In re Michael Allen Bowers
- Citation:
- In re Bowers, No. 13-8014 (B.A.P. 6th Cir. Nov. 22, 2013)
- Tag(s):
-
- Ruling:
- The decision of the district court was affirmed. Pursuant to Ohio Rev. Code Ann. § 5721.37(A)(3), the certificate rate of interest, not the interest rate provided in Ohio Rev. Code Ann. § 5721.38(B), is the interest rate applicable to a tax lien certificate claim in bankruptcy. Section 5721.37(A)(3) "specifically provide[s] that the tax certificate interest rate continues to accrue during a bankruptcy." Ignoring Section 5721.37(A)(3) in favor of Section 5721.38(B) would violate basis tenets of statutory construction: it would require more general provisions to prevail over specific statutory provisions and it would render specific statutory provisions "mere surplusage."
- Procedural context:
- Appeal to the Bankruptcy Appellate Panel of the United States Court of Appeals for the Sixth Circuit, from the United States Bankruptcy Court for the Northern District of Ohio.
- Facts:
- Plymouth Park purchased a tax lien certificate from Summit County, Ohio that provided Plymouth Park a lien against the debtors' property and the right to pursue the debtors for unpaid taxes. The certificate stated a negotiated interest rate of 0.25%. After Plymouth Park filed a tax lien foreclosure complaint against the debtors, the debtors filed a Chapter 13 bankruptcy petition. In their plan, the debtors proposed to pay Plymouth Park the interest rate listed on its certificate: 0.25%. Plymouth Park filed a claim in which it calculated an interest rate of 18%. Thereafter, Plymouth Park filed an objection to the debtors' plan, and the debtors filed an objection to Plymouth Park's claim. Plymouth Park argued that Ohio Rev. Code Ann. § 5721.38(B) entitled it to an 18% interest rate. Section 5721.38(B) provides that a property owner "may redeem the parcel by paying ... interest on the certificate purchase price ... at the rate of [18%] per year." The debtors' argued that Section 5721.38(B) was inapplicable because it did not apply to redemption via Chapter 13 plan payments. The bankruptcy court agreed with the debtors and held that 0.25% was the appropriate interest rate for Plymouth Park's claim. The bankruptcy court concluded (i) Section 5721.38(B) "is limited to those instances where 'a party redeems real estate from a certificate sale by paying cash to the county treasurer'" and (ii) Ohio law provides a creditor the interest rate established by the tax certificate auction. Plymouth Park appealed and re-asserted its argument that Section 5721.38(B) guaranteed it 18% interest on its claim.
- Judge(s):
- Emerson, Lloyd, and Preston
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