Document Type
Article
Publication Title
ABI Law Review
Publication Date
2005
Volume
13
First Page
733
Abstract
(Excerpt)
Supreme Court opinions often take on a life of their own, evolving into authority for a general proposition divorced from the factual and legal environments that gave them birth. The emerged proposition assumes a talismanic quality and becomes accepted as the meaning of the case. The proposition is extended and applied as a principle, without revisiting the opinion from which it sprang. A dramatic change in the background legal regime calls for a re-evaluation of such accepted principles and a return to their origins to determine whether, and to what extent, the emerged proposition still has validity.
An example of such an opinion is the 1974 opinion of Kokoszka v. Belford which defined the relationship between the federal consumer protection restrictions on wage garnishment and the bankruptcy laws. The federal garnishment limitations generally insulate 75 percent of a debtor's earnings from seizure. Although Kokoszka dealt with the relatively narrow question of whether those provisions could be used to exempt 75 percent of an income tax refund from the debtor's bankruptcy estate under the exemption provisions of the then applicable Bankruptcy Act, it has become viewed as standing for the more general proposition that the garnishment limitations do not apply in bankruptcy. The substantial changes to the consumer bankruptcy laws ushered in by the recent Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (hereinafter "BAPCPA") call for a reconsideration of Kokoszka and a re-evaluation of whether the proposition that the garnishment limitations do not apply in bankruptcy makes sense in light of the new legal structure.
Comments
Reprinted with permission of the American Bankruptcy Institute Law Review. Originally published at 13 AM. BANKR. INST. L. REV. 733 (2005).