Look to the States: How the State-Specific Interpretation Clarifies BAPCPA's § 522 Ambiguity and Protects State Exemption Laws
26 Pages Posted: 19 Aug 2013 Last revised: 23 Jan 2014
Date Written: February 1, 2013
After Congress revised the Bankruptcy Code in 2005, courts have taken divergent views about how to apply 11 U.S.C. § 522 in relation to state exemptions. Three main interpretations have developed: antiextraterritoriality, preemption, and state-specific. This Note advocates the state-specific approach, as it prevents forum shopping without rendering state exemption laws void or futile. The state-specific view requires courts to consider both state case law and public policy. When state statutes remain silent, courts applying the state-specific interpretation should liberally construe the exemption statutes in favor of the debtor and allow extraterritorial application.
Keywords: Bankruptcy, extraterritorial, homestead, exemption, state-specific, preemption, 522, forum shopping, liberal exemptions, liberal construction of exemption laws
JEL Classification: E22, E29, E51, E52, E61, E62, G21, G33, H70, H73, K11, P46
Suggested Citation: Suggested Citation