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Timestamp: 2018-07-17 03:56:08
Document Index: 140553943

Matched Legal Cases: ['§ 101', '§ 523', '§ 726', '§ 523', '§ 523', '§ 523', '§ 523', '§ 1328', '§ 101', '§ 101', '§ 523', '§ 523']

PENNSYLVANIA DPW V. DAVENPORT, 495 U. S. 552 (1990) - US SUPREME COURT DECISIONS ON-LINE
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(a) Section 101(11)'s definition of "debt" as a "liability on a claim" reveals Congress' intent that the meanings of "debt" and "claim" be coextensive. Furthermore, § 101(4)(A)'s definition of a "claim" as a "right to payment" broadly contemplates any enforceable obligation of the debtor, including a restitution order. Petitioners' reliance on Kelly's discussion emphasizing the special purposes of punishment and rehabilitation that underlie the imposition of restitution obligations is misplaced. Unlike § 523(a)(7), which explicitly ties its application to the purpose of the chanroblesvirtualawlibrary
(c) This holding does not signal a retreat from the principles applied in Kelly. The Code will not be read to erode past bankruptcy practice absent a clear indication that Congress intended such a departure. However, where, as here, congressional intent is clear, the Court's function is to enforce the statute according to its terms, even where this means chanroblesvirtualawlibrary
concluding that Congress intended to interfere with States' administration of their criminal justice systems. Pp. 495 U. S. 563-564. chanroblesvirtualawlibrary
MARSHALL, J., delivered the opinion of the Court, in which REHNQUIST, C.J.,and BRENNAN, WHITE, STEVENS, SCALIA, and KENNEDY, JJ., joined. BLACKMUN, J., filed a dissenting opinion, in which O'CONNOR, J., joined, post, p. 495 U. S. 564.
In September 1986, respondents Edward and Debora Davenport pleaded guilty in a Pennsylvania court to welfare chanroblesvirtualawlibrary
While the adversary action was pending, the Bankruptcy Court confirmed the Davenports' Chapter 13 plan without objection from any creditor. [Footnote 1] Although notified of the chanroblesvirtualawlibrary
Our construction of the term "debt" is guided by the fundamental canon that statutory interpretation begins with the chanroblesvirtualawlibrary
Nor does the State's method of enforcing restitution obligations suggest that such obligations are not "claims." Although neither the Probation Department nor the victim can enforce restitution obligations in civil proceedings, Commonwealth v. Mourar, 349 Pa.Super. 583, 603, 504 A.2d 197, 208 (1986), rev'd on other grounds, 517 Pa. 83, 534 A.2d 1050 (1987), the obligation is enforceable by the substantial threat of revocation of probation and incarceration. That the Probation Department's enforcement mechanism is criminal rather than civil does not alter the restitution order's character as a "right of payment." Indeed, the right created by such an order made as a condition of probation is in some sense greater than the right conferred by an ordinary civil obligation, because it is secured by the debtor's freedom, chanroblesvirtualawlibrary
We find no inconsistency in these provisions. Section 362(b)(1) ensures that the automatic stay provision is not construed to bar federal or state prosecution of alleged criminal chanroblesvirtualawlibrary
The central difficulty with the United States' construction of § 726(a)(4) is that it conflicts with Kelly's holding that § 523(a)(7), the exception to discharge provision, applies to criminal restitution obligations. 479 U.S. at 479 U. S. 51 (§ 523(a)(7) "creates a broad exception for all penal sanctions"). The United States acknowledges that the phrase "fine, penalty, chanroblesvirtualawlibrary
Moreover, in locating Congress' policy choice regarding the dischargeability of restitution orders in § 523(a)(7), Kelly is faithful to the language and structure of the Code: Congress defined "debt" broadly, and took care to except particular debts from discharge where policy considerations so warranted. chanroblesvirtualawlibrary
Our refusal to carve out a broad judicial exception to discharge for restitution orders does not signal a retreat from the principles applied in Kelly. We will not read the Bankruptcy Code to erode past bankruptcy practice absent a clear indication that Congress intended such a departure. Kelly, supra, 479 U.S. at 479 U. S. 47 (citing Midlantic National Bank v. New Jersey Dept. of Environmental Protection, 474 U. S. 494 (1986)). In Kelly, the Court examined pre-Code practice and identified a general reluctance "to interpret federal bankruptcy statutes to remit state criminal judgments." 479 U.S. at 479 U. S. 44. This pre-Code practice informed the Court's conclusion that § 523(a)(7) broadly applies to all penal sanctions, including criminal fines. Here, on the other hand, the statutory language plainly reveals Congress' intent not to except restitution orders from discharge in certain Chapter 13 proceedings. This intent is clear from Congress' decision to limit the exceptions to discharge applicable to Chapter 13, § 1328(a), as chanroblesvirtualawlibrary
The Court today concludes that Congress intended an obligation to pay restitution imposed as part of a state criminal sentence to be a "debt" within the meaning of the United States Bankruptcy Code. Because Congress has given no clear indication that it intended to abrogate the long "history of bankruptcy court deference to criminal judgments," Kelly v. Robinson, 479 U. S. 36, 479 U. S. 44 (1986), and because there is no suggestion in the Bankruptcy Code that it may be used as a shield to protect a criminal from punishment for his crime, I must disagree. chanroblesvirtualawlibrary
Kelly, 479 U.S. at 479 U. S. 43, quoting, as have other opinions of this Court, 49 U. S. 122 (1849). The strict language of the Bankruptcy Code does not control, even if the statutory language has a "plain" meaning, if the application of that language "will produce a result demonstrably at odds with the intention of its drafters." United States v. Ron Pair Enterprises, Inc., 489 U. S. 235, 489 U. S. 243 (1989). To determine the drafters' intent, the Court presumes that Congress intended to keep continuity between pre-Code judicial practice and the enactment of the Bankruptcy Code in 1978. Midlantic,@ 474 U.S. at 474 U. S. 501. For me, the statutory language, the consistent authority treating criminal sanctions as nondischargeable under the Bankruptcy Act of 1898, the absence of any legislative history suggesting that the Code was intended to change that established principle, and the strong policy of deference to state criminal judgments all compel the conclusion that a restitution order is not a dischargeable debt.
The majority appropriately begins its analysis with the language of the statute. As the majority points out, the Bankruptcy Code defines "debt" as a "liability on a claim." 11 U.S.C. § 101(11). The term "claim," in turn, is defined as a "right to payment." § 101(4)(A). The question then becomes whether it is clear from the statutory language alone that a restitution order is a "right to payment," or whether the statutory language, "at least to some degree, [is] open to interpretation." Ron Pair, 489 U.S. at 489 U. S. 245-246 (emphasis chanroblesvirtualawlibrary
Some time ago, Justice Frankfurter pointed out: "The notion that, because the words of a statute are plain, its meaning is also plain is merely pernicious oversimplification." United States v. Monia, 317 U. S. 424, 317 U. S. 431 (1943) (dissenting opinion). This observation rings especially true in this case. It is not at all clear to me that the words "right to payment" plainly include an obligation resulting from a criminal restitution order. While the words may be of common usage, their meaning is not at all plain in this context. Notably absent from the Code's definition (and from the legislative history) of both "debt" and "claim" is any indication that Congress intended the discharge provisions to extend into the criminal sphere. Indeed, there are persuasive reasons for excluding criminal restitution from the category of "debts." Petitioners argue -- not without force -- that a criminal restitution order is not a "right to payment" because neither the victim of the crime nor the Probation Department possesses a right to payment of a restitution order. Brief for Petitioners 22. Petitioners also argue that, because the victim has no right of enforcement, the victim has no right to payment. Id. at 27; see also Commonwealth v. Mourar, 349 Pa.Super.Ct. 583, 603, 504 A.2d 197, 208 (1986), vacated and remanded on other grounds, 517 Pa. 83, 534 A.2d 1050 (1987) (if criminal defendant fails to make restitution as ordered, victim has no right of enforcement); cf. Bearden v. Georgia, 461 U. S. 660 (1983) (state court cannot constitutionally revoke probation for failure to pay a fine and make restitution without first determining the probationer's ability to pay). Several bankruptcy courts have agreed with petitioners, and have decided that the definition of debt in the Bankruptcy Code does not include a criminal restitution order. See, e.g., In re Norman, 95 B.R. 771, 773, and n. 3 (Colo. 1989) (criminal penalties chanroblesvirtualawlibrary
Kelly, 479 U.S. at 479 U. S. 44. That deference was reflected in the judicial interpretation of the discharge provisions of the Bankruptcy Act of 1898. In Kelly, the Court discussed at length the customary pre-Code practice of chanroblesvirtualawlibrary
479 U.S. at 479 U. S. 44-45. Nonetheless, courts consistently "refused to allow a discharge in bankruptcy to affect the judgment of a state criminal court." Id. at 479 U. S. 45. See, e.g., In re Abramson, 210 F.8d 8, 880 (CA2 1914) ("judgments for penalties are not debts which can be proved or allowed as such because they are not for a fixed liability"); cf. In re Alderson, 98 F.5d 8 (W.Va. 1899) (the only federal court decision found by the Kelly Court that allowed a discharge to affect a sentence imposed by a state criminal court). In fact, the judicially created exception to discharge was
Kelly, 479 U.S. at 479 U. S. 46, quoting 1A Collier on Bankruptcy � 17.13, pp. 1609-1610, and n. 10 (14th ed. 1978). chanroblesvirtualawlibrary
474 U.S. at 474 U. S. 501. There is no indication that Congress had any intent so drastically to change the established pre-Code practice regarding criminal sanctions. Although the Bankruptcy chanroblesvirtualawlibrary
The majority today brushes aside the rule of statutory construction outlined by this Court -- a rule the Court has stressed must be used with "particular care in construing the scope of bankruptcy codifications." Midlantic, 474 U.S. at 474 U. S. 501 (emphasis added). The majority insists that its holding does not signal a retreat from the principles applied in Kelly because there is a "clear indication" that Congress intended to depart from past bankruptcy practice. Ante at 495 U. S. 563 (emphasis added). The majority contends that Congress made that intent "clear" by its "adoption of the broadest possible' definition of `debt.'" Ante at 495 U. S. 564. I disagree. And I am puzzled by the majority's position, because the Court previously has rejected it expressly. See Kelly, 479 U.S. at 479 U. S. 50, n. 12 (although the definition of debt was broadened, "nothing in the legislative history of these sections compels the conclusion that Congress intended to change the state of the law with respect to criminal judgments"). Moreover, it seems chanroblesvirtualawlibrary
§ 523(a)(7). The majority reasons that if restitution obligations were not debts, there would be no need to except them from discharge; therefore, it says, Congress clearly intended that criminal restitution orders be considered debts. Because § 523(a)(7) does not apply to all Chapter 13 proceedings, the majority contends that criminal restitution obligations should be considered chanroblesvirtualawlibrary
I do not believe that Congress so cavalierly would have disregarded the States' overwhelmingly important interest in administering their criminal justice systems free from the interference of a federal bankruptcy judge. Every State and the District of Columbia presently authorizes the use of restitution orders. See Note, Criminal Restitution as a Limited chanroblesvirtualawlibrary
Ibid. The concerns of the Kelly Court are no less applicable in this chanroblesvirtualawlibrary