C. Russell Kelleran, Jr., Eighteen Mile Corporation v. Slavko Andrijevic, A/K/A Al Andrie

I cannot agree with my fellow members of the panel that the entry by the state court of this “default judgment” against the appellee on counterclaims brought by one of the appellant-creditors precludes the bankruptcy court from looking behind the state court determination and disallowing the claims in the bankruptcy proceeding. To require a mechanical application of the doctrine of res judicata and the seeming dictate of 28 U.S.C. § 1738 ignores the broad equitable powers of the bankruptcy court to take actions necessary to achieve an equitable distribution of the bankrupt’s estate among…