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Chepovetsky v. Civello

New Jersey Appellate Division

June 16, 2022

The New Jersey Appellate Division reviewed Rule 4:5-4. The Rule requires responsive pleadings to “set forth specifically and separately” the affirmative defense of discharge in bankruptcy and the federal statutory injunction against prosecuting enforcement of a debt discharged in bankruptcy under 11 U.S.C. ยง 524. The defendant argued that the plaintiffs waived the affirmative defense of discharge in bankruptcy by failing to assert it in their answer to his counterclaim, during discovery, and during the trial. The plaintiffs responded by arguing that they were not required to plead discharge in bankruptcy as an affirmative defense to the defendant’s counterclaim and that under the Supremacy Clause, the federal statutory injunction against prosecuting discharged debts in state court trumps Rule 4:5-4 and renders the judgment on the counterclaim void ab initio. The Court ruled that enforcing the waiver of the affirmative defense under Rule 4:5-4 would be inconsistent with substantial justice.

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