[J-33-2019] IN THE SUPREME COURT OF PENNSYLVANIA MIDDLE DISTRICT
SAYLOR, C.J., BAER, TODD, DONOHUE, DOUGHERTY, WECHT, MUNDY, JJ.
COMMONWEALTH OF PENNSYLVANIA, : No. 47 MAP 2018 : Appellee : Appeal from the Order of the Superior : Court at No. 619 MDA 2017 dated : February 20, 2018 Affirming the v. : Judgment of Sentence of the Court of : Common Pleas of Lackawanna : County, Criminal Divison, at No. CP- JOSEPH PETRICK, : 35-CR-0000068-2016 dated March 8, : 2017. Appellant : : ARGUED: May 16, 2019
OPINION
JUSTICE MUNDY DECIDED: September 26, 2019 We granted allocatur in this case to address the effect a discharge of a civil debt
by a federal bankruptcy court has on the authority of a state trial court to order mandatory
restitution as part of a sentence in a criminal case involving the same obligation.
On April 14, 2015, Appellant, Joseph Petrick, contracted with a homeowner, Donna
Sabia, to perform remodeling work. Under the terms of the contract, in exchange for
payment of $3,500.00, Appellant agreed to frame and sheet-rock three rooms and lower
the ceiling in one room. The work was to commence on April 16, 2015, and be completed
within seven days. Sabia paid Appellant a deposit of $1,750.00 plus $300.00 to cover
the cost of city permits. Appellant began some of the contracted work on April 18, 2015,
at which time Sabia paid an additional $1,750.00 to Appellant. That same day, Appellant
and Sabia’s son, Carmen Fazio, who also resided in the home, entered into a second
contract for Appellant to do some painting in the home. As consideration, Fazio purchased a $600.00 saw for Appellant. Appellant performed additional work on April 19,
2015. Appellant and Fazio entered into a third contract to install siding on the exterior of
the home. Fazio paid Appellant $2,300.00 to purchase materials. Appellant did not return
to the still uncompleted job after that date. Appellant at first advised Sabia and Fazio that
he needed time to hire help, as he had another job, and would complete the jobs in May.
Appellant eventually advised Sabia and Fazio that he could not complete the jobs but
would refund $4,950.00 within a week. Appellant never refunded any money or the saw,
nor did he ever purchase the siding materials or obtain the permits from the city.
On September 3, 2015, Appellant filed for Chapter 7 bankruptcy. In his petition,
Appellant listed Sabia and Fazio as creditors. The bankruptcy court issued a discharge
order on March 17, 2016. On October 5, 2015, Detective Jaimie Barrett, of the City of
Scranton Police Department, filed a criminal complaint charging Appellant with theft by
deception and deceptive business practices.1 Following a non-jury trial, the court found
Appellant guilty of theft by deception and not guilty of deceptive business practices. The
court sentenced Appellant to a term of incarceration of three to eighteen months.
Appellant was also ordered to pay $6,700.00 in restitution. Appellant filed a motion for
reconsideration of his sentence, which the trial court denied on March 21, 2017.
On appeal, the Superior Court affirmed the trial court’s judgment of sentence.2 See
Commonwealth v. Petrick, 185 A.3d 1133 (Pa. Super. 2018) (unpublished memorandum).
1 18 Pa.C.S. §§ 3922(a)(1) and 4107(a)(1), respectively. Each count was graded as a third-degree felony. 2 In addition to the issue discussed infra, Appellant challenged the sufficiency of the evidence to prove theft by deception, asserting the evidence did not establish the requisite mens rea, in part, because his ability to repay was legally barred during the pertinent period by the bankruptcy stay. Appellant also challenged the discretionary aspects of his sentence. The Superior Court’s rulings on these issues are not the subject of this Court’s allocatur grant.
[J-33-2019] - 2 Before the court, Appellant argued that the portion of his sentencing order requiring him
to pay restitution is illegal because the debt was discharged in bankruptcy. 3 Appellant
argued that the Bankruptcy Code specified that the filing of a petition operated as an
automatic stay of any action to recover a debt that preceded the filing.
§ 362. Automatic stay
(a) Except as provided in subsection (b) of this section, a petition filed under section 301, 302, or 303 of this title, or an application filed under section 5(a)(3) of the Securities Investor Protection Act of 1970, operates as a stay, applicable to all entities, of--
...
(6) any act to collect, assess, or recover a claim against the debtor that arose before the commencement of the case under this title
11 U.S.C. § 362(a)(6). Appellant also cited Johnson v. Lindsey, 16 B.R. 211 (Bankr. M.D.
Fla. 1981), for the proposition that a state may not use criminal proceedings solely to
compel payment of a debt subject to the Bankruptcy Code’s automatic stay. Appellant’s
Brief at 19-20. In Johnson, the Bankruptcy Court entertained the debtor’s request to
enjoin the creditor and state prosecutors from pursuing criminal charges on the same
facts underlying a listed debt in the bankruptcy proceeding. In that case, the debtor had
filed a voluntary petition in bankruptcy on July 9, 1981, and notice was sent to the creditor.
On September 16, 1981, the State Assistant Attorney filed an information charging the
debtor with obtaining property with a worthless check. The facts supporting the
3 Although Appellant did not raise this issue at or before sentencing, or in a post-sentence motion, the Superior Court recognized that the claim implicated the legality of his sentence and was therefore not subject to waiver. Superior Ct. Op. at 10 (citing Commonwealth v. Burwell, 42 A.3d 1077, 1084 (Pa. Super. 2012) (holding question regarding a court’s authority to order restitution implicates the legality of a sentence, and is not waivable)).
[J-33-2019] - 3 information were supplied by the creditor. The court held that bankruptcy proceedings do
not shield a debtor from criminal prosecution. Johnson, 16 B.R. at 212. However, it
determined that use of criminal proceedings to secure repayment of a debt otherwise
subject to the automatic stay would not be proper. Id. Accordingly, it enjoined the State
Assistant Attorney from seeking or recommending restitution as part of any sentence that
may ensue. The Court also enjoined the creditor from utilizing the criminal prosecution
to recover its claim. Id.
The Superior Court noted it had addressed this same issue in Commonwealth v.
Shotwell, 717 A.2d 1039 (Pa. Super. 1998). In that case, Shotwell defrauded a victim out
of more than $71,000.00 as part of an investment scheme and then filed for bankruptcy,
listing the victim as an “unsecured debt in dispute.” Id. at 1046. Shotwell was
subsequently charged and convicted of theft by deception and related offenses. The trial
court imposed an obligation to pay restitution as part of Shotwell’s sentence. On appeal,
Shotwell contended that the trial court lacked authority to order restitution of a debt
discharged in bankruptcy. Id. The Shotwell Court referenced Kelly v. Robinson, 479 U.S.
36 (1986), wherein the United States Supreme Court reasoned that restitution orders as
part of the criminal justice system are not motivated to benefit the victim/debtor, but by
the criminal justice goals a State has in deterrence, enforcement, and rehabilitation.
Shotwell, 717 A.2d at 1046. Because the benefit of a restitution order inures primarily to
the State, the Court in Kelly held that the obligation was not dischargeable in bankruptcy.
Id. The Shotwell Court further held that a restitution order entered after the discharge by
the bankruptcy court of a civil debt is distinct and does not resurrect the debt or
debtor/creditor relationship in circumvention of the bankruptcy relief. Id.
Instantly, the Superior Court deemed Shotwell controlling. It therefore determined
the restitution order in this case was legally entered.
[J-33-2019] - 4 Appellant suggests that the issue before this Court involves balancing the
protection of a State’s citizens through the State’s police power as expressed through its
criminal justice system and the protection of debtors provided by the federal Bankruptcy
Code. Appellant remarks that it has long been established that the Bankruptcy Act serves
both a public and private interest by providing relief for the “honest but unfortunate debtor”
who submits to the distribution of his or her property by affording a fresh start unburdened
by past debt. Appellant’s Brief at 13-14 (quoting Local Loan Co. v. Hunt, 292 U.S. 234,
244 (1934)). Appellant acknowledges that the authority to discharge debt is not
unconstrained under the Act. Appellant notes Section 523 of the Bankruptcy Act
enumerates obligations that are excepted from discharge, which includes any obligation
“for a fine, penalty, or forfeiture payable to and for the benefit of a governmental unit, and
is not for compensation of actual pecuniary loss.” Id. at 14 (quoting 11 U.S.C.
§ 523(a)(7)).4 Appellant argues that because Pennsylvania’s mandatory restitution
statutes, by their terms, have a core purpose to compensate victims for their losses and
fail to serve any rehabilitative purpose, Section 523(a)(7) does not apply to preclude
discharge of such restitution orders in Chapter 7 bankruptcy proceedings.5 In support of
4At issue here is a discharge under Section 727 pertaining to liquidation of the debtor’s estate pursuant to a petition filed under Chapter 7 of the Bankruptcy Act. Discharges in connection with a reorganization plan pursuant to a petition filed under Chapter 13 of the Bankruptcy Act are subject to additional exceptions listed in Section 1328, including an express exception from discharge of a debt “for restitution, or a criminal fine included in a sentence on the debtor’s conviction of a crime.” 11 U.S.C. § 1328(a)(3). 5 The provisions at issue include the following.
§ 9721. Sentencing generally
(c) Mandatory restitution.--In addition to the alternatives set forth in subsection (a) of this section the court shall order the
[J-33-2019] - 5 defendant to compensate the victim of his criminal conduct for the damage or injury that he sustained. . . .
42 Pa.C.S. § 9721(c).
§ 1106. Restitution for injuries to person or property
(a) General rule.--Upon conviction for any crime wherein:
(1) property of a victim has been stolen, converted or otherwise unlawfully obtained, or its value substantially decreased as a direct result of the crime; or
(2) the victim, if an individual, suffered personal injury directly resulting from the crime,
the offender shall be sentenced to make restitution in addition to the punishment prescribed therefor.
(b) Condition of probation or parole.--Whenever restitution has been ordered pursuant to subsection (a) and the offender has been placed on probation or parole, the offender’s compliance with such order may be made a condition of such probation or parole.
(c) Mandatory restitution.--
(1) The court shall order full restitution:
(i) Regardless of the current financial resources of the defendant, so as to provide the victim with the fullest compensation for the loss. . . .
(2) At the time of sentencing the court shall specify the amount and method of restitution. In determining the amount and method of restitution, the court:
(iii) Shall not order incarceration of a defendant for failure to pay restitution if the failure results from the offender’s inability to pay.
[J-33-2019] - 6 this conclusion, Appellant notes that the Section 1106(c)(1)(i) of the Crimes Code was
amended by the Legislature in 1995 to require restitution “regardless of the current
financial resources of the defendant.” Id. at 14-15 (citing 18 Pa.C.S. § 1106(c)(1)(i) and
42 Pa.C.S. § 9721(a)). Appellant notes that prior to that amendment, the Superior Court
expressed the view that “[i]f the amount of restitution imposed exceeds the defendant’s
ability to pay, the rehabilitative purpose of the order is disserved, especially where the
restitution payment is a condition of probation, for in such a case the defendant is told
that he will not be imprisoned only if he somehow satisfies a condition he cannot hope to
satisfy.” Id. at (quoting Commonwealth v. Fuqua, 407 A.2d 24, 26 (Pa. Super. 1976)).
Appellant argues that this Court’s recent pronouncement in Commonwealth v. Veon, 150
A.3d 435 (Pa. 2016), that the primary purpose of restitution in Pennsylvania is
rehabilitative, merely relied on pre-amendment authority and failed to consider the
mandatory aspect of the current restitution requirements, which may result in the
imposition of an obligation beyond a defendant’s means to fulfill. Appellant’s Brief at 16.
Accordingly, Appellant argues the Pennsylvania restitution statutes no longer serve a
rehabilitative purpose, but rather serve primarily a compensatory goal. As such, Appellant
(f) Noncompliance with restitution order.--Whenever the offender shall fail to make restitution as provided in the order of a judge, the probation section or other agent designated by the county commissioners of the county with the approval of the president judge to collect restitution shall notify the court within 20 days of such failure. . . . Upon such notice of failure to make restitution . . . the court shall order a hearing to determine if the offender is in contempt of court or has violated his probation or parole.
18 Pa.C.S.A. § 1106(a)-(c), (f).
[J-33-2019] - 7 argues that the imposition of mandatory restitution in this case is in violation of the
Bankruptcy Code.
Appellant concedes that federal courts are generally reticent to interfere with state
criminal matters, but argues it is nevertheless “well established . . . that the Bankruptcy
Court will not permit the State to use criminal prosecution for the sole purpose of collecting
a debt dischargeable in bankruptcy, or to use law enforcement as a collection agency.”
Id. at 19 (quoting Johnson, 16 B.R. at 212). Appellant maintains that the facts in this case
establish that he filed for bankruptcy prior to the filing of the criminal complaint and that
the homeowner had a full opportunity to avail herself of the protections afforded creditors
under the Bankruptcy Code. He argues that criminal proceedings ought not to be used
as an alternative to those protections in securing debt payment.
Appellant argues the Superior Court’s reliance on Shotwell, which in turn relied on
Kelly, is misplaced. Appellant maintains the circumstances in Kelly are distinguishable
from the facts in this case. Appellant notes the bankruptcy filing by the defendant in Kelly
post-dated the imposition of the subject restitution order, which contrasts with the
circumstances in the instant case where Appellant filed for bankruptcy before any criminal
charges were filed. Additionally, Appellant notes the Connecticut restitution statute at
issue in Kelly authorized an order of restitution “in an amount [the defendant] can afford
to pay.” Id. at 18 n.1 (quoting Conn. Gen. Stat. § 53a-30 (1985)). Thus, Appellant argues
the statute was deemed to be rehabilitative rather than serving solely a compensatory
purpose.
Appellant urges this Court to adopt a balancing test, as proposed by the Amici in
their supporting brief, for courts to evaluate whether a restitution order unduly burdens
the interests embodied in the Bankruptcy Code. The factors proposed are the following:
(1) whether the statute, rule, or judgment imposing the restitution obligation is compensatory or rehabilitative in
[J-33-2019] - 8 nature, (2) whether the proceeding resulting in the imposition of the restitution obligation was initiated at the request of private creditors of the debtor, (3) whether the prosecutor’s office conducted an independent investigation into the criminal charges, (4) whether the proceeding resulting in the imposition of the restitution obligation was commenced after the debtor received a discharge in bankruptcy, and (5) whether the beneficiaries of the restitution obligation had notice of the debtor’s bankruptcy proceeding and an opportunity to assert their claims in the bankruptcy court and object to the discharge of their claims. Id. at 23; see also Amici Brief at 21-27.6
The Commonwealth argues that Appellant’s reliance on Johnson is inapt because,
as a Bankruptcy Court decision from the Middle District of Florida, it has no precedential
value in this jurisdiction.7 The Commonwealth also argues that Appellant’s interpretation
of the import of the holding in Johnson was contradicted by the later decision of the United
States Supreme Court in Kelly, as followed by the Superior Court in Shotwell. Further,
6 The National Consumer Bankruptcy Rights Center, The American Civil Liberties Union of Pennsylvania, Inc., Pennsylvania Legal Aid Network, Inc., Community Legal Services, Inc., Neighborhood Legal Services Association, the Community Justice Project, and the National Consumer Law Center, filed an Amici brief in support of Appellant. Therein, Amici urge this Court to consider the competing goals and interests between the federal Bankruptcy Code and the Commonwealth’s Crimes Code. As does Appellant, Amici argue that Pennsylvania’s restitution provisions no longer serve a primarily rehabilitative purpose due to their mandatory nature without regard to a defendant’s ability to pay. In order to prevent end-runs around bankruptcy protections through use of the criminal courts, Amici propose the above mentioned five-part test to assure proper criminal justice interests are served by the issuance of a restitution award where the civil obligation has already been discharged in bankruptcy. See Amici Brief, passim. 7 The Commonwealth also asks this Court to take judicial notice of additional proceedings before the bankruptcy court that are not contained in the certified record below and were not considered by the lower courts. In those proceedings, Appellant sought relief from the bankruptcy court against enforcement of the restitution order in light of the prior discharge of the civil debt. The court dismissed the complaints, noting, inter alia, that the discharge did not include any restitution per section 523(a)(7). These determinations by the bankruptcy court do not moot the issue accepted for review by this Court, which involve a legality of sentence issue and statutory interpretation of the sentencing provisions at issue in this case. Accordingly, we need not accept the Commonwealth’s invitation to take judicial notice of the bankruptcy court’s extra-record proceedings.
[J-33-2019] - 9 the Commonwealth argues that the Superior Court correctly relied on Shotwell. The key
holding in Shotwell was that a restitution order is distinct from any related civil debt. This
distinction does not depend on whether a discharge in bankruptcy is sought before or
after the imposition of the restitution order.
The Commonwealth also argues that other cases support the Superior Court’s
reliance on Shotwell and Kelly. Particularly, the Third Circuit Court of Appeals in In re
Thompson, 418 F.3d 362 (3d Cir. 2005), noted that the federalism concerns expressed
in Kelly preclude interference with a state’s restitution order. Thus, the Commonwealth
points out, the Thompson court distinguished cases that concerned federal restitution
orders. Commonwealth’s Brief at 19.
The Commonwealth additionally argues that this Court, in a case construing
Pennsylvania’s mandatory restitution statute, has already reaffirmed the primary
rehabilitative purpose of the restitution requirement.
It is well established that the primary purpose of restitution is rehabilitation of the offender by impressing upon him or her that his criminal conduct caused the victim’s loss or personal injury and that it is his responsibility to repair the loss or injury as far as possible. Commonwealth v. Runion, 662 A.2d 617, 618 (Pa. 1995). Thus, recompense to the victim is only a secondary benefit, as restitution is not an award of damages. Although restitution is penal in nature, it is highly favored in the law and encouraged so that the criminal will understand the egregiousness of his or her conduct, be deterred from repeating the conduct, and be encouraged to live in a responsible way. Thus, restitution, at its core, involves concepts of rehabilitation and deterrence.
Commonwealth v. Brown, 981 A.2d 893, 895–96 (Pa. 2009) (some citations omitted).
The Commonwealth argues that this Court in Brown and Veon did not rely blindly on
Runion, but did so recognizing that the amendment to the restitution statutes, which made
restitution mandatory, did not alter the purpose behind restitution awards. Indeed, the
[J-33-2019] - 10 Commonwealth notes that, in Veon, this Court specifically remarked that the Legislature’s
amendment to Section 1106 served to reinforce that purpose. Commonwealth’s Brief at
21 (citing Veon, 150 A.2d at 451).
Lastly, the Commonwealth argues that neither the timing of the restitution order
relative to Appellant’s bankruptcy proceedings, nor the fact that the victim did not
participate in the bankruptcy proceedings, are relevant to the central question of the
purposes served by a restitution order. Nothing in the record of this case suggests the
Commonwealth was improperly motivated in investigating and pursuing criminal charges
or in ascertaining the harm to be remedied through its recommendation of restitution.
We granted allocatur in this case to specifically address a sentencing court’s
“authority to direct payment of restitution which obligation has been previously discharged
in [the defendant’s] bankruptcy[.]” Commonwealth v. Petrick, 192 A.3d 1109 (Per Curiam
Order). The question of whether a sentencing court has the authority to order restitution
where the equivalent civil debt has been discharged by a bankruptcy court implicates the
legality of sentencing, which presents a pure question of law. In such case our scope of
review is plenary and our standard of review de novo. Commonwealth. v. McClintic, 909
A.2d 1241, 1245 (Pa. 2006). Additionally, the resolution of this matter involves statutory
interpretation of the relevant sentencing statutes, which also present pure questions of
law for which our scope of review is plenary and standard of review de novo. Bowling v.
Office of Open Records, 75 A.3d 453, 466 (Pa. 2013).
As reflected in their respective arguments, the parties recognize that the Court in
Kelly held that the language of Section 523(a)(7) of the Bankruptcy Code exempts from
discharge a restitution order entered as a consequence of a state prosecution. Kelly, 479
U.S. at 52. The decision in Kelly, however, included a recognition that the Connecticut
restitution statute in question “focus[es] on the State’s interests in rehabilitation and
[J-33-2019] - 11 punishment, rather than the victim’s desire for compensation.” Id. at 53. Thus, at its core,
Appellant’s argument is that Section 523(a)(7) of the Bankruptcy Code, as interpreted by
the United States Supreme Court in Kelly, does not preclude discharge of the restitution
order in this case because, by amending the restitution statutes to mandate the imposition
of a restitution order as part of any sentence imposed, the Legislature altered the
fundamental purpose underlying restitution from rehabilitation of the defendant to
compensation of the victim. As acknowledged by Appellant, this Court has specifically
stated otherwise in Brown and Veon. Arguably, the observations made in those cases
were dicta as they did not directly affect the outcome of the issues disposed of.8
The notion that a mandatory imposition of restitution as part of a sentence is
antithetical to a rehabilitative purpose can be traced to the language of the Superior Court
in Fuqua that suggests “if the amount of restitution imposed exceeds the defendant’s
ability to pay, the rehabilitative purpose of the order is disserved, especially where the
restitution payment is a condition of probation, for in such a case the defendant is told
that he will not be imprisoned only if he somehow satisfies a condition he cannot hope to
satisfy.” Fuqua, 407 A.2d at 26. The concern expressed here is not the mandatory
requirement of an order for restitution, but the disconnection between the requirement
and any assessment of a defendant’s ability to fulfill the obligation. We do not discount
the limited utility of requiring something impossible of compliance, but the statute
accounts for this by providing consideration of a defendant’s ability to pay, albeit at a
different stage of the proceedings.
8Both Brown and Veon involved issues of statutory construction concerning whether Medicare, or the Department of Community and Economic Development, respectively, were entities in a capacity that entitled them to receive restitution under the provisions of Section 1106.
[J-33-2019] - 12 (2) At the time of sentencing the court shall specify the amount and method of restitution. In determining the amount and method of restitution, the court:
(iii) Shall not order incarceration of a defendant for failure to pay restitution if the failure results from the offender’s inability to pay. 18 Pa.C.S. § 1106 (c)(2)(iii). The Legislature did not foreclose a sentencing court’s
consideration of a defendant’s ability to pay restitution; it merely eliminated ability to pay
as a prerequisite consideration. By mandating that a court include an order of restitution
for losses occasioned by defendants’ criminal conduct, in appropriate cases, as part of
its sentencing, the Legislature did not alter the rehabilitative and restorative benefits
previously recognized as embodied by such orders. Rather, as we noted in Veon, it
sought to reinforce them. Neither did the Legislature seek to punish a defendant for his
or her inability to comply. The Legislature simply placed the consideration of a
defendant’s ability to pay at the more pertinent stage, when a sentencing court must
assess a defendant’s compliance with the order.9
Accordingly, we reaffirm our statement in Veon:
9 Legislative enactments imposing mandatory sentencing considerations and mandatory sentencing provisions that diminish or channel a sentencing court’s discretion reflect a long understood attempt to find a balance between sentencing consistency and individualized consideration.
[I]ndividualized sentencing is not the only relevant tradition. A just legal system seeks not only to treat different cases differently but also to treat like cases alike. Fairness requires sentencing uniformity as well as efforts to recognize relevant sentencing differences.
Pepper v. U.S., 562 U.S. 476, 510 (2011) per Breyer, J., concurring. By mandating a sentencing consideration (such as consultation of guidelines), a minimum term of incarceration, or, as in this case, an imposition of a restitution order, the Legislature does not alter the rehabilitative, deterrent, restorative or other purpose underlying the sanctions at issue.
[J-33-2019] - 13 Echoing Runion, we emphasized [in Brown] that the primary purpose of restitution is rehabilitation of the offender. Consequently, recompense to the victim is only a secondary benefit, as restitution is not an award of damages, a proposition reinforced by the General Assembly’s 199[5] amendment of Section 1106 making restitution mandatory rather than discretionary.
Veon, 150 A.3d at 451 (internal quotation marks and citations omitted).
Having determined that the basis for restitution orders in Pennsylvania remains
focused on the rehabilitative needs of defendants, we conclude the holding of the United
States Supreme Court in Kelly applies. The Court in Kelly determined that the qualifying
language in Section 523(a)(7), “payable to and for the benefit of a governmental unit and
is not for actual pecuniary loss,” includes a prohibition from discharge of both fines and
restitution orders in a state criminal case. Kelly, 479 U.S. at 52. A contrary holding “would
hamper the flexibility of state criminal judges in choosing the combination of
imprisonment, fines, and restitution most likely to further the rehabilitative and deterrent
goals of state criminal justice systems.” Id. at 49. As expressed in Thompson:
[F]ederalism concerns embodied in a long tradition of courts’ unwillingness to discharge monetary obligations that form part of a state criminal judgment when applying federal bankruptcy statutes, and Congress’s deference to that tradition, trump a literal reading of the statutory text. We thus hold that § 523(a)(7) preserves from discharge Thompson’s state criminal restitution order-related debt.
Thompson, 418 F.3d at 363. We also agree with the Superior Court that the Kelly Court’s holding that Section
523(a)(7)’s exclusion from bankruptcy discharge includes restitution, is not dependent on
the relative timing of the discharge of the civil obligation in relation to the imposition of the
criminal sanction. The discharge of a civil debt prior to the commencement of a criminal
proceeding has no bearing on the purpose served by a restitution order. Similarly, the
[J-33-2019] - 14 level of participation of the victim/creditor in any bankruptcy proceeding is irrelevant to the
distinct status of and purpose of a restitution order. To accept Appellant’s suggestion
would only encourage a race to the respective courthouses to jockey for a perceived
advantage. Other checks and balances exist to prevent inappropriate use of criminal
prosecution. For these reasons we decline to impose the balancing test proposed by the
Amici and endorsed by Appellant.
We conclude that the Legislature did not alter the rehabilitative, enforcement,
deterrent and other purposes for restitution orders in criminal sentencing by making such
orders mandatory. The Legislature allowed for consideration of a defendant’s ability to
pay by a court when considering a defendant’s compliance with the order. Because the
mandatory restitution order serves criminal justice goals, restitution orders remain distinct
from civil debt liability with respect to discharge in bankruptcy. This distinction is
unaffected by the temporal relationship between the proceedings in the bankruptcy court
and the criminal prosecution. Additionally, it is unaffected by a creditor’s participation in
the bankruptcy proceedings. In the instant case there is no indication the restitution award
was improperly sought by the prosecutor or awarded by the sentencing court.
Accordingly, we affirm the order of the Superior Court.
Chief Justice Saylor and Justices Baer, Todd, Donohue, Dougherty and Wecht join the opinion.
[J-33-2019] - 15