Cite as: 538 U. S. 314 (2003)
Thomas, J., dissenting
Based on the sweeping language of the general release, it is inaccurate for the Court to say that the parties did not "resolve the issue of fraud." Ante, at 317. To be sure, as in Brown, there is no legally controlling document stating that respondent did (or did not) commit fraud. But, unlike in Brown, where it was not clear which claims were being resolved by the consent judgment, the release in this case clearly demonstrates that the parties intended to resolve conclusively not only the issue of fraud, but also any other "right[s], claim[s], or demand[s]" related to the state-court litigation, "excepting only obligations under [the] Note and deeds of trust." 1 App. 67. See McNair v. Goodwin, 262 N. C. 1, 7, 136 S. E. 2d 218, 223 (1964) (" '[A] compromise agreement is conclusive between the parties as to the matters compromised' " (quoting Penn Dixie Lines v. Grannick, 238 N. C. 552, 556, 78 S. E. 2d 410, 414 (1953))).
The fact that the parties intended, by the language of the general release, to replace an "old" fraud debt with a "new" contract debt is an important distinction from Brown, for the text of the Bankruptcy Code prohibits discharge of any debt "to the extent obtained by" fraud. 11 U. S. C. § 523(a)(2) (emphasis added). In interpreting this provision, the Court has recognized that, in order for a creditor to establish that a debt is not dischargeable, he must demonstrate that there is a causal nexus between the fraud and the debt. See Cohen v. de la Cruz, 523 U. S. 213, 218 (1998) (describing § 523(a)(2)(A) as barring discharge of debts " 'resulting from' " or " 'traceable to' " fraud (quoting Field v. Mans, 516 U. S. 59, 61, 64 (1995))). Indeed, petitioners conceded at oral argument that the "obtained by" language of § 523(a)(2) requires a creditor to prove that a debtor's fraud is the proximate cause of the debt. Tr. of Oral Arg. 10, 12; see also 1 Am. Jur. 2d, Actions § 57, p. 760 (1994) ("What is essential is that the wrongful act charged be the proximate cause of the
1 There are no allegations that petitioners were fraudulently induced to execute the settlement agreement or the general release.
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