Taylor v. Freeland & Kranz

RESPONDENT:Freeland & Kranz et al.
LOCATION:Northern District Court of New York

DOCKET NO.: 91-571
DECIDED BY: Rehnquist Court (1991-1993)
LOWER COURT: United States Court of Appeals for the Third Circuit

CITATION: 503 US 638 (1992)
ARGUED: Mar 02, 1992
DECIDED: Apr 21, 1992

Phillip S. Simon – on behalf of the Respondents
Timothy B. Dyk – on behalf of the Petitioner

Facts of the case


Media for Taylor v. Freeland & Kranz

Audio Transcription for Oral Argument – March 02, 1992 in Taylor v. Freeland & Kranz

Audio Transcription for Opinion Announcement – April 21, 1992 in Taylor v. Freeland & Kranz

William H. Rehnquist:

The opinion of the Court in No. 91-571, Taylor against Freeland and Kranz will be announced by Justice Thomas.

Clarence Thomas:

This case comes to us on a writ of certiorari to the United States Court of Appeals for the Third Circuit.

It started in 1984 when Emily Davis filed a bankruptcy petition.

At that time, Davis was pursuing a lawsuit against her employer.

On a schedule filed with the Bankruptcy Court, Davis claimed that the proceeds from this lawsuit would be exempt from distribution to creditors.

She listed the value of the proceeds as unknown because she did not know whether she would win or lose the lawsuit.

The bankruptcy trustee did not object.

Several months later, while the bankruptcy case still was pending, Davis won $110,000 judgment against her employer.

The trustee asked the Bankruptcy Court to include this money in Davis’ bankruptcy estate so that he could distribute it to the creditors.

The Bankruptcy Court granted the trustee’s request, and both the District Court and the Court of Appeals for the Third Circuit affirmed its decision.

In an opinion filed today with the Clerk’s office, we now reverse the Court of Appeals.

Davis claimed the proceeds from the lawsuit as exempt property.

The relevant bankruptcy rule gave the trustee only 30 days to object to this claim.

The trustee missed this deadline.

Although the trustee argues that Davis had no statutory basis for claiming the property as exempt, we have no authority to create an exception to the 30-day period.

The proceeds, therefore, are exempt for distribution to creditors.

Justice Stevens has filed a dissenting opinion.