Opinion ID: 765093
Heading Depth: 2
Heading Rank: 3

Heading: lien issue

Text: 16 The court below incorrectly held that it lacked jurisdiction over the lien issue. But because we find that Tudisco's claim fails on the merits, we affirm the district court's decision upholding the bankruptcy court's dismissal of the adversary proceeding.
17 The district judge concluded that jurisdiction did not exist under 28 U.S.C. § 158(a) because Judge Eisenberg's order on the lien issue in the plan proceeding was not an appealable final order. 4 Had it been final, the court added, the appeal from it would not have been timely under Federal Rule of Bankruptcy Procedure 8001, which provides that a notice of appeal must be filed within ten days. 18 Judge Eisenberg's order was in fact not final when issued and had not become final by the date of Tudisco's appeal because the plan proceeding had not then concluded. Perhaps as a result, Tudisco never appealed from it. 5 Accordingly, we agree that the district court lacked jurisdiction to review any part of the plan proceeding. 19 The fact that the district court lacked jurisdiction over Judge Eisenberg's order in the plan proceeding, does not, however, mean that the district court lacked jurisdiction over the lien issue. Tudisco's complaint in the adversary proceeding raised both the dischargeability question and the lien issue. In order for Judge Conrad to dismiss the case with prejudice -- which he did -- he had to reach a decision on the merits of all the issues in Tudisco's complaint. Cf. Fed. R. Civ. P. 41(b) (providing that an involuntary dismissal operates as an adjudication upon the merits). Therefore, a rejection of Tudisco's position on the lien issue was necessarily, if only implicitly, a part of the final dismissal order of the bankruptcy court. As a result, the district court had jurisdiction pursuant to 28 U.S.C. § 158(a), and we, in turn, have jurisdiction under 28 U.S.C. § 158(d) (giving the courts of appeals jurisdiction over final decisions by district courts).
20 We must, therefore, reach the merits of Tudisco's claim that the tax lien cannot reach his exempt assets. 21 In the plan proceeding, the IRS filed a proof of claim, indicating $179,001.81 as a secured debt. Tudisco objected, arguing, inter alia, that this figure represented his accumulated retirement, and that his retirement was an exempt asset. 22 Both Tudisco and the government have assumed, but not demonstrated, that Tudisco's pension is indeed exempt. See 11 U.S.C. § 522(b) (authorizing certain property to be exempted from the estate and thereby to escape liquidation in satisfaction of creditors' claims). We need not decide whether this is in fact the case. As the government correctly argues, even if the pension is exempt, the tax lien nevertheless attaches. 23 Under 26 U.S.C. § 6321, a tax liability gives rise to a lien, which attaches to all [of the taxpayer's] property and rights to property. The Supreme Court has given an expansive reading to this language, stating that it reveals on its face that Congress meant to reach every interest in property that a taxpayer might have. United States v. National Bank of Commerce, 472 U.S. 713, 719-20 (1985); see also Bourque v. United States (In re Bourque), 123 F.3d 705, 706 n.2 (2d Cir. 1997) (quoting 11 U.S.C. § 522(c)(2)(B) in discussing 26 U.S.C. § 6321:  '[A] tax lien, notice of which is properly filed,' is effective against exempt property . . . and may not be avoided.). As a result, even if Tudisco's retirement funds are exempt from the bankruptcy estate, they are nevertheless subject to a tax lien.