United States v. Krakover, 8786.
| Decision Date | 02 May 1967 |
| Docket Number | No. 8786.,8786. |
| Parties | UNITED STATES of America, Appellant, v. Allen S. KRAKOVER, Trustee, Appellee. |
| Court | U.S. Court of Appeals — Tenth Circuit |
Florence Wagman Roisman, Atty. Dept. of Justice (Barefoot Sanders, Asst. Atty. Gen., Lawrence M. Henry, U. S. Atty., and David L. Rose, Atty., Dept. of Justice, were with her on the brief), for appellant.
Fred M. Winner, of Winner, Berge, Martin & Camfield, Denver, Colo., for appellee.
Before LEWIS, BREITENSTEIN, and HICKEY, Circuit Judges.
The question is whether in a Chapter 13 bankruptcy proceeding1 the United States can be ordered to pay to the trustee part of the wages of one of its employees. The referee answered the question in the affirmative and, on a petition for review, the district court agreed. This appeal followed. No jurisdictional question is raised by the parties. If an allowance of the appeal is required by § 24 of the Bankruptcy Act, 11 U.S.C. § 47, we allow the appeal because of the important question presented.
The case is before us on a skeleton record. We are not provided with the debtor's petition, the plan which he proposed, the action of the creditors thereon, or the order of confirmation. In the circumstances, we assume that they are regular and in conformity with the Act. It is conceded that at the time of the confirmation of the plan the debtor was an employee of the State of Colorado and thereafter became an employee of the mint of the United States at Denver.
On the motion of the trustee the referee ordered that:
"* * * until the further order of the Court said employer the United States shall hereafter, as the wages or earnings of the debtor become due and payable, and on each pay day, and out of said wages or earnings, pay $30.00 semi-monthly to said Trustee; and the payment thereof by said employer to the Trustee shall fully acquit and discharge said employer to the extent of such payments as against the claims or demands of the debtor; * * *."
The question presented is one of first impression for federal appellate courts. The United States relies on its immunity to suit without consent and the trustee denies the applicability of that doctrine.
The referee's order was entered under § 658(2), 11 U.S.C. § 1058(2), which provides:
The trustee says that the reference to "any employer" in its uncompromising generality includes the United States and supports his position by reference to Baltimore National Bank v. State Tax Commissioner of Maryland, 297 U.S. 209, 56 S.Ct. 417, 80 L.Ed. 586, where the Court held that the use of the word "all" in a statute pertaining to the taxation of bank shares includes shares owned by an agency of the United States. The government counters with United States v. United Mine Workers of America, 330 U.S. 258, 67 S.Ct. 677, 91 L.Ed. 884, where the Court declined to construe the word "employer" as used in the Norris-La Guardia Act to include the United States.
In United States v. Mel's Lockers, Inc., 10 Cir., 346 F.2d 168, 170, we held that general language in the Bankruptcy Act "cannot be construed as a waiver of governmental immunity." The same rule must be applied here.
The trustee's argument that the order does not violate the principle of sovereign immunity is unconvincing. Although compliance with the order may require only another hole in a punch card and the issuance of two checks rather than one, the controlling factor is the fact of impact on the government rather than the extent of the impact. The referee has ordered the government to pay to the trustee money in the hands of its disbursing agent. This runs contrary to Buchanan v. Alexander, 45 U.S. (4 How.) 20, 11 L. Ed. 857, where the Court denied the right to attach money which was in the hands of a government disbursing agency and was due for wages earned.
If the intent of Chapter 13 is to permit the voluntary assignment of unearned wages by the submission and confirmation of a plan, and if such an arrangement is not subject to the restrictions of the Anti-Assignment Act,2 the fact remains that no avenue is open for the referee to enforce his order against the United States because it is immune from execution and garnishment.3 An order which may not be enforced is an exercise in futility.
Segal v. Rochelle, 382 U.S. 375, 86 S.Ct. 511, 15 L.Ed.2d 428, and Kolb v. Berlin, 5 Cir., 356 F.2d 269, do not...
To continue reading
Request your trial
-
Hamilton v. Nakai
...1941, 57 Ariz. 41, 110 P.2d 554. The Navajo's case support again misses the mark; their principal case authority, United States v. Krakover, 10 Cir., 1969, 377 F.2d 104, stands only for the proposition that execution and garnishment will not be permitted where the United States has not cons......
-
In re Howell, Bankruptcy No. 380-00072.
...claim the immunity from income deduction orders which may have been available under prior law. As demonstrated in United States v. Krakover, 377 F.2d 104 (10th Cir. 1967), agencies of the United States government had realized some insulation from income deduction orders in Chapter 13 cases ......
-
In re Hughes
...142 (1978). Only by obtuseness can the administration avoid the conclusion that § 1325(b) was meant to overrule United States v. Krakover, 377 F.2d 104 (10th Cir. 1967) cert. den. 389 U.S. 845, 88 S.Ct. 97, 19 L.Ed.2d 112 That case involved a similar provision in chapter 13's predecessor, C......
-
In re Buren, Bankruptcy No. 379-01863.
...claim the immunity from income deduction orders which may have been available under prior law. As demonstrated in United States v. Krakover, 377 F.2d 104 (10th Cir. 1967), agencies of the United States government had realized some insulation from income deduction orders in Chapter 13 cases ......