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In United States v. Whiting Pools, Inc., supra,6 a
bankruptcy case brought under the Bankruptcy Code of 1978
(Bankruptcy Code), the Supreme Court addressed the question of
whether the issuance of a notice of levy to a third party
satisfies a taxpayer’s liability. The Supreme Court stated:
Under the old Bankruptcy Act, a bankruptcy court’s
summary jurisdiction over a debtor’s property was limited to
property in the debtor’s possession when the liquidation was
filed. Phelps v. United States, 421 U.S. 330, 335-336
(1975); Taubel-Scott-Kitzmiller Co. v. Fox, 264 U.S. 426,
432-434 (1924). Phelps, which involved a liquidation
petition under the prior Bankruptcy Act, held that a
bankruptcy court lacked jurisdiction to direct the Service
to turn over property which had been levied on and which, at
time of the commencement of bankruptcy proceedings, was in
the possession of an assignee of the debtor’s creditors.
Phelps does not control this case. First, the new
Bankruptcy Code abolished the distinction between summary
and plenary jurisdiction, thus expanding the jurisdiction of
bankruptcy courts beyond the possession limitation. H.R.
Rep. No. 95-595, pp. 48-40 (1977); see Northern Pipeline
Construction Co. v. Marathon Pipe Line Co., 458 U.S. 50, 54
(1982)(plurality opinion). Moreover, Phelps was a
liquidation situation, and is inapplicable to reorganization
proceedings such as we consider here. [Id. at 206 n.13.]
6The property in issue in United States v. Whiting Pools,
Inc., supra, was tangible property. The property in issue in
Phelps v. United States, 421 U.S. 330 (1975), was intangible
property. The Supreme Court granted certiorari in United States
v. Whiting Pools, Inc., supra at 202, to resolve a split in the
circuits, between United States v. Whiting Pools, Inc., 674 F.2d
144 (2d Cir. 1982) (tangible property), and Cross Elec. Co. v.
United States, 664 F.2d 1218 (4th Cir. 1981) (intangible
property). Accordingly, we reject petitioners’ contention that,
with respect to the issue under consideration, a distinction
should be drawn between tangible property and intangible
property. See also Meehan v. Wallace, 102 F.3d 1209 (11th Cir.
1997); In re Challenge Air Intl., Inc., 952 F.2d 384 (11th Cir.
1992).
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