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90-368.S
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Subject: TOIBB v. RADLOFF, Syllabus
NOTE: Where it is feasible, a syllabus (headnote) will be released, as
is being done in connection with this case, at the time the opinion is
issued. The syllabus constitutes no part of the opinion of the Court but
has been prepared by the Reporter of Decisions for the convenience of the
reader. See United States v. Detroit Lumber Co., 200 U. S. 321, 337.
SUPREME COURT OF THE UNITED STATES
Syllabus
TOIBB v. RADLOFF
certiorari to the united states court of appeals for the eighth circuit
No. 90-368. Argued April 22, 1991 -- Decided June 13, 1991
Petitioner Toibb filed a voluntary petition for relief under Chapter 7 of
the Bankruptcy Code, disclosing, inter alia, assets that included stock in
an electric power company. When he discovered that the stock had
substantial value, he decided to avoid its liquidation by moving to convert
his Chapter 7 case to one under Chapter 11's reorganization provisions.
After the Bankruptcy Court granted his motion, and he filed his
reorganization plan, that court dismissed his petition, finding that he did
not qualify for relief under Chapter 11 because he was not engaged in an
ongoing business. The District Court and the Court of Appeals affirmed.
Held: The Bankruptcy Code's plain language permits individual debtors not
engaged in business to file for relief under Chapter 11. Toibb is a debtor
within the meaning of MDRV 109(d), which provides that "a person who may be
a debtor under chapter 7 . . . except a stockbroker or a commodity broker,
and a railroad may be a debtor under chapter 11." He is a person who may
be a Chapter 7 debtor, since only railroads and various financial and
insurance institutions are excluded from Chapter 7's coverage, and MDRV
109(d) makes Chapter 11 available to all entities eligible for Chapter 7
protection, other than stockbrokers and commodities brokers. Although
Chapter 11's structure and legislative history indicate that it was
intended primarily for the use of business debtors, the Code contains no
ongoing business requirement for Chapter 11 reorganization; and there is no
basis, including underlying policy considerations, for imposing one. Pp.
3-9.
902 F. 2d 14, reversed.
Blackmun, J., delivered the opinion of the Court, in which Rehnquist, C.
J., and White, Marshall, O'Connor, Scalia, Kennedy, and Souter, JJ.,
joined. Stevens, J., filed a dissenting opinion.
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