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In settling the lawsuit, the Archers executed releases except for obligations under a $100,000 promissory note and then voluntarily dismissed the lawsuit. After the Warners failed to make the first payment on the promissory note, the Archers sued in state court. The Warners filed for bankruptcy, and the Bankruptcy Court ordered liquidation under Chapter 7. The Archers then brought a claim asking the Bankruptcy Court to find the $100,000 debt nondischargeable and to order the Warners to pay the sum. The Bankruptcy Code provides that a debt shall not be dischargeable in bankruptcy \u0022to the extent\u0022 it is \u0022for money...obtained by...false pretenses, a false representation, or actual fraud.\u0022 The Bankruptcy Court denied the Archers\u0027 claim. The District Court and the Court of Appeals affirmed.\u003C\/p\u003E\n","question":"\u003Cp\u003EDoes the Bankruptcy Code cover a debt embodied in a settlement agreement that settled a creditor\u0027s earlier claim \u0022for money...obtained by...fraud?\u0022\u003C\/p\u003E\n","conclusion":"\u003Cp\u003EYes. In a 7-2 opinion delivered by Justice Stephen G. Breyer, the Court held that a debt for money promised in a settlement agreement accompanied by the release of underlying tort claims can amount to a debt for money obtained by fraud, within the nondischargeability statute\u0027s terms. \u0022We conclude that the Archers\u0027 settlement agreement and releases may have worked a kind of novation, but that fact does not bar the Archers from showing that the settlement debt arose out of \u0027false pretences, a false representation, or actual fraud,\u0027 and consequently is nondischargeable,\u0022 wrote Justice Breyer. 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