well this case is about whether mr rizzo's personal liability for the unpaid michigan single business tax of the company which he had a significant ownership interest in jefferson beach properties was discharging his personal bankruptcy case  the issues that were presented for appeal are you know whether the bankruptcy court erred in holding that the single business tax which is a tax assessor by the state of michigan against businesses which has since been repealed or voice up just a little please i'm sorry or whether the single business tax assessed to the business owned by mr result was an excise tax as to him personally and a whether it renders his liability for the single business tax under michigan law not just charitable in his bankruptcy case you can see that it was an excise tax i can see the single business tax all three guards to that issue michigan law determines what what what the excise tax attributes or state law determines it and for that i cite to the united health care case you as to the entity that is assessed against a how does that work on i'm i'm i'm trying to ok you know tell me how that works well first of all you know there's three reasons why the single business tax is not an excise tax system mr result personally first state law determines an excise tax attributes and that's the united health care case out of the third circuit in two thousand and five second michigan law as determined michigan law determines that the s  business activity is defined as a transfer of title to property with the object of the gain direct or indirect to the taxpayer and again trying over makes that proposition and its sights directly to michigan it subsequently sold those assets which triggered a single business tax liability against the business mr rizzle the individual who owned about half of the company forty five percent of it he didn't sell anything he didn't gauge in any michigan law for that he's liable for the failure of the entity to pay the tax is responsible for the excess he's responsible for the company's failure to pay the excise tax but is it an excise tax as to him and my argument is it is not and so my point is he didn't engage in any business activity he he just was a victim of the foreclosure sale and and as a result of the sale of the assets by its lender he didn't do what he didn't want done it was done in voluntarily this single business tax arose  and so yeah he's liable for the company's failure to pay it but that doesn't mean it's an excise tax as to him individually that's my argument you know and he actually did make that distinction or to just say that excise taxes are not discharge has to use his two subparts one it refers to five zero seven eight which is the set of priority taxes that are not dischargeable in a list seven different taxes one of which is excise tax another one of which is property tax and another one is withholding tax that was collected but not paid over and that that whole laundry list of taxes  is excepted from this charge and so the bankruptcy code says all those taxes are not dischargeable but one of those items in that list specifically says that the debtor is not liable for the debt or does not receive a discharge for if he's liable for in whatever capacity none of the other six sub taxes that are listed in five of the seven which are referred to in five twenty three have that it's not carved up and so why would congress say you're liable for payroll withholding taxes regardless of whatever capacity  completely disregard the capacity argument with respect to the other taxes such as excise taxes or property taxes there has to be a reason for that so that's why i believe that that statutory construction argument is important and if we don't read it that way essentially it makes that language unnecessary under the withholding tax portion of five zero seven if you have any authority for your position while i have the statutory construction argument that it just makes sense the cases you know it's always it's a new it's a new argument you know there's none yet and yet there's not yeah that doesn't mean there shouldn't be and you know it's absolutely novel issue i believe and if if if that's the case then what was the point of adding that liable in whatever capacity under five zero seven eight c is meaningless if you have any legislative history as to why over you know to the to the i r s and and to tell all hell held and that's on page two seventy eight and seventy nine of that opinion that congress this perception of the consequences of a corporate bankruptcy makes it most unlikely that the legislature intended section seventeen a one day of the bankruptcy act to apply only to the corporations liability for unpaid withholding taxes because corporate dissolution has practical effect of discharging all taxes and that result would directly be inconsistent with con congress's declaration that the investments to that same section of bankruptcy at met the department's concern about insuring post bankruptcy liability for these withholding taxes so the telo specifically dealt with it with olding taxes and when congress enacted the bankruptcy code four years later in hundred two they were very concerned about that and that was one of the reasons why they included that language in five hundred seventy eight c when included under the excise tax section so to me that was the company is liable for the failure it's the failure to file the return or to pay the tax which basically puts him into a barren tore position he's liable for the unpaid dollars it's almost like he's he's the with the company if the company doesn't do it you have to pay it but it's not an excise tax as to him because he didn't engage in the business activity he just happened to own the business this is basically piercing the corporate veil and making the well that's what that's what they that's what they did but and they and he is liable for the dollars the question is once he files bankruptcy the rules change it's a different world we have a n exception carved out and i mean we have a list of taxes carved out that the debtors non discharge that the debtor does not receive a discharge for however there's seven items in that list and only one of them makes it whatever capacities and the other ones don't so my feeling is you know they don't really apply they apply to the actual tax payer he's not the actual tax payer he's the  apartment a treasury appellant spends much of his brief and today's argument stressing the importance of statutory construction principles this case is so simple that there's no need to employ statutory construction principles and if you look at that code section it very clearly states that an end of a jewel doctor is not discharge from any debt any debt is the phrase and then it references of the kind listed in five zero seven eight  eight there is a restriction that's where the restrictive nature comes in but before you even get there under five twenty three you're looking at the any debt there's no language that says any dat that originally accrued to the debtor or this doesn't there's absolutely no language or no statutory requirement that it be a debt that originally accrued to the debt or there's no restriction or no limitation on that it simply says that the x i i if it's an excise tax on a transaction for purposes of fi seventy eight which is undisputed at this point in this case that the single listed business tax is in fact an excess tax on a transaction it's not dischargeable plain and simple yes but you're attributing to your opponent an argument he's not making i mean his argument is not that his argument is that his client must be directly liable in order for this to be non dischargeable under the code and he  draws an inference from another exception to discharge which is that exception applies regardless of what capacity the debtor takes on that debt directly or indirectly so i mean why isn't he correct in saying that we ought to construe the other provisions only to involve call it reference to the essential character of the underlying tax changes whether the assessment is against the company directly or if it's the derivative liability for the corporate officer in this case mr result sotelo in fact explicitly stands for the proposition that the underlying tax nature does not change even the use of the word penalties in the i r c the court still determined that hey they might have used the word penalty but at the crux of the case at the end of the day there and being held responsible for the failure to pay the tax it's actually the tax regardless of the language the underlying assessment doesn't change in this case mr rizzo is assessed for single business tax liabilities he was notified of that by treasury he did not appeal those assessments at any point in time and never argue that hey i might be liable for the money paid but i'm not liable for an excise tax those arguments were never made to try to make those arguments today i think is extending it in frankly allowing for a misapplication of sotelo counsel references the language whatever capacity that's included in subsection c that's nothing more than the codification of the actual holding and sotelo which dealt with the facts of the case withholding taxes withholding taxes exclusively reference t indicate that the supreme court found some tallow even under the principles of derivative liability responsible for his company's beholding taxes under a version of the bankruptcy code that didn't include in whatever capacity so the hotel decision itself stands for the and given the timing of the tell it was clearly in the forefront of people's minds with respect to the bankruptcy code changes ok it's my understanding that the single business taxes has been repealed and replaced by something else that is correct and the tax that  of this is this the issue here is an issue of first impression there is no authority on those and often will publish cases that are issues of first impression however once i learn that we don't the corporate income tax issues especially with respect to bankruptcy cases issues regarding surrounding single business sacks and subsequently the michigan business tax still come up very frequently very regularly it would be helpful with either way the court finds in this particular case to provide guidance for those of us who are dealing with us regularly inside and day at that stage of what i want to  for there are not at all your honor just simply again a reference that this case is really one that's very simple you need simply to look at five twenty three a one and then reference five zero seventy eight and it's it's clear that the bankruptcy court the district court thank you your honor i'm just going to address the on ambiguous part of the interaction between section five twenty three of the bankruptcy code and five zero seven if you look at five o two if you look at five o seven as i said earlier there's a list of seven taxes listed if you just and if you look at five twenty three it refers to that section of  seven taxes it says any of the taxes listed in five zero seven eight or nine dischargeable and that list an eight as those seven taxes so if you just look at five twenty three and five zero seven eight sub which deals with excise taxes ok it's on ambiguous but can you just stop there you know can you stop at that plain language or do you have to consider other canons of statutory construction when you're considering it and those at renders the language in five of seven eight c's superfluous regarding the liable in whatever capacity so that's one problem the second problem is you have to look at the statute construction and if there isn't any and if there isn't any ambiguity in determining whether an exception to discharge should be granted there is substantial case law is that that ambiguity has to be resolved in favor of the debtor as opposed to the creditor and exemptions i'm talking about exceptions to discharge if there is if there is an ambiguity to whether an exception to discharge should be granted it's supposed to be construed in favor of the debtor that the ambiguity if it's a close call it goes the debtors way so i don't believe i believe if you just look at it very narrowly and that linkage is it's ambiguous but if you look at it and take a step back and look at the other can