District of Columbia
P. MEHTA UNITED STATES DISTRICT JUDGE.
Ojo Momoh appeals from a Bankruptcy Court determination that
his debt to Victor Osayande is not dischargeable because
Momoh obtained the money he owes by fraud. Momoh contends
that the Bankruptcy Court erred in reaching that conclusion
because the record evidence demonstrates he did not intend to
deceive Osayande, but, in fact, repaid Osayande in part,
thereby establishing Momoh's intent to repay Osayande.
Upon review of the record and consideration of the
parties' briefs, the court affirms the ruling of the
court assumes the parties' familiarity with the
underlying record and recites only what is necessary to
resolve the narrow issue on appeal.
early 2011, Momoh approached Osayande with an opportunity to
invest in Momoh's business, “Dirisu Momoh Auto
Sales, Inc., ” which purportedly purchased cars in the
United States and resold them in Nigeria for a profit.
See Br. of the Appellee, ECF No. 7 [hereinafter
Appellee's Br.], at 5; Appellee's Br., App'x, ECF No.
7-1, at 28-102 [hereinafter Osayande Direct Exam. Tr.], at
4-7. Dirisu Momoh Auto Sales, Inc. did not exist.
See Br. of the Appellant, ECF No. 6 [hereinafter
Appellant's Br.], App'x, ECF No. 6-1, at 24-40
[hereinafter Trial Ruling Tr.], at 10. Momoh and Osayande
subsequently entered into two contracts-one in April 2011,
the other in July 2011-under each of which Osayande invested
$6, 500 in “Dirisu Momoh Auto Sales, Inc.” and
expected to earn a profit of $1, 625 on a bi-monthly basis
for a set period of time. See Appellant's Br.,
App'x, ECF No. 6-1 [hereinafter Appellant's
App'x], at 20-21. On March 26, 2012, Osayande filed a
police report claiming Momoh had defrauded him.
Appellant's Br., App'x, ECF No. 6-1, at 18-19
[hereinafter Police Report], at 1. The Police Report reflects
that Osayande gave the police a copy of the two contracts and
supposedly made a statement “that [Momoh] did give him
1600 dollars in June of 2011.” Id. at 2.
trial, Momoh testified that he made three payments to
Osayande to satisfy his obligations under the contracts.
First, he claimed he made a cash payment to Osayande in June
2011, for which Osayande refused to give him a receipt.
See Trial Ruling Tr. at 12. Second, Momoh testified
he wired two payments to Osayande on September 26, 2011. In
support, he submitted an exhibit purporting to show that he
made two wire transfers-one for $759 and one for $734-to
“Victor Osayange, ” in Salt Lake City, Utah, on
September 26, 2011, via Western Union. Appellant's
App'x at 17.
testified that he never received any payments from Momoh.
See Osayande Direct Exam. Tr. at 19, 25.
Additionally, he stated under oath that his name is not
spelled with a “g, ” and he has never been to
Salt Lake City, Utah. See Id. at 25-27. Lastly,
Osayande testified that the Police Report misstates what he
told the police; instead, he “told the police that
[Momoh] said he gave [Osayande] $1600, and that's not
true.” Id. at 33.
Bankruptcy Court ultimately credited Osayande's testimony
over Momoh's testimony and ruled that the debt was not
dischargeable because it was procured by actual fraud.
See In re Momoh, No. 14-291, 2016 WL 270155, at *2,
5-6 (Bankr. D.D.C. Jan. 20, 2016).
district courts have jurisdiction to review the final
judgments of the bankruptcy courts in their judicial
district. See 28 U.S.C. § 158(a). In so doing,
the district court reviews the bankruptcy court's legal
conclusions de novo and factual findings for clear error.
Yelverton v. District of Columbia, 529 B.R. 1, 3
error exists only when the reviewing court “is left
with the definite and firm conviction that a mistake has been
committed.” Moore v. Robbins, 24 F.Supp.3d 88,
94 (D.D.C. 2014) (internal quotation mark omitted). “If
the [fact-finding] court's account of the evidence is
plausible in light of the record viewed in its entirety, the
[reviewing court] may not reverse it even though convinced
that had it been sitting as the trier of fact, it would have
weighed the evidence differently.” See Anderson v.
City of Bessemer City, 470 U.S. 564, 573-74 (1985);
accord Hope 7 Monroe St. Ltd. P'ship v. RIASO
L.L.C., 473 B.R. 1, 6 (D.D.C. 2012), aff'd,
743 F.3d 867 (D.C. Cir. 2014). Indeed, “[w]here there
are two permissible views of the evidence, the
factfinder's choice between them cannot be clearly
erroneous.” Anderson, 470 U.S. at 574;
accord Moore, 24 F.Supp.3d at 94. This standard
applies equally to the district court's review of oral
and documentary record evidence, as well as the bankruptcy
court's credibility determinations. See Alberts v.
HCA, Inc., 496 B.R. 1, 9, 18-19 (D.D.C. 2013); In re
Chreky, 450 B.R. 247, 251- 52 (D.D.C. 2011).
Section 523 of Title 11 of the United States Code, an
individual debtor in bankruptcy seeking discharge of his
debts under Section 727 remains liable for monetary debts
“obtained by- false pretenses, a false representation,
or actual fraud, other than a statement respecting the
debtor's or an insider's financial condition.”
11 U.S.C. § 523(a)(2)(A). The terms “false
pretenses, ” “false representation, ” and
“actual fraud” “imply elements that the
common law has defined them to include” at the time
each term was added to the statutory provision. Field v.
Mans, 516 U.S. 59, 69-70 (1995); see Husky Int'l
Electronics, Inc. v. Ritz, 578 U.S.___, 136 S.Ct. 1581,
1586 (2016). The Supreme Court has read the term
“actual fraud” broadly to mean “anything
that counts as ‘fraud' and is done with wrongful
intent.” Husky Int'l Electronics, 136
S.Ct. at 1590. When the term “actual fraud” was
added to § 523(a)(2)(A) in 1978, the District of
Columbia defined the elements of fraud as: “(1) a false
representation (2) in reference to material fact, (3) made
with knowledge of its falsity, (4) with the intent to
deceive, and (5) action is taken in reliance upon the
representation.” Bennett v. Kiggins, 377 A.2d
57, 59 (D.C. 1977); accord Va. Academy of Clinical
Psychologists v. Grp. Hospitalization & Med. Servs.,
Inc., 878 A.2d 1226, 1233 (D.C. 2005).
raises two interrelated arguments why the Bankruptcy Court
erred in concluding he intended to deceive Osayande. First,
Momoh contends that Osayande bore the burden of proof at
trial to show Momoh intended to deceive him, and Osayande
failed to submit evidence proving Momoh had no intention of
repaying Osayande. Second, Momoh asserts that the evidence he
introduced firmly establishes that ...