*District Judge of the Northern District of Mississippi,

sitting by designation.

 

**Local Rule 47.5 provides: "The publication of opinions that

have no precedential value and merely decide particular cases on

the basis of well-settled principles of law imposes needless

expense on the public and burdens on the legal profession."

Pursuant to that Rule, the Court has determined that this opinion

should not be published.

UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 93-2070

IN THE MATTER OF: FRED AUGUST QUENZER and JAMIE QUENZER,

 Debtors.

FRED AUGUST QUENZER and

JAMIE QUENZER,

Appellants,

versus

UNITED STATES OF AMERICA,

Appellee.

Appeal from the United States District Court

for the Southern District of Texas

(CA H 92 905)

 (November 30, 1993) 

Before POLITZ, Chief Judge, and HIGGINBOTHAM, Circuit Judge, and

DAVIDSON*, District Judge.

POLITZ, Chief Judge:**

Fred August Quenzer and Jamie Quenzer appeal an adverse
 

1In the bankruptcy court the parties stipulated that: (1) all

tax, interest, and penalties for 1979 and 1980 were dischargeable;

(2) the tax return assessments for 1981-1983 were dischargeable;

(3) the audit deficiency assessments for 1981-1984 were not

dischargeable; and (4) the penalties and interest on penalties

based upon the return assessments for 1981-1983 were dischargeable.

2

summary judgment affirming a ruling by the bankruptcy court that

certain taxes, penalties, and interest were not discharged.

Concluding that the government's action is time barred we reverse

and render judgment in favor of the Quenzers.

Background

The essential facts are not in dispute. In September 1986 the

Quenzers filed a Chapter 13 petition which was converted to a

Chapter 7 and voluntarily dismissed in March 1988. In March 1990

they filed a Chapter 7 petition in bankruptcy and their discharge

was entered in July 1990.

The instant dispute involves the dischargeability of the

Quenzers' 1984 and 1985 tax return liability. The record reflects

stipulations regarding all other tax, interest, and penalty

claims.1 The bankruptcy court found all assessments and penalties

nondischargeable. On the appeal to the district court the

government conceded that the penalties and interest thereon for the

1984 and 1985 returns were dischargeable. The district court

inadvertently overlooked this and ruled that these were

nondischargeable. The government candidly concedes that these

penalties, and the interest thereon, are dischargeable as arising

from events occurring more than three years prior to the filing of
 

2397 U.S. 471, 90 S.Ct. 1153, 25 L.Ed.2d 491 (1970).

 

3397 U.S. at 475 n.6.

3

the subject petitions. 11 U.S.C. § 523(a)(7).

Analysis

This appeal focuses on the tax deficiencies for 1984 and 1985.

In the district court the government successfully relied on the

suspension provision in section 108(c) of the Bankruptcy Code as

the basis for tolling the priority period for the collection of

taxes during the prior bankruptcy proceedings. Under the plain

language of section 108(c), however, that suspension applies only

to nonbankruptcy law and nonbankruptcy proceedings. Absent some

other basis for tolling the section 507 time limit, the Quenzers'

tax liability for the years 1984 and 1985 must be discharged.

In apparent recognition that the plain language of 11 U.S.C.

§§ 507 and 108(c) gives no support to the rulings a` quo, the

government urges us to exercise the equitable tolling powers

granted by section 105(a) of the Bankruptcy Code and extend the

period for its collection efforts. In support of this suggestion

the government invites our review of Dandridge v. Williams,

2 which

holds that a prevailing party may urge legal grounds for a ruling

that were not relied on by the trial court. A close reading of

Dandridge reflects that the arguments presented to the Supreme

Court had been "fully argued . . . in the district court."3 That

is not the case herein.

Typically, we will not consider on appeal matters not
 

4See Singleton v. Wulff, 428 U.S. 106, 121, 49 L.Ed.2d 826,

837, 96 S.Ct. 2868 (1976); In re Gilchrist, 891 F.2d 559, 561 (5th

Cir. 1990).

 

5In Taylor v. Freeland & Kronz, 112 S.Ct. 1644, 1649 (1992),

a debtor suggested equitable tolling under section 105(a) for the

first time in his opening brief to the Court. The issue was not

properly before the Court since it was not raised in a lower court

and was not set forth in the petition for certiorari. Id.

 

6Hecht Co. v. Bowles, 321 U.S. 321, 329-30 (1944)

(Douglas, J.).

 

7Lemon v. Kurtzman, 411 U.S. 192, 200 (1973).

4

presented to the trial court.4 The Supreme Court recently

"decline[d] to consider § 105(a)" of the Bankruptcy Code because it

was raised in disregard of the fabric of this rubric.5 This

principle applies with even more force when we address questions of

the proper exercise of the equitable powers of the court, either

inherent or statutorily granted.

Equitable considerations are largely fact-driven. "The

essence of equity jurisdiction has been the power of the Chancellor

to do equity and to mould each decree to the necessities of the

particular case."6 Full development and examination of the facts

and the relative positions of the parties are imperative in the

exercise of the court's equitable powers. Necessarily, "[i]n

shaping equity decrees the trial court is vested with broad

discretionary power; appellate review is correspondingly narrow."7

Determining equities in the first instance is seldom fit grist for

the appellate mill.

The record before us is devoid of any factual findings by the

bankruptcy or district courts which would justify the exercise of
5

equitable powers to extend the time for the government's tax

collection efforts. We decline, therefore, the government's

invitation that we base an affirmance thereon.

The judgment of the district court is REVERSED and judgment in

favor of the Quenzers is RENDERED declaring the questioned taxes,

interests, and penalties to be discharged in bankruptcy.