The Rehnquist Court, Strict Statutory Construction and the Bankruptcy Code

This article analyzes the Rehnquist Court's use of strict statutory construction. It will argue that strict statutory construction can be justified under public choice and agency theories of statutory interpretation, and that strict construction promotes the implementation of bankruptcy policy. Strict statutory construction, moreover, is beneficial because it produces reliability and predictability, which is essential to our dynamic economy. The use of strict statutory construction precludes a court from relying on legislative history to manufacture the result that the court thinks is the best solution to the problem.

Another justification for strict statutory construction is that it prevents bankruptcy judges from using their equitable powers to create entitlements that are not authorized by the Code. There are, however, detriments to using strict statutory construction. It can inhibit the development of bankruptcy law, and it is also unproductive when public policy issues are involved. Indeed, it can seriously inhibit the development of bankruptcy policy.

After examining the benefits and detriments of strict statutory construction, this article concludes that bankruptcy courts should use it only when deciding debtor-creditor issues.