No. 96-2036 IN THE SUPREME COURT OF THE UNITED STATES OCTOBER TERM, 1996 WILLIAM WINSTON WAUGH, PETITIONER v. INTERNAL REVENUE SERVICE ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE EIGHT CIRCUIT BRIEF FOR THE RESPONDENT IN OPPOSITION WALTER DELLINGER Acting Solicitor General LORETTA C. ARGRETT Assistant Attorney General GARY D. GRAY SARA S. HOLDERNESS Attorneys Department of Justice Washington, D.C. 20530-0001 (202)514-2217 ---------------------------------------- Page Break ---------------------------------------- QUESTION PRESENTED Whether the three-year priority period established in Section 507(a)(8)(A)(i) of the Bankruptcy Code runs during the pendency of a bankruptcy proceeding. (I) ---------------------------------------- Page Break ---------------------------------------- TABLE OF CONTENTS Opinions Below . . . . 1 Jurisdiction . . . . 1 Statement . . . . 2 Argument . . . . 6 Conclusion . . . . 13 TABLE OF AUTHORITIES Cases: Acosta v. IRS, 184 B.R. 544 (W.D. Term. 1995) . . . . 10 Bowling, In re, 147 B.R. 383 (Bankr. E.D. Va. 1992) . . . . 11 Brickley, In re, 70 B.R. 113 (Bankr. 9th Cir. 1986) . . . . 10 Bryant, In re, 120 B.R. 983 (Bankr. E.D. Ark. 1990) . . . . 11 Carter, In re, 74 B.R. 613 (Bankr. E.D. Pa. 1987) . . . . 11 Cowart, In re, 199 B.R. 799 (Bankr. M.D. Fla. 1996) . . . . 10 Darden, In re, 202 B.R. 715 (Bankr. E.D. Va. 1996) . . . . 10 Davidson, In re, 120 B.R. 777 (Bankr. D.N.J. 1990) . . . . 11 Deitz, In re, 116 B.R. 792 (D. Co l o. 1990) . . . . 10 DiCamillo, In re, 186 B.R. 59 (Bankr. E.D. Pa. 1995) . . . . 10 Eysenbach, In re 183 B.R. 365 (W.D.N.Y. 1995) . . . . 10 Florence, In re, 115 B.R. 109 (Bankr. S.D. Ohio 1990) . . . . 11 Gore, In re, 182 B.R. 293 (Bankr. N.D. Ala. 1995) . . . . 11 Harris, In re, 167 BR. 680 (Bankr. M.D. Fla. 1994). . . . 10 Jones, In re, 177 B.R. 541 (Bankr. N.D. Ohio 1994) . . . . 11 Linder, In re, 139 B.R. 950 (D. Colo. 1992) . . . . 10 (III) ---------------------------------------- Page Break ---------------------------------------- IV Cases-Continued: Page Macko, In re, 193 B.R. 72 (Bankr. M.D. Fla. 1996) . . . . 11 McMillan, In re, 204 B.R. 835 (Bankr. M.D. Ga. 1996) . . . . 10 Molina, In re, 99 B.R. 792 (S.D. Ohio 1988) . . . . 10 Montoya, In re, 965 F.2d 554 (7th Cir. 1992) . . . . 10, 11 Pastula, In re, 203 B.R. 941 (Bankr. M.D. Fla. 1996) . . . . 11 Pepper v. .Litton, 308 U.S. 295 (1939) . . . . 7 Quenzer, In re, 19 F.3d 163 (5th Cir. 1993) . . . . 11, 12 Quinlan, In re, 107 B. Ft. 300 (Bankr. D. Colo. 1989) . . . . 11 Richards, In re, 994 F.2d 763 (l0th Cir. 1993) . . . . 7, 8, 9, 10, 11, 12 Ringdahl, In re, Bankr. L. Rep. (CCH) 74,082 (Bankr. M.D. Fla. June 5, 1991) . . . . 11 Ross, In re, 130 B.R. 312 (Bankr. D. Neb. 1991) . . . . 11 Shabazz, In re, 206 B.R. 116 (Bankr. E.D. Va. 1996) . . . . 10 Shedd, In re, 190 B.R. 692 (Bankr. M.D. Fla. 1996) . . . . 10 Solito v. United States, 172 B.R. 837 (W.D. La. 1994) . . . . 10 Stoll, In re, 132 B.R. 782 (Bankr. N.D. Ga. 1990) . . . . 11 Taylor, In re, 81 F.3d 20 (3d Cir. 1996) . . . . 10, 11 Teeslink, In re, 165 B.R. 708 (Bankr. S.D. Ga. 1994) . . . . 10-11 Tibaldo, In re, 187 B.R. 673 (Bankr. C.D, Cal. 1995) . . . . 10 Turner , In re, 182 B.R. 317 (1995), adhered to on reconsideration, 195 B.R. 476 (Bankr. N.D. Ala. 1996) . . . . 11 United States v. Energy Resources Co., 495 U.S. 545 (1990) . . . . 7 United States v. Ron Pair Enterprises, Inc., 489 U.S. 235 (1989) . . . . 7, 12 West, In re, 5 F.3d 423 (9th Cir. 1993), cert. denied, 511 U.S. 1081 (1994) . . . . 10, 11 ---------------------------------------- Page Break ---------------------------------------- V Cases-Continued: Page West v. United States, 511 U.S. 1081 (1994) . . . . 13 Wise, In re, 127 B.R. 20 (Bankr. E.D. Ark. 1991) . . . . 11 Statutes: Bankruptcy Code, 11 U.S.C. 101 et seq.: Ch. 1, 11 U.S.C. 101 et seq: 11 U.S.C. 105(a) . . . . 7, 11, 12 11 U.S.C. 108 . . . . 12 11 U.S.C. 108(c) . . . . 6, 9, 11, 12 Ch. 3, 11 U.S.C. 301 et seq.: 11 U.S.C. 362 . . . . 2, 8 11 U.S.C. 362(a)(6) . . . . 2 Ch. 5, 11 U.S.C. 501 et seq.: 11 U.S.C. 507 . . . . 12 11 U.S.C. 507(a)(7)(A)(i) (1988) . . . . 3 11 U.S.C. 507(a)(8) . . . . 6 11 U.S.C. 507(a)(8)(A) . . . . 5, 10, 11, 12 11 U.S.C. 507(a)(8)(A)(i) . . . . 3, 4, 6, 7, 8 11 U.S.C. 523(a)(l)(A) . . . . 3 Ch. 7, 11 U.S.C. 701 et seq . . . . 2, 3, 8 Ch. 11, 11 U.S.C. 1101 et seq . . . . 2 Ch. 13, 11 U.S.C. 1301 et seq . . . . 2, 8 Bankruptcy Reform Act of 1994, Pub. L. No. 103-394, 108 Stat. 4106: 304(c)(2), 108 Stat. 4132 . . . . 3 702(b), 108 Stat. 4150 . . . . 3 Bankruptcy Tax Act of 1980, Pub. L. No. 96-589, 6(a), 94 Stat. 3389 . . . . 9 Internal Revenue Code (26 U.S.C.): 6503 . . . . 6, 11, 12 6503(b) . . . . 8, 9 6503(h) . . . . 6, 9 Miscellaneous: S. Rep. No. 1158, 89th Cong., 2d Sess. (1966) . . . . 8 S. Rep. No. 989, 95th Gong., 2d Sess. (1978) . . . . 8, 9 S. Rep. No. 1035, 96th Cong., 2d Sess. (1980) . . . . 9 ---------------------------------------- Page Break ---------------------------------------- In the Supreme Court of the United States OCTOBER TERM, 1996 No. 96-2036 WILLIAM WINSTON WAUGH, PETITIONER v. INTERNAL REVENUE SERVICE ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE EIGHTH CIRCUIT BRIEF FOR THE RESPONDENT IN OPPOSITION OPINIONS BELOW The opinion of the court of appeals (Pet. App. Al- A10) is reported at 109 F.3d 489. The opinion of the district court (Pet. App. A1l-A27) is unofficially reported at 76 A. F. T.R.2d 95-7059. The opinion of the bankruptcy court (Pet. App. A28-A34) is unofficially reported at 75 A. F. T.R.2d 95-2601. JURISDICTION The judgment of the court of appeals was entered on March 26, 1997. The petition for a writ of certiorari was filed on June 24, 1997. The jurisdiction of this Court is invoked under 28 U.S.C. 1254(1). (1) ---------------------------------------- Page Break ---------------------------------------- 2 STATEMENT 1. a. On April 15,1988, petitioner filed his federal income tax return for the taxable year 1987 but failed to pay the tax due. On July 1, 1988, petitioner filed a petition for relief under Chapter 13 of the Bankruptcy Code. The bankruptcy case was subsequently con- verted to proceedings under Chapter 11. The bank- ruptcy court initially confirmed petitioner's Chapter 11 plan but later revoked it (because petitioner failed to make child support and alimony payments in accordance with the plan) and dismissed petitioner's case. Petitioner appealed to the district court from the order of revocation and dismissal. Petitioner was granted a stay pending that appeal. From July 1, 1988 (the date that petitioner filed his petition) until February 6, 1991 (the date the district court affirmed the bankruptcy court's order dismissing the bank- ruptcy case), the government was prevented from taking any action to collect petitioner's 1987 tax liabilities by (i) the automatic stay provided by Section 362 of the Bankruptcy Code (11 U.S.C. 362(a)(6)), (ii) the provisions of the confirmed re- organization plan and (iii) the stay pending appeal from the order of dismissal. Pet. App. A2. b. On May 9, 1991, petitioner filed a second petition for relief, this time under Chapter 7 of the Bank- ruptcy Code. Under the provisions of this Chapter, he was granted a discharge on August 27, 1991. Pet. App. A2. 2. On April 2, 1994, petitioner filed his income tax return for 1993. He directed that his income tax refund of $11,019 for that year, plus an additional cash payment of $847 that he remitted with his return, be applied by the Internal Revenue Service against his ---------------------------------------- Page Break ---------------------------------------- 3 outstanding 1989 tax liability. The Service, however, instead applied the 1993 tax refund and the cash remittance to petitioner's still unsatisfied 1987 tax liability. The Service also sent notices advising peti- tioner of the government's intent to levy on his assets to recover his remaining unpaid income tax liabilities for 1987 ($157,631.36) and 1989 ($15,620.52). Pet. App. A2. 3. In response to these notices of intent to levy, petitioner filed a complaint in bankruptcy court seek- ing a declaration that his 1987 tax liability had been discharged in his Chapter 7 case. Pet. App, A2-A3. a. Under Sections 507(a)(8)(A)(i) and 523(a)(l)(A) of the Bankruptcy Code, an income tax obligation of a debtor is entitled to priority status and is not dischargeable if the last day on which the tax return could have been filed falls within three years of the date of the filing of the bankruptcy petition. 11 U.S.C. 507(a)(8)(A)(i), 523(a)(l) (A).1 Petitioner as- serted, however, that, because his 1987 tax return was due on April 15, 1988-a date more than three years prior to the filing of his Chapter 7 petition on May 9, 1991-his income tax liability for 1987 was not enti- tled to priority status in the Chapter 7 proceeding under Section 507(a)(8)(A)(i). If, as petitioner claimed, the tax liability was not entitled to priority status in the Chapter 7 proceeding, it would have been within the scope of the discharge that he received in that proceeding. Pet. App. A2. ___________________(footnotes) 1 Effective October 22, 1994, Section 507(a)(7)(A)(i) was renumbered Section 507(a)(8)(A)(i). Bankruptcy Reform Act of 1994, Pub. L. No. 103-394, 304(c)(2), 702(b), 108 Stat. 4132, 4150. The provision was otherwise unchanged. Consistent with the decisions below, we use the new section number throughout this brief. ---------------------------------------- Page Break ---------------------------------------- 4 The government contended, however, that the three-year priority period of Section 507(a)(8)(A)(i) was extended by the period of time that the govern- ment was prevented by petitioner's first bankruptcy case from collecting his 1987 taxes. The priority period therefore would not have expired before peti- tioner filed his second bankruptcy case, and those taxes therefore would not have been within the scope of the discharge received in that proceeding. Pet. App. A3. b. The bankruptcy court agreed with the govern- ment's position. The court stated that a "literal reading and `plain meaning' approach to the Bank- ruptcy Code, seems to indicate that [an] income tax liability of a debtor who has filed a return, which is last due more than three years before the filing of a bankruptcy case, is not covered by the nondischarge- ability provision of 11 U.S.C. 523(a)(l); even where the same tax debt was involved in an earlier bank- ruptcy case as a nondischargeable tax liability falling within the three year period" (Pet. App. A31). The court noted, however, that nearly every reported decision holds that the "running of the tax priority periods fixed in 11 U.S.C. 507(a)(8)(A) are [sic] tolled during pendency of bankruptcy proceedings in which the IRS is stayed from collection efforts to secure payment of the tax" (id. at A31-A32). The court con- cluded that these decisions, "clearly driven by percep- tions of Congressional intent, Bankruptcy Code pur- pose, and underlying public policy," are correct and "reflect a near universal agreement on the state of the law" (id. at A32-A33). Applying the holdings of these cases to the facts in the present case, the court held that "[d]ebtor's income tax liability for the 1987 ---------------------------------------- Page Break ---------------------------------------- 5 taxes was not dischargeable in his May 9, 1991, Chapter 7 bankruptcy case" (id. at A33). 4. The district court affirmed. The court stated that the literal terms of the applicable statutes do not suspend the running of the priority periods of Section 507(a)(8)(A) during a prior bankruptcy. The court held, however, that this was the "rare case" in which it was necessary to go beyond the literal language of the statutes (Pet. App. A19). The court explained that under a purely literal construction of the statute, debtors would be able to avoid tax obligations simply by dismissing their first bankruptcy petition after the priority periods of Section 507(a)(8)(A) expired and then filing a second petition shortly thereafter (Pet. App. A19). The court emphasized that, if the pri- ority periods ran during a pending bankruptcy pro- ceeding, the government would not be given the time periods to collect tax liabilities that Congress clearly sought to provide (id. at A21). The court noted that the legislative history of these provisions "militates directly against the improperly narrow reading sug- gested by [petitioner]" (id. at A22). Because peti- tioner's argument "would operate to defeat the pur- pose of Congress," the court concluded that "[t]he proper result is that the filing of a bankruptcy petition suspends the running of the three-year col- lection period in determining tax claim priority status, pursuant to 11 U.S.C. 507(a)(8)(A)(i)" (id. at A26). 5. The court of appeals affirmed. The court ac- knowledged that the "Bankruptcy Code does not con- tain any provisions which explicitly suspend the priority period of section 507(a)(8)(A)(i) while a debtor is engaged in bankruptcy proceedings" (Pet. App. A6). After examining the structure and history of these ---------------------------------------- Page Break ---------------------------------------- 6 provisions, however, the court agreed with the district court that this was the "rare case" in which the plain meaning of legislation should not be applied in a manner that would frustrate the plain object of the statute to afford the government a three-year period for the collection of taxes (id. at A7-A8). The court therefore concluded that "the three-year prior- ity period of section 507(a)(8)(A)(i) is suspended 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" (id. at A8). ARGUMENT The decision of the court of appeals is correct and does not conflict with any decision of this Court or any other court of appeals. Further review is there- fore not warranted. 1. Petitioner contends (Pet. 5-9) that the decision of the court of appeals unjustifiably disregards the language of Sections 108(c) and 507(a)(8)(A)(i) of the Bankruptcy Code and Section 6503 of the Internal Revenue Code. Petitioner asserts (i) that Section 507(a)(8)(A)(i) is silent regarding any tolling of the three-year priority period during the pendency of a prior bankruptcy proceeding, (ii) that Section 108(c) of the Bankruptcy Code only extends nonbankruptcy law limitation periods, not the priority periods found in Section 507(a)(8), and (iii) that, while Section 6503(h) of the Internal Revenue Code suspends the statute of limitations for the assessment or collection of taxes when the government "is prohibited by rea- son of [a bankruptcy] case" from assessing or collecti- ng taxes (26 U.S.C. 6503(h)), that statute does not expressly apply to the three-year priority period of Section 507(a)(8)(A)(i). Petitioner further claims that ---------------------------------------- Page Break ---------------------------------------- 7 this is not one of those "rare cases [in which] the literal application of a statute will produce a result demonstrably at odds with the intentions of its drafters" (United States v. Ron Pair Enterprises, Inc, 489 U.S. 235,242 (1989)). As the Tenth Circuit concluded in In re Richards, 994 F.2d 763 (1993), however, these statutory provi- sions are not alone controlling. Authority to suspend the three-year priority period of Section 507(a)(8)(A) (i) can be found in a different statutory provision, Section 105(a) of the Bankruptcy Code. See 994 F.2d at 765. That Section provides bankruptcy courts with the authority to issue orders "necessary or appropri- ate to carry out the provisions of [the Bankruptcy Code,] to enforce or implement court orders or rules, or to prevent an abuse of process." 11 U.S. C. 105(a). Applying Section 105(a) in United States v. Energy Resources Co., 495 U.S. 545, 549 (1990), this Court noted the "traditional understanding" that bankruptcy courts are courts of equity. See also Pepper v. Litton 308 U.S. 295, 303-304 (1939). The orders in this case-suspending the three-year prior- ity period of Section 507(a)(8)(A)(i) during petitioner's first bankruptcy case-represent an appropriate ap- plication of this equitable power. See 994 F.2d at 765. As the court of appeals explained (Pet. App. A9- A10), the suspension of the three-year priority period in this case fulfills the statutory design of providing a reasonable time for the government to collect taxes and preventing debtors from escaping liability by shielding their assets in repetitive bankruptcies. As a result of petitioner's first bankruptcy proceeding, the government was precluded from collecting peti- tioner's 1987 taxes (i) by the automatic stay provi- sions of Section 362, (ii) by the provisions of peti- ---------------------------------------- Page Break ---------------------------------------- 8 tioner's confirmed plan of reorganization, and (iii) by the stay that petitioner obtained pending his appeal from the order revoking his plan and dismissing his case. Instead of the three years that Congress con- templated in Section 507(a)(8)(A)(i) that the govern- ment would have for collecting taxes, petitioner's repetitive bankruptcy filings gave the government only 169 days to do so: (i) the period of 77 days from April 15, 1988, the date the 1987 return was due to be filed, to July 1, 1988, the date the Chapter 13 petition was filed, and (ii) the period of 92 days from February 6, 1991, the date the district court affirmed the bank- ruptcy court's order of revocation and dismissal, to May 9, 1991, the date the Chapter 7 petition was filed. Suspending the priority period for collecting taxes under Section 507(a)(8)(A)(i) during petitioner's ini- tial bankruptcy case was necessary to ensure that the government was not deprived of the full benefit of the three years that Congress granted for collection (Pet. App. A9-A10). Accord, In re Richards, 994 F.2d at 765; S. Rep. No. 989, 95th Cong., 2d Sess. 14 (1978) ("the tax collector * * * should not lose taxes which he has not had reasonable time to collect or which the law has restrained him from collecting"); S. Rep. No. 1158, 89th Cong., 2d Sess. 3 (1966) (excepting priority taxes from discharge would "discourage recourse to bankruptcy as a facile device for evading tax obliga- tions'').2 As the court explained in In re Richards, ___________________(footnotes) 2 In several related provisions, Congress has evidenced its clear intent to afford the government an opportunity to collect taxes unimpeded by intervening bankruptcy cases. Section 6503(b) of the Internal Revenue Code was already in effect when the Bankruptcy Code was enacted in 1978. It suspends any limitations on the time in which the government may collect taxes during the period that the assets of the taxpayer ---------------------------------------- Page Break ---------------------------------------- 9 994 F.2d at 765, "use of the equitable authority in 11 U.S.C. 105(a) [to deprive debtors of unintended bene- fits from repetitive bankruptcy filings] is not incon- sistent with any specific provision of the Bankruptcy Code, and * * * is consistent with the underlying philosophy of the Bankruptcy Code." The court of appeals was also correct in noting that acceptance of petitioner's contrary argument-under which the three-year priority period would continue to run during a prior bankruptcy proceeding-would facilitate schemes of tax avoidance (Pet. App. A10). A debtor could avoid paying his tax debt by filing a petition that stayed collection of taxes, then dismiss- ing his bankruptcy petition after the three-year pri- ___________________(footnotes) are in the custody or control of any court. See 26 U.S.C. 6503(b). When the Bankruptcy Code was enacted, Congress specified that nonbankruptcy statutes of limitations (such as those contained in the Internal Revenue Code) are suspended until the automatic stay is lifted. 11 U.S.C. 108(c). This provi- sion is intended to "minimize the administrative problems governmental tax authorities face, or may face, in collecting taxes in bankruptcy proceedings." S. Rep. No. 989, supra, at 14-15. Shortly after the Bankruptcy Code was enacted, Congress added Section 6503(h) to the Internal Revenue Code. Bank- ruptcy Tax Act of 1980, Pub. L. No. 96-589, 6(a), 94 Stat. 3389. That Section specifically tolls the statute of Imitations on assessment and collection of taxes while bankruptcy proceed- ings are pending. 26 U.S.C. 6503(h). "[I]f the internal Revenue Service is prohibited for a period of time by reason of a bankruptcy case from assessment or collection of tax (for example, because of the automatic stay under new 11 U.S. Code sec. 362(a)(6)), the running of the period of limitations is sus- pended, for assessment, for the prohibition period and for 60 days thereafter; and for collection, for the prohibition period and for six months thereafter." S. Rep. No. 1035, 96th Cong., 2d Sess. 50-51 (1980). ---------------------------------------- Page Break ---------------------------------------- 10 ority period expired and then (as petitioner did in this case) filing a new petition shortly thereafter. See also In re West, 5 F.3d 423, 426 (9th Cir. 1993), cert. denied, 511 U.S. 1081 (1994); In re Montoya, 965 F.2d 554, 556 (7th Cir. 1992). As the Third Circuit stated in In re Taylor, 81 F.3d 20, 25 (1996), Congress "did not intend to leave a loophole for debtors to engage in tax avoidance." See also In re Molina, 99 B.R. 792, 795 (S.D. Ohio 1988) ("Congress did not intend for a taxpayer to be able to escape liability by protecting his assets in a bankruptcy proceeding until the stat- ute of limitations expired."). 2. a. For these reasons, the courts of appeals have (with only one, limited exception) consistently con- cluded that the priority periods set forth in Section 507(a)(8)(A) are suspended during the pendency of a prior bankruptcy proceeding. See Pet. App. A8-A9; In re Taylor, 81 F.3d at 25; In re West 5 F.3d at 426; IN re Richards, 994 F.2d at 765; In re Montoya, 965 F.2d at 556. In reaching this conclusion, however, the courts have applied different analyses. ___________________(footnotes) 3 The lower courts have also generally agreed with this conclusion. See, e.g., Acosta v. IRS, 184 B.R. 544, 547 (W.D. Term. 1995); In re ,Eysenbach, 183 B.R. 365, 368 (W.D.N.Y. 1995); Solito v. United States, 172 B.R. 837, 840 (W.D. La. 1994); In r e Linder, 139 B.R. 950, 952-953 (D. Colo. 1992); In re Deitz, 116 B.R. 792, 794 (D. Colo. 1990); In re Molina, 99 B.R. 792, 795 (S.D. Ohio 1988); In re Brickley, 70 B.R. 113, 116 (Bankr. 9th Cir. 1986); In re Shabazz, 206 B.R. 116, 126 (Bankr. E.D. Va. 1996); In re McMillan, 204 B.R. 835, 837-838 (Bankr. M.D. Ga. 1996); In re Darden, 202 B.R. 715, 717 (Bankr. E.D. Va. 1996); In re Cowart, 199 B.R. 799, 800 (Bankr. M.D. Fla. 1996); In re Shedd, 190 B.R. 692, 694 (Bankr. M.D. Fla. 1996); In re Tibaldo, 187 B.R. 673, 676 (Bankr. C.D. Cal. 1995); In re DiCamillo, 186 B.R. 59, 62 (Bankr. E.D. Pa. 1995); In re Harris, 167 B.R. 680, 683 (Bankr. M.D. Fla. 1994); In re ---------------------------------------- Page Break ---------------------------------------- 11 Some courts, like the court of appeals in this case, have held that a proper basis for suspending the prior- ity periods of Section 507(a)(8)(A) results from apply- ing Section 108(c) of the Bankruptcy Code, in con- junction with Section 6503 of the Internal Revenue Code, to achieve the clear legislative intent to allow a three-year period unobstructed by any bankruptcy stay of collection. See, e.g., In re Taylor, 81 F.3d at 22-24; In re West, 5 F.3d at 426-427 In re Montoya 965 F.2d at 557-558. Other courts have relied more directly on the conclusion that the authority to sus- pend the priority period of Section 507(a)(8)(A) stems from the equitable powers of the bankruptcy court under Section 105(a) of the Bankruptcy Code. See, e.g., In re Richards, 994 F.2d at 765; In re Jones, 177 B.R. 541,543-544 (Bankr. N.D. Ohio 1994). b. Contrary to petitioner's contention (Pet. 4), the decision in this case does not conflict with the deci- sion of the Fifth Circuit in In re Quenzer, 19 F.3d 163 (1993). In that case, as here, the government did not ___________________(footnotes) Teeslink, 165 B.R. 70$3-711-712 (Bankr. S.D. Ga. 1994); In re Bowling, 147 B.R. 383, 385 (Bankr. E.D. Va. 1992); In re Ringdahl, Bankr. L. Rep. (CCH) 74,082, at 99,718 (Bankr. M.D. Fla. June 5, 1991); In re Stoll, 132 B.R. 782, 785-786 (Bankr. N.D. Ga. 1990); In re Ross, 130 B-R. 312, 313 (Bankr. D. Neb. 1991); In re Wise, 127 B.R. 20, 23 (Bankr. E.D. Ark. 1991); In re Bryant, 120 B.R. 983,985 (Bankr. E.D. Ark. 1990); In re Davidson, 120 B.R. 777, 787 (Bankr. D.N.J. 1990); In re Florence, 115 B.R. 109, 112-113 (Bankr. S.D. Ohio 1990); In re Quinlan, 107 B.R. 300,301 (Bankr. D. Colo. 1989); In re Carter, 74 B.R. 613 (Bankr. E.D. Pa. 1987); contra In re Pastula, 203 B R. 941, 945-948 (Bankr. E.D. Mich. 1997); In re Macko, 193 B.R. 72 (Bankr. M.D. Fla. 1996); In re Turner, 182 B.R. 317 (1995), adhered to on reconsideration, 195 B.R. 476 (Bankr. N.D. Ala. 1996); In re Gore, 182 B.R. 293, 298-299 (Bankr. N.D. Ala. 1995). ---------------------------------------- Page Break ---------------------------------------- 12 contend that the literal terms of Section 108(c) of the Bankruptcy Code and Section 6503 of the Internal Revenue Code tolled the priority periods of Section 507(a)(8)(A). The government contended instead that suspension of the priority period was a proper exercise of the court's authority under Section 105(a) of the Bankruptcy Code. The Fifth Circuit declined to consider that argument, however, because the government had not raised it in the lower courts. 19 F.3d at 165. Because the government had relied exclusively on Section 105(a) on that appeal, the Fifth Circuit merely adopted the government's concession that the literal terms of Sections 108, 507 and 6503 do not themselves compel the suspension of the priority period. Ibid. The court in Quenzer therefore did not consider either of the arguments accepted by the various courts that have ruled in favor of the government on this issue. The court in Quenzer did not consider the argument, adopted by the court of appeals here, that this is the "rare case" in which "the intention of the drafters, rather than the strict language, controls" (United States v. Ron Pair Enterprises, Inc,, 489 U.S. at 242). Nor did the court in Quenzer address the argument adopted in decisions such as Richards, 994 F.2d at 765, that the priority periods of Section 507(a)(8)(A) may be suspended under Section 105(a) of the Bankruptcy Code. Instead, the court in Quenzer specifically declined to address that question because it had not been raised in the lower courts in that case. 19 F.3d at 165. A conflict among the circuits thus does not exist on the proper disposition of the question presented in this case. On the issues actually litigated in this case, it cannot be said that the Fifth Circuit would ---------------------------------------- Page Break ---------------------------------------- 13 reach a different result than that reached by the sev- eral circuits that have addressed them. Thus, when the same alleged conflict between Quenzer and the decisions of the other circuits was raised as a basis for further review in In re West, supra, this Court denied the petition for a writ of certiorari. 511 U.S. 1081 (1994). Review by this Court is not warranted here for the same reasons. CONCLUSION The petition for a writ of certiorari should be denied. Respectfully submitted. WALTER DELLINGER Acting Solicitor General LORETTA C. ARGRETT Assistant Attorney General GARY D. GRAY SARA S. HOLDERNESS Attorneys AUGUST 1997