Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca8-15-01340/USCOURTS-ca8-15-01340-0/pdf.json

Parties Involved:
Stephanie Georgean Dittmaier
Appellant
Office of U.S. Trustee
Not Party
David A. Sosne
Appellee

Document Text:

United States Court of Appeals

For the Eighth Circuit

___________________________

No. 15-1340

___________________________

In re: Stephanie Georgean Dittmaier

lllllllllllllllllllllDebtor

------------------------------

Stephanie Georgean Dittmaier

lllllllllllllllllllllAppellant

v.

David A. Sosne

lllllllllllllllllllllAppellee

Office of U.S. Trustee

lllllllllllllllllllllU.S. Trustee

____________

Appeal from United States District Court 

for the Eastern District of Missouri - St. Louis

____________

 Submitted: September 24, 2015

 Filed: November 17, 2015

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Before WOLLMAN, BRIGHT, and COLLOTON, Circuit Judges.

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Appellate Case: 15-1340 Page: 1 Date Filed: 11/17/2015 Entry ID: 4337206 
BRIGHT, Circuit Judge.

Stephanie Dittmaier (Dittmaier) received an income tax refund for her 2012

federal and state income taxes (2012 income tax refund), including an earned income

tax credit (EIC), approximately five hours prior to filing for bankruptcy. The trustee

of the bankruptcy estate filed a motion to compel Dittmaier to turn over the 2012

income tax refund. The bankruptcy court exempted some of Dittmaier’s 2012 income

tax refund, but denied her claimed exemption of the EIC under Mo. Rev. Stat.

§ 513.430.1(10)(a). The bankruptcy court required Dittmaier to turn over the

unexempt portion of the 2012 income tax refund in the amount of $4,968.03. 

Dittmaier appealed and the district court affirmed. We affirm. 1

I. BACKGROUND

At approximately 3:35 p.m. on February 12, 2013, Dittmaier received the 2012

income tax refund. Dittmaier’s 2012 income tax refund included an EIC. 

Approximately five hours later, Dittmaier filed for relief under the United States

Bankruptcy Code.

The bankruptcy court appointed David Sosne (Trustee) as trustee for the

bankruptcy estate. On January 21, 2014, Trustee filed a motion to compel Dittmaier

to turn over the 2012 income tax refund. In response, Dittmaier amended her

bankruptcy schedules, including a modification to Schedule C asserting an exemption

of the EIC pursuant to Mo. Rev. Stat. § 513.430.1(10)(a). On February 27, 2014, the

bankruptcy court issued an order exempting some of Dittmaier’s 2012 income tax

refund, but denying Dittmaier’s claimed exemption of the EIC. The order required

Dittmaier to turn over $4,968.03 to Trustee.

The Honorable Carol E. Jackson, United States District Court for the Eastern District 1

of Missouri. 

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Dittmaier filed a motion to reconsider, which was denied. Dittmaier appealed

to the United States District Court for the Eastern District of Missouri. The district

court affirmed, holding section 513.430.1(10)(a) did not exempt Dittmaier’s EIC

because she received the EIC prior to filing for relief in bankruptcy court. Dittmaier

filed a timely appeal.

II. DISCUSSION

The sole issue presented in this case is one ofstatutory interpretation: Whether

a “public assistance benefit,” here an EIC, is exempt from the bankruptcy estate 2

pursuant to Mo. Rev. Stat. § 513.430.1(10)(a) when the “public assistance benefit”

is received by the debtor prior to filing for relief in bankruptcy court. We review the

bankruptcy court’s legal conclusions, including interpretations ofstate law, de novo.

JPMorgan Chase Bank, N.A. v. Johnson, 719 F.3d 1010, 1014 & n.2 (8th Cir. 2013).

As the Missouri Supreme Court has not interpreted the application of section

513.430.1(10)(a), “we must attempt to predict what [the Missouri Supreme Court]

would decide if faced with the issue.” In re Bargfrede, 117 F.3d 1078, 1080 (8th Cir.

1997) (per curiam). In so doing, we consider “relevant state precedent, analogous

decisions, considered dicta, . . . and any other reliable data.” Id. (alteration in

original) (quoting Ventura v. Titan Sports, Inc., 65 F.3d 725, 729 (8th Cir. 1995)).

Further, we apply Missouri’s rules of statutory construction when interpreting

Missouri statutes. See, e.g., In re Hardy, 787 F.3d 1189, 1192 (8th Cir. 2015). In

Missouri, “[t]he seminal rule of statutory construction is to ascertain the intent of the

legislature from the language used and to consider the words used in their plain and

ordinary meaning.” Mo. Beverage Co. v. Shelton Bros., 669 F.3d 873, 877 (8th Cir.

For the purpose of this appeal, the parties agree an EIC is a “public assistance 2

benefit” under Missouri law.

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2012) (alteration in original) (quoting St. Louis Cnty. v. Prestige Travel, Inc., 344

S.W.3d 708, 713-14 (Mo. 2011) (en banc)).

Section 513.430.1(10)(a) provides, as relevant here: “The following property

shall be exempt from attachment and execution to the extent of any person’s interest

therein: . . . (10) Such person’s right to receive . . . A Social Security benefit,

unemployment compensation or a public assistance benefit.” (Emphasis added). In

dispute is whether a “right to receive . . . a public assistance benefit” extinguishes

when the benefit isreceived by the debtor prior to filing for relief in bankruptcy court.

The Missouri Court of Appeals interpreted an earlier version of section

513.430.1(10)(a), concluding a “right to receive” funds does not include funds

already received by a debtor because funds already received “are [the debtor’s]

personal property and are no longer exempt from execution.” Fraser v. Deppe, 770

S.W.2d 479, 479 (Mo. Ct. App. 1989) (per curiam) (citing Owens v. Owens, 591

S.W.2d 57, 58 (Mo. Ct. App. 1979)). Under the Missouri Court of Appeals’ 3

Dittmaier cites Hatfield v. Cristopher, 841 S.W.2d 761, 767 (Mo. Ct. App.

3

1992) for the proposition that “Missouri Courts have interpreted a ‘right to receive’

to mean the right to use.” To the contrary, Hatfield specifically distinguished the

phrase “right to receive” in Mo. Rev. Stat. § 513.430.1(10)(a) and “none of the

moneys paid” in 42 U.S.C. § 407(a), concluding the latter “clearly exempts more than

just the right to receive social security benefits.” Id. For that reason, the Missouri

Court of Appeals reaffirmed thatfederal law preempted section 513.430.1(10)(a) with

respect to social security benefits. Id.

Dittmaier further argues the Missouri Court of Appeals’ interpretation of the

phrase “right to receive” is preempted by Mo. Sup. Ct. R. 90.07 and a form published

by the Missouri Supreme Court. Rule 90.07 states a garnishor must file written

interrogatories indicating whether funds already deposited could “[r]easonably [be]

identified as . . . exempt from garnishment pursuant to” section 513.430.1(10).

(Emphasis added). Rule 90.07 does not interpret section 513.430.1(10) but, instead,

requires garnishors to “identify” funds that may be exempt. Further, to the extent

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interpretation of a “right to receive,” the exemption of “public assistance benefit[s]”

under section 513.430.1(10)(a) terminates when monies are obtained prior to filing

the bankruptcy petition because the funds become the personal property ofthe debtor.

See id. The Missouri Court of Appeals’ interpretation is in agreement with federal

law and has been consistently applied by bankruptcy courts in Missouri. See, e.g.,

In re McCollum, 287 B.R. 750, 753 (Bankr. E.D. Mo. 2002) (“The ‘right to receive’

a benefit has been deemed to have been extinguished when payments or benefits have

already been received by a debtor before the bankruptcy case was commenced.”); In

re McGoy, 86 B.R. 174, 176 (Bankr. E.D. Mo. 1988) (“As a matter of law, the ‘right

to receive’ terminates upon receipt.”).

Further, the construction of Mo. Rev. Stat. § 513.430.1 shows the Missouri

legislature uses particular language when intending to exempt funds received by a

debtor prior to filing for relief in bankruptcy court. In paragraph 11 of the same

statute, the Missouri legislature provides:

The following property shall be exempt from attachment and execution

to the extent of any person’s interest therein: . . . [t]he debtor’s right to

receive, or property that is traceable to, a payment on account of the

wrongful death of an individual of whom the debtor was a dependent.

Mo. Rev. Stat. § 513.430.1(11) (emphasis added). Under Missouri principles of

statutory construction, we must presume the Missouri legislature acted intentionally

4

Rule 90.07 could be interpreted as contrary to the Missouri Court of Appeals’

interpretation of “right to receive,” the Missouri Constitution expressly prohibits

Missouri Supreme Court rules from “chang[ing] substantive rights” under laws

passed by the Missouri legislature. Mo. Const. Art. V § 5.

Dittmaier argues the statutory construction doctrines of noscitur a sociis and

4

ejusdem generis show the Missouri legislature intended to exempt public assistance

benefits received prior to the bankruptcy filing because both social security benefits

and unemployment compensation—which are listed in section

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when it included the language “property that is traceable to” in one portion of the

statute and omitted the language from another. See, e.g., Jantz v. Brewer, 30 S.W.3d

915, 918 (Mo. Ct. App. 2000) (“[T]he legislature is presumed . . . to act intentionally

when it includes language in one section of a statute but omits it from another.”).

Thus, we determine in this case that the language of Mo. Rev. Stat. 

§ 513.430.1(10)(a) does not exempt “public assistance benefit[s]” received by the

debtor prior to filing for relief in bankruptcy court. The parties do not dispute that

Dittmaier received the EIC prior to filing for bankruptcy. Accordingly, the district

court correctly affirmed the bankruptcy court’s conclusion that Dittmaier’s EIC funds

here were not exempt from the bankruptcy estate. We AFFIRM.

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513.430.1(10)(a)—received prior to the bankruptcy filing are exempted by other

statutes. Dittmaier’s argument is unpersuasive because section 513.430.1(10)(a)

treats social security, unemployment, and public assistance benefits the

same—meaning the statute only protects the “right to receive” the funds. In fact,

prior to the Missouri Court of Appeals’ acknowledgment that the federal Social

SecurityAct exempted socialsecurity benefits received prior to the bankruptcy filing,

the Missouri Court of Appeals held such funds were not exempt under Missouri law.

Fraser v. Deppe, 770 S.W.2d 479, 479 (Mo. Ct. App. 1989); see also Collins, Webster

& Rouse v. Coleman, 776 S.W.2d 930, 931-32 (Mo. Ct. App. 1989) (holding social

security benefits received prior to the bankruptcy filing were exempted under 42

U.S.C. § 407(a)). Thus, the fact that social security and unemployment benefits are

listed with public assistance benefits does not show a legislative intent to exempt

public assistance benefits received prior to filing for relief in bankruptcy court.

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