LOCATION:The Department of Health and Human Services
DOCKET NO.: 90-368
DECIDED BY: Rehnquist Court (1990-1991)
LOWER COURT: United States Court of Appeals for the Eighth Circuit
CITATION: 501 US 157 (1991)
ARGUED: Apr 22, 1991
DECIDED: Jun 13, 1991
James Hamilton – as amicus curiae in support of judgment below
Peter M. Lieb – on behalf of the Petitioner
Stephen J. Marzen – on behalf of the Respondent United States supporting the Petitioner
Media for Toibb v. Radloff
Audio Transcription for Opinion Announcement – June 13, 1991 in Toibb v. Radloff
William H. Rehnquist:
The opinion of the Court in No. 90-368 Toibb against Radloff will be announced by Justice Blackmun.
Harry A. Blackmun:
This is a bankruptcy case that comes to us from the Court of Appeals for the Eighth Circuit.
We took it because of the conflict in the lower courts.
It concerns the interplay of chapters 7, 11, and in a way, 13 of the Bankruptcy Code.
Specifically, it has to do with a conversion by an individual of his chapter seven case to one under chapter eleven’s reorganization provisions.
The Bankruptcy Court of Saint Louis allowed the conversion, but when the petitioner’s reorganization plan was filed, that court dismissed the petition finding at that time that he did not qualify for relief under chapter 11 because he was not engaged in an ongoing business.
The District Court for the Eastern District of Missouri affirmed and so did the Court of Appeals.
We hold that the code’s language permits individual debtors not engaged in business to file for relief under chapter 11.
We acknowledge that, that chapter was intended primarily for the use of business debtors.
But the code contains no ongoing business requirement for a chapter-11-reorganization.
And the judgment of the Court of Appeals is, therefore, is reversed.
Justice Stevens has filed a dissenting opinion.