Obrázky stránek
PDF
ePub
[blocks in formation]

for a system in which particular property is identified as the trust res, are thus unhelpful in this special context.

Federal law delineating the nature of the relationship between the § 7501 trust and preferential transfer rules is limited. The only case in which we have explored that topic at any length is United States v. Randall, 401 U. S. 513 (1971), a case dealing with a postpetition transfer of property to discharge trust-fund tax obligations that the debtor had accrued prepetition. There, a court had ordered a debtor in possession to maintain a separate account for its withheld federal income and FICA taxes, but the debtor did not comply. When the debtor was subsequently adjudicated a bankrupt, the United States sought to recover from the debtor's general assets the amount of withheld taxes ahead of the expenses of the bankruptcy proceeding. The Government argued that the debtor held the amount of taxes due in trust for the IRS and that this amount could be traced to the funds the debtor had in its accounts when the bankruptcy petition was filed. The trustee maintained that no trust had been created because the debtor had not segregated the funds. The Court declined directly to address either of these contentions. Id., at 515. Rather, the Court simply refused to permit the IRS to recover the taxes ahead of administrative expenses, stating that "the statutory policy of subordinating taxes to costs and expenses of administration would not be served by creating or enforcing trusts which eat up an estate, leaving little or nothing for creditors and court officers whose goods and services created the assets." Id., at 517.

In 1978, Congress fundamentally restructured bankruptcy law by passing the new Bankruptcy Code. Among the changes Congress decided to make was a modification of the rule this Court had enunciated in Randall under the old Bankruptcy Act. The Senate bill attacked Randall directly, providing in § 541 that trust-fund taxes withheld or collected

ation of a trust in the "amount" of withheld taxes. The common law of trusts is not binding on Congress.

[blocks in formation]

prior to the filing of the bankruptcy petition were not "property of the estate." See S. Rep. No. 95-1106, at 33. See also ibid. ("These amounts will not be property of the estate regardless of whether such amounts have been segregated from other assets of the debtor by way of a special account, fund, or otherwise, or are deemed to be a special fund in trust pursuant to provisions of applicable tax law") (footnote omitted). The House bill did not deal explicitly with the problem of trust-fund taxes, but the House Report stated that "property of the estate" would not include property held in trust for another. See H. R. Rep. No. 95-595, at 368. Congress was unable to hold a conference, so the Senate and House floor managers met to reach compromises on the differences between the two bills. See 124 Cong. Rec. 32392 (1978) (remarks of Rep. Edwards); Klee, Legislative History of the New Bankruptcy Law, 28 DePaul L. Rev. 941, 953-954 (1979). The compromise reached with respect to the relevant portion of § 541, which applies to postpetition transfers, was embodied in the eventually enacted House amendment and explicitly provided that “in the case of property held in trust, the property of the estate includes the legal title, but not the beneficial interest in the property." 124 Cong. Rec., at 32417 (remarks of Rep. Edwards). Cf. id., at 32363 (text of House amendment). Accordingly, the Senate language specifying that withheld or collected trust-fund taxes are not part of the bankruptcy estate was deleted as "unnecessary since property of the estate does not include the beneficial interest in property held by the debtor as a trustee. Under [§ 7051], the amounts of withheld taxes are held to be a special fund in trust for the United States." Id., at 32417 (remarks of Rep. Edwards).5

5 Because of the absence of a conference and the key roles played by Representative Edwards and his counterpart floor manager Senator DeConcini, we have treated their floor statements on the Bankruptcy Reform Act of 1978 as persuasive evidence of congressional intent. See, e. g., Commodity Futures Trading Comm'n v. Weintraub, 471 U. S. 343, 351

[blocks in formation]

Representative Edwards discussed the effects of the House language on the rule established by Randall, indicating that the House amendment would supplant that rule:

"[A] serious problem exists where 'trust fund taxes' withheld from others are held to be property of the estate where the withheld amounts are commingled with other assets of the debtor. The courts should permit the use of reasonable assumptions under which the Internal Revenue Service, and other tax authorities, can demonstrate that amounts of withheld taxes are still in the possession of the debtor at the commencement of the case." Ibid.

The context of Representative Edwards' comment makes plain that he was discussing whether a postpetition payment of trust-fund taxes involved "property of the estate." This focus is not surprising given that Randall, the case Congress was addressing, involved a postpetition demand for payment by the IRS. But Representative Edwards' discussion also applies to the question whether a prepetition payment is made from "property of the debtor." We have explained that "property of the debtor" is that property that would have been part of the estate had it not been transferred before the commencement of bankruptcy proceedings. Supra, at 58. The same "reasonable assumptions" therefore apply in both contexts.

The strict rule of Randall thus did not survive the adoption of the new Bankruptcy Code. But by requiring the IRS to "demonstrate that amounts of taxes withheld are still in the possession of the debtor at the commencement of the case [i. e., at the filing of the petition]," 124 Cong. Rec., at 32417 (remarks of Rep. Edwards), Congress expected that the IRS would have to show some connection between the § 7501 trust

(1985). Cf. 124 Cong. Rec. 32391 (1978) (remarks of Rep. Rousselot) (expressing view that remarks of floor manager of the Act have "the effect of being a conference report").

[blocks in formation]

and the assets sought to be applied to a debtor's trust-fund tax obligations. See United States v. Whiting Pools, Inc., 462 U. S. 198, 205, n. 10 (1983) (IRS cannot exclude funds from the estate if it cannot trace them to § 7501 trust property). The question in this case is how extensive the required nexus must be. The Bankruptcy Code provides no explicit answer, and Representative Edwards' admonition that courts should "permit the use of reasonable assumptions" does not add much. The House Report does, however, give sufficient guidance regarding those assumptions to permit us to conclude that the nexus requirement is satisfied here. That Report states:

“A payment of withholding taxes constitutes a payment of money held in trust under Internal Revenue Code § 7501(a), and thus will not be a preference because the beneficiary of the trust, the taxing authority, is in a separate class with respect to those taxes, if they have been properly held for payment, as they will have been if the debtor is able to make the payments." H. R. Rep. No. 95-595, supra, at 373.6

As

Under a literal reading of the above passage, the bankruptcy trustee could not avoid any voluntary prepetition payment of trust-fund taxes, regardless of the source of the funds. the House Report expressly states, the limitation that the funds must "have been properly held for payment" is satisfied "if the debtor is able to make the payments." The debtor's act of voluntarily paying its trust-fund tax obligation

"Petitioner's claim that this legislative history is irrelevant because the House Bill was not enacted is in error. The exact language to which the quoted portion of the House Report refers was enacted into law. Compare § 547(b) with H. R. 8200, 95th Cong., 1st Sess., § 547(b) (1977). The version of § 541 that was eventually enacted is different from the original House bill, but only in that it makes explicit rather than implicit that "property of the estate" does not include the beneficiary's equitable interest in property held in trust by the debtor. Compare § 541(d) with H. R. 8200, supra, § 541(a)(1).

53

SCALIA, J., concurring in judgment

therefore is alone sufficient to establish the required nexus between the "amount" held in trust and the funds paid.

We adopt this literal reading. In the absence of any suggestion in the Bankruptcy Code about what tracing rules to apply, we are relegated to the legislative history. The courts are directed to apply "reasonable assumptions" to govern the tracing of funds, and the House Report identifies one such assumption to be that any voluntary prepetition payment of trust-fund taxes out of the debtor's assets is not a transfer of the debtor's property. Nothing in the Bankruptcy Code or its legislative history casts doubt on the reasonableness of that assumption. Other rules might be reasonable, too, but the only evidence we have suggests that Congress preferred this one. We see no reason to disregard that evidence.

III

We hold that AIA's payments of trust-fund taxes to the IRS from its general accounts were not transfers of "property of the debtor," but were instead transfers of property held in trust for the Government pursuant to § 7501. Such payments therefore cannot be avoided as preferences. The judgment of the Court of Appeals is

JUSTICE SCALIA, concurring in the judgment.

Affirmed.

Representative Edwards, the House floor manager for the bill that enacted the Bankruptcy Code, said on the floor that "[t]he courts should permit the use of reasonable assumptions" regarding the tracing of tax trust funds. 124 Cong. Rec. 32417 (1978). We do not know that anyone except the presiding officer was present to hear Representative Edwards. Indeed, we do not know for sure that Representative Edwards' words were even uttered on the floor rather than inserted into the Congressional Record afterwards. If Representative Edwards did speak these words, and if there were others present, they must have been surprised to hear

« PředchozíPokračovat »