In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 21‐1423
IN RE:
DONALD WAYNE HARSHAW,
Debtor,
ELIZABETH ANNE HARSHAW,
Plaintiff‐Appellant,
v.
DONALD WAYNE HARSHAW,
Defendant‐Appellee.
____________________
Appeal from the United States District Court for the
Northern District of Indiana, Hammond Division.
No. 2:19‐cv‐00144‐HAB — Holly A. Brady, Judge.
____________________
ARGUED OCTOBER 29, 2021 — DECIDED FEBRUARY 23, 2022
____________________
Before SYKES, Chief Judge, and KANNE and HAMILTON, Cir‐
cuit Judges.
HAMILTON, Circuit Judge. This bankruptcy appeal turns on
the familiar difference between a judgment for money and
one that awards an interest in specific property. The case
2 No. 21‐1423
arises from an unusual arbitration award that was enforced
by Indiana state courts to resolve disputes between an unmar‐
ried couple. Elizabeth Anne Harshaw and Donald Harshaw
married and divorced. They later reconciled but did not re‐
marry, setting the stage for this legal dispute. The couple then
separated again. Because divorce laws no longer applied to
the couple, Anne sued Donald in state court under equitable
theories to seek redress for her contributions to the relation‐
ship during their second period together.
The two agreed to binding arbitration. The arbitrator
awarded Anne $435,000, half the increase in value of Donald’s
retirement savings during their years of unmarried cohabita‐
tion. Donald appealed the award but lost in the state courts.
After that loss became final, Donald declared bankruptcy and
sought to discharge the arbitrator’s award. He asserted that
the award was for a money judgment and thus subject to dis‐
charge in the bankruptcy. Anne opposed his claim, arguing
that the arbitrator had awarded her an interest in specific
property so that the award could not be discharged in Don‐
ald’s bankruptcy. The bankruptcy court sided with Anne. The
district court reversed and sided with Donald. We agree with
the district court and affirm its judgment.
I. Facts and Procedural History
A. The Separation
Anne and Donald have a long history together. They were
married for twenty‐five years but divorced in 1996. They got
back together shortly after but separated again in 2013. Since
they had not remarried, Anne could not secure relief through
the familiar channels of divorce law. Instead, she sued Donald
in state court under equitable theories of express or implied
No. 21‐1423 3
contract, unjust enrichment, and quantum meruit. Anne’s
claims were based on her contributions to the relationship
during their approximately sixteen‐year reconciliation, in‐
cluding quitting her job to take care of the home and to take
care of Donald’s nieces and grandson, who have special
needs, as well as Donald himself, who suffered from various
health issues.
B. The Arbitration
Anne and Donald agreed to submit the dispute to binding
arbitration. The arbitrator issued a final award with detailed
findings about Anne’s contributions to the relationship. Indi‐
ana common law permits relief for an unmarried person upon
separation under equitable principles when the previous re‐
lationship shared many of the characteristics of a traditional
marriage. See, e.g., Glasgo v. Glasgo, 410 N.E.2d 1325, 1330–32
(Ind. App. 1980). Finding those characteristics present here,
the arbitrator determined that Donald was liable to Anne.
Next, the arbitrator turned to the question of the remedy.
The arbitrator’s remedial language led to this appeal, which
turns on the difference between a money judgment and an in‐
terest in specific property. The award said that Anne was
awarded the sum of $435,000, but also included language re‐
ferring to Donald’s retirement savings accounts and a Quali‐
fied Domestic Relations Order, as discussed below. The Lake
County Superior Court entered judgment on the arbitration
award. Donald appealed, and the Indiana Court of Appeals
affirmed in relevant part. Harshaw v. Harshaw, 37 N.E.3d 978
(Ind. App. 2015) (mem.).
4 No. 21‐1423
C. Bankruptcy Court Proceedings
After losing his appeal in the state courts, Donald filed for
bankruptcy. A dispute soon emerged over the whether the ar‐
bitrator had awarded Anne a money judgment or an interest
in specific property. Donald asserted that it was a money
judgment and therefore subject to discharge in bankruptcy.
He also claimed an exemption from attachment for his retire‐
ment account. Anne responded with an adversarial complaint
seeking a declaration from the bankruptcy court that she had
been awarded a property interest that was not dischargeable
in the proceedings.
The bankruptcy court ruled in favor of Anne. The court,
recognizing all that Anne had sacrificed in her relationship
with Donald, found that the arbitrator intended to give Anne
a property interest. In doing so, the court took guidance from
cases concerning the division of property within a marriage
dissolution. See Paxton v. Paxton, 709 N.E.2d 31 (Ind. App.
1999); Brown v. Pitzer, 249 B.R. 303 (S.D. Ind. 2000). The bank‐
ruptcy court read the award as specifying the exact source of
the funds, the equal distribution of Donald’s pension fund
and 401(k) account, and ordering Donald to transfer a portion
of the property to Anne through an assignment, Qualified Do‐
mestic Relations Order, or other mechanism agreeable to both
parties. These factors had also been present in the divorce
cases finding that the plaintiff‐spouses had been awarded
property interests rather than dischargeable money judg‐
ments.
D. District Court Proceedings
Donald appealed to the district court, which reversed. In
re Harshaw, No. 15‐22342, 2021 WL 406174 (N.D. Ind. Feb. 4,
No. 21‐1423 5
2021). The district court found that the arbitrator awarded
Anne a money judgment. The award said that Anne was
awarded “the sum of Four Hundred Thirty‐Five Thousand
Dollars & 00/100 ($435,000.00), plus post‐judgment interest.”
That is the language of a money judgment, and post‐judg‐
ment interest is available under Indiana law only for judg‐
ments for money. Id. at *5. The district court also found that
additional language about how the arbitration award might
be satisfied did not transform it from a money judgment into
a property award. This appeal followed.1
II. Analysis
The central issue here is whether the arbitration award
gave Anne a money judgment against Donald, which would
be a debt dischargeable in bankruptcy, or instead vested her
with a property interest in a portion of his retirement ac‐
counts, which would not be affected by Donald’s bankruptcy.
The parties have not identified any disputed factual issues, so
we review this question of law de novo and look to state law
to determine the nature of a party’s interest in property. In re
Krueger, 192 F.3d 733, 737 (7th Cir. 1999). We agree with the
district court that the better reading of the arbitration award
is that it awarded Anne a money judgment, not a property in‐
terest. We reach that conclusion based on both the text of the
1 The district court recognized that “generally, an arbitration award is
not objectionable on the ground that the arbitrator misinterpreted appli‐
cable law.” Harshaw, 2021 WL 406174, at *5 n.3, citing National Railroad Pas‐
senger Corp. v. Chesapeake & Ohio Railway Co., 551 F.2d 136, 143 (7th Cir.
1977). Since Anne did not raise such an argument, the court declined to
apply that principle to the domestic relations portions of the arbitration
award that might have rested on uncertain legal grounds if the award had
been understood as vesting Anne with a property interest.
6 No. 21‐1423
award and the broader legal context of Indiana domestic rela‐
tions law and the extent of an arbitrator’s authority. We turn
first to the text and then to the broader legal context.
A. The Arbitrator’s Award
Here is the critical language, which appears at the end of
the award in paragraph 55, and the awarding language:
55. The arbitrator finds, based upon the above
findings and conclusions, that the plaintiff, Eliz‐
abeth A. Harshaw, is hereby awarded the sum
of Four Hundred Thirty‐Five Thousand Dollars
& 00/100 ($435,000.00), plus post‐judgment in‐
terest, which judgment is deemed to be just and
due to her, upon a full consideration of all the
evidence, testimony, proof, allegations, and
contentions of the parties herein, and based
upon Indiana law. The arbitrator further finds
that payment of this amount to the plaintiff shall
be accomplished by the defendant either
through assignment of his pension and/or re‐
tirement benefits; or by Qualified Domestic Re‐
lations Order (QDRO), to be approved and ef‐
fectuated and ordered by the Court; and/or by
payment from Don to Anne in any other man‐
ner acceptable to both parties. Further, the
Court hereby enters judgment in favor of Eliza‐
beth Anne Harshaw and against Donald W.
Harshaw [and] finds that this judgment should
not be dischargeable in bankruptcy, since it is
specifically awarded to the plaintiff as compen‐
sation, and for her support and maintenance,
No. 21‐1423 7
whether in full or in part, throughout the cohab‐
itation of the parties herein.
IT IS THEREFORE CONSIDERED, ORDERED,
ADJUDGED AND DECREED that Elizabeth A.
Harshaw is hereby awarded a judgment in the
sum of Four Hundred Thirty‐Five Thousand
Dollars & 00/100 ($435,000.00) in her favor and
against the defendant.
The beginning of paragraph 55 uses the language of a
money judgment: “The arbitrator finds, based upon the above
findings and conclusions, that the plaintiff, Elizabeth A.
Harshaw, is hereby awarded the sum of Four Hundred
Thirty‐Five Thousand Dollars & 00/100 ($435,000.00), plus
post‐judgment interest.” The decretal language after para‐
graph 55 then echoes this key language of a money judgment:
“IT IS THEREFORE CONSIDERED, ORDERED, ADJUDGED
AND DECREED that Elizabeth A. Harshaw is hereby
awarded a judgment in the sum of Four Hundred Thirty‐Five
Thousand Dollars & 00/100 ($435,000.00) in her favor and
against the defendant.” See Hilliard v. Jacobs, 916 N.E.2d 689,
694 (Ind. App. 2009) (holding that “any order that requires the
payment of a sum of money and states the specific amount due,
whether labeled as a mandate or a civil money judgment, is a
‘judgment for money’” (emphasis in original)); United Farm
Bureau Mutual Insurance Co. v. Ira, 577 N.E.2d 588, 593 (Ind.
App. 1991) (“The key to a money judgment is the statement
of an amount due. A money judgment must be certain and
definite. It must name the amount due.”).
Also weighing on the money‐judgment side of the scales
is the language in the first sentence in paragraph 55 providing
that Anne is entitled to post‐judgment interest. As the district
8 No. 21‐1423
court noted, under Indiana law, post‐judgment interest ap‐
plies only to money judgments, not to judgments partitioning
property. See Ind. Code § 24‐4.6‐1‐101; see also Hilliard, 916
N.E.2d at 694 (“Because the trial court’s order was not a judg‐
ment for money, the post‐judgment interest provisions of
[§ 24‐4.6‐1‐101] were inapplicable.”). Since awards of prop‐
erty interests are not accompanied by post‐judgment interest,
this language also weighs in favor of treating the award as a
money judgment rather than an award of a property interest.
In determining the nature of the interest awarded here, it
is helpful to compare this case to two cases that were dis‐
cussed by the bankruptcy and district courts and that in‐
volved similar issues, but arising from divorce decrees. First,
the Indiana Court of Appeals explained in Paxton: “A money
judgment ‘adjudges the payment of a sum of money, as dis‐
tinguished from one directing an act be done or property to
be restored or transferred.’” 709 N.E.2d at 33, quoting Money
Judgments, Black’s Law Dictionary (6th ed. 1990). There, the
issue was whether a divorce decree provided the husband a
money judgment or property interest. The decree said that he
was entitled to “the sum of $19,940.00 from the [retirement
account] (in Wife’s name) from the amount in said account on
August 25, 1995.” Id. at 33 (emphasis omitted). The court de‐
termined that this was “an order for transfer of property,
namely the in‐kind asset allocation of a portion of Wife’s IRA
account” because it explicitly ordered a distribution from the
retirement account to the husband. Id.
A federal case shortly after Paxton reached a similar con‐
clusion. In Brown, the court also examined the language of a
divorce decree to determine the type of interest it provided.
The critical part of the decree said: “The parties’ property
No. 21‐1423 9
shall be divided between them as set out in Paragraph 28 of
this Decree. [The husband] shall cause the amount of Fifty‐
five Thousand Seven Hundred Seventy Dollars and Thirty‐
three Cents [$55,770.33] in his pension account with
TIAA/CREF to be set off to [the wife] by a Qualified Domestic
Relations Order….” 249 B.R. at 305.
The district court found in Brown that “the decree call[ed]
for transfer of property to [the wife] through an in‐kind asset
allocation of a portion of the marital pension.” Id. at 308. It did
so because the “divorce decree direct[ed] the parties to split
the marital assets equally” and ordered the wife’s entitlement
“from the pension fund to accomplish the equal division of
property.” The decree also specified “the exact source of the
funds, the marital pension,” and did “not allow [the husband]
to choose the source of the payment nor [did] it contemplate
that he [was] obligated to pay the funds personally.” Id.
Unlike the divorce decrees in Paxton and Brown, the arbi‐
tration award here did not include language such as “the as‐
sets are hereby divided equally between the parties” or that
“Anne shall receive half of Donald’s retirement account” or
the like. Nor did it mandate a specific source of payment. The
arbitration award here simply did not contain property‐divi‐
sion language.
Anne counters, however, by directing us to other language
in the arbitration award that she says shows an intent to
award her a property interest. Between the two passages that
use the language of a money judgment, paragraph 55 includes
this sentence: “The arbitrator further finds that payment of
this amount to the plaintiff shall be accomplished by the de‐
fendant either through assignment of his pension and/or re‐
tirement benefits; or by Qualified Domestic Relations Order
10 No. 21‐1423
(QDRO), to be approved and effectuated and ordered by the
Court; and/or by payment from Don to Anne in any other
manner acceptable to both parties.” Anne argues that the ar‐
bitrator, through this language, specified the source of the
funds to satisfy the award, along with specifying the manner
and means of payment, so that her award qualifies as a prop‐
erty interest under Paxton.
We read that sentence differently. It does not identify a re‐
quired source of funds or manner of payment. It instead lists
options for satisfying the obligation to pay $435,000. Those
options include the “assignment of his pension and/or retire‐
ment benefits,” a “Qualified Domestic Relations Order”
and/or “by payment from Don to Anne in any other manner
acceptable to both parties.” The payment of cash—legal ten‐
der for all debts, public and private—would surely suffice.
The order thus allowed Donald to choose how to satisfy the
award, which is also consistent with a money judgment. That
is markedly different from both Brown and Paxton.
We recognize that the amount awarded was based on Don‐
ald’s retirement account: one half of the increase in value dur‐
ing the couple’s unmarried cohabitation. But understanding
how the arbitrator calculated the amount does not answer the
question whether the award was for a money judgment or a
property interest.
Anne also emphasizes one other passage in the arbitration
award. After paragraph 55, the award addresses how it
should be executed by both parties and the consequences for
failing to abide by it. Donald was “ordered to execute a Qual‐
ified Domestic Relations Order, if the same is allowed and/or
approved by the Court, or any such similar documentation
necessary to transfer or pay the plaintiff from his pension
No. 21‐1423 11
and/or retirement benefits.” This is the closest the arbitration
award came to “directing an act be done or property to be re‐
stored or transferred.” See Paxton, 709 N.E.2d at 33 (citation
omitted).
This language, however, cannot overcome all the other in‐
dications in the award that it awarded a money judgment. The
order to execute a QDRO is conditional on court approval.
There is no indication that the court gave such approval or
that a QDRO was even permissible under the circumstances
of a non‐married couple. The reference to “transfer or pay the
plaintiff” might have enabled payment from Donald’s retire‐
ment account, which was certainly one option, but it did not
require payment from that source. The arbitrator had already
said twice that he was awarding Anne $435,000, in the same
terms that courts use to impose money judgments, and post‐
judgment interest, a remedy available only for money judg‐
ments. Payment from the retirement account was only one op‐
tion for complying with the award. Accordingly, the language
about executing a QDRO or other documentation does not
persuade us that the award was a property award rather than
a money judgment.
B. Additional Considerations
Looking beyond the text of the arbitration award, two as‐
pects of relevant substantive law support our conclusion that
the award awarded a money judgment rather than a property
interest. We have already mentioned the first, that post‐judg‐
ment interest is available only for money judgments, and the
arbitration award here awarded post‐judgment interest. See
Ind. Code § 24‐4.6‐1‐101; see also Paxton, 709 N.E.2d at 33.
12 No. 21‐1423
The second is Indiana law protecting tax‐deferred retire‐
ment accounts from the execution of money judgments. Ind.
Code § 34‐55‐10‐2(c)(6). The Indiana statute establishing this
exemption for a debtor’s tax‐deferred retirement accounts re‐
flects a fundamental public policy decision by Indiana to pro‐
tect such retirement savings from judgment creditors.
At the same time, Indiana law also provides special pro‐
tection for arbitration awards. A court may vacate an arbitra‐
tion award obtained by fraud or corruption, or on certain
other narrow grounds, but a court’s authority is subject to a
critical limit: “the fact that the relief was such that it could not
or would not be granted by a court of law or equity is not
ground for vacating or refusing to confirm the award.” Ind.
Code § 34‐57‐2‐13(a). This limitation, which is part of Indi‐
ana’s enactment of the Uniform Arbitration Act, is critical to
one of the key tradeoffs in arbitration—finality is valued over
legal accuracy. Parties who agree to have an arbitrator resolve
their dispute agree to only extremely narrow and deferential
judicial review of the arbitration award.
Such narrow and deferential judicial review does not
mean no review. Indiana courts have also recognized a pub‐
lic‐policy exception to courts’ obligations to enforce arbitra‐
tion awards. In School City of East Chicago v. East Chicago Fed‐
eration of Teachers, for instance, a school district challenged an
arbitration award requiring it to pay union members punitive
damages after a labor dispute. 422 N.E.2d 656, 661 (Ind. App.
1981). The appellate court set aside the punitive damages
award against the school corporation as contrary to public
policy. Accord, Fort Wayne Education Ass’n v. Fort Wayne Com‐
munity Schools, 753 N.E.2d 672, 677 (Ind. App. 2001) (the “re‐
fusal to enforce an arbitrator’s award under a collective
No. 21‐1423 13
bargaining agreement because it is contrary to public policy
is a specific application of the more general doctrine, rooted
in the common law that a court may refuse to enforce con‐
tracts that violate law or public policy,” quoting United Paper‐
workers International v. Misco, Inc., 484 U.S. 29, 42 (1987)).
In this case, the parties seem to agree that a court could not
have ordered a division of Donald’s retirement account be‐
cause the couple were not married, meaning that a court
would not have had the statutory powers of a court in a di‐
vorce proceeding. In considering how to interpret the arbitra‐
tion order here, we accept that premise. But the question
arises whether the arbitrator could have ordered division of
Donald’s retirement account. That would be a difficult ques‐
tion to answer. It poses a conflict between, on one hand, the
broad powers extended to arbitrators by one statute, and the
separate statute and important public policy protecting retire‐
ment accounts from being attached to pay debts, on the other.
Indiana cases do not draw sharp lines for the public policy
limits to arbitrators’ authority. The Indiana Court of Appeals
taught most recently: “Any such public policy must be ex‐
plicit, well‐defined, dominant, and ascertained by reference to
the laws and legal precedents and not from general consider‐
ations of supposed public interests.” Wright v. City of Gary, 963
N.E.2d 637, 651 (Ind. App. 2012) (reversing trial court’s deci‐
sion to vacate arbitration award), citing Eastern Associated Coal
Corp. v. United Mine Workers of America, Dist. 17, 531 U.S. 57,
62 (2000) (affirming enforcement of award that reinstated
truck driver who had twice tested positive for marijuana use,
and explaining the demanding standards for public‐policy ex‐
ception to enforcing arbitration awards). The protection of re‐
tirement savings from attachments to enforce money
14 No. 21‐1423
judgments may well satisfy those criteria, suggesting that any
arbitrator’s attempt to contravene that public policy would
need to be unmistakably clear. The arbitration award in this
case is not such a clear statement.2
One final issue: The arbitrator’s award also said that “this
judgment should not be dischargeable in bankruptcy.” That
language is not controlling. An arbitrator cannot determine
conclusively that an award is not dischargeable merely be‐
cause he wants that to be the case. Federal bankruptcy law
governs which debts are and are not dischargeable. See 11
U.S.C. § 523(a). An award will be non‐dischargeable if it meets
one of the statutory exceptions to discharge. The closest ex‐
ception here is § 523(a)(5), which prohibits discharge for
awards of domestic support, but only such support that goes
to the debtor’s spouse, former spouse, or child. The parties
stipulated in the bankruptcy court that the arbitration award
was not a domestic support obligation for purposes of
§ 523(a)(5), and for good reason; as a non‐spouse, Anne does
not meet the statutory requirements under the facts identified
by the arbitrator. See 11 U.S.C. § 101(14A) (defining “domestic
support obligation” for purposes of § 523(a)(5)).
2To illustrate further some of the potential complications, suppose a
company’s employment contract with a senior manager contains both an
arbitration clause and an unreasonably broad covenant not to compete af‐
ter the manager leaves the company. The manager resigns and goes into
competition in violation of the unreasonably broad covenant not to com‐
pete. Suppose then that an arbitrator issues an award both enforcing the
covenant and ordering forfeiture of the manager’s retirement account to
compensate the employer for its lost business. Would and should an Indi‐
ana court enforce such an award?
No. 21‐1423 15
To be sure, bankruptcy courts have exclusive jurisdiction
to decide the dischargeability of debts under §§ 523(a)(2),
(a)(4), and (a)(6), but not under the remaining exceptions to
discharge listed in § 523(a). For those, bankruptcy courts and
state courts exercise concurrent jurisdiction to determine
whether a debt is dischargeable. 3 Norton Bankruptcy Law &
Practice § 57:70 (3d ed. 2018). Where a prior tribunal has de‐
cided the issue of dischargeability within its own jurisdiction,
bankruptcy courts must give full faith and credit to that deci‐
sion if it meets the necessary requirements for issue preclu‐
sion under state law. See generally 4 Collier on Bankruptcy
¶ 523.06 (16th ed. 2021); see also National Wine & Spirits, Inc.
v. Ernst & Young, LLP, 976 N.E.2d 699, 704 (Ind. 2012) (“Issue
preclusion, or collateral estoppel, bars subsequent relitigation
of the same fact or issue where that fact or issue was neces‐
sarily adjudicated in a former lawsuit and that same fact or
issue is presented in a subsequent suit.”). That is not the case
here, however. Whether the award was a non‐dischargeable
support obligation for purposes of § 523(a)(5) was not actually
litigated in the prior proceeding.
For these reasons, we agree with the district court that the
arbitrator awarded Anne a money judgment, not a property
interest in Donald’s retirement account. The district court’s
judgment is AFFIRMED.