On the Nature of Federal Bankruptcy Jurisdiction: A General Statutory and Constitutional Theory

By Brubaker, Ralph | William and Mary Law Review, March 2000 | Go to article overview

On the Nature of Federal Bankruptcy Jurisdiction: A General Statutory and Constitutional Theory


Brubaker, Ralph, William and Mary Law Review


The words we have to construe are not only words with a history. They express an enactment that is part of a serial, and a serial that must be related to Article III of the Constitution, the watershed of all judiciary legislation, and to the enactments which have derived from that Article.... These give content and meaning to its pithy phrases [and] must be considered [as] part of an organic growth--part of the evolutionary process of judiciary legislation that began September 24, 1789, and projects into the future.

Justice Frankfurter in Romero v. International Terminal Operating Co.([dagger])

INTRODUCTION

Consumer debtors seeking relief from a federal bankruptcy court now number well in excess of one million per annum, and another two million individuals are employed by businesses filing for the bankruptcy protection of a federal court.(1) Bankruptcy, therefore, is a substantial and significant component of the charge of the federal courts. Yet, the jurisdiction in bankruptcy remains one of the most enduring puzzles of our federal court system.(2) Congress, of course, has plenary legislative power "on the subject of Bankruptcies."(3) For the most part, however, creditors' and debtors' rights and obligations in bankruptcy are governed by state law, not federal law.(4) For example, a creditor may assert a right to payment from a debtor founded upon a disputed state-law cause of action. Likewise, among the debtor's assets, to which the creditors lay claim, may be similar state-law causes of the debtor against others. Bankruptcy brings all such state-law disputes into federal court, but without any diversity-of-citizenship requisite, and thus, the constitutional source of this federal "judicial Power"(5) is not at all self-evident. The Supreme Court consistently has confirmed the propriety of the federal jurisdiction in bankruptcy, but has been cryptic, parsimonious, and inconsistent in its explanations of this judicial province.(6)

The Supreme Court's abstruseness is, of course, fuel for the scholarly engine, and bankruptcy has become the seemingly inscrutable crucible of federal jurisdiction theory. In fact, because it is not easily explained by traditional theory, most scholars rely upon bankruptcy to buttress novel and unconventional departures that would accommodate the apparent anomaly of federal bankruptcy jurisdiction.(7) These efforts, however, have not grappled with the parallel and equally bedeviling problem of charting the outermost bounds of the statutory grant of federal bankruptcy jurisdiction, which contemplates a federal forum for any proceeding "related to" a bankruptcy case.(8) This provision for pervasive federal bankruptcy jurisdiction is the most extensive in our history, and indeed, was designed to be as broad as the Constitution permits.(9) The extant jurisdictional structure, therefore, provides a contextual framework that proves critical for testing constitutional theories of federal bankruptcy jurisdiction.

In the absence of clear constitutional guidance, jurisprudential demarcation of the content of the statutory grant, not surprisingly, has been chaotic. In fact, the case law has developed in a vacuum-like separation from constitutional principles that would define the reach of federal bankruptcy jurisdiction.(10) This disconnect is aggravated by the literal breadth of the statute itself, which on its face extends to any dispute, even one wholly between third parties and not directly involving the debtor nor the debtor's bankruptcy estate, but that nonetheless is in some manner "related to" the debtor's bankruptcy case. The dominant test for "related to" bankruptcy jurisdiction in such a third-party dispute, the so-called Pacor test,(11) merely asks "whether the outcome of that [third-party] proceeding could conceivably have any effect on the estate being administered in bankruptcy."(12)

When one ponders such an approach to third-party "related to" bankruptcy jurisdiction for an operating business attempting reorganization in Chapter 11 bankruptcy proceedings, the prospect of potentially limitless federal bankruptcy jurisdiction is not beyond the pale. …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

On the Nature of Federal Bankruptcy Jurisdiction: A General Statutory and Constitutional Theory
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.