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United States v. River Coal Co.

Citation: 14 ELR 20866
No. No. 83-5560, 748 F.2d 1103/21 ERC 2147/(6th Cir., 11/23/1984)

The court holds that debtors who have filed for bankruptcy nonetheless are liable to the United States for post-filing interest on delinquent Surface Mining Control and Reclamation Act reclamation fees. The court first rules that the "fees" are in fact taxes since they are involuntary exactions furthering a public purpose and not payments in exchange for a governmental permit of benefit to the payor. Under § 17 of the old Bankruptcy Act, in force when the filings were made, United States taxes are nondischargeable debts. The court rules that post-filing interest on nondischargeable debts may be recovered from the debtor, regardless of whether the underlying debt is paid as part of the settlement of the bankrupt estate. Finally, the court holds that the government's failure to demand interest in the bankruptcy proceedings does not estop the government from demanding interest now from the debtors, in part because the claim for interest is against the individual, not the estate.

Counsel for Appellant
Christine Whittaker
Civil Division
Department of Justice, Washington DC 20530
(202) 633-4096

Counsel for Appellees
John Lang
Reece, Clark & Lang
304 Bridge St., Manchester KY 40962
(606) 598-5147

Before: LIVELY, Chief Judge; MERRITT, Circuit Judge; and GIBBONS, District Judge.*