It is summer and vacation time, and many people will be heading to rural Wisconsin lakes and rivers. With over 600,000 registered vessels in Wisconsin, and more than 300,000 nonresident boats, we can expect a number of injuries and even deaths. We average about 20 fatalities from boating accidents each year.

Injuries and deaths lead to lawsuits, and lawsuits often lead to bankruptcy.

Injured parties facing a bankruptcy filing by a tortfeasor explore their options to avoid having the injury or death claim discharged. These options are divided into two basic categories.

David KrekelerJ. David Krekeler, U.W. 1979, has been solving financial problems for farmers since 1983 and is a founding principal and shareholder with Krekeler Strother, S.C., Madison.

Debts Caused by Unlawful Operation due to Intoxication

The first is debts for death or personal injury caused by the debtor’s operation of a vessel, if that operation was unlawful because the debtor was intoxicated from using alcohol, a drug, or another substance. Bankruptcy Code section 523(a)(9) makes these debts non-dischargeable. Note that these debts that are not discharged are only those for death or personal injury, and would not include property damage.

A party objecting to discharge of a debt bears the burden of proof.1 But that burden can be met by the preponderance of the evidence.2

This standard is substantially less than what must be shown for a criminal conviction (beyond a reasonable doubt). This means that a debtor could be acquitted of a criminal charge of operating the vessel under the influence, yet still have a non-dischargeable debt in bankruptcy.

However, all inferences will be construed strictly against the creditor and liberally in favor of the debtor, to promote the policy of providing the debtor with a fresh start.3

Debts Caused by Willful and Malicious Injury

The second category is for debts caused by willful and malicious injury by the debtor to another.4

Negligent operation of the boat, or even reckless operation, will create debts that will likely be dischargeable. From Kawaauhau v. Geiger: “Nondischargeability takes a deliberate or intentional injury, not merely a deliberate or intentional act that leads to injury.”5 Kawaauhau was a medical malpractice claim, in which the Supreme Court specifically held “ that debts arising from recklessly or negligently inflicted injuries do not fall within the compass of § 523(a)(6).”


Moreover, the exception to discharge under section 523(a)(6) likely will not apply in chapter 13 cases. Chapter 13 provides a broader discharge than does chapter 7.

The Best Choice

The lesson is to have fun on the lake – but let’s be careful out there.

This article was originally published on the State Bar of Wisconsin’s Agriculture Law and Rural Practice Blog of the Solo/Small Firm & General Practice Section. Visit the State Bar sections or the Solo/Small Firm & General Practice Section webpages to learn more about the benefits of section membership.


1 Goldberg Secs., Inc. v. Scarlata (In re Scarlata), 979 F.2d 521, 524 (7th Cir. 1992).

2 Grogan v. Garner, 498 U.S. 279, 291 (1991); see also In re McFarland, 84 F.3d 943, 946 (7th Cir. 1996).

3 In re Crosswhite, 148 F.3d 879, 881 (7th Cir. 1998); Meyer v. Rigdon, 36 F.3d 1375, 1385 (7th Cir. 1994).

4 11 U.S.C. 523(a)(6).

5 Kawaauhau v. Geiger, 523 U.S. 57 (1998).