Opinion ID: 797372
Heading Depth: 2
Heading Rank: 2

Heading: The Bankruptcy Court's Equitable Authority

Text: 25 Abnos contends that the bankruptcy court lacked equitable authority to make retroactive its approval of rejection under 11 U.S.C. § 365(a). Abnos first argues that such equitable authority would contravene Congress's intent behind § 365(d)(3): to assure landlords of post-petition, pre-rejection rent until court-approved rejection. He further argues that this sort of equitable power has no statutory authorization and is not within the equitable authority conferred on the courts by the Judiciary Act of 1789, 1 Stat. 73 (1789). For the latter point, Abnos relies upon Grupo Mexicano de Desarrollo, S.A. v. Alliance Bond Fund, Inc., 527 U.S. 308, 119 S.Ct. 1961, 144 L.Ed.2d 319 (1999), in which the Supreme Court held that a preliminary injunction issued under Fed. R.Civ.P. 65 had to be within the district court's equitable authority under the Judiciary Act of 1789, which conveyed only an authority to administer in equity suits the principles of the system of judicial remedies which had been devised and was being administered by the English Court of Chancery at the time of separation of the two countries. Id. at 318-19, 119 S.Ct. 1961 (internal quotation marks omitted). 26 We have not ruled on the existence or scope of a bankruptcy court's equitable authority to order retroactive approval of rejection under § 365, and there is no need for us to do so here. The parties litigated this case in the district court on the assumption that such authority existed: Abnos did not raise this issue below in his brief and conceded at oral argument before the district court that the bankruptcy court possessed the relevant equitable power. In general, a federal appellate court refrains from passing on issues not raised below. See Paese v. Hartford Life Accident Ins. Co., 449 F.3d 435, 446 (2d Cir.2006). We are more likely to exercise our discretion to consider such issues when, as here, they are purely legal and require no additional fact finding. See Official Comm. of the Unsecured Creditors of Color Tile, Inc. v. Coopers & Lybrand, LLP, 322 F.3d 147, 159 (2d Cir.2003); Baker v. Dorfman, 239 F.3d 415, 420 (2d Cir.2000). However, we decline to exercise our discretion; Abnos affirmatively conceded the issue in the district court, and his failure to raise the issue in the bankruptcy court deprived that court of the opportunity to fashion relief such that no court would have to decide the question in this dispute. Therefore, we will assume, without deciding, that the bankruptcy court had equitable authority to make its order retroactive. 1 27