In re Sapp
81 B.R. 545, 1987 Bankr. LEXIS 2110 (1987)
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Rule of Law:
Under the Missouri Constitution, a legislative bill that contains more than one subject, where the subject is not clearly expressed in the bill's title, is unconstitutional and void.
Facts:
- Darrel and Bonita Sapp granted ITT Financial Services (ITT) a non-possessory, non-purchase money security interest in their household goods as collateral for a loan.
- The Missouri General Assembly passed House Bill 484, which was titled 'AN ACT To repeal sections... relating to support obligations, liens and other child services, and to enact in lieu thereof six new sections relating to the same subject...'
- Appended to the end of House Bill 484 was a provision, later codified as Mo. Rev. Stat. § 513.436, stating that no property upon which a debtor has voluntarily granted a lien shall be exempt from attachment or execution.
- After the law was enacted, the Sapps filed for Chapter 7 bankruptcy.
Procedural Posture:
- Darrel and Bonita Sapp filed a petition for Chapter 7 bankruptcy in the U.S. Bankruptcy Court.
- The Sapps filed a motion to avoid a non-possessory, non-purchase money lien held by ITT Financial Services on their household goods under 11 U.S.C. § 522(f).
- ITT Financial Services filed a response denying the Sapps' motion, arguing that a new state statute, Mo. Rev. Stat. § 513.436, prevented the property from being claimed as exempt and thus barred lien avoidance.
- The parties agreed that no evidentiary hearing was required and submitted the case to the Bankruptcy Court to decide the purely legal question of the new statute's effect.
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Issue:
Does a Missouri statute that eliminates property exemptions for items subject to a voluntary lien violate the single-subject rule of the Missouri Constitution when it is included in a bill titled as 'relating to support obligations, liens and other child services'?
Opinions:
Majority - Koger, Bankruptcy J.
Yes, the statute violates the Missouri Constitution's single-subject rule. A Missouri law is unconstitutional if it contains more than one subject and that subject is not clearly expressed in its title. Article 3, § 23 of the Missouri Constitution requires that '[n]o bill shall contain more than one subject which shall be clearly expressed in its title'. The title of House Bill 484 exclusively referenced child support obligations and related liens. The challenged provision, § 513.436, deals with general property exemptions in bankruptcy, a subject entirely unrelated to child support. The court inferred this provision was surreptitiously added to otherwise innocuous legislation, likely by lobbyists, without the full comprehension of the legislators. Because the statute's subject matter is not expressed in the bill's title, it violates the state constitution and is therefore void and ineffective to prevent the debtors from avoiding ITT's lien under federal bankruptcy law.
Analysis:
This decision is significant because it invalidates a state law affecting federal bankruptcy rights on state constitutional grounds, rather than engaging in a complex federal preemption or Supremacy Clause analysis. The court sidestepped the question of whether a state can legislatively 'opt out' of the federal lien avoidance provision (§ 522(f)) by instead focusing on a procedural defect in the state law's enactment. This ruling provides a strategic roadmap for challenging state laws that curtail federal bankruptcy protections, demonstrating that the legislative process by which a state law is passed can be as vulnerable to legal attack as its substantive content. It affirms that federal courts will scrutinize state statutes for compliance with state constitutional requirements when those statutes impact rights under federal law.
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