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Are Decisions by the Bankruptcy Appellate Panels or U.S. District Courts Binding on Bankruptcy Courts?

By Jill Michaux, Kansas Bankruptcy Attorney on Sep 10, 2007 in Bankruptcy Practice and Procedure

American courts follow the doctrine of stare decisis, which requires a lower court to follow the rulings of its higher courts. What “higher courts” must a bankruptcy court follow?

There are three possible levels of appeal in bankruptcy. An appeal from the bankruptcy court is filed in the U.S. District Court or the Bankruptcy Appellate Panel. That decision may be appealed to the U.S. Court of Appeals known as the Circuit Court. The Circuit Court decision may be appealed to the U.S. Supreme Court.

Bankruptcy court decisions are not binding on other bankruptcy courts. Nor are decisions of the U.S. District Court or Bankruptcy Appellate Panel. Those rulings are binding on the parties of that case, but not on other cases. Only Circuit Court decisions bind all lower courts in that circuit.

Circuit Court decisions are not binding in other circuits. U.S. Supreme Court decisions are binding on all federal courts, including bankruptcy courts.

City of Olathe v. K.A.R. Development Assocs. L.P. (In re KAR Assocs., L.P.), 180 B.R. 629, 640 (D. Kan. 1995) (Van Bebber, J.) (”[B]ecause district court bankruptcy decisions do not bind other district judges within the same district, they are not binding on bankruptcy courts either.”), affirming the bankruptcy court.

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