Summary of the Argument
Section 542(a) of the Bankruptcy Code, 11 U.S.C. § 542(a), directs that persons “shall deliver to the trustee” property that the trustee may use, sell or lease. This unambiguous mandate applies only when the property indisputably belongs to the bankruptcy estate. If persons who are asked to relinquish such property demand more protection of their interests than the trustee believes is adequate, Congress put the onus on those persons and not the trustee (or, as in these cases, the individual chapter 13 debtors) to ask the bankruptcy court for relief. 11 U.S.C. § 363(e). A person who declines to do so but refuses to permit the trustee or debtor to use the property, as Petitioner the City of Chicago did here unabashedly, violates the automatic stay by acting to exercise control of that property. 11 U.S.C. § 362(a)(3). The statutes are plainly worded, consonant, and sensible. If § 362(a)(3) does not apply, § 542(a) loses its utility, because a statute that imposes an affirmative obligation to do something without waiting for a court order is neutered by a rule that it can only be enforced by obtaining a court order.
Congress did not intend “shall deliver” to be an invitation to litigate, any more than it did § 521’s mandate that a debtor “shall . . . surrender to the trustee all property of the estate[.]” 11 U.S.C. § 521(a)(4). Section 362(a)(3) enforces compliance with these mandates without diminishing the bankruptcy estate. The City’s proposed shifting of costs and burdens to trustees and debtors to enforce these mandates runs counter to the purpose and design of the federal bankruptcy laws. The Seventh Circuit’s statutory construction adheres to the plain language of the statutes, applies them coherently and in harmony with the Bankruptcy Code as a whole. The Seventh Circuit’s decision should be affirmed.