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For a new bankruptcy law

If the US Congress has caught up with what has happened on the bankruptcy front, it certainly has not indicated as much in recent months. What has happened, of course, is that bankruptcies have been running at record levels, reaching 21,597 for the first 44 weeks of this year, according to Dun & Bradstreet. That compares with 14,449 for the same period last year. Now, add to those sobering numbers the fact that this past June the US Supreme Court limited the powers of bankruptcy judges - and gave lawmakers a deadline of Oct. 4 to write a new bankruptcy law. Congress was unable to meet that deadline so the court granted a final deadline of Dec. 24.

Unfortunately, Congress has not yet gotten around to hammering together a new law to correct the 1978 bankruptcy law that the high court found deficient. Nor is it at all certain that lawmakers will reach agreement on a revision during the upcoming special session that begins Nov. 29. That prospect has so concerned the Justice Department that one official recently said that the bankruptcy court system may be unable to function if Congress doesn't act in the next few weeks.

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Granted, the legal issues involved are complicated. In a split decision the high court had ruled that Congress conferred broader powers on the nation's 220 bankruptcy judges than was permissible under the Constitution.

Lawmakers, however, have several alternatives by which they could remedy the 1978 act, including transferring powers granted bankruptcy judges under that legislation to federal district court judges or, alternatively, upgrading the role of bankruptcy judges to the status of Article III judges. Bankruptcy judges are currently adjuncts of federal district courts but with a limited 14-year term. By contrast, the lifetime tenure of a district court judge is defined under Article III of the Constitution.

As one expert recently pointed out, lawmakers have been ''nonchalant'' about sitting down and deciding what should or should not be the role of a bankruptcy judge. The US Supreme Court has allowed Congress time to change the law. Given the pressing number of cases pending, it would be irresponsible for lawmakers not to meet that deadline.

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