Union Calendar No. 188

105TH CONGRESS

1ST SESSION H. R. 764

[Report No. 105–324]

A BILL

To make technical corrections to title 11, United

States Code, and for other purposes.

OCTOBER 21, 1997

Reported with an amendment, committed to the Commitordered to be printed tee of the Whole House on the State of the Union, and
IB

Union Calendar No. 188

105TH CONGRESS

1ST SESSION H. R. 764

[Report No. 105–324]

To make technical corrections to title 11, United States Code, and for other

purposes.

IN THE HOUSE OF REPRESENTATIVES

FEBRUARY 13, 1997

Mr. HYDE (for himself, Mr. GEKAS, and Mr. MCCOLLUM) introduced the

following bill; which was referred to the Committee on the Judiciary

OCTOBER 21, 1997

Reported with an amendment, committed to the Committee of the Whole

House on the State of the Union, and ordered to be printed

[Strike out all after the enacting clause and insert the part printed in italic]

[For text of introduced bill, see copy of bill as introduced on February 13, 1997]

A BILL

To make technical corrections to title 11, United States

Code, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Bankruptcy Amend5 ments of 1997’’.
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1 SEC. 2. DEFINITIONS.

2 Section 101 of title 11, United States Code, is amend3 ed—

4 (1) by striking ‘‘In this title—’’ and inserting

5 ‘‘In this title:’’,

6 (2) in each paragraph by inserting ‘‘The term’’

7 after the paragraph designation,

8 (3) in paragraph (35)(B) by striking ‘‘para9 graphs (21B) and (33)(A)’’ and inserting ‘‘para10 graphs (23) and (35)’’,

11 (4) in paragraphs (35A) and (38) by striking ‘‘;

12 and’’ at the end and inserting a period,

13 (5) in paragraph (51B)—

14 (A) by inserting ‘‘who is not a family farm15 er’’ after ‘‘debtor’’ the first place it appears, and

16 (B) by striking ‘‘$4,000,000’’ and inserting

17 ‘‘$15,000,000 as of the date of the filing of the

18 petition’’,

19 (6) by amending paragraph (54) to read as fol20 lows:

21 ‘‘(54) The term ‘transfer’ means—

22 ‘‘(A) creation of a lien;

23 ‘‘(B) retention of title as a security interest;

24 ‘‘(C) foreclosure of the debtor’s equity of re25 demption; or
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1 ‘‘(D) every mode, direct or indirect, absolute

2 or conditional, voluntary or involuntary, of dis3 posing of or parting with property or with an

4 interest in property;’’,

5 (7) in paragraphs (1) through (35), in para6 graphs (36) and (37), and in paragraphs (40)

7 through (55), including paragraph (54) as added by

8 this section, by striking the semicolon at the end and

9 inserting a period, and

10 (8) by redesignating paragraphs (4) through

11 (55), including paragraph (54) as added by this sec12 tion, in entirely numerical sequence.

13 SEC. 3. ADJUSTMENT OF DOLLAR AMOUNTS.

14 Section 104 of title 11, United States Code, is amended

15 by inserting ‘‘522(f)(3),’’ after ‘‘522(d),’’ each place it ap16 pears.

17 SEC. 4. EXTENSION OF TIME.

18 Section 108(c)(2) of title 11, United States Code, is

19 amended by striking ‘‘922’’ and all that follows through

20 ‘‘or’’, and inserting ‘‘922, 1201, or’’.
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1 SEC. 5. PENALTY FOR PERSONS WHO NEGLIGENTLY OR

2 FRAUDULENTLY PREPARE BANKRUPTCY PE3 TITIONS.

4 Section 110(j)(3) of title 11, United States Code, is

5 amended by striking ‘‘attorney’s’’ and inserting

6 ‘‘attorneys’ ’’.

7 SEC. 6. LIMITATION ON COMPENSATION OF PROFESSIONAL

8 PERSONS.

9 Section 328(a) of title 11, United States Code, is

10 amended by inserting ‘‘on a fixed or percentage fee basis,’’

11 after ‘‘hourly basis,’’.

12 SEC. 7. COMPENSATION TO OFFICERS.

13 Section 330(a) of title 11, United States Code, is

14 amended—

15 (1) in paragraph (1) by inserting ‘‘, or the debt16 or’s attorney’’ after ‘‘1103’’, and

17 (2) in paragraph (3) by striking ‘‘(3)(A) In’’

18 and inserting ‘‘(3) In’’.

19 SEC. 8. SPECIAL TAX PROVISIONS.

20 Section 346(g)(1)(C) of title 11, United States Code,

21 is amended by striking ‘‘, except’’ and all that follows

22 through ‘‘1986’’.

23 SEC. 9. EFFECT OF CONVERSION.

24 Section 348(f)(2) of title 11, United States Code, is

25 amended by inserting ‘‘of the estate’’ after ‘‘property’’ the

26 first place it appears.
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1 SEC. 10. AUTOMATIC STAY.

2 Section 362(b) of title 11, United States Code, is

3 amended—

4 (1) in paragraph (17) by striking ‘‘or’’ at the

5 end,

6 (2) in paragraph (18) by striking the period at

7 the end and inserting ‘‘; or’’, and

8 (3) by adding at the end the following:

9 ‘‘(19) under subsection (a) of this section, of any

10 transfer that is not avoidable under section 544 and

11 not avoidable under section 549.’’.

12 SEC. 11. EXECUTORY CONTRACTS AND UNEXPIRED LEASES.

13 Section 365 of title 11, United States Code, is amend14 ed—

15 (1) in subsection (b)(2)—

16 (A) in subparagraph (C) by striking ‘‘or’’

17 at the end, and

18 (B) by striking subparagraph (D) and in19 serting the following:

20 ‘‘(D) the satisfaction of any penalty rate or

21 penalty provision relating to a default arising

22 from a failure to perform nonmonetary obliga23 tions under an executory contract or under an

24 unexpired lease of real or personal property;

25 ‘‘(E) the satisfaction of any provision (other

26 than a penalty rate or penalty provision) relat-
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1 ing to a default arising from any failure to per2 form nonmonetary obligations under an

3 unexpired lease of real property, if it is impos4 sible for the trustee to cure such default by per5 forming nonmonetary acts at and after the time

6 of assumption; or

7 ‘‘(F) the satisfaction of any provision (other

8 than a penalty rate or penalty provision) relat9 ing to a default arising from any failure to per10 form nonmonetary obligations under an execu11 tory contract, if it is impossible for the trustee

12 to cure such default by performing nonmonetary

13 acts at and after the time of assumption and if

14 the court determines, based on the equities of the

15 case, that paragraph (1) should not apply with

16 respect to such default.’’,

17 (2) in subsection (c)—

18 (A) in paragraph (2) by adding ‘‘or’’ at the

19 end,

20 (B) in paragraph (3) by striking ‘‘; or’’ at

21 the end and inserting a period, and

22 (C) by striking paragraph (4),

23 (3) in subsection (d)—

24 (A) by striking paragraphs (5) through (9),

25 and
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1 (B) by redesignating paragraph (10) as

2 paragraph (5).

3 (4) in subsection (f)(1) by striking ‘‘; except

4 that’’ and all that follows through the end of the para5 graph and inserting a period.

6 SEC. 12. AMENDMENT TO TABLE OF SECTIONS.

7 The table of sections for chapter 5 of title 11, United

8 States Code, is amended by striking the item relating to

9 section 556 and inserting the following:

‘‘556. Contractual right to liquidate a commodities contract or forward contract.’’.

10 SEC. 13. ALLOWANCE OF ADMINISTRATIVE EXPENSES.

11 Section 503(b)(4) of title 11, United States Code, is

12 amended by inserting ‘‘subparagraph (A), (B), (C), (D), or

13 (E) of ’’ before ‘‘paragraph (3)’’.

14 SEC. 14. PRIORITIES.

15 Section 507(a) of title 11, United States Code, is

16 amended—

17 (1) in paragraph (3)(B) by striking the semi18 colon at the end and inserting a period, and

19 (2) in paragraph (7) by inserting ‘‘unsecured’’

20 after ‘‘allowed’’.

21 SEC. 15. EXEMPTIONS.

22 Section 522 of title 11, United States Code, is amend23 ed—

24 (1) in subsection (f)(1)(A)(ii)(II)—
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1 (A) by striking ‘‘includes a liability des2 ignated as’’ and inserting ‘‘is for a liability that

3 is designated as, and is actually in the nature

4 of,’’, and

5 (B) by striking ‘‘, unless’’ and all that fol6 lows through ‘‘support.’’, and

7 (2) in subsection (g)(2) by striking ‘‘subsection

8 (f)(2)’’ and inserting ‘‘subsection (f)(1)(B)’’.

9 SEC. 16. EXCEPTIONS TO DISCHARGE.

10 Section 523 of title 11, United States Code, is amend11 ed—

12 (1) in subsection (a)(3) by striking ‘‘or (6)’’ each

13 place it appears and inserting ‘‘(6), or (15)’’,

14 (2) as amended by section 304(e) of Public Law

15 103–394 (108 Stat. 4133), in paragraph (15) by

16 transferring such paragraph so as to insert it after

17 paragraph (14) of subsection (a),

18 (3) in paragraph (9) by inserting ‘‘, watercraft,

19 or aircraft’’ after ‘‘motor vehicle’’,

20 (4) in subsection (a)(15), as so redesignated by

21 operation of paragraph (2), by inserting ‘‘to a spouse,

22 former spouse, or child of the debtor and’’ after

23 ‘‘(15)’’,

24 (5) in subsection (a)(17)—
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1 (A) by striking ‘‘by a court’’ and inserting

2 ‘‘on a prisoner by any court’’,

3 (B) by striking ‘‘section 1915 (b) or (f)’’

4 and inserting ‘‘subsection (b) or (f)(2) of section

5 1915’’, and

6 (C) by inserting ‘‘(or a similar non-Federal

7 law)’’ after ‘‘title 28’’ each place it appears, and

8 (6) in subsection (e) by striking ‘‘a insured’’ and

9 inserting ‘‘an insured’’.

10 SEC. 17. EFFECT OF DISCHARGE.

11 Section 524(a)(3) of title 11, United States Code, is

12 amended by striking ‘‘section 523’’ and all that follows

13 through ‘‘or that’’, and inserting ‘‘section 523, 1228(a)(1),

14 or 1328(a)(1) of this title, or that’’.

15 SEC. 18. PROTECTION AGAINST DISCRIMINATORY TREAT16 MENT.

17 Section 525(c) of title 11, United States Code, is

18 amended—

19 (1) in paragraph (1) by inserting ‘‘student’’ be20 fore ‘‘grant’’ the second place it appears, and

21 (2) in paragraph (2) by striking ‘‘the program

22 operated under part B, D, or E of’’ and inserting

23 ‘‘any program operated under’’.
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1 SEC. 19. PROPERTY OF THE ESTATE.

2 Section 541(b)(4)(B)(ii) of title 11, United States Code

3 is amended by inserting ‘‘365 or’’ before ‘‘542’’.

4 SEC. 20. LIMITATIONS ON AVOIDING POWERS.

5 Section 546 of title 11, United States Code, is amended

6 by redesignating the second subsection (g) as subsection (h).

7 SEC. 21. PREFERENCES.

8 Section 547 of title 11, United States Code, is amend9 ed—

10 (1) in subsection (b) by striking ‘‘subsection (c)’’

11 and inserting ‘‘subsections (c) and (h)’’, and

12 (2) by adding at the end the following:

13 ‘‘(h) If the trustee avoids under subsection (b) a secu14 rity interest given between 90 days and 1 year before the

15 date of the filing of the petition, by the debtor to an entity

16 that is not an insider for the benefit of a creditor that is

17 an insider, then such security interest shall be considered

18 to be avoided under this section only with respect to the

19 creditor that is an insider.’’.

20 SEC. 22. POSTPETITION TRANSACTIONS.

21 Section 549(c) of title 11, United States Code, is

22 amended—

23 (1) by inserting ‘‘an interest in’’ after ‘‘transfer

24 of’’,

25 (2) by striking ‘‘such property’’ and inserting

26 ‘‘such real property’’, and
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1 (3) by striking ‘‘the interest’’ and inserting

2 ‘‘such interest’’.

3 SEC. 23. SETOFF.

4 Section 553(b)(1) of title 11, United States Code, is

5 amended by striking ‘‘362(b)(14)’’ and inserting

6 ‘‘362(b)(17)’’.

7 SEC. 24. DISPOSITION OF PROPERTY OF THE ESTATE.

8 Section 726(b) of title 11, United States Code, is

9 amended by striking ‘‘1009,’’.

10 SEC. 25. GENERAL PROVISIONS.

11 Section 901(a) of title 11, United States Code, is

12 amended by inserting ‘‘1123(d),’’ after ‘‘1123(b),’’.

13 SEC. 26. APPOINTMENT OF ELECTED TRUSTEE.

14 Section 1104(b) of title 11, United States Code, is

15 amended—

16 (1) by inserting ‘‘(1)’’ after ‘‘(b)’’, and

17 (2) by adding at the end the following new para18 graph:

19 ‘‘(2)(A) If an eligible, disinterested trustee is elected

20 at a meeting of creditors under paragraph (1), the United

21 States trustee shall file a report certifying that election.

22 Upon the filing of a report under the preceding sentence—

23 ‘‘(i) the trustee elected under paragraph (1) shall

24 be considered to have been selected and appointed for

25 purposes of this section, and
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1 ‘‘(ii) the service of any trustee appointed under

2 subsection (d) shall terminate.

3 ‘‘(B) In the case of any dispute arising out of an elec4 tion under subparagraph (A), the court shall resolve the dis5 pute.’’.

6 SEC. 27. ABANDONMENT OF RAILROAD LINE.

7 Section 1170(e)(1) of title 11, United States Code, is

8 amended by striking ‘‘section 11347’’ and inserting ‘‘section

9 11326(a)’’.

10 SEC. 28. CONTENTS OF PLAN.

11 Section 1172(c)(1) of title 11, United States Code, is

12 amended by striking ‘‘section 11347’’ and inserting ‘‘section

13 11326(a)’’.

14 SEC. 29. DISCHARGE.

15 Subsections (a) and (c) of section 1228 of title 11,

16 United States Code, are amended by striking ‘‘1222(b)(10)’’

17 each place it appears and inserting ‘‘1222(b)(9)’’.

18 SEC. 30. CONTENTS OF PLAN.

19 Section 1322 of title 11, United States Code, is amend20 ed—

21 (1) in subsection (b) by striking ‘‘(c)’’ and in22 serting ‘‘(d)’’, and

23 (2) in subsection (e) by striking ‘‘default, shall’’

24 and inserting ‘‘default shall’’.
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1 SEC. 31. DISCHARGE.

2 Paragraphs (1), (2), and (3) of section 1328(a) of title

3 11, United States Code, are amended to read as follows:

4 ‘‘(1) provided for under section 1322(b)(5) of this

5 title;

6 ‘‘(2) of the kind specified in paragraph (5), (8),

7 or (9) of section 523(a) of this title; or

8 ‘‘(3) for restitution, or a criminal fine, included

9 in a sentence on the debtor’s conviction of a crime.’’.

10 SEC. 32. BANKRUPTCY CASES AND PROCEEDINGS.

11 Section 1334(d) of title 28, United States Code, is

12 amended—

13 (1) by striking ‘‘made under this subsection’’ and

14 inserting ‘‘made under subsection (c)’’, and

15 (2) by striking ‘‘This subsection’’ and inserting

16 ‘‘Subsection (c) and this subsection’’.

17 SEC. 33. KNOWING DISREGARD OF BANKRUPTCY LAW OR

18 RULE.

19 Section 156(a) of title 18, United States Code, is

20 amended—

21 (1) in the first undesignated paragraph—

22 (A) by inserting ‘‘(1) the term’’ before

23 ‘‘ ‘bankruptcy’’, and

24 (B) by striking the period at the end and

25 inserting ‘‘; and’’, and

26 (2) in the second undesignated paragraph—
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1 (A) by inserting ‘‘(2) the term’’ before ‘‘ ‘doc2 ument’’, and

3 (B) by striking ‘‘this title’’ and inserting

4 ‘‘title 11’’.

5 SEC. 34. EFFECTIVE DATE; APPLICATION OF AMENDMENTS.

6 (a) EFFECTIVE DATE.—Except as provided in sub7 section (b), this Act and the amendments made by this Act

8 shall take effect on the date of the enactment of this Act.

9 (b) APPLICATION OF AMENDMENTS.—The amendments

10 made by this Act shall apply only with respect to cases com11 menced under title 11 of the United States Code on or after

12 the date of the enactment of this Act.