Chapter 7 debtor David Edmonston challenges a bankruptcy court ruling disallowing his exemption claim to entireties property— the primary residence owned by him and his nondebtоr spouse since 1980. Edmonston duly claimed the residence exempt, see Bankruptcy Code § 522(b)(2)(B); Mass.Gen.Laws eh. 209, § 1, estimated its value at $200,000, and indicated that he and his nondebtor spousе were jointly obligated under the $59,-000 real estate mortgage and for unsecured indebtedness totaling at least $10,000. In due course the chapter 7 trustee objected to the exemption claim and Edmonston responded by contesting both the merits of the objection and the trustee’s “standing” to assert it. Ultimately, the bankruptcy court disallowed the exemption claim, the district court affirmed, and Edmonston appealed.
I.
As the facts are not in dispute, we conduct
de novo
review of the conclusions of law challenged on appeal.
See In re Caron,
An interest in property held in tenancy by the entirety is exempt in bankruptcy “to the extent ... exempt from process under applicable nonbankruptcy law,” 11 U.S.C. § 522(b)(2)(B), in this instance Massachusetts law.
See Napotnik v. Equibank & Parkvale Sav. Assoc.,
Nevertheless, an exemption claim becomes effective by operation of law absent a cognizable objection.
See
11 U.S.C. § 522(0 (“Unless a party in interest objects, the propеrty claimed as exempt on such list is exempt.”); Fed.R.Bankr.P. 4003(b);
see also Taylor v. Freeland & Kronz,
We think it clear thаt Bankruptcy Rule 4003(b) — itself “derived from § 522(1) of the Code,” Fed.R.Bankr.P. 4003, Advisory Committee Note — authoritatively defines the section 522(1) term “party in interest,” by explicitly stating that the “trustee or any creditor may file objections to the list of property claimed as exempt.” Fed. R.Bankr.P. 4003(b) (emphasis added).
2
Moreover, the position we make explicit today simply gives voice to the longstanding, implicit acknowledgement that a chapter 7 trustee is a “party in interest” within the meaning of section 522®.
See, e.g., Taylor,
As
“the
representative of the estаte,” 11 U.S.C. § 323(a) (emphasis added), the chapter 7 trustee is under a duty to “collect and reduce to money the property of the estate.”
Id.
§ 704(1).
3
See First Nat’l Bank of Mobile v. Norris,
We accordingly hold that the trustee, as the designated representative of the chapter 7 estate, 11 U.S.C. § 323(a), whose duties include the collection and liquidation of the nonexempt property of the estate,
see id.
§ 704(1), is a “party in interest” entitled to oppose exemption claims under Bankruptcy Code § 522(Z).
See also In re Van Rye,
II.
Edmonston further contends that since a chaрter 7 discharge can only relieve indebtedness of the chapter 7 debtor, joint creditors may still proceed directly against the entireties property itself because their claims against the nondebtor spouse would be unaffected by Edmonston’s chapter 7 proceeding. 4 This claim impermissibly assumes that the chapter 7 debtor is entitled to have the entireties property set apart as exempt, on the theory that joint creditors would retain their respective rights to proceed agаinst the entireties property under Commonwealth law in any event. As all relevant reported cases make clear, 5 assuming a proper objection by a party in interest an entire-ties exemption claim is invalid ab initio to the extent there are joint creditors. Thereupon, as nonexempt property of the chapter 7 estate the entireties property becomes subject to administration.
III.
For the foregoing reasons, the district court order is affirmed, with costs to appel-lee, and the case is remanded to the bankruptcy court for further proceedings consistent with this opinion.
SO ORDERED.
Notes
. Originally, chapter 209, § 1, did not apply to tenancies by the entirety created prior to its effective date,
viz.,
February 11, 1980.
Turner v. Greenaway,
. The Bankruptcy Rules "govern” procedure in all bankruptcy proceedings unless inconsistent with either title 11 or title 28, United States Codе.
Section 247 of Public Law 95-598, 92 Stat. 2549 amended 28 U.S.C. § 2075_to require that procedural rules promulgated pursuant to 28 U.S.C. § 2075 be consistent with the bankruptcy statute, both titles 11 and 28 U.S.C. Thus, ... any procedural matters contained in title 11 or 28 U.S.C. with respect to cases filed under 11 U.S.C. would control. See 1 Collier, Bankruptcy ¶ 3.04[2][c] (15th ed. 1980).
Advisory Committee Note (1983) (emphasis added).
Edmonston neither contends nor intimates that Rule 4003(b) is in any respect inconsistent with either title 11 (Bankruptcy Code) or title 28 (Judiciary and Judicial Procedure). Nor do we discern any pertinent inconsistency. On the contrary, given the mandate in Bankruptcy Code § 704 ("The trustee shall — (1) collect and reduce to money the property of the estate...."), any suggestion that a chapter 7 trustee is not required, let alone permitted, to oppose an unal-lowable exemption claim would be totally at odds with the chapter 7 trustee's principal statutory responsibility, as “the representative of the [chapter 7] estate," id. § 323(a) (emphasis added).
. Edmonston does not dispute that the entireties property became "property of the estate" by operation of law, see 11 U.S.C. § 541(a)(2)(B) (including in estate all property of debtor and spouse which is “liable for an аllowable claim against the debtor, or for an allowable claim against the debtor and an allowable claim against the debtor’s spouse, to the extent that such interest is so liable"), and thus became subject to administration under chapter 7 unless exempt.
. in assailing the Fourth Circuit's holding in Sumy, 777 F.2d at 929-32 — that the entireties properly was not exempt under Bankruptcy Codе § 522(b)(2)(B) — Edmonston misapprehends the court's rationale. The holding was not based on a "legal fraud” rationale, as Edmonston suggests, but on Bankruptcy Code § 522(b)(2)(B) and applicablе state law. Sumy, 777 F.2d at 929 (rejecting entireties exemption claim “by interpreting § 522(b)(2)(B) in light of state law”).
. Other courts of appeals which have weighed in on the matter are in acсord,
see Sumy, 111
F.2d at 932;
In re Grosslight,