Kagan delivers her first judicial opinion, in bankruptcy case

The Supreme Court audience perked up Tuesday when Chief Justice John G. Roberts Jr. announced that Justice Elena Kagan would deliver the first judicial opinion of her career.

“This case,” she said in a strong, confident voice, “is about proper interpretation of the bankruptcy code.”

Like other rookie justices before her, Kagan drew a relatively noncontroversial decision for her maiden effort. The court ruled against a man who argued that an ambiguity in federal bankruptcy law allowed him to shield some income from creditors by claiming a monthly allowance for car payments, even though his car loan was paid off.

Kagan wrote a detailed, 18-page opinion that spoke for seven of her colleagues. The lone dissenter was Justice Antonin Scalia, with whom Kagan has friendly relations. He took her skeet shooting earlier in the term.

In the justices’ only other decision Tuesday, a unanimous court said the government may impose Social Security taxes on physicians who are in residencies at university hospitals. Roberts, who wrote the opinion, said the case raised the question of whether residents are students who work or workers who study.

In the bankruptcy case, the dispute arose over the way debtors may keep part of their incomes from creditors. They are allowed to take deductions for living expenses such as food, housing, car payments and upkeep before determining how much of their income should be paid toward debt.

Jason Ransom, who declared bankruptcy after running up more than $80,000 in unsecured debt, wanted to take advantage of the $471 monthly allowance for car payments. But the credit card company he owed objected because Ransom’s 2004 Toyota Camry was paid off.

Kagan’s order upheld lower-court rulings that agreed with the company.

“In short, Ransom may not deduct loan or lease expenses when he does not have any,” she wrote. She said that over the course of the repayment plan, the deduction would allow Ransom to shield “some $28,000 that he does not in fact need for loan or lease payments.”

One of the purposes of the bankruptcy law, she said, is to make sure creditors are paid back as much as possible.

Kagan explained her decision in detail from the bench, and she smiled a moment later when a fellow justice handed her what appeared to be a note of congratulations. Ransom v. FIA Card Services was the first case the court heard this term, on Oct. 4.

It was also Kagan’s first judicial writing. Unlike the rest of her colleagues, she has never been a judge. The former solicitor general and Harvard Law School dean addressed each of the arguments raised by Ransom and dealt with Scalia’s dissent in a footnote.

Scalia said that Congress wrote the law in such a way that any debtor who owns a car is entitled to the car ownership deduction. Ransom’s case may seem odd, he said, but the court’s job is “not to eliminate or reduce those oddities, but to give the formula Congress adopted its fairest meaning.”

Kagan delivers her first judicial opinion, in bankruptcy case – from the Washington Post.

The decision in Ransom may be found here: http://www.supremecourt.gov/opinions/10pdf/09-907.pdf

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