Citizens Bank of Maryland v. David Strumpf (516 U.S. 16)
U.S. Supreme Court · decided October 31, 1995 · Supreme Court Database (Spaeth)
- Citation
- 516 U.S. 16 · 116 S. Ct. 286
- Decided
- October 31, 1995
- Term
- October Term 1995
- Vote
- 9–0
- Majority author
- Justice Scalia
- Issue area
- Economic Activity
- Disposition
- Reversed
- Outcome
- Petitioning party won
- Ideological direction
- Conservative
Opinion excerpt
Justice Scalia delivered the opinion of the Court. We must decide whether the creditor of a debtor in bankruptcy may, in order to protect its setoff rights, temporarily withhold payment of a debt that it owes to the debtor in bankruptcy without violating the automatic stay imposed by 11 U.S. C. § 362(a). I On January 25,1991, when respondent filed for relief under Chapter 13 of the Bankruptcy Code, he had a checking account with petitioner, a bank conducting business in the State of Maryland. He also was in default on the remaining balance of a loan of $5,068.75 from the bank. Under 11 U. S. C. § 362(a), respondent’s bankruptcy filing gave rise to an automatic stay of various types of activity by his creditors, including “the setoff of any debt owing to the debtor that arose before the commencement of the [bankruptcy case] against any claim against the debtor.” § 362(a)(7). On October 2, 1991, petitioner placed what it termed an “administrative hold” on so much of respondent’s account as it claimed was subject to setoff — that is, the bank refused to pay withdrawals from the account that would reduce the balance below the sum that it claimed was due on respondent’s loan. Five days later, petitioner filed in the Bankruptcy Court, under § 362(d), a “Motion for Relief from Automatic Stay and for Setoff;” Respondent then filed a motion to hold petitioner in contempt, claiming…
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