child support had been directed to a chapter thirteen trustee in a bankruptcy case with an unconfirmed plan that had been dismissed three points we believe demonstrate why there is no preemption here in the district court's judgment should be reverse first absent the bankruptcy code automatic state provisions the commonwealth has the undisputed right to serve orders to withhold on debtors as well as debtors of the debtor such as a bank or lawyer second because the automatic state provision terminates soon as a bankruptcy case mess the trustee was nothing more than that a debtor of the debtor in this case when the commonweal served with hole on continues in this case demonstrates why that's true is factual matter there were multiple unconfirmed plans in this case and under thirteen twenty six eighty two there may be an argument that a debtor make that the trustees obligate under thirteen twenty six to tu n the funds at each instance when the plan is unconfirmed but when a plan is unconfirmed it doesn't necessarily mean that the case is smiths in fact as we pointed out in our brief the principal concern that thirteen twenty six eighty two is after is what does the kyra's intended and the problem with the trustees argument in this case is that there is no bankruptcy case once it's dismissed it is over the automatic stay provisions are gone which is the hallmark of bankruptcy in the first place which is a creditors can't come in and  be approved it so it's all wrapped up inside the bankruptcy case thirteen twenty six eight two presupposes that there is one ongoing this is an anomalous case in the sense that was we put out a statistically you don't have as many that are  unconfirmed and there's no reason necessarily in this case that had to happen at same time you just have a situation where the bankruptcy case is over there is no signal from congress that danton did for the automatic stay provisions to continue to cover the of the trustee after the bankruptcy case it's just an instruction to the trustee now what you do with fines that you're holding partly i can get it harris when it's converted after seven for example sets the default rule inside bankruptcy for unconfirmed plans that that is the debtors property and it actually picks up on a unique feature of chapter thirteen itself which is the post petition income as part of the bankruptcy anyway it's not in chapter seven and that's sort of the distinguishing feature about harris where with reason it goes back to the debtors because that would have never been included in the bankruptcy estate in the first place because when you convert to chapter seven it's treated as if it started on the same day the chapter thirteen petition was filed so that sort of explains the outcome in harris and  what you do then i did pick up a sense from one of his questions about potential concerns that the barton doctrine idea of suing the trustee i would you want to touch on is that's not what's at issue here in this court's mcdaniel case there was an actual lawsuit filed against the trust ees there there is no such lawsuit here it's an order to withhold that the commonwealth has the right to serve under virginia law and then there would have to be a separate judicial suit if we ever tried to force that against the ninth trustee and that context the pardon doctrine may very well live but not on the front it and another point i think is important to respond to is the idea that the trustee is subject to personal liability for the full eighty thousand dollars issue here that the way the trustee put this in their brief they live seized out the intent portion of that virginia code section it isn't strict liability if you choose not to comply with or to withhold you have to make that decision to or for the benefit of the debtor it implies some sort of intent to help the general void their obligations not just strict liability you didn't  comes back and says we're right what's really critical is whether or not there's an ongoing bankruptcy case and we really do think this is an important distinction and i know it looks the case a very high level but the bankruptcy code is an entire package titles one three and five and the automatic stay comes from title three and it says explicitly that the dismissal the state terminates at the earlier of the case is closed or the dismissal of the case in a third provision that's not relevant here and so under the bankruptcy code itself was not firm on february and immediately the trustee knowing that the debtor was not going to file another one turn funds and it wasn't dismissed until the ninth we wouldn't be able to serve an order to withhold seven because the automatic stay would be in place we would be subject liability under three and what thirteen twenty six eighty two is principally concerned about is the payment of creditors under nine confirmed plans congress was making sure that the trustee knew that the obligation was to make payments consistent with a confirmed plan to choose georgia you're exactly right but there are exceptions to the ability to make payments out of bankruptcy because the bankruptcy estate exists as a solid in any until such time as you have a plank in from to pay creditors it's an exception to that the otherwise the trustee would not be able to make any payments at all out of bankruptcy state unless you had a confirmed plans with giving you an exception which you would not otherwise be able to make those payments would exist so it actually i think supports our argument that all of this is happening in the confines of the bankruptcy case itself because they are simply two fundamentally different things between planned confirmation or not and whether or not the case is extant and so because the trustee to return judge must i finish my answer because the trustee has the case was dismissed we would have been able to serve an order to withhold immediately on him and since the trustee has the same obligations in the absence of a bankruptcy case that would seem to control here and i do think it's important for me to highlight least one policy point it's important to the commonwealth because money is returned to the debtor in its proper cash we won't be able to access and this person here we believe is scanted to england and so this is a continuous problem for the commonwealth a very limited subset of cases the most again it's interesting that this issue has never arisen before it appears to be an issue of first impression this court you know closest analogous case that i'm aware of is from the first circuits bankruptcy appellate panel which read with a reading of the statute that what's critical here is the good morning my name is angela skull fluoro i am a staff attorney for her basket chapter thirteen standing trustee for the western district of virginia thank you for the opportunity for oral argument today i have full reasons i'm going to ask you to affirm the district court opinion i'd like to point out the description of the case on your docket today says that the funds that were returned were a return of child support payments i think that may be a typo on your description the funds that the trustee was holding the three thousand that he still holding were from post petition wages that the debtor was paying in on a monthly basis under the terms of his proposed plan those are the funds that were holding they've never ben and sorry dollars of many many eighty thousand just to the division many many tens of thousands of debt yes but the first thing i'd like to point out is as you mention the plain language of the statute it says the trustee shall return the funds to the debtor that is mandatory there's no discretion in trustee congress  d the code to balance rights of creditors and debtors sometimes it favors creditors sometimes it favors debtors as judge pointed out congress sets the scheme it says at dismissal funds go to the debtor that's the same similar language that the supreme court was reviewing in harris when it said conversion funds go to the debtor in harris the supreme court never mentioned the automatic stay the department makes a big deal that inherits the automatic stay was in place because he was converting from thirteen to seven it's true the automatic stay was in place but the supreme court never mentioned it i don't think it is i live in this case i don't think it was relevant in that case in that case the supreme court said y retain the funds intil confirmation or denial of confirmation and i think it's a practical issue that the court almost never denies confirmation in the thirteen years i've done this job i can only think of twice the judge has ever denied confirmation what happens most of the time which is what happened in this case on the docket is there for confirmation hearings confirmation is before the court the court never rules on confirmation the court didn't confirm a plan the court did not deny confirmation of a plan either so the beginning of thirteen twenty six says trustee holds of funds until confirmation or so i think that's why the later sentence in thirteen twenty six a two is a little more prot it says if a plan is not confirmed then return the money to the debtor because it has to incorporate w it's exactly what they did here you'll see in the record we file a trustees report that says we need these additional documents to convince us this plan works the trustees report in this record shows the documents we wanted to look at to try to evaluate it in this case they attempted to try to do some play and didn't work as you say they saw the writing on the wall and agreed to the dismissal of the fourth hearing so that's what happens most of the time we never get this scenario where there's this denial of confirmation and then they have to give the funds back right away we don't get a denial of confirmation we just get no substantive ruling who are hearing continued again and again so i think this idea that it's going to happen the the  first part of the statute says i have to hold the funds until confirmation or denial of confirmation that's what we're going to do and we're going to wait but the second sentence in thirteen twenty six is more broad so if it never gets confirmed give the money back to the debtor and that's what happened here never got confirmed never got denial of confirmation but it dismissal we give the money back to the debtor and that's what happened here i would also point out i would like to highlight the importance of this issue for the trustees office you saw the end of his brief signed by every chapter thirteen in the entire circuit because this is of concern to the trustees office the trustee as judge a g pointed out it creates your creature of statute he's not a corporation he's not a bank he is an individual pointed individually to perform the duties under the statute in thirteen zero two and the entire  personal liability the twenty three chapter thirteen trustees in this district have personal liability for every dime that comes in and out of his office in our office mr best in disperses more than two point four million dollars every month in more than forty four hundred open cases we are concerned about the race to the trustee judge connelly was concerned in the bankruptcy court opinion judge moon was concerned about it in the district court opinion the order to cold in those two cases which were just two thousand and fifteen in two thousand and seventeen the supreme court reiterate again what i call my six points debtor's fresh start very important it is a holy thirteen in particular is wholly voluntary that matters they come in they're trying to do their best cut them more slack chapter thirteen should benefit debtors and creditors not just debt creditors the importance of restoring the debtor to the pre partition financial status quo supreme court talked about that in harris and that was in poor and put them back how they were before the case was filed but there's no code provision that classifies property  belonging to the creditor the creditor doesn't have a right to any of the property he just has with the code provides any and the supreme court wasn't concerned at all about this argument that there would be a windfall by giving this money back to the debtor that's the concern right i mean use eighty thousand dollars in child support we don't hand him three thousand dollars but the supreme court in harris addressed head on the fifth circuit based part of its ruling on its concern about debtor back money but the supreme court said we're not worried about the windfall and all it's not of concern to us because of these reasons because coming into thirteen is voluntary because it should benefit both because we have to put him back the way because the statute says what to do in harris three forty eight f says this post petition wages is not property of the converted seven estate it's what congress said it's not so they don't go to the creditor they go back to the debtor even though there are a lot of creditors that would like in this case thirteen twenty six says when it's over give the money back to the debtor that's what the statute says that's the balance congress made so that's what bankruptcy court said in the district court said i'm asking thirteen twenty six addresses and the department wants to say there's no case anymore it's done once it's just missed there's no case well then why would thirteen twenty six tell me what to do when no plan ever gets confirmed it's a plan isn't confirmed the case is over i mean if a court actually ruled on confirmation and denied confirmation the core enters in order to are the court enters in order to amend the plane and under the thirteen twenty six eighty three that's what's going to happen and if that doesn't happen that's when thirteen twenty six says trustee is the funds the debtor that's the it doesn't tell me what to do with these funds thirteen twenty six tells me what to do with these funds i mean just like in harris the fact that there was an automatic stay the supreme court did not say there's not a magic stay  nobody can go after this dead or nobody else can see these funds there's an automatic stay so the debtor gets the funds no they said three forty eight after says these are property the seven estates of the debtor gets similar here may not i don't think it matters that there's no way i agree with the department that once a case is dismissed and there's no stay they can pursue the many remedies they have they could have the debtor they could have garnished the debtors employer they could've  this absurd result argument is once the stay is lifted once the case is dismissed that's the time that's when the trustee cuts the check and gives it back to the debtor and the who of who we cut the check to in that's the trust checked do we cut the check to the debtor under thirteen twenty six or do we cut the check to the commissioner under the state statute who do we cut the checked and so his his point is thirteen twenty six shouldn't if we give it to them and we shouldn't have we're in their argument in their reply brief so after we give the money to the debtor and after they sue the trustee and after they try to hold him liable penny and i'll tell you what the trustees going to do we're going to file a motion from the bankruptcy judge and say who are we pay in your honor and then somebody is going to be figuring out is this preempted by the supremacy clause it's the i r s there's n supremacy clause well but who's was first is that matter i mean those are the arguments but is enough to figure out and look at it we're going to file the motion asked judge conley and then she's going to have to tell us we're not i think it is a much simpler course the department says this hasn't really come up well i can assure you people have hauled about garnishing us and we've suggested that we're not really subject to garnishment that's been our line the whole time i've been there most people honor that we usually dismiss we dispersed once a month so usually the money's gone before they're calling us often sometimes the debtor last cut the check to somebody we can't even do that our position has always been thirteen twenty six says when it's dismissed we have to cut the check to the debtor and our auditors are going to ask us why we didn't if we didn't so when it's dismissed we cut the check to the debtor in the in the what the shields case quoted quite a bit by the department in that case the bankruptcy who were really struggled and a lot of language the department thought was helpful but at the end of that case the bankruptcy court said cut the check to the debtor when you don't hold the money till you get confirmation or denial of confirmation that doesn't happen which it didn't if the case is dismissed thirteen twenty six broader language plan didn't get confirmed if the money backed the d that's been our practice that's what the two lower courts said that's what we're asking you to rule in today's case thank you thank you  entirely so it just doesn't come up in that context when i wanted to make is the organ from the trustee that the goal of bankruptcy provision which we agree with is to put everybody back in the status quo before the case was filed the problem here is that he would have met the debt are we not had this money from garnishment but for the fact that he filed chapter thirteen the idea that he could have accrued three thousand dollars without having been levied by the division or some other creditor in the absence of bankruptcy is just not critical is the fact the bankruptcy case is ongoing and during the trustees argument i continuously heard the blending of the words dismissal and plant confirmation they are not the same thing i think if the court looks at all the bankruptcy cases around th what judge wants what i heard is that once the dismissal dismissal thirteen twenty six eight two tells you where the money should go but that is simply not what the statute says statute uses the word plan confirmation and it is a once the case is dismissed nothing in title will leaven of the united states code plies from our view and that's why the lawsuit here should be controlled by the state thank you very big fish on we will ask our clerk to join court and then come