In re Spradlin

• Decision Date: 29 January 1999
• Docket Number: Bankruptcy No. 98-20611.
• Citation: 231 BR 254
• Parties: In re Robert Cecil SPRADLIN, Sr., Debtor.
• Court: U.S. Bankruptcy Court — Eastern District of Michigan

231 B.R. 254 (1999)

In re Robert Cecil SPRADLIN, Sr., Debtor.

Bankruptcy No. 98-20611.

United States Bankruptcy Court, E.D. Michigan, Northern Division.

January 29, 1999.

Susan M. Cook, Attorney at Law, Bay City, MI, for debtor.

George E. Jacobs, Attorney at Law, Bay City, MI, for Chapter 7 Trustee.

Michael C. Hammer, Attorney at Law, Detroit, MI, for Kenneth Nathan.

Daniel G. Helton, Attorney at Law, Detroit, MI, for Steelcase parties.

OPINION ON OBJECTION TO DEBTOR'S EXEMPTING TWO IRA'S

ARTHUR J. SPECTOR, Bankruptcy Judge.

The issue to be decided is whether the Michigan exemption from levy and sale permitting a debtor to exempt "an individual retirement account," Mich.Comp.Laws § 600.6023(1)(k), exempts one-and-only-one IRA or any-and-all IRAs owned by the judgment debtor. For the reasons which follow, we agree with the chapter 7 trustee and the creditors that the statutory phrase encompasses one and only one IRA.

The Debtor filed a voluntary petition for relief under chapter 13 of the Bankruptcy Code on March 13, 1998, which he converted to chapter 11 on May 18, 1998. He later converted the case again, on June 19, 1998, this time to chapter 7. Opting for Michigan state exemptions in lieu of the federal exemptions as he is permitted to do by 11 U.S.C. § 522(b), the Debtor seeks to exempt a "Prudential Individual Retirement Account" valued at $400,000, and an "Equitable Individual Retirement" valued at $45,707.20.

On August 31, 1998, Kenneth A. Nathan, an assignee for the benefit of the creditors of Contract Interiors, Inc., objected to the Debtor's exemptions, including "the Debtor's attempt to exempt two individual retirement accounts for the reason that Mich.Comp. Laws § 600.6023(1)(k) allows the exemption only of `an individual retirement account.'" Objection to Exemption at 1. On September 3, 1998, Daniel C. Himmelspach, the chapter 7 trustee of the Debtor's estate, joined in this objection. The following day, Lakestates Workplace Solutions, Inc., Steelcase, Inc., Steelcase Financial Services, Inc., and The Holland Group, L.L.C. d/b/a Workplace Integrators (related entities who collectively refer to themselves as "The Steelcase Parties") filed their own objection to the Debtor's claim of exemptions, including the IRAs.

The position of the trustee and the creditors is easy to summarize. The statute expressly allows a judgment debtor to exempt only "an" IRA. And since the word "a" or "an" denotes a single unit, they argue that a debtor may exempt only one IRA.

The Debtor retorts that under Michigan law, exemptions from levy and sale are to be read liberally in favor of a judgment debtor. As the term "an individual retirement account" is ambiguous in the context of the entire statutory scheme, the Debtor contends that it should be read broadly in keeping with its remedial purpose.

The issue before the Court is strictly one of interpretation of Michigan statutory law.¹ In performing such a task, a federal court sits as a lower state court would. Accordingly, when the state supreme court has not spoken, the task of the federal court is "to discern, from all available sources, how that court would respond if confronted with the issue." In re Akron-Cleveland Auto Rental, Inc., 921 F.2d 659, 662 (6th Cir.1990); Kurczi v. Eli Lilly & Co., 113 F.3d 1426, 1429 (6th Cir.1997); Wieczorek v. Volkswagenwerk, A.G., 731 F.2d 309, 310 (6th Cir.1984). Since the Michigan Supreme Court has not addressed the matter before us, we must try to anticipate how that court would decide the issue. In re Boufsko, Inc., 44 B.R. 98 n. 1, 39 U.C.C.Rep.Serv. 1788 (Bankr.E.D.Mich. 1984); cf. Sours v. General Motors Corp., 717 F.2d 1511, 1514 (6th Cir.1983) (diversity case).

Michigan law on statutory interpretation is essentially the same as it is under federal law. "The primary goal of judicial interpretation of statutes is to ascertain and give effect to the intent of the legislature." People v. Stanaway, 446 Mich. 643, 658, 521 N.W.2d 557 (1994); State Treasurer v. Gardner, 222 Mich.App. 62, 65, 564 N.W.2d 51 (1997). A statute that is clear and unambiguous on its face needs no interpretation by a court; only statutes which are of doubtful meaning are subject to the process of interpretation. Jones v. Grand Ledge Public Schools, 349 Mich. 1, 9, 84 N.W.2d 327 (1957). See also People v. Blodgett, 13 Mich. 127, 167 (1865) ("The fair and natural import of the terms employed, in view of the subject matter of the law, is what should govern."); MacQueen v. Port Huron City Commission, 194 Mich. 328, 342, 160 N.W. 627 (1916).

The problem here is that the word "an" has two natural meanings, either of which would be reasonably applied in this statute. According to a respected dictionary, "an" is "equivalent to `one' or `any.'" Black's Law Dictionary 84 (6th ed.1990). If the word following "an" in the subsection had started with a consonant, the word we would be construing would be "a." And "the word `a' has varying meanings and uses." Id. at 1.

"A" means "one" or "any," but less emphatically than either. It may mean one where only one is intended, or it may mean any one of a great number. It is placed before nouns of the singular number, denoting an individual object or quality individualized.

The article "a" is not necessarily a singular term; it is often used in the sense of "any" and is then applied to more than one individual object. Lewis v. Spies, 43 A.D.2d 714, 350 N.Y.S.2d 14, 17. So under a statute providing that the issuance of "a" certificate to one carrier should not bar a certificate to another over the same route, a certificate could be granted to more than two carriers over the same route. State ex rel. Crown Coach Co. v. Public Service Commission, 238 Mo.App. 287, 179 S.W.2d 123, 127. Also, article "a" in statute making it a crime for a person to have in his possession a completed check with intent to defraud includes the plural. People v. Carter, 75 Cal.App.3d 865, 142 Cal.Rptr. 517, 520. But the meaning depends on context. For example, in Workers\' Compensation Act, on, or in or about "a" railway, factory, etc., was held not to mean any railway, factory, etc., but the railway, factory, etc., of the employer.

Id. Therefore, it seems apparent that there is no one "fair and natural" meaning for the word being scrutinized.

Michigan law is also like federal law in that statutory construction is a "holistic" endeavor. See LaGuire v. Kain, 440 Mich. 367, 487 N.W.2d 389, 402-03 (1992) (Boyle, J. concurring and also dissenting). When "construing a statute, `effect must be given, if possible, to every word, sentence and section.' Moreover, to discover the legislative intent, `the entire act must be read, and the interpretation be given to a particular word in one section arrived at after due consideration of every other section so as to produce, if possible, a harmonious and consistent enactment as a whole.'" Weems v. Chrysler Corp., 448 Mich. 679, 769-700, 533 N.W.2d 287 (1995) (quoting Grand Rapids v. Crocker, 219 Mich. 178, 182, 189 N.W. 221 (1922)) (internal citations omitted); see also Mayor of Detroit v. State of Michigan, 228 Mich.App. 386, 461, 579 N.W.2d 378 (1998) ("Particular provisions of a statute should be read in the context of the entire statute."). See, e.g., Int'l Primate Protection League v. Administrators of Tulane Educational Fund, 500 U.S. 72, 79, 111 S.Ct. 1700, 114 L.Ed.2d 134 (1991) ("`We continue to recognize that context is important in the quest for a word's meaning,' United States v. Bishop, 412 U.S. 346, 356, 93 S.Ct. 2008, 36 L.Ed.2d 941 (1973), and that `statutory construction . . . is a holistic endeavor.'" United Savings Assn. of Texas v. Timbers of Inwood Forest Assoc., Ltd., 484 U.S. 365, 371, 108 S.Ct. 626, 98 L.Ed.2d 740 (1988)).

Consequently, we must refocus with a wider lens, examining the term in the context of the entire exemption statute. Mich.Comp. Laws § 600.6023(1) includes varying terms when quantifying the number of objects subject to exemption. For example, subsection (a) permits the exemption of "all family pictures, all arms and accouterments required by law to be kept by any person, all wearing apparel of every person or family, and provisions and fuel for comfortable subsistence of each household and his or her family for 6 months." Mich.Comp.Laws § 600.6023(1)(a) (emphasis added). Likewise, subsection (b) allows a debtor to exempt "all household goods, furniture, utensils, books, and appliances not exceeding in value $1,000." Mich.Comp.Laws § 600.6023(1)(b) (emphasis added). And subsection (c) says: "all cemeteries, tombs, and rites of burial while in use as repositories of the dead of the judgment debtor's family or kept for burial of the judgment debtor." Mich.Comp.Laws § 600.6023(1)(c) (emphasis added).

On the other hand, subsection (d) permits each householder to exempt: "10 sheep, 2 cows, 5 swine, 100 hens, 5 roosters and a sufficient quantity of hay and grain, growing or otherwise, for properly keeping such animals and poultry for 6 months." Mich.Comp. Laws § 600.6023(1)(d).

For purposes of quantification, the term "any" is used only in subsection (f): "any money or other benefits paid, provided or allowed to be paid, provided, or allowed, by any stock or mutual life or health or casualty insurance company. . . .". Mich.Comp.Laws § 600.6023(1)(f). (emphasis added).

Four subsections use the word "the:" (1) subsection (g) — "the shares held by any member, being a householder, of any association incorporated under the provisions of the Savings and Loan Act of 1980 . . . to the amount of $1,000 in such shares. . . ."; (2) subsection (j) — "the homestead of a family, after the death of the owner of the homestead, from the payment of his or her debts in all cases during the minority of his or her children."; (3) subsection (1) — "the right or interest of a person in a pension, profit-sharing, stock bonus, or other plan that is qualified under § 401 of the...