Cite as: 508 U. S. 152 (1993)
Opinion of the Court
its own judgment as to investment policy—that are solved by § 4975. Pp. 160-161. (c) The Court of Appeals erred in reading § 4975(f)(3)—which states that a transfer of property "by a disqualified person to a plan shall be treated as a sale or exchange if the property is subject to a mortgage or similar lien"—as implying that a transfer cannot be a "sale or exchange" under § 4975(c)(1)(A) unless the property is encumbered. The legislative history demonstrates that Congress intended § 4975(f)(3) to expand, not limit, § 4975(c)(1)(A)'s scope by extending the reach of "sale or exchange" to include contributions of encumbered property that do not satisfy funding obligations. The Commissioner's construction of § 4975 is a sensible one. A transfer of encumbered property, like the transfer of unencumbered property to satisfy an obligation, has the potential to burden a plan, while a transfer of property that is neither encumbered nor satisfies a debt presents far less potential for causing loss to the plan. Pp. 161-162. 951 F. 2d 76, reversed.
Blackmun, J., delivered the opinion of the Court, in which Rehnquist, C. J., and White, O'Connor, Kennedy, Souter, and Thomas, JJ., joined, and in which Scalia, J., joined as to all but Part III-B. Stevens, J., filed a dissenting opinion, post, p. 162.
Christopher J. Wright argued the cause for petitioner. With him on the briefs were Solicitor General Starr, Acting Solicitor General Bryson, Acting Assistant Attorney General Bruton, Deputy Solicitor General Wallace, and Steven W. Parks.
Raymond P. Wexler argued the cause for respondent.
With him on the brief were Todd F. Maynes and Ralph P. End.*
Justice Blackmun delivered the opinion of the Court.† In this case, we are concerned with the legality of an employer's contributions of unencumbered property to a defined benefit pension plan. Specifically, we must address the
*Carol Connor Flowe, William G. Beyer, and James J. Armbruster filed a brief for the Pension Benefit Guaranty Corporation as amicus curiae urging reversal.
†Justice Scalia joins all but Part III-B of this opinion.
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