Appendix — Saunders v. United States, 122 S. Ct. 1305 (2002) (No. 01-1051)

& Supreme Court, U.S.

FILED

%

No.

| In The

Supreme Court of the Anited States

JERALD D. SAUNDERS,

Petitioner,

V.

UNITED STATES OF AMERICA

On Petition for Writ of Certiorari

To The United States Court of Appeals, Eleventh Circuit

APPENDIX TO

PETITION FOR WRIT OF CERTIORARI

PATRICK S. SCOTT

Counsel of Record

Law Office of Patrick Scott

111 S.E. 12% Street, Suite B

Ft. Lauderdale, FL 33316-1813

Phone No. (954) 523-1615

Fax No. (954) 523-1614

TABLE OF CONTENTS TO APPENDIX

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[1996 Bankr. LEXIS 1928 ]

UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF FLORIDA

In re:

JERALD SAUNDERS, Debtor.

CASE NO. 94-23489-BKC-RBR

/

JERALD SAUNDERS, Plaintiff,

v.

UNITED STATES OF AMERICA, Defendant.

ADVERSARY NO. 95-0475-BKC-RBR-A

/

MEMORANDUM DECISION AND ORDER

THIS MATTER came before the Court for trial on

September 22, 1995 upon the Debtor's Complaint to

Avoid Liens and Determine Dischargeability of Income

Taxes. The Court, having heard the testimony, examined

the evidence presented, observed the candor and

demeanor of the witnesses, and considered the

arguments of counsel, makes the following findings of

fact and conclusions of law.

FINDINGS OF FACT

The Debtor, Jerald Saunders, first filed for bankruptcy

relief under Chapter 7 of the Bankruptcy Code on July 6,

1994. As discussed later herein, that case was eventually

1

ER Cre nn geen

dismissed at the request of the Debtor, and the Debtor's

second Chapter 7 petition was filed on September 9,

1994. At the time of the Debtor's first petition, the Debtor

owed the IRS over $ 500,000.00 in delinquent federal

income taxes, interest, and penalties for [*2] the years

1978, 1979, 1983, 1984, 1985, 1986, and 1987. These

delinquencies are the subject of this adversary

proceeding.

The Debtor was a long-term pilot for Pan American

Airways ("Pan Am") who lost his job after Pan Am filed

for bankruptcy relief in late 1991. As an employee of Pan

Am, the Debtor had an interest in two ERISA Title I

qualified pension plans. During the course of Pan Am's

bankruptcy proceedings, the Debtor's interests in those

pension plans were terminated. Consequently, in March

1993, the Debtor rolled over his funds from the pension

plans into individual retirement accounts (IRA) held at

Smith Barney Shearson, Inc. ("Smith Barney"). The

Debtor has claimed an exemption in these funds on his

Schedule C, and no objection has been filed to the

exemption. Therefore, the funds in the Debtor's IRA

accounts are generally exempt from the claims of the

trustee and general creditors.

The IRS recorded two Notices of Federal Tax Lien with

respect to the Debtor's tax delinquencies. The first one

was filed in Washington, D.C. on September 20, 1991.

The other one was recorded in the public records of

Broward County, Florida on September 8, 1994, in

connection with the dismissal [*3] of the original

Chapter 7 and the refiling of the second Chapter 7.

Curiously, no notices were recorded in the time period

between 1992 and September 1994.

The IRS mailed a Notice of Levy to Smith Barney on June

9 or 10, 1994. Smith Barney received the notice on June

14, 1994. At all times before the levy, Smith Barney held

2

more funds in the Debtor's IRA accounts than the sum

stated in the Notice of Levy. The notice instructed Smith

Barney to hold the funds for 21 days from the date of

receipt of the notice, and the funds were be released to

the IRS on July 6, 1994. However, the Debtor's

bankruptcy petition was filed on July 6, 1994 and the

automatic stay prohibited Smith Barney from releasing

the funds.

In his Complaint, the Debtor seeks a determination that

his entire obligatior: to the IRS is dischargeable except for

the taxes, interest and penalties for the 1986 tax year. The

IRS does not dispute that the obligations for the years

1978, 1979, and 1987 are dischargeable. However, the IRS

maintains that the Debtor may not discharge the debt

owed for 1983, 1984, and 1985.

The Debtor also seeks the determination that the notices

of federal tax lien filed by the IRS were ineffective. [*4]

As stated above, the first notice of federal tax lien was

filed on September 20, 1991 in Washington, D.C. The

Debtor claims that he was a resident of Florida at that

time and, therefore, the filing in Washington, D.C. was

not proper. |

In support of its contention that Washington, D.C. was

the proper jurisdiction for filing the notice, the IRS

maintains that the documents used by the IRS to locate

the Debtor indicated that the Debtor was residing

outside of the country. It also argues that even if the

Debtor was living in Florida in September of 1991, the

Debtor never provided the IRS with a change of address.

The Debtor testified that he was based in Berlin,

Germany for a period of time but was transferred by Pan

Am to Miami, Florida in early 1991, and that he generally

resided at the same address in Ft. Lauderdale, Florida

from the date of the Pan Am transfer to the date of the

3

trial.

At trial, Cyd Sykes, an IRS Revenue Officer testified as to

the IRS source documents used by the IRS to determine

the Debtor's last known address. She testified that the

documents listed an international address, an address in

Jamaica, New York, an address in Kent, Connecticut, and

one document listed [*5] the Debtor's current address in

Fort Lauderdale, Florida.

Upon review of the evidence, I find that the Debtor has

been a resident of Florida since he was reassigned to

Miami by Pan Am in April 1991. At that time, he was

registered in a training course and filed a W-4 with his

employer listing his Florida address. The Debtor has

spent a great majority of his time traveling with Pan Am

and "living out of a suitcase," but in 1991 the Debtor

spent more than 100 days in Florida. He registered to

vote in Florida before the 1992 general election, and in

early 1993 he filed his 1989, 1990, and 1991 tax returns

using the Florida address. The IRS has not produced any

evidence that the Debtor claimed any residency other

than Florida after April 1991, or that Mr. Saunders spent

more time anywhere other than Florida.

I also find that several grounds existed for the IRS to

question the Debtor's actual address in September 1991,

but neglected to do so. While the IRS was aware that the

Debtor was assigned to employment overseas since the

late 1980's, several source documents on file with the IRS

contained domestic addresses. In addition, when the IRS

gamished the Debtor's wages beginning September [*6]

15, 1991, the IRS initially used a German Pan Am address

but was unsuccessful. Thereafter, the IRS re-noticed the

levy to Pan Am-New York. Considering these factors, the

IRS should have questioned whether the Debtor still

resided overseas.

It was conceded that the Debtor's first Chapter 7 petition

was filed for the purpose of preventing the IRS from

successfully levying upon the Debtor's IRA accounts.

However, after that petition was filed the Debtor

determined that the filing on July 6, 1994 would not

allow the Debtor to discharge in the Bankruptcy all of the

past due taxes pursuant to 11 U.S.C. §§ 507(a)(8)(A)(ii)

and 523(a)(1)(A). Therefore, on August 26, 1994, the

Debtor sought to dismiss the first bankruptcy and

immediately thereafter file a second bankruptcy which

would enable the Debtor to discharge virtually all of the

past due taxes. This matter was noticed for hearing on

September 8, 1995. It was as a result of the Debtor's

actions and the dismissal of the first bankruptcy petition

that the second notice of levy to which the Debtor objects

was filed in Broward County, Florida on September 8,

1994. The Court's ruling authorizing dismissal of the case

was read into the record [*7] at the time of the hearing,

or approximately 10-11:00 a.m. The written Order (the

"Dismissal Order") was date-stamped by the Clerk's

office at 2:01 p.m. and docketed at 4:09 p.m. that same

day.

Immediately following the hearing on the Debtor's

Motion to Dismiss, IRS counsel instructed a waiting IRS

Revenue Officer to file a notice of federal tax lien in

Broward County, Florida. The notice was date-stamped

at 2:32 p.m. on September 8, 1994 at the Broward County

State Courthouse. The Debtor maintains that since the

notice was filed prior to the actual docketing of the

Dismissal Order, the notice was filed in violation of the

automatic stay and is thereby ineffective.

The Court will address each of the above issues in turn

below.

CONCLUSIONS OF LAW

The Notice of Federal Tax Lien Filed on September 8,

1994 Violated the Automatic Stay Provisions of § 362

Federal Rule of Bankruptcy Procedure 9021 provides that

"[a] judgment is effective when entered as provided in

Rule 5003." Rule 5003 requires the Clerk to enter on the

official docket "each judgment, order, and activity in that

case." The term "judgment" as used in this rule means

"any appealable order". F.R.B.P. 9001(7). [*8] Therefore,

any appealable order becomes effective once entered on

the Court's official docket.

The Dismissal Order is an appealable final order.

Consequently, following the plain meaning of the above

rules, the notice of federal tax lien, which was filed prior

to the actual docketing of the Dismissal Orders, was filed

when the automatic stay was still in effect. See, In re

1 (automatic

Stay terminated when dismissal order entered on

docket), aff'd, 123 B.R. 466 (9th Cir. BAP 1991). See also,

ir. BAP (effective

ruling converting case was not effective until entered on

docket by clerk).

The United States argues that such a result would be

unjust as bankruptcy practitioners often rush copies of

date-stamped petitions to the IRS to stop collection

activities. The government argues that the Debtor cannot

rely on the act of filing to commence the automatic Stay,

but thereafter rely on the act of entry on the docket to lift

the same stay. The IRS maintains that if the Debtor's

argument [*9] is accepted, "the IRS reasonably could

contend that it need not stop collection activity until

receiving a copy of a docket entry sheet showing the

6

filing time and date of a bankruptcy petition or order. ..

The government's position is incorrect. Rule 9021 only

applies to judgments and final orders, not to petitions.

Section 301 of the Code specifically provides that a

voluntary petition is effective upon filing. Similarly,

Section 362(a) provides that the filing of a petition

operates as an automatic stay. The IRS may find this

disparate treatment unfair, but such treatment is

mandated by the Code.

The United States also refers the Court to a recent

decision by the Bankruptcy Court for the District of

Massachusetts, Eastern Division, for the proposition that

formal entry on the docket of an oral ruling is

insignificant. Roy v. Roy, et. al., Case No. 93-1040

(October 2, 1995). In Roy, the Court affirmed monetary

sanctions against an attorney for failing to disclose an

oral order of dismissal in a related case. The Court found

that the attorney should have disclosed the prior oral

rulings, and the fact that a "final order had not been

entered on the docket did [*10] not obviate [the

attorney's} obligation to ensure that full disclosure was

made." Roy, Case No. 93-1040, slip. op. at 4. However,

while the Court found that the attorney should have

disclosed the existence of the oral ruling, the Court did

not address the effectiveness of the order prior to it being

docketed. I also find this case factually distinguishable as

the issue in Roy was the appropriateness of Rule 11

sanctions for an attorney who filed a motion in the

Massachusetts bankruptcy court requesting sanctions for

violation of the automatic stay without disclosing that

the bankruptcy court in California had orally dismissed

her client's case and denied her employment. The

undisclosed facts were critical to the outcome of the

attorney's motion. In contrast, sanctions pursuant to Rule

9011 are not at issue in this case, and there has been no

7

allegation that any of the parties herein misled the Court.

The Notice of Federal Tax Lien filed in Washington

D.C. on September 20, 1991 was Ineffective

Pursuant to 26 U.S.C. § 6323(f)(2)(B) the proper location

for filing a notice of federal tax lien for personal property

is the residence of the taxpayer at the time the notice

[*11] is filed. By statute, "the residence of a taxpayer

whose residence is without the United States is deemed

to be in the District of Columbia." § 6323(f)(2).

Consequently, the 1991 lien notice filed in Washington,

D.C. is valid against a hypothetical bona fide creditor

and the Debtor only if the Debtor was a resident of

Washington, D.C. or a resident "without the United

States" at the time the lien was filed.

As stated above, the IRS maintains that the filing in

Washington, D.C. was proper based on its knowledge of

the Debtor's whereabouts. The government contends that

as of September 20, 1991, the information possessed by

the IRS indicated that the Debtor was living abroad. As

such, the IRS maintains that it cannot be expected to

know the undisclosed location of a Debtor who has

moved without advising them, and refers the Court to

several cases to support the proposition that the

taxpayer's "last known address" is controlling.

I have reviewed the cases cited by the IRS and I find

them distinguishable from the matter presently before

the Court. Each of the cited cases involves the

determination of a taxpayer's address for the purpose of

mailing a notice of tax deficiency. The deficiency [*12]

notice statute, 26 U.S.C. § 6212, specifically provides that

the "last known address" is the address to be used for

such purposes. In contrast, the lien notice statute at issue

in this case does not provide that a taxpayer's "last

known address" is to be used for the filing of a notice of

federal tax lien. In fact, it has been held that § 6323(f)

does not generally permit the IRS to file its notice at the

place of the taxpayer's "last known address," even if IRS

does not know the taxpayer's current address. For

instance, in Corwin Consultants, Inc. v. Interpublic

Group of Companies, Inc., 512 F.2d 605 (2d Cir. 1975), the

Second Circuit stated

A principal purpose of the 1966 Tax

Lien Act in using residence filing was

to "increase the likelihood that

creditors, generally, will receive notice

as to the taxpayer's standing with the

Government."

Id. at 610. As.such, the Court recognized that "a last

known address interpretation [of § 6323] might thus put

creditors of the taxpayer at the mercy of whatever

records the IRS office involved happens to possess," and

acknowledged that it may even be impossible under the

law for the IRS to properly perfect its [*13] lien in

certain cases, such as where the taxpayer has no

definable address. Id. |

Furthermore, even if the Court assumes that the

taxpayer's "last known address" is controlling, when the

IRS holds information which indicates that the address

on the taxpayer's last filed tax return may be incorrect, it

is under a duty to exercise "reasonable diligence" to

ascertain the correct address. In re Bell, 166 B.R. 478, 480

(Bankr. S.D. Fla. 1994), aff'd, 183 B.R. 650 (S.D. Fla. 1995).

According to the testimony of Ms. Sykes, the source

documents used by the IRS to determine the Debtor's

whereabouts contained numerous addresses, both within

the United States and abroad. Considering these

numerous addresses, | find that the IRS had an

obligation to attempt to ascertain which address, if any,

9

Se

en _

was correct. This obligation could have been satisfied by

simply sending an address information request form to

the addresses listed on the source documents, to the

Debtor's employer, or to the Debtor's accountant.

However, since the IRS did not make any such inquiries,

I find that the IRS did not exercise reasonable diligence

when it filed the notice in Washington, D.C.

Finally, I note that between [*14] September 20, 1991

and June 8, 1994, the date of the Debtor's second petition,

the Debtor filed several tax documents with the IRS

which listed the Debtor's Ft. Lauderdale address. For

example, when the Debtor changed his address to Ft.

Lauderdale, Florida in early 1991, he gave Pan Am a W-

4. Although the IRS may not have received a copy of this

W-4, they did receive a copy of the W-2 which was

generated by Pan Am in 1992 for the 1991 tax year. In

addition, the Debtor's tax returns for 1989, 1990 and 1991,

each listing the Florida address, were filed in early 1993.

At that time, the IRS could have easily protected its claim

by filing a notice in Florida, yet it waited until June of

1994 to do so. The IRS has provided no reasonable

explanation for its delinquent actions.

Accordingly, for all of the reasons stated above, I find

that the filing of the notice in Washington, D.C. was

invalid.

The Debtor is Entitled to Discharge the Assessed and _

Unpaid Federal Income Tax Liabilities for Years 1978,

1979, and 1987

Sections 507(a)(8)(A)(ii) and 523(a)(1)(A) of the

Bankruptcy Code provide that prepetition indebtedness

for income taxes is non-dischargeable if the taxes were

“assessed [*15] within 240 days, plus any time plus 30

days during which an offer in compromise with respect

to such tax that was made within 240 days after such

10

assessment was pending, before the date of the filing of

the petition." § 507(a)(8)(A)(ii).

The Debtor had an offer in compromise pending for 476

days. Therefore, to determine whether the Debtor's

unpaid tax liability for a given year is dischargeable, the

Court must count the number of days between the date

of assessment and the date of the Debtor's first petition,

July 6, 1994, and subtract 506 days (476 plus 30). The tax

year is dischargeable if the result for any given year is

greater than 240.

The calculations for the years at issue are as follows:

Year # of Days

1978 2,609-506 = 2,103 Dischargeable

1979 2,609-506 = 2,103 Dischargeable

1983 714 - 506 Non-Dischargeable

1984 738-506 = 232 Non-Dischargeable

i]

B

1985 692-506 = 186 Non-Dischargeable

1986 500-506 = -6 Non-Dischargeable

1987 ~ 771-506 = 265 Dischargea’

The Debtor argues that the above calculations are

incorrect. He asserts that the automatic stay in the

Debtor's first bankruptcy did not toll the running

of the [*16] limitations period for the delinquent

taxes. Therefore, the Debtor argues that the

calculation must be conducted from the date of

the Debtor's second petition, September 9, 1994.

In that case, only the delinquent taxes for 1986

would be non-dischargeable.

11

The relevant code sections are 11 U.S.C. § 108(c)!

and 26 U.S.C. 6503(h).?2 Several courts have held

that these provisions operate to extend the

limitations periods provided in §§ 507(a)(8)(A)(ii)

and 523(a) during the pendency of a debtor's

bankruptcy case. In re Teeslink, 165 B.R. 708, 711

(Bankr. S.D. Ga. 1994). See also, In re Montoya,

F ir. 1 l

Cir. 1993); In re West, 137 B.R. 1012 (D. Or. 1992),

aff'd, 5 F.3d 423 (9th Cir. 1993). However, the

' Section § 108(c) provides:

If applicable nonbankruptcy law . . . fixes a period for

commencing or continuing a civil action in a court

other than a bankruptcy court on a claim against the

debtor . . . and such period has not expired before the

date of the filing of the petition, then such period

does not expire until the later of . . . the end of such

period, including an suspension of such period

occurring on or after the commencement of the case.

(emphasis added).

2 Section 6503(h) provides:

Cases under title 11 of the United States

Code.

The running of the period of limitations

provided in section 6501 or 6502 on the

making of assessments or collection shall,

in a case under title 11 of the United States

Code, be suspended for the period during

which the Secretary is prohibited by

reason of such case from making the

assessment or from collecting and -

(1) for assessment, 60 days thereafter, and

(2) for collection, 6 months thereafter.

12

plain language of the statute suggests that §

108(c) only applies to nonbankruptcy law.

Therefore, since the time periods provided in §§

507 and 523 are necessarily bankruptcy law, §

108(c) would not apply. [*17]

This plain language interpretation of § 108(c) was

adopted by Judge Cohen in the Northern District of

Alabama. In re Gore, 182 B.R. 293 (Bankr. N.D. Ala.

1995); In re T 182 B.R. 317 _N.D, Ala

In Gore and Turner, Judge Cohen recognized that

Neither section 108(c) of the Bankruptcy

Code nor section 6503(h) of the Internal

Revenue Code mention the word

"discharge," or refer to section 523 or

section 507, or by their express terms

purport to relate to or effect either the

dischargeability or priority of taxes in

bankruptcy, but instead, specifically apply

to [*18] nonbankruptcy periods of

limitation.

Gore, 182 B.R. at 299; T 1 24. He also

reasoned that had Congress intended the time period in

§§ 507 and 523 to be suspended during the pendency of

prior bankruptcy cases, Congress could have easily

enacted such a provision in the Bankruptcy Code just as

it had with respect to offers in compromise. 182 B.R. 293

at 302.

While Judge Cohen determined that §§ 108(c) and

6503(h) do not toll the time periods specified in §§ 507

and 523, he explained that under 11 U.S.C. § 105, the

bankruptcy court may nevertheless exercise its equitable

powers when it would be necessary to prevent prejudice

to the IRS. As such, if the discharge of the debtor's

13

income taxes in a subsequently filed bankruptcy case

would be inequitable, the Court may, for the purpose of

determining the dischargeability of the debtor's income

tax obligations, “add the time that the IRS was actually

enjoined by the automatic stay in the prior bankruptcy

case from proceeding against a debtor to the time period

specified under § 507(a)(7)(A)(i). . . ." Id. at 314.

Having reviewed Judge Cohen's opinions and the cases

finding the time periods in §§ 507 and 523 [*19] to be

tolled during the pendency of a bankruptcy case, I find

Judge Cohen's rulings more persuasive. Consequently,

following the literal language of the Bankruptcy Code,

only the Debtor's cbligation for the 1986 tax year would

be non-dischargeable. However, I find that such a result

would unfairly prejudice the IRS.

The Debtor commenced his first bankruptcy to prevent

Smith Barney from honoring the levy on the Debtor's

IRA accounts. Had the Debtor not filed for bankruptcy

on July 6, 1994, the IRS claims would have been paid in

full. Once the Debtor filed his first petition, the automatic

stay thereafter prevented the IRS from attempting to

collect the delinquent taxes. The Debtor then dismissed

his first petition and immediately filed another petition,

attempting to discharge delinquent taxes not otherwise

dischargeable in the first bankruptcy. If this Court holds

that the time period for determining priority status and

dischargeability of tax claims is not tolled during the

Debtor's first bankruptcy case, the IRS will forever lose

the ability to recover its taxes whereas the Debtor would

effectively avoid payment on account of the first levy as

well as discharge the underlying obligation, [*20] a

result inconsistent with the purpose of the Bankruptcy

Code. This Court will not allow the Debtor to use his first

bankruptcy filing as both a sword and a shield.

Therefore, pursuant to the above, I find it necessary to

14

add to the 240-day reach back period the time that the

IRS was enjoined, by reason of the automatic stay in the

Debtor's first bankruptcy case, from pursuing its claim

against the Debtor. Accordingly, based on the above

calculations, the Debtor is only entitled to discharge the

assessed and unpaid federal income tax liabilities for

1978, 1979 and 1987.

Penalties Attributable to Tax Debt Arising More than

Three Years from Date of Petition are Dischargeable

Section 523(a)(7)(B) of the Bankruptcy Code provides

that fines or penalties "imposed with respect to a

transaction or event that occurred before three years

before the date of the filing of the petition" are not

discharged. In In re Burns, 887 F.2d 1541 (11th Cir. 1989),

the Eleventh Circuit recognized that this section extends

to tax penalties, even if the underlying tax is non-

dischargeable.

In determining which tax penalties are dischargeable, it

has been recognized that the relevant "transaction [*21]

or event" the Court must look to is the date the tax was

due. In re Leahey, 169 B.R. 96 (Bankr. D.N.J. 1994) (citing,

Teeslink, 165 B.R. at 717), This is so because "penalties

are incurred the first day that the tax payment or return

is late." Leahey, 169 B.R. at 100. Accordingly, in this case,

any penalties arising from the tax years prior to 1991 are

discharged.

* The Debtor asserts that the penalties arising from all tax

years before 1992 are discharged. However, the taxes for

1991 were not due until April 15, 1992. This is the transaction

to which the Court must look, and it occurred within three

years of the Debtor's petition.

15

In accordance with the foregoing findings of fact and

conclusions of law it is hereby ORDERED AND

ADJUDGED as follows:

1. The relief requested in Count I of the Debtor's

Complaint is hereby GRANTED. All liens for the ;

delinquent taxes, penalties, and interest are avoided.

2. The relief requested in Count II of the Debtor's

Complaint is GRANTED [*22] in part and DENIED in

part. The Debtor's tax liability, along with interest and

penalties assessed thereon, shall be discharged for the

1978, 1979, and 1987 tax years. The Debtor's tax liabilities

for tax years 1983, 1984, 1985, and 1986 shall not be

discharged.

3. The Debtor's liability for penalties arising from tax

years prior to 1991 shall be discharged.

DONE AND ORDERED in chambers in the Southern

District of Florida, this 26th day of January, 1996.

s/RAYMOND B. RAY, Judge

United States Bankruptcy Court

16

[240 B.R. 636; 1999 U.S. Dist. LEXIS 4664; 99-1 U.S. Tax

Cas. (CCH) P50,445; 84 A.F.T.R.2d (RIA) 5875]

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF FLORIDA

In re:

JERALD D. SAUNDERS, Debtor,

JERALD D. SAUNDERS, Appellant,

vs.

UNITED STATES OF AMERICA, Appellee.

CASE NO. 96-6236-CIV-DIMITROULEAS

/

FINAL ORDER AFFIRMING/REVERSING

BANKR T'S ORDER

THIS CAUSE is before the Court, pursuant to 28 U.S.C. §

158(a), on cross-appeals by the debtor, Jerald D.

Saunders, and the United States of America, of a

Memorandum Decision and Order, dated January 26,

1996, entered by United States Bankruptcy Judge

Raymond B. Ray (hereinafter "Bankruptcy Order").4 The

Court has carefully considered the cross-appeals,

[**2] has carefully reviewed the court file herein

* Saunders v. United States (In re Saunders), 1996 Bankr.

LEXIS 1928, No. 94-23489- BKR-RBR, 1995 WL 865471

(Bankr. S.D. Fla. Jan. 26, 1996).

17

il

including the entire designation of record on appeal, and

is otherwise fully advised in the premises.

I, BACKGROUND

This case arose from the Internal Revenue Service's

("IRS") attempt to collect unpaid federal tax liabilities of

the debtor, a former pilot with Pan Am. The debtor owed

federal income taxes for the 1978, 1979, 1983, 1984, 1985,

1986 and 1987 tax years. In April 1991, Pan Am

reassigned the debtor from Germany back to the United

States. On September 20, 1991, the IRS filed a notice of

federal tax lien in Washington, D.C. with respect to the

unpaid tax liabilities. The IRS filed the notice in

Washington, D.C. because it believed that the debtor still

resided outside of the United States.

In late 1991, Pan Am filed for bankruptcy relief. As a

result, the debtor lost his job with Pan Am. As an

employee of Pan Am, the debtor had an interest [**3] in

two pension plans. During the course of Pan Am's

bankruptcy proceedings, the debtor's interests in those

pension plans were terminated. Consequently, in March

1993, the debtor rolled over his funds from the pension

plans into individual retirement accounts (IRA) held at

Smith Barney Shearson, Inc. ("Smith Barney"). The IRS

was seeking to levy on the IRA accounts in order to

satisfy the debtor's outstanding tax liabilities. On June 9

or 10, 1994, the IRS mailed a notice of levy to Smith

Barney, which was received on !une 14, 1994. At all times

before the levy, the funds in the IRA accounts totaled

more than the outstanding tax liabilities. Pursuant to the

notice of levy, Smith Barney believed the funds were to

be released to the IRS by July 6, 1994.

On July 6, 1994, prior to Smith Barney releasing the

funds to the IRS, the debtor filed a bankruptcy petition

under Chapter 7 of the United States Bankruptcy Code in

18

order to prevent the IRS from levying upon his IRA

accounts with Smith Barney. On August 26, 1994,

realizing that certain liabilities were not dischargeable in ,

the bankruptcy proceeding, the debtor requested the ()

bankruptcy court to dismiss the petition. On September ()

8, 1994, [**4] at a hearing on the debtor's motion to

dismiss, the bankruptcy court read a ruling into the

record at approximately 11:00 a.m. dismissing the

bankruptcy proceeding. A [*638] written order of

dismissal followed, which was date-stamped by the

Clerk's office at 2:01 p.m. and was docketed at 4:09 p.m.

on the same day, September 8, 1994.

The IRS, after receiving the written order of dismissal,

but prior to the docketing of the order, immediately filed

a notice of federal tax lien in Broward County, Florida.

The notice was date-stamped as filed at 2:32 p.m. on

September 8, 1994.

On September 9, 1994, one day after the dismissal of his

first bankruptcy proceeding, the debtor filed a second

bankruptcy petition under Chapter 7 of the Bankruptcy

Code. This second bankruptcy proceeding is currently

before the Court. On September 9, 1994, the date of the

present bankruptcy petition, the debtor owed the IRS

over $ 500,000 as follows:

Tax Year = Tax Interest _—~Penallty

1978 $5,167.80 $112,839.51 $ 11,046.84

1979 6,616.64 24,689.14 1,995.16

1983 14,122.36 42,422.62 21,627.50

1984 14,427.00 39,769.82 22,213.84

1985 19,038.00 44,801.70 27,319.26

1986 19,349.00 24,166.31 9,190.78 ()

1987 14,296.00 21,590.90 17,076.40 ()

Totals $ 93,016.80 $310,280.00 $110,469.78

[**5] The debtor's IRA accounts with Smith Barney have

been determined to be exempt from the debtor's bankruptcy

estate pursuant to Florida Statutes §§ 222.21(2)(a) and

222.201.

On April 12, 1995, the debtor filed an adversary complaint to

avoid liens and determine dischargeability of income taxes,

which is the subject of the present cross-appeals. The

adversary complaint sought to avoid the notices of federal

tax liens recorded on September 20, 1991 in Washington, DC

and on September 8, 1994 in Broward County, Florida. The

adversary complaint also sought to have the debtor's 1978,

1979, 1983, 1984, 1985 and 1987 tax liabilities discharged.5

On September 22, 1995, a trial was held on the debtor's

adversary complaint. Following the trial, [**6] the

bankruptcy court entered its Memorandum Decision and

Order, which is the current order on appeal. The

bankruptcy court specifically held as follows: (1) the

September 8, 1994 recording of a notice of federal tax lien

violated the automatic stay provisions of 11 U.S.C. § 362,

and is therefore avoided, because the IRS recorded the

notice prior to the actual docketing of the written order

of dismissal; (2) the September 20, 1991 notice of federal

tax lien recorded in Washington, DC was ineffective, and

therefore avoided, because the debtor was a resident of

Florida; (3) the 1978, 1979 and 1987 taxes and interest are

dischargeable but the 1983, 1984, 1985 and 1986 taxes and

interest are not dischargeable; and (4) the penalties for all

* The debtor has conceded from the beginning of the

proceeding that the 1986 taxes and interest are

dischargeable. The United States has not challenged the

1978, 1979, and 1987 tax liabilities, and the bankruptcy court

discharged these liabilities in the Bankruptcy Order.

20

of the tax years at issue are dischargeable. The debtor

appealed and the United States has cross-appealed.

Specifically, the debtor appeals the bankruptcy court's

determination that the 1983, 1984 and 1985 taxes and

interest are not dischargeable. The debtor asserts that the

bankruptcy court should not have tolled the time periods

for dischargeability for the time period during the

debtor's first bankruptcy proceeding.

The United States appeals the [**7] bankruptcy court's

determination that the debtor was a resident of Florida

on September 20, 1991. The United States also appeals

the bankruptcy court's determination that the recording

of the September 8, 1994 notice of federal tax lien

violated the automatic stay. Finally, the United States

requests the Court to remand the matter to the

bankruptcy court to determine the rights of the parties to

the funds held in the IRA accounts with Smith Barney

which are subject to the notice of levy.

The Court will address each of the issues on appeal in

turn.

[*639] II. STANDARD OF REVIEW

The Bankruptcy Court's findings of fact will not be set

aside unless clearly erroneous. Fed.R.Bankr.P. 8013;

v vi

F.2d 1069, 1071 (11th Cir. 1990). Equitable

determinations by the bankruptcy court are reviewed for

abuse of discretion, In re Red Carpet Corp., 902 F.2d 883

(11th Cir. 1990), while conclusions of law are reviewed

by the District Court de novo. In re Chase & Sanborn

Corp., 904 F.2d 588 (11th Cir. 1990); In re Sublett, 895

F.2d 1381 (1 i

21

Ill. DISCUSSION

A. Tolling of Time Periods for Prior Bankruptcy Filing

[**8]

Pursuant to section 523(a)(1)(A) and 507(a)(8)(A)(ii) of

the Bankruptcy Code, income tax liabilities which were

assessed within 240 days, plus any time plus 30 days

during which an offer in compromise was pending, of

the date of the filing of the petition, are excepted from

discharge. Here, the debtor's 1983, 1984 and 1985 taxes

were assessed within such time period prior to the initial

July 6, 1994 bankruptcy petition, and thus, were excepted

from discharge. Consequently, the debtor requested the

bankruptcy court to dismiss the original bankruptcy

proceeding to allow the debtor to file a new bankruptcy

petition.

The debtor filed a new bankruptcy petition on September

9, 1994, which was filed more than 240 days (plus the

additional time within which the debtor had an offer of

compromise pending before the IRS plus 30 days) after

the debtor's 1983, 1984 and [**9] 1985 taxes were

assessed. Therefore, if the debtor had not filed the

original bankruptcy proceeding, the debtor's 1983, 1984

and 1985 tax liabilities would have been dischargeable in

the present bankruptcy proceeding.” The question before

the Court, however, is whether the time period for

° The parties do not dispute the dates that the IRS assessed

the taxes or the time period during which the debtor had an

offer in compromise pending.

” However, if the debtor had not filed the original

bankruptcy petition, the IRS would have had ample

opportunity to levy upon the debtor's IRA accounts with

Smith Barney to satisfy the entire outstanding tax liabilities.

22

|

determining the dischargeability of tax liabilities was

tolled during the pendency of the prior bankruptcy

proceeding.

The Court notes that there is a split among the courts as

to whether such time periods are tolled. Compare

Waugh v. Internal Revenue Serv. (In re Waugh), 109 F.3d

489 (8th Cir.1997), cert. denied, 118 S. Ct. 80 (1997)

(finding the time periods are suspended while the debtor

was in bankruptcy) with Quenzer v. United States (In re

Quenzer), 19 F.3d 163 (Sth Cir.1993) (finding that [**10]

the time periods are not suspended). The majority of

cases, relying upon 11 U.S.C. § 108(c) and 26U.S.C. -

6503(b), hold that the time periods are suspended during

the pendency of the debtor's prior bankruptcy

nae ae Gee

N.D. Ga. 1998) (listing cases). The Eleventh Circuit has

not yet reached the present issue. For the reasons that

follow, the Court will follow the majority of cases to

decide the present issue.

While the Bankruptcy Code does not contain any

provisions which explicitly suspend the dischargeability

time periods while a debtor is engaged in bankruptcy

proceedings, 11 U.S.C, § 108(c) provides as follows:

Except as provided in section 524 of this title, if

applicable nonbankruptcy law, an order entered in

a nonbankruptcy proceeding, or an agreement fixes

a period for commencing or continuing a civil

action in a court other than a bankruptcy court on a

claim against the debtor, or against an individual

with respect to which such individual is protected

under [*640] section 1201 or 1301 of this title, and

such period has not expired before the date of the

filing of [**11] the petition, then such period does

not expire until the later of-—

23

OL ee

(1) the end of such period, including any

suspension of such period occurring on

or after the commencement of the case;

or

(2) 30 days after notice of the

termination or expiration of the stay

under section 362, 922, 1201, or 1301

of this title, as the case may be, with

respect to such claim.

11 US.C. § 108(c) (emphasis added). The United States'

argument is that Section 108(c) incorporates 26 U.S.C. §

6503(h), which provides as follows:

(h) Cases under title 11 of the United States Code.—

The running of the period of limitations provided

in section 6501 or 6502 on the making of

assessments or collection shall, in a case under title

11 of the United States Code, be suspended for the

period during which the Secretary is prohibited by

reason of such case from making the assessment or

from collecting and—

(1) for assessment, 60 days thereafter,

and

(2) for collection, 6 months thereafter.

(Emphasis added). In Waugh, the court addressed these

two provisions and noted as follows:

Waugh urges this Court to determine that because

section [**12] 108(c) applies only to

"nonbankruptcy law,” the statute does not act to

suspend the priority period of section

507(a)(8)(A)(i), which is itself part of the

Bankruptcy Code. We recognize that "the plain

meaning of legislation should be conclusive, except

in the ‘rare cases [in which] the literal application of

a statute will produce a result demonstrably at

24

odds with the intentions of its drafters." United

States v. Ron Pair Enters., Inc., 489 U.S. 235, 242,

109 S. Ct. 1026, 1031, 103 L. Ed. 2d 290

(1989)(alteration in original)(quoting Griffin v.

Ct. 3245, 3250, 73 L. Ed. 2d 973 (1982)); accord

Shoe Co.), 64 F.3d 1146, 1150 (8th Cir.1995),

However, we conclude that this is such a "rare

case." If we applied the plain meaning of section

108(c) and held that the priority period of section

507(a)(8)(A)(i) is not suspended during bankruptcy

proceedings, Congress's intent to afford the IRS a

three-year priority period for the collection of taxes

certainly would be frustrated. Therefore, we

conclude that the three-year priority period of

section 507(a)(8)(A)(i) is suspended [**13] by 11

U.S.C. § 108(c) and 26 U.S.C. § 6503(b) and (h), for

the time that the automatic stay prevents the IRS

from collecting outstanding tax debts.

Waugh, 109 F.3d at 492-493, In support of its decision,

the court cited to the legislative history of section 108(c),

which supports the position that Congress intended

section 108(c) to incorporate section 6503(h) into the

Bankruptcy Code:

In the case of Federal tax liabilities, the Internal

Revenue Code suspends the statute of limitations

on a tax liability of a taxpayer from running while

his assets are in the control or custody of a court

and for 6 months thereafter (sec.6503(b) of the

Code). The amendment applies this rule in a title 11

proceeding. Accordingly, the statute of limitations

on collection of a nondischargeable Federal tax

liability of a debtor will resume running after 6

months following the end of the period during

which the debtor's assets are in the control or

custody of the bankruptcy court. This rule will

25

provide the Internal Revenue Service adequate

time to collect nondischargeable taxes following the

end of the title 11 proceedings.

Id, at 493 (quoting S.Rep. No. 95-989, at [**14] 31 (1978),

reprinted in 1978 U.S.C.C.A.N. 5787, 5816-17).

[*641] The court finds Waugh, and the other cases

following the majority position, to be persuasive and will

therefore follow the majority position. The Court notes

that the present case would be the precise case that

Congress was concerned about when it intended for the

IRS to have adequate time to collect nondischargeable

taxes following the end of a bankruptcy proceeding.

Here, the original bankruptcy was dismissed on

September 8, 1994 and the second bankruptcy was filed

the next day on September 9, 1994. Clearly, the IRS did

not have ample opportunity to collect the outstanding

tax liabilities between the two bankruptcy proceedings,

and the IRS' efforts to collect the debtor's liabilities were

certainly frustrated by the debtor's successive

bankruptcy filings. Accordingly, the Court affirms the

bankruptcy court's holding that the debtor's 1983, 1984

and 1985 taxes and interest are excepted from

discharge.*[**15]

B. The September 20, 1991 notice was not effective

Pursuant to 26 U.S.C. § 6323(f)(2)(B), the proper place for

filing a notice of federal tax lien, "in the case of personal

property, whether tangible or intangible, [is] at the

* Because of the Court's holding that the time periods were

suspended by section 108(c) and 6503(h), the Court does not

need to reach the bankruptcy court's basis, under 11 U.S.C.

. 105(c), for holding the 1983, 1984 and 1985 taxes and interest

are nondischargeable.

26

residence of the taxpayer at the time the notice of lien is

filed . . . and the residence of a taxpayer whose residence

is without the United States shall be deemed to be in the

District of Columbia." In the present case, the bankruptcy

court found that the debtor's residence at the time of the

filing of the September 20, 1991 notice was Florida.

Therefore, the bankruptcy court found that the notice

was invalid. The United States argues that the notice was

correctly filed in Washington, D.C. The Court disagrees.

"Section 6323(f)(2)(B) . .. was added by the Federal Tax

Lien Act of 1966 (Pub.L.No.89-719) to clarify ‘existing law

by providing specific rules with respect to the place of

Pon Sy ig gi weiede oqo .”" Corwin

Inc._ 512 F.2d 605, 608 (24 Cir. 1975) (quoting 3 US.Code

Cong. & Admin.News, 89th Cong., 2d Sess.1966, at p.

3732 (S.Rep.No.1708)). "When the drafters added [**16]

section 6323(f)(2)(B), they deliberately avoided using

domicile, however, and chose residence instead "because

of the difficulty in determining a person's domicile,

based as it is on (among other things) his state of mind."

Id. (quoting 3 U.S.Code Cong. & Admin.News, supra, at

p. 3732). A principal purpose of the 1966 Tax Lien Act in

using "residence" filing was to "increase the likelihood

that cresiiters, generally, will receive notice as to

taxpayers’ standing with the Government." Id. at 610

(quoting 3 U.S.Code Cong. & Admin.News, 89th Cong,,

2d Sess.1%66, at 3731); see also Urban Industries, Inc. of

Kentucky v. Thevis, 670 F.2d 981 (11th Cir.1982). A

person can have more than one residence but only one

domicile. Urban Industries, 670 F.2d at 986 (citing

Corwin, 512 F.2d 605 at 610).

The residence of a delinquent taxpayer is a question of

fact to be determined by various criteria, including: the

taxpayer's physical presence as an inhabitant and not a

mere transient; the permanence of that presence; the

27

reason for his presence; and the existence of other

Foams Sorwin, 512 F.2d at 610; see also In re

219 B. .D.

[**17] 7 In general, for this statute, where a

taxpayer resides is where he dwells for a significant

amount of time and where creditors would be most

likely to look for him. Corwin, 512 F.2d at 610.

In the present case, the bankruptcy court found that the

debtor was a Florida resident on September 20, 1991. In

particular, the bankruptcy court found as follows:

[*642] Upon review of the evidence, I find that the

Debtor has been a resident of Florida since he was

reassigned to Miami by Pan Am in April 1991. At

that time, he was registered in a training course

and filed a W-4 with his employer listing his

Florida address. The Debtor has spent a great

majority of his time traveling with Pan Am and

"living out of a suitcase," but in 1991 the Debtor

spent more than 100 days in Florida. . . . The IRS

has not produced any evidence that the Debtor

claimed any residency other than Florida after

April 1991, or that Mr. Saunders spent more time

anywhere other than Florida.

Bankruptcy Order at 4. The Court holds that the

bankruptcy court's finding that the debtor was a Florida

resident on September 20, 1991 was not clearly

erroneous.’ [**18]

° The United States argues that the evidence was not

sufficient to establish that the debtor was a residence of

Florida. It is clear, however, that the debtor was no longer a

resident of Germany, even if the IRS was unaware of this

fact. Moreover, if the debtor was not a resident of Florida,

then the only other alternative residence would have been

New York. However, the IRS also did not file a notice of

federal tax lien in New York. Finally, the Court agrees with

28

Having concluded that the debtor was a Florida resident

on September 20, 1991, the next question presented is

whether the IRS can still file the notice in Washington,

D.C. if the only means available to the [RS indicates that

the debtor still resided outside the United States. More

specifically, the question is whether the debtor was

required to notify the IRS that he had changed his

residence to Florida. The Court finds that the Internal

Revenue Code does not provide for such a requirement.

The cases relied upon by the United States all involve

instances where the IRS mailed notices of deficiencies of

taxes to taxpayers under 26 U.S.C. § 6212. Section 6212

requires that a notice of deficiency be mailed to the

taxpayer's "last known address." Implicit in this

requirement is that the taxpayer must notify the IRS of

any new address or the IRS is permitted to mail a notice

of deficiency to the taxpayer's last known address, even

if the taxpayer no longer lives there. See, e.g., Gaw v.

Commissioner, 310 U.S. App. D.C. 1 F. 1(D.C.

Cir, 1995). Unlike section 6212, however, section

6523(f)(2)(B) does not provide that the IRS may file a

notice of federal tax lien in the taxpayer's [**19] "[last

known] residence." The Court declines to read such

additional language into the statute. But see Corwin, 512

F.2d 605 at 611 (concurring opinion) ("The interpretation

of "residence" as meaning "last known residence" is in

accord with other provisions of the Code, see, e.g., 26

U.S.C. §§ 6212 & 6303."). Rather, the notice of federal tax

the United States' argument that events occurring after

September 20, 1991 are not relevant for determining the

debtor's residence on September 20, 1991. However, |

ignoring these additional events, the Court holds that the

bankruptcy court's finding that the debtor was a Florida

resident on September 20, 1991 was not clearly erroneous.

29

lien must be filed in the taxpayer's residence.

Here, the debtor's residence on September 20, 1991 was

in Florida. While the Court is sympathetic to the United

States’ argument that it would have been difficult to

ascertain the debtor's residence in September 1991, it

would have been just as difficult for creditors, especially

creditors in Florida, to have located a notice of federal tax

lien filed in Washington, D.C. Therefore, the Court

affirms the bankruptcy court's holding that the

September 20, 1991 notice of federal tax lien filed in

Washington, D.C. was not valid.

C. The September 8, 1994 notice was valid and not

avoidable.

The next question presented is whether the automatic

stay from the debtor's prior bankruptcy was lifted prior

to 2:32 p.m., on September 8, 1994, when the IRS filed its

notice of federal tax lien in Broward County, [**20]

Florida. 11 U.S.C. § 362(c)(2) provides that the automatic

[*643] stay was in effect until the prior bankruptcy case

was "dismissed." Therefore, the Court must decide when

the prior bankruptcy case was actually "dismissed" for

purposes of dissolving the automatic stay.

The United States argues that the notice of federal tax

lien did not violate the automatic stay if the bankruptcy

case was dismissed by the bankruptcy court when the

court gave its ruling from the bench, or when the

bankruptcy court signed its order dismissing the action,

or when the written order was stamped by the clerk of

the court. The debtor argues that the case was not

dismissed until the clerk officially docketed the written

order at 4:09 p.m. on the computer system, and therefore,

the recording of the notice of federal tax lien at 2:32 p.m.

violated the automatic stay.

30

After considering the arguments of the parties, the

bankruptcy court held that the notice of federal tax lien

filed on September 8, 1994 violated the automatic stay

provisions of section 362 as follows:

Federal Rule of Bankruptcy Procedure 9021

provides that "[a] judgment is effective when

entered as provided in Rule 5003." Rule 5003

requires [**21] the Clerk to enter on the official

docket "each judgment, order, and activity in that

case." The term "judgment" as used in this rule

means "any appealable order". F.R.B.P. 9001(7).

Therefore, any appealable order becomes effective

once entered on the Court's official docket.

The Dismissal Order is an appealable final order.

Consequently, following the plain meaning of the

above rules, the notice of federal tax lien, which

was filed prior to the actual docketing of the

Dismissal Orders, was filed when the automatic

stay was still in effect. See, In re Weston, 101 B.R.

202 (Bankr. E.D. Cal. 1989) (automatic stay

terminated when dismissal order entered on

docket), aff'd, 123 B.R. 466 (9th Cir. BAP 1991). See

also, In re Beatty, 162 B.R. 853 (9th Cir. BAP 1994)

(effective and operative date of order is date of

entry into docket); In re Rebeor, 89 B.R. 314 (Bankr.

N.D.N.Y. 1988) (oral ruling converting case was not

effective until entered on docket by clerk).

Bankruptcy Order at 6.

Initially, the Court has reviewed the cases cited by the

bankruptcy court and notes that none of these cases

squarely addressed the subject issue in the present

action. At best, the [**22] cited passages in these cases

are merely dicta. However, for every case that states that

an order must be officially docketed to be effective, the

31

Court has also found a separate case indicating that a

dismissal is effective when dismissed on the record or

when the order was entered. See, e.g., In re Lashley, 825

F.2d 362, 363 (11th Cir.1987) (per curiam) ("On

September 22, 1986, the bankruptcy court entered an

order dismissing the case. The bankruptcy court also

specifically dissolved and vacated the § 362(a) automatic

stay."); see also Fish Market Nominee Corp. v. Pelofsky,

72 F.3d 4, 6 (1st Cir.1995) ("But the stay under section

362(a) itself expired as soon as the judgment dismissing

the chapter 11 case was entered, § 11 U.S.C. 362(c)"); In re

De Jesus Saez, 721 F.2d 848, 851 (1st Cir.1983) ("We begin

by noting that, unless extended by Rule 762 or in some

other manner, an automatic stay must plainly terminate

upon dismissal of the petition giving rise to it.").

However, these additional cases also did not squarely

address the subject issue in the present action. As far as

the court can ascertain, the present issue is an issue of

first impression.

More importantly, [**23] a review of the applicable

rules also does not support the bankruptcy court's

holding. Rule 5003 provides in pertinent part as follows:

(a) Bankruptcy dockets. The clerk shall keep a

docket in each case under the Code and shall enter

thereon each judgment, order, and activity in that

case as prescribed by the Director of the

Administrative Office of [*644] the United States

Courts. The entry of a judgment or order in a

docket shall show the date the entry is made.

The Court notes that Rule 5003 is unclear as to which

“entry” is required to be shown on the docket. Docket

sheets routinely reflect both the date the order was

actually entered by the Judge and the date the order was

docketed. Of course the effective date listed on the

32

docket sheet is always the actual date of the Order (or the

date a pleading was actually filed) and not the actual

date of docketing, which many times occurs a day or

several days later.

Regardless of which entry is referenced, however, it does

not necessarily follow from these rules that it is the task

of docketing the order that makes the order effective.

Rather, common sense dictates that a court's order is

effective when a court enters such an [**24] order. Ifa

court orders a case dismissed, then the case is dismissed.

To hold otherwise would permit the clerk's office to

misplace an order and prevent the judge's order from

becoming effective. Parties should be able to reasonably

rely on a written order, signed by a Judge, that the party

has actually received, even if this Order does not get

docketed. This is exactly what occurred here. The IRS

physically had in its revenue officer's hands, a signed

order from the bankruptcy court with a date stamp of

2:01 p.m., September 8, 1994. Relying upon this signed

order, which caused the automatic stay to no longer be in

effect, the IRS immediately filed a notice of federal tax

lien. The Court holds that the filing of this notice of

federal of tax lien did not violate the automatic stay.

Therefore, the Court holds that the prior bankruptcy case

was dismissed when the bankruptcy court entered its

order dismissing the case.’° This dismissal occurred

'° The Court does not need to reach the question whether

the bankruptcy court's oral dismissal operated to cease the

automatic stay, because a written order was also entered and

date-stamped prior to the IRS’ filing of the subject notice of

oral ruling is not operative if it is a final order, with In re

Nail, 195 B.R. 922 (Banks. N.D. Ale.1996), which disagreed

33

prior to 2:32 p.m. on September 8, 1994, and

consequently, the automatic stay was no longer in effect

when the IRS filed its notice of federal tax lien.

Accordingly, the Court reverses the bankruptcy court's

holding that the September 8, 1994 [**25] notice of

federal tax lien violated the automatic stay.

D. Determination of the Rights of the Parties

The United States argues that the bankruptcy court failed

to address the rights of the parties with respect to the

IRA accounts at Smith Barney. The debtor agrees that the

Bankruptcy Order does not address this issue; however,

the debtor argues that the issue was not preserved in the

pretrial order and the issue was not raised by the [**26]

United States in its pleadings. Because the bankruptcy

court has not addressed the issue, including whether the

issue was even preserved for the bankruptcy court to

address, and in light of the court's prior rulings which

clearly affect the parties rights to the IRA accounts with

Smith Barney, the Court will remand the matter to the

bankruptcy court to address.

IV. CONCLUSION

Accordingly, after due consideration, it is

ORDERED AND ADJUDGED as follows:

1. The Bankruptcy Court's Memorandum Decision and

Order, dated January 26, 1996, is hereby AFFIRMED in

part and REVERSED in part as follows:

A. The bankruptcy court's holding that the debtor's

1983, 1984 and 1985 taxes and interest are excepted

_ with the prior cases.

from discharge is hereby AFFIRMED;

[*645] B. The bankruptcy court's holding that the

September 20, 1991 notice of federal tax lien filed in

Washington, D.C. was not valid is hereby

AFFIRMED;

C. The bankruptcy court's holding that the

September 8, 1994 notice of federal tax lien violated

the automatic stay is hereby REVERSED; and

2. This case is REMANDED to the Bankruptcy Court to

enter whatever orders are necessary consistent with the

above rulings, [**27] including addressing the rights of

the parties with respect to the IRA accounts at Smith

Barney;

3. The Clerk of this Court is directed to deny all pending

motions as moot; and

4. This case is closed.

DONE AND ORDERED in Chambers at Fort

Lauderdale, Broward County, Florida, this 25th day of

February, 1999.

s/WILLIAM P. DIMITROULEAS

United States District Judge

35

(DO NOT PUBLISH)

IN THE UNITED STATES COURT OF APPEAJ.S

FOR THE ELEVENTH CIRCUIT

No. 00-12737

D. C. Docket Nos. 96-06236-CV-WPD

94-23489-BKC-RB

JERALD D. SAUNDERS,

Plaintiff-Appellant,

versus

MARIKA TOLZ,

UNITED STATES OF AMERICA,

Defendants-Appellees.

Appeal from the United States District Court

for the Southern District of Florida

(October 4, 2001)

Before [ROSEMARY] BARKETT and [STANLEY] MARCUS,

Circuit Judges, and O’KELLEY*, District Judge.

*The Honorable William ‘° ©’ Kelley, U.S. District Court

Judge for the Northern District of Georgia, sitting by designation.

36

_

PER CURIAM:

AFFIRMED. See 11" Cir. R. 36-1. '

1 11" Cir. R. 36-1 provides:

When the court determines that any of the following

circumstances exist:

(a) judgment of the district court is based on findings

of fact that are not clearly erroneous;

(b) the evidence in support of a jury verdict is

sufficient;

(c) the order of an administrative agency is supported

by substantial evidence on the record as a whole;

(d) summary judgment, directed verdict, or judgment

on the pleadings is supported by the record.

(e) judgment has been entered without a reversible

error of law; and an opinion would have no precedential value, the

judgment or order may be affirmed or enforced without opinion.

37