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Casus Omissus in Preventing Bankruptcy Fraud: Ordering a Search of a Debtor's Home

NCJ Number
Ohio State Law Journal Volume: 73 Issue: 1 Dated: 2012 Pages: 93-139
Michael D. Sousa
Date Published
47 pages
This article examines whether current bankruptcy law permits bankruptcy courts to order searches of debtors' homes.
Current Federal consumer bankruptcy laws serve two purposes: to allow individual debtors to have a fresh start free from preexisting indebtedness, and to enable to debtor's creditors to receive an equitable distribution of the debtor's available assets. To ensure that debtors do not attempt to fraudulently conceal assets, bankruptcy courts have in the past allowed for a warrantless search of a debtor's residence. The author of this article argues that this action is legal and not in violation of the fourth amendment which prohibits warrantless searches. The author uses two authorities to support his argument: the Federal All Writs Act and Section 105 of the Bankruptcy Code. The Federal All Writs Act states that "The Supreme Court and all courts established by Act of Congress may issue all writs necessary or appropriate in aid of their respective jurisdictions and agreeable to the usages and principles of law." This Act allows enables Federal courts to have the mechanisms and instruments needed to perform their duty, as prescribed by Congress and the Constitution. Section 105 of the Bankruptcy Code states that a bankruptcy court "may issue an order, process, or judgment that is necessary or appropriate to carry out the provisions of this title." The author also discusses a possible third source of authority for a bankruptcy court to issue a search warrant for a debtor's residence. This third source is the Inherent Powers Doctrine based on the idea that Federal courts are "invested with inherent powers that are governed not by rule or statute but by the control necessarily vested in courts to manage their own affairs so as to achieve the orderly and expeditious disposition of cases."