APPENDIX N
BINDING EFFECT OF CONFIRMATION,
ORGANIZED BY CIRCUIT
A. Supreme Court of the United States
United Student Aid Funds, Inc. v. Espinosa, __ U.S. __, 130 S. Ct. 1367, 1376-80, 176 L. Ed. 2d 158 (Mar. 23, 2010) (Student loan creditor is not entitled to Rule 60 relief from confirmation order when creditor had actual notice that plan would discharge a portion of its debt, creditor filed a proof of claim, bankruptcy court had jurisdiction to confirm plan and constitutional due process was satisfied by actual notice. "The Bankruptcy Court's order confirming Espinosa's proposed plan was a final judgment. . . . United concedes that the Bankruptcy Court had jurisdiction to enter the order confirming Espinosa's plan. . . . United received actual notice of the filing and contents of Espinosa's plan. This more than satisfied United's due process rights. . . . [T]he Bankruptcy Court's failure to find undue hardship before confirming Espinosa's plan was a legal error. . . . But the order remains enforceable and binding on United because United had notice of the error and failed to object or timely appeal. . . . Rule 60(b)(4) does not provide a license for litigants to sleep on their rights. . . . Where, as here, a party is notified of a plan's contents and fails to object to confirmation of the plan before the time for appeal expires, that party has been afforded a full and fair opportunity to litigate, and the party's failure to avail itself of that opportunity will not justify Rule 60(b)(4) relief."), aff'g 553 F.3d 1193, 1198-1204 (9th Cir. Dec. 10, 2008) (Kozinski, Tashima, Smith) (Reaffirming Great Lakes Higher Education Corp. v. Pardee (In re Pardee), 193 F.3d 1083 (9th Cir. Oct. 25, 1999) (Lay, Pregerson, Hawkins), and rejecting Educational Credit Management Corp. v. Mersmann (In re Mersmann), 505 F.3d 1033 (10th Cir. Sept. 24, 2007) (en banc), Whelton v. Educational Credit Management Corp., 432 F.3d 150 (2d Cir. Dec. 15, 2005) (Calabresi, Raggi, Murtha), Ruehle v. Educational Credit Management Corp. (In re Ruehle), 412 F.3d 679 (6th Cir. June 23, 2005) (Daughtrey, Gibbons, Sargus), In re Hanson, 397 F.3d 482 (7th Cir. Feb. 2, 2005) (Bauer, Manion, Evans), and Banks v. Sallie Mae Servicing Corp. (In re Banks), 299 F.3d 296 (4th Cir. Aug. 5, 2002) (Wilkinson, Motz, Baldock), student loan creditor is not entitled to Rule 60 relief from discharge order when confirmed plan paid student loan without interest, penalties or fees and provided for discharge of balance of the debt; when notice is adequate, there are neither statutory nor constitutional barriers to the discharge of student loans through a confirmed Chapter 13 plan. "Pardee held that a discharge is a final judgment and cannot be set aside or ignored because a party suddenly claims, years later, that the trial court committed an error. . . . The provision giving student loan creditors a right to special procedures comes into play when the case is pending before the bankruptcy court. If a debtor proposes to discharge a student loan debt without invoking the special procedures applicable to such debts, the creditor can object to the plan until the debtor shows undue hardship in an adversary proceeding. But there are many reasons a student loan creditor might not object to such a Chapter 13 plan. . . . [W]hen the creditor is served with notice of the proposed plan, it has a full and fair opportunity to insist on the special procedures available to student loan creditors by objecting to the plan . . . . Rights may, of course, be waived or forfeited, if not raised in a timely fashion. . . . A bankruptcy discharge order is a final judgment and, even without the special protection of section 1327(a), a final judgment cannot be ignored or set aside just because it was the result of an error. . . . The three circuits that have held that the creditor is denied due process in circumstances such as these appear to have a different understanding of what due process requires. . . . [W]e find it both wrong and dangerous to hold that the standard for what amounts to constitutionally adequate notice can be changed by legislation. . . . We reject the idea that a creditor who is in the business of administering student loans has a constitutional right to ignore a properly served notice that clearly specifies that its debt will be discharged on successful completion of the plan.").
United Student Aid Funds, Inc. v. Espinosa, __ U.S. __, 130 S. Ct. 1367, 1378-80, 176 L. Ed. 2d 158 (Mar. 23, 2010) (Rejecting five contrary circuit court decisions, student loan creditor cannot void confirmation order under Bankruptcy Rule 9024 when creditor had actual notice that plan would discharge a portion of its debt and failed to object to confirmation or to appeal confirmation order. "Espinosa's failure to serve United with a summons and complaint deprived United of a right granted by a procedural rule. See [
B. First Circuit
Pawtucket Credit Union v. Boyajian (Diruzzo), 527 B.R. 800, 802, 805-09 (B.A.P. 1st Cir. Mar. 31, 2015) (Kornreich, Tester, Cary) (Citing United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), provision of confirmed plan that junior mortgage "'will be allowed as a wholly unsecured claim'" is binding on trustee; mortgagee keeps plan payments notwithstanding disallowance of its late-filed proof of claim. Debtor listed credit union as unsecured creditor in connection with a second mortgage. Plan proposed 67% distribution to unsecured claims, including wholly unsecured second mortgage. Five months after claims bar date, credit union filed untimely proof of claim. Trustee objected and objection was sustained. Due to "clerical error" trustee disbursed more than $41,000 to the credit union over five years of plan. Trustee then filed motion seeking turnover of everything paid to credit union on theory that creditor with disallowed claim was not entitled to distributions. "The confirmed plan binds not only the debtors and creditors but also the chapter 13 trustee. . . . [A]lthough PCU failed to comply with the provisions of the Bankruptcy Code and Bankruptcy Rules which require an unsecured creditor to file a proof of claim in order to have an allowed claim and receive distributions, it is clear that, in light of Espinosa and its progeny, the binding effect of the confirmed plan trumps the claims allowance process in this case.").
Boyajian v. Vargas (In re Vargas), No. RI 11-076, 2012 WL 2450170, at *4 (B.A.P. 1st Cir. June 8, 2012) (unpublished) (Hillman, Feeney, Hoffman) (Confirmation order is binding on trustee: failure to appeal confirmation order defeats appellate jurisdiction to consider appeal of subsequent order overruling trustee's objection to exemption in tort proceeds when objection was that tort proceeds were projected disposable income. Trustee objected to debtor's exemption claim in an unliquidated personal injury action. Before ruling on exemption objection, bankruptcy court confirmed plan that did not reserve issue whether proceeds from personal injury claim would be projected disposable income. "Although not a listed party, a chapter 13 trustee is bound by a confirmed plan. . . . [T]he Trustee's objection . . . was moot given the intervening Confirmation Order which did not reserve the issue.").
New Hampshire v. McGrahan (In re McGrahan), 459 B.R. 869 (B.A.P. 1st Cir. Dec. 7, 2011) (Feeney, Tester, Hoffman) (Because modified plan was silent with respect to state's right to intercept future tax refunds to collect support, modified plan was not binding under § 1327 and did not prohibit state from exercising intercept rights in future.), rev'g 448 B.R. 611 (Bankr. D.N.H. Apr. 22, 2011) (Deasy) (New Hampshire Department of Health and Human Services Division of Child Support was bound by confirmed plan that provided 100% payment of child support and could not continue to intercept tax refunds to satisfy prepetition support obligation. Exception to stay in § 362(b)(2)(F) did not preclude modification of confirmed plan to reflect payments already obtained through seizures. Department was prohibited from intercepting future tax refunds.).
Knowles v. Bayview Loan Servicing, LLC (In re Knowles), 442 B.R. 150, 163-64 (B.A.P. 1st Cir. Jan. 3, 2011) (Feeney, Tester, Bailey) (When local rule postponed claims resolution until after confirmation, confirmed plan is not binding with respect to attorney fees and costs included in postconfirmation proof of claim. "The confirmation order expressly reserved the determination of claims until after the claims deadline passed. Therefore, any change to the amount [the servicer] receives would be in accordance with—not in conflict with—the terms of the Amended Plan."), aff'g No. 08-1020, 2010 WL 1427393 (Bankr. D. Me. Apr. 9, 2010) (unpublished) (Kornreich) (Although mortgage servicer was bound by confirmation, because Local Rule postponed determination of claims until after confirmation, creditor was not prohibited by confirmed plan from assessing postpetition fees or charges.).
Fatsis v. Braunstein (In re Fatsis), 405 B.R. 1 (B.A.P. 1st Cir. Apr. 4, 2009) (Vaughn, Kornreich, Tester) (When confirmed plan overcame vesting effect in § 1327(b) and prohibited debtors from alienating property of the estate without court permission, after conversion from Chapter 13, Chapter 7 trustee recovers sanctions for contempt based on debtor's unauthorized sale of stock. Confirmed plan preserved estate and provided "[t]he debtor(s) shall not transfer, sell or otherwise alienate property of the estate other than in accordance with the confirmed plan or other order of the bankruptcy court." During the Chapter 13 case and without court permission, debtor sold stock and used proceeds. "[U]nder the express terms of the Confirmation Order, the Stock remained nonexempt property of the Debtor's estate after confirmation of his plan. By selling the Stock without bankruptcy court approval, the Debtor violated the clear and unambiguous terms of the Confirmation Order." BAP affirms civil contempt judgment in the amount of the sales price of the stock.).
Torres Martinez v. Arce (In re Torres Martinez), 397 B.R. 158 (B.A.P. 1st Cir. Dec. 1, 2008) (Boroff, Deasy, Rosenthal) (Confirmation in pre-BAPCPA case does not preclude motion to dismiss for bad faith because, prior to addition of § 1325(a)(7), good faith in filing petition was not a condition for confirmation.).
Burrell v. Town of Marion (In re Burrell), 346 B.R. 561, 568-70 (B.A.P. 1st Cir. July 17, 2006) (Lamoutte, Vaughn, Deasy) (Confirmation of plan that treated property taxes and water charges as unsecured priority debts to be paid in full without postpetition interest was binding notwithstanding liens for property taxes and water charges under Massachusetts law; completion of payments discharged postpetition interest and released the liens. "Although the Town held an allowed secured claim, the Debtor's plan failed to satisfy any of the three options for treatment of an allowed secured claim. The Debtor's plan treated the Town's allowed secured claim as a priority unsecured claim. Accordingly, the Debtor's plan failed to provide for the payment of postpetition interest . . . . The Town did not object to its treatment under the Debtor's plan and the bankruptcy court confirmed that plan. . . . Accordingly, the confirmation order is res judicata and binding on the Debtor and the Town in accordance with § 1327 of the Bankruptcy Code. . . . [T]he Debtor's completion of her plan effectively discharged [the] real estate tax lien, covering prepetition real estate taxes and water charges, against her interest in the property, pursuant to the terms of the Bankruptcy Code. . . . [U]pon completion of the Debtor's plan payments and receipt of her Chapter 13 discharge, the Debtor had neither an in personam nor an in rem obligation to pay any prepetition claim beyond the amount in the Town's allowed claim. . . . The allowance of the Town's secured claim for prepetition real estate taxes and water claims was res judicata on the amount of its claim. . . . The failure of the Town to object to the improper treatment of its allowed secured claim in the Debtor's plan prior to confirmation or to appeal the confirmation order is binding to the Town.").
Vicenty v. Sandoval (In re Sandoval), 327 B.R. 493 (B.A.P. 1st Cir. June 16, 2005) (Feeney, Boroff, Kornreich) (Confirmation of Chapter 13 plan is res judicata with respect to the debtor's eligibility under § 109(e); creditors cannot challenge eligibility after confirmation by motion to dismiss.).
Mountain Peaks Fin. Servs., Inc. v. Shepard (In re Shepard), 328 B.R. 601 (B.A.P. 1st Cir. June 2, 2005) (Lamoutte, Votolato, Haines) (Confirmation is binding when creditor appealed denial of its objection to confirmation but there was no valid appeal of confirmation order; order denying creditor's objection to confirmation was interlocutory.).
Massachusetts
Mbazira v. Litton Loan Servicing, LLP (In re Mbazira), No. 10-11831-FDS, 2011 WL 3208033 (D. Mass. July 27, 2011) (Saylor) (Citing Celli v. First National Bank of Northern New York, 460 F.3d 289 (2d Cir. Aug. 15, 2006) (Kearse, Sack, Hall), judicial estoppel and res judicata effect of confirmation prevented modification to reclassify mortgage as unsecured based on defective acknowledgment. Confirmed plan treated mortgage as fully secured. After postconfirmation default, proposed modification would reclassify mortgage as unsecured based on defective certificate of acknowledgment. Adversary proceeding challenging mortgage validity was dismissed.).
Chung-Chan v. Bankowski (In re Chung-Chan), No. 09-CV-10926-PBS, 2009 WL 3837846 (D. Mass. Nov. 17, 2009) (Saris) (Applying Barbosa v. Soloman, 235 F.3d 31 (1st Cir. Dec. 21, 2000) (Torruella, Selya, Casellas), bankruptcy estate continues to exist after confirmation and is funded by regular income and postpetition assets under § 1306(a); postconfirmation settlement of adversary proceeding with mortgage creditor belonged to bankruptcy estate.).
Bankowski v. Wells Fargo Bank, N.A. (In re Reid), 480 B.R. 436 (Bankr. D. Mass. Oct. 10, 2012) (Bailey) (Trustee's failure object to confirmation of plan that treated mortgage as fully secured barred use of strong-arm power to avoid defective mortgage.).
In re Darden, 474 B.R. 1 (Bankr. D. Mass. May 25, 2012) (Bailey) (Debtor was bound by confirmed plan that promised proceeds from postpetition litigation with GMAC Mortgage to unsecured creditors. At dismissal of case, trustee was authorized to disburse settlement proceeds in accordance with confirmed plan with balance to debtor.).
Sarner v. Massachusetts Dep't of Rev. (In re Sarner), No. 11-1253, 2011 WL 6026894 (Bankr. D. Mass. Dec. 5, 2011) (Feeney) (Proposed amended plan was not confirmed and was not binding on Commissioner of Revenue for Commonwealth of Massachusetts. Commissioner had executed on unscheduled bank account, and debtors' late attempt to claim joint ownership in that account was not supported by evidence that debtors had interest in account.).
In re Euliano, 442 B.R. 177, 188-89 (Bankr. D. Mass. Nov. 29, 2010) (Boroff) (Confirmation does not preclude dismissal for cause when confirmed plan provided for payment of $8,000 mortgage arrearage and creditor filed timely postconfirmation claim for more than $15,000 that could not be paid in 60 months. Failure of confirmed plan to provide payment in full of allowed prepetition arrears constituted unreasonable delay prejudicial to mortgage creditor. "[I]t cannot be conclusively determined that a plan fails to comply with § 1322(b)(5) until the applicable deadlines for filing and objecting to proofs of claim have passed. . . . Where the deadline for filing claims falls after the deadline for objecting to a Chapter 13 plan, the failure of a creditor to object to a plan on the grounds that the plan has misstated the amount of the claim can not [sic], consistent with due process, bind the creditor with respect to the amount which the creditor is required to identify no earlier than the deadline for filing proofs of claim. Thus, the Debtors' proposed Plan 'treatment' of the Countrywide Claim—payment of less than the full prepetition arrears—does not preclude the Court from its postconfirmation conclusion that the Plan presents an unreasonable delay prejudicial to creditors." United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), was not controlling because plan treatment of student loans was inconsistent with Code from outset and creditor was bound by confirmation. Debtor was given opportunity to modify plan.).
In re Ryan, No. 08-40601-MSH, 2010 WL 2889107, at *1 (Bankr. D. Mass. July 21, 2010) (unpublished) (Hoffman) (Sections 1327 and 502 coexist: when confirmed plan provided for an arrearage amount and secured creditors filed larger arrearage claims, creditors are bound by confirmation to accept lesser amount but difference will survive discharge. Order confirming plan was res judicata as to treatment of mortgage claims and prepetition arrearages, but "[t]he determination of the allowed amounts of those claims occurred outside the plan and as part of the claims process and since each creditor timely filed a proof of claim to which the debtor interposed no objection, each creditor's allowed claim was in the amount set forth in its proof of claim. To the extent the plan treatment of those allowed claims will not result in full payment of those claims during the life of the plan, the unpaid balance will have to be paid outside the plan." Trustee "unreasonably" waited 19 months from claims bar date and 17 months from plan confirmation to raise objection to plan indirectly by motion to dismiss.).
In re Rodrigues, 370 B.R. 467 (Bankr. D. Mass. July 5, 2007) (Feeney) (Motion to reopen closed case and revoke discharge is denied; confirmation order has res judicata effect and is entitled to finality, citing Factors Funding Co. v. Fili (In re Fili), 257 B.R. 370, 373 (B.A.P. 1st Cir. Jan. 11, 2001) (Lamoutte, Haines, Deasy).).
In re Rubinski, 349 B.R. 320, 323 (Bankr. D. Mass. Sept. 13, 2006) (Confirmed plan is not res judicata with respect to dischargeability of child support claims because plan provided for an amount but was not clear with respect to dischargeability. "Where a plan is ambiguous with respect to its treatment of particular aspect of a creditor's claim . . . courts have found that res judicata does not necessarily apply. . . . This has been found particularly to be the case where the proposed treatment of a claim in a Chapter 13 plan undercuts other provisions of the Bankruptcy Code and Rules.").
In re Abbott, No. 01-17874-WCH, 2006 WL 344758, at *2 (Bankr. D. Mass. Feb. 13, 2006) (unpublished) (Hillman) (Confirmed plan that specified arrearage bound EquiCredit Corporation; "provisions in an adequately noticed Chapter 13 plan which modify the rights of a secured creditor are the functional equivalent of a claims objection under § 502(a)." Debtor successfully completed plan and discharge prohibited EquiCredit from seeking reimbursement for prepetition arrearage in excess of amount specified in confirmed plan.).
In re Searcy, 333 B.R. 617 (Bankr. D. Mass. Dec. 1, 2005) (Hillman) (In reopened 15-year-old case, plan was adequately noticed and confirmation bound mortgagee to modified claim, notwithstanding debtor's failure to object to proof of claim. Adequately noticed plan modification is functionally equivalent to claims objection. Moreover, creditor's lack of collection effort for more than a decade triggered laches. Court ordered discharge of mortgage.).
New Hampshire
In re Franklin, No. 09-13399-JMD, 2017 WL 3701214, at *2
In re Nevins, 564 B.R. 151, 154
In re Ashley, 539 B.R. 198, 204 (Bankr. D.N.H. Oct. 14, 2015) (Harwood) (Secured creditor sanctioned $13,055 for failure to comply with confirmation order, including refusal to turn over title after car was paid off through plan. "Debtors' counsel [ ] made a written demand for the release and title; the Debtors purchased a new vehicle and attempted to finance the purchase in part by using the [paid-off vehicle] as a trade-in; [creditor] failed to timely release the lien and turn over the title as required by the Confirmation Order; the Debtors, their counsel, and the dealer attempted to resolve the issue from April 2015 through August 2015 to no avail; and the Debtors ultimately had to repurchase the [paid-off vehicle] from the dealership and are now forced to sell it in an attempt to recoup those funds. Under these circumstances, the Court finds that an appropriate inherent power, non-contempt, punitive sanction is $11,625—the amount paid to [creditor] in respect of its allowed secured claim under the Plan—in addition to the amount of $1,430, which [creditor] already voluntarily agreed to pay to the Debtors on account of their attorney's fees[.]").
Gaff v. Town of Pembroke (In re Doolan), 447 B.R. 51 (Bankr. D.N.H. Mar. 14, 2011) (Deasy) (Town was in contempt of confirmation order when it failed to properly apply postpetition property tax payments and assessed interest. Evidentiary hearing was set for sanctions.).
In re Rodger, 423 B.R. 591 (Bankr. D.N.H. Feb. 5, 2010) (Deasy) (Trustee may seek modification of confirmed plans to require payment of future income tax refunds to trustee, but refunds received before filing of modification motion belong to debtor.).
In re Watson, 417 B.R. 165 (Bankr. D.N.H. Oct. 26, 2009) (Deasy) (Citing Barbosa v. Solomon, 235 F.3d 31 (1st Cir. Dec. 21, 2000) (Torruella, Selya, Casellas), res judicata effect of confirmation does not preclude motion by trustee to modify plan to require turnover of postconfirmation tax refunds; § 1329 permits modification to increase payments to unsecured creditors, notwithstanding that disposable income was determined at confirmation. Since debtors were not on notice that they would be required to turn over refunds to trustee, it would be fundamentally unfair to require turnover of 2008 refund, but future tax refunds should be turned over.).
In re Wyatt, 368 B.R. 99 (Bankr. D.N.H. May 10, 2007) (Vaughn) (Confirmation is binding upon creditor with sufficient notice of plan, and res judicata effect extends to debtor's debt-limit eligibility.).
Puerto Rico
In re Medina-Espinosa, No. 13-04255 (ESL), 2015 WL 2400092 (Bankr. D.P.R. May 18, 2015) (Lamoutte) (Res judicata effect of confirmation required denial of preconfirmation fees beyond no-look fees allowed in confirmed plan.).
In re Galindez, 514 B.R. 79, 97-100 (Bankr. D.P.R. July 31, 2014) (Lamoutte) (Confirmed plan and amended plan fixed arrearage amount and trump inconsistent amended claim filed more than four years after confirmation. Amended allowed claim does not overcome binding effect of postconfirmation modified plan when creditor had adequate notice of plan and amended plan, filed amended claim more than four years after confirmation, and did not object to trustee's notice of final cure payment. "This view is aligned with the [United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (2010),] decision, which supports the principle of finality of plan confirmation orders. . . . [T]iming and due notice are key to the binding effect of a confirmed plan and the finality of plan confirmation orders. . . . [I]f a discrepant secured proof of claim is filed before the plan confirmation, then the debtor or Trustee should object the same as part of the claims allowance/disallowance process and before the entry of the confirmation order. The conflict between the claims allowance process and the plan confirmation process oftentimes occurs when the plan gets confirmed prior to the claims bar date and the creditor files after plan confirmation a timely proof of claim. It behooves the debtor or the chapter 13 trustee to object [to] the secured proof of claim prior to confirmation to avoid the friction between the claims allowance process and the plan confirmation process. . . . [A]mended claim . . . filed . . . four years and eight months after the petition date constitutes a collateral attack on the Debtors' confirmed Chapter 13 plan, as modified. The secured creditor was duly notified of the post-petition mortgage arrearages that were going to be paid throughout the plan and prior to the post-confirmation modification. . . . [P]ost-confirmation modified plan . . . , based on [creditor's] own statement of accounts for the mortgage loan, and after notice and opportunity for hearing, bars [creditor's] later filed amended claim under the binding effect disposition in 11 U.S.C. § 1327(a). . . . The belated reclamation of pre-petition amounts owed, even if true, . . . was untimely under the circumstances. . . . [T]he pre-petition mortgage arrearages, fees and charges were paid in full. . . . [N]o pre-petition arrears owed.").
In re Pagán, No. 09-07451 EAG, 2014 WL 1430899, at *5 (Bankr. D.P.R. Apr. 14, 2014) (Godoy) (Creditor bound by unambiguous plan that modified oversecured mortgage claim subject to § 1322(c)(2) by providing for payment in full with no interest. "The effect of a plan's confirmation is established under section 1327. Section 1327(a) provides that '[t]he provisions of a confirmed plan bind the debtor and each creditor, whether or not the claim of such creditor is provided for by the plan, and whether or not such creditor has objected to, has accepted or has rejected the plan.' . . . Under section 1324(a), any party in interest may object to the confirmation of the plan. If a creditor does not object to confirmation, section 1327 binds the creditor to the terms set forth in the plan and further precludes collateral attack of the plan's confirmation. '[T] he interest in the finality of confirmation orders in bankruptcy proceedings is stronger than the bankruptcy court's obligation to verify a plan's compliance with the Bankruptcy Code.'").
In re Marquez, No. 10-03882, 2011 WL 4543226 (Bankr. D.P.R. Sept. 28, 2011) (Lamoutte) (Confirmation was finding that petition was filed in good faith and precludes postconfirmation motion to dismiss based on bad faith.).
In re Salva, No. 03-09405(ESL), 2009 WL 2898822 (Bankr. D.P.R. Apr. 1, 2009) (Lamoutte) (Best-interests-of-creditors test cannot be raised for first time after confirmation by way of a motion to dismiss for cause.).
In re Rodriguez Figueroa, No. 00-10605 GAC, 2006 WL 3898295, at *6 (Bankr. D.P.R. Apr. 6, 2006) (unpublished) (Applying "expansive" view of "misconduct," as required by Anderson v. Cryovac, Inc., 862 F.2d 910, 923 (1st Cir. 1989), debtor forfeited binding effect of confirmation by incorrectly scheduling claim as unsecured when prebankruptcy court had determined that it was secured. Although confirmed plan is normally binding, here lien would survive bankruptcy since it was not provided for in the plan. No objections were filed to confirmation of plan that provided there were no secured claims. Alma Paravisini was scheduled as unsecured in amount of $43,546.29 arising out of prior civil litigation. Postconfirmation motion alleged the claim was secured by prejudgment attachment against real estate and sought determination of secured status and in rem relief. Court first held that confirmation bound creditors, but upon motion for reconsideration and filing of certificate of perfected lien, court applied Fed. R. Civ. P. 60 and granted equitable relief to pursue secured lien.).
De Jesus Rivera v. GECC of P.R. (In re De Jesus Rivera), Nos. 00-00801 GAC, 04-00165, 2006 WL 3898296, at *4 (Bankr. D.P.R. Feb. 24, 2006) (unpublished) (Carlo) (Confirmed plan bound creditors in absence of "evidence that debtor is scheming to defraud the creditor and where a secured creditor has the opportunity to object to its treatment under a plan and fails to do so." Creditor secured by tow truck first demanded interest after plan completion and discharge. Debtor's adversary proceeding for discharge injunction violation was granted with a damage hearing set.).
Rhode Island
In re Murphy, 487 B.R. 86 (Bankr. D.R.I. Mar. 6, 2013) (Finkle) (Debtors were bound by confirmed plan that dedicated personal injury proceeds to creditors. Applying Barbosa v. Solomon, 235 F.3d 31 (1st Cir. Dec. 21, 2000) (Torruella, Selya, Casellas), modification to retain proceeds was denied.).
C. Second Circuit
Celli v. First Nat'l Bank of N. N.Y. (In re Layo), 460 F.3d 289, 293-95 (2d Cir. Aug. 15, 2006) (Kearse, Sack, Hall) (Confirmed plan that treated mortgage holder as secured with regular monthly payments precluded trustee's adversary proceeding asserting that mortgage had been released and discharged. "[T]he facts that form the basis for the Trustee's challenge to the mortgages were available in the county clerk's office for anyone to see. The Trustee had clear opportunities to object to the validity of the mortgage lien listed in the confirmed Chapter 13 plan—when FNB filed its claim . . . and when Layo consented to and included that claim in his final Chapter 13 plan. . . . We acknowledge that challenges to the validity of a lien must be brought through an adversary proceeding. Where, at the outset, there is no dispute as to the basis of a lien, however, given the policy embodied in § 1327(a) that confirmation of a plan 'bind the debtor and each creditor,' it does not follow that a non-objecting creditor has a right to bring an adversary proceeding whenever he gets around to doing so. . . . We do not view [Cen-Pen Corp. v. Hanson, 58 F.3d 89 (4th Cir. June 22, 1995) (Wilkinson, Hamilton, Heaney),] as establishing a general rule that creditors whose liens are not in dispute at the time of confirmation have a right to bring an adversary proceeding post-confirmation to challenge the lien.").
Whelton v. Educational Credit Mgmt. Corp., 432 F.3d 150, 153, 154, 154-55, 155 (2d Cir. Dec. 15, 2005) (Agreeing with Fourth, Sixth and Seventh Circuits, discharge of student loan may not be achieved by declaration in confirmed plan; confirmation has no preclusive effect on issues that must be decided in adversary proceeding. "[B]y employing a discharge by declaration, Whelton attempted to avoid the adversary process to which ECMC was entitled . . . [amounting to] 'practice by ambush.'" Obtaining discharge by declaration "is properly treated as void." Bankruptcy judge "lacked the authority to grant a discharge of Whelton's student loan debt through the ordinary confirmation process. As a general matter, res judicata can only be invoked where (1) there is a previous adjudication on the merits; (2) the previous action involved ECMC or its privy; and (3) the claims involved were or could have been raised in the previous action. . . . Here, it is difficult to see how these claims could have been raised since ECMC lacked proper notice." Undue hardship "cannot be adjudicated in a summary proceeding," because Brunner's three-part test requires adjudication on merits. Since § 523(a)(8) exception is "self-executing," ECMC had right to expect adversary proceeding notice before discharge.).
Connecticut
In re Tessier, 333 B.R. 174 (Bankr. D. Conn. Nov. 2, 2005) (Lender with deficiency claim on repossessed car is not bound by confirmed plan provision that claim is satisfied by possession, since notice of plan amendments was not sufficient, citing Piedmont Trust Bank v. Linkous (In re Linkous), 990 F.2d 160, 162 (4th Cir. 1993).).
New York
Eastern District of New York
In re Roberts, 514 B.R. 358, 362-63 (Bankr. E.D.N.Y. Aug. 12, 2014) (Grossman) (Under §§ 541(a)(5) and 1306(a), any inheritance received after commencement of case and before case is closed, dismissed or converted is property of Chapter 13 estate. Adopting majority view, "§ 1306(a)(1) creates an exception to the general rule of § 541(a)(5), removing the 180-day limitation in the chapter 13 context. . . . [Section] 1306(a) brings into the estate, in chapter 13 cases, any property that the debtor inherits post-petition but before the case is closed or converted, notwithstanding § 541(a)(5). . . . Debtors' chapter 13 case has neither been closed nor converted, and therefore, . . . [debtor's] post-petition inheritance is property of the estate.").
In re Fennell, No. 10-49969-CEC, 2012 WL 1556535 (Bankr. E.D.N.Y. May 2, 2012) (Craig) (Confirmed plan that treated mortgage as secured claim precluded debtor's resistence to lift stay motion on basis of chain-of-title defects. Confirmation and postconfirmation challenges to mortgage involved same issue—whether underlying lien was valid.).
In re Rosenhouse, 453 B.R. 50, 57 (Bankr. E.D.N.Y. June 27, 2011) (Trust) (Rejecting Ford Motor Credit Co. v. Parmenter (In re Parmenter), 527 F.3d 606 (6th Cir. May 30, 2008) (Martin, Sutton, Oberdorfer), vehicle lease assumed in confirmed plan was debt "provided for" by plan, notwithstanding direct payments to Ford Motor Credit. "It is this Court's construction of §§ 1322(b)(7), 1325(a)(6), and 1328 that, even though Debtors were to make payments on the assumed Lease 'outside the Plan,' meaning that they were not being paid through the Chapter 13 Trustee, those are still payments on a lease assumed under the plan (§ 1322(b)(7)), to be paid by debtor under the plan (§ 1325(a)(6)) and are therefore 'debts provided for by the Plan.' Thus, the Debtors' Lease obligations can be discharged, upon compliance with the plan." Ford was entitled to administrative expense claim on default and surrender of vehicle, including unpaid lease charges, excess mileage charges and $300 attorney fee. Claim could be paid in deferred cash payments through modified plan.).
In re Malewicz, 457 B.R. 1 (Bankr. E.D.N.Y. Nov. 4, 2010) (Grossman) (No provision of Code or confirmed plan requires turnover to trustee of nonfiling spouse's share of joint tax refund. Nonfiling spouse's income was considered to determine projected disposable income, but nonfiling spouse's portion of joint tax refund is not property of the estate, and trustee cannot compel nonfiling spouse to commit tax refund to plan.).
In re Lemma, 394 B.R. 315, 322-24 (Bankr. E.D.N.Y. Sept. 29, 2008) (Grossman) (Confirmed plan that cures default and maintains payments trumps relief from codebtor stay under § 1301(c)(2) notwithstanding prepetition judgment of foreclosure and postpetition termination of § 362(a) stay under § 362(c)(3). "The only effect termination of the stay had on this case was to permit the Bank to proceed against Debtors in state court. . . . [T]here is nothing in the Code to even suggest that once the stay is terminated, Debtors can no longer bind the Bank under a plan which implements the cure and reinstatement provisions provided in the Bankruptcy Code. . . . The Bank is now barred by res judicata from arguing that Debtors had no right to cure and reinstate the mortgage and note. . . . [E]ven where the stay has been terminated preconfirmation by operation of law under section 362(c)(3) . . . the debtor still retains the right to bind the creditors under a confirmed plan. . . . [T]his Court declines to follow [In re Cline, 386 B.R. 344 (Bankr. N.D. Ala. Feb. 11, 2008) (Robinson).]").
Northern District of New York
Palmatier v. Wells Fargo Fin. Nat'l Bank (In re Palmatier), No. 1:09-CV-220 (DNH), 2010 WL 2516577, at *4 (N.D.N.Y. June 14, 2010) (Hurd) (Distinguishing Celli v. First National Bank of Northern New York (In re Layo), 460 F.3d 289 (2d Cir. Aug. 15, 2006) (Kearse, Sack, Hall), and citing Cen-Pen Corp. v. Hanson, 58 F.3d 89 (4th Cir. June 22, 1995) (Wilkinson, Hamilton, Heaney), confirmed plan that treated furniture lender as unsecured did not preclude finding that claim was secured in context of claim objection when claim was filed before confirmation and claim objection was filed after confirmation. "As with Cen-Pen, and unlike Layo, the instant case concerns a claim that was in dispute prior to the confirmation of debtors' bankruptcy plan. Creditor filed its proof of claim more than five months before debtor[s'] plan was confirmed. Only after the confirmation order was entered did debtors file their objection to the creditor's proof of claim. As a result, they now try to benefit from the generally binding nature of a confirmed bankruptcy plan, see 11 U.S.C. § 1327, without ever having litigated the validity of creditor's secured claim. However, by virtue of its proof of claim, creditor avoided the preclusive effect of debtors' confirmed bankruptcy plan.").
In re Holtslander, 507 B.R. 779 (Bankr. N.D.N.Y. Mar. 20, 2014) (Davis) (Casualty insurance proceeds from postconfirmation destruction of vehicle are property of estate subject to lien when confirmed plan did not revest property of estate in debtor. Confirmed plan limits lienholder's recovery to amount due under plan. Plan may be amended to distribute surplus proceeds.).
Karakas v. Bank of N.Y. (In re Karakas), Nos. 06-32961, 06-80245, 2007 WL 1307906 (Bankr. N.D.N.Y. May 3, 2007) (unpublished) (Gerling) (Res judicata effect refused plan provision that no equity existed in home over first mortgage when plan also provided that debtor would initiate adversary proceeding to avoid bank's second lien. Upon filing complaint, court finds bank to be wholly unsecured, and claim is reclassified.).
American Gen. Fin. Servs., Inc. v. Bryan (In re Bryan), 357 B.R. 12 (Bankr. N.D.N.Y. Dec. 12, 2006) (Gerling) (Res judicata effect given to confirmation order that stripped wholly unsecured junior lien under Celli v. First National Bank of Northern New York (In re Layo), 460 F.3d 289, 292 (2d Cir. Aug. 15, 2006) (Kearse, Sack, Hall); lienholder had notice of plan and participated in confirmation process. Confirmation included valuation and determined that junior lender's claim was totally unsecured. "[A] creditor who fails to object to a plan or appeal a confirmation order is without a basis for challenging a provision of the confirmed plan.").
In re Coss, No. 02-65893, 2005 WL 5419055 (Bankr. N.D.N.Y. July 14, 2005) (unpublished) (Gerling) (Finding plan clear and unambiguous in providing for bifurcation of CitiMortgage's claim, creditor had adequate notice, did not object to confirmation and is bound by confirmed plan.).
In re Coss, No. 02-65893, 2005 WL 5419055, at *7 (Bankr. N.D.N.Y. July 14, 2005) (unpublished) (Gerling) (Notwithstanding binding effect of confirmed plan's modification of CitiMortgage's claim into secured and unsecured portions, its lien will survive discharge unless debtor initiates adversary proceeding to determine extent of lien, "namely, the scope of the property subject to CitiMortgage's lien under the terms of its mortgage and whether the trailer is permanently affixed to the land on which it sits so as to be subject to the mortgage[.]").
Southern District of New York
Armstrong v. Trustco Bank (In re Armstrong), 434 B.R. 120 (Bankr. S.D.N.Y. Aug. 4, 2010) (Morris) (Although confirmed plan binds debtors and creditors, plan providing for surrender of apartment property did not accomplish surrender when debtors took no action during case and mortgage holder was paid in full on its unsecured claim. After completion of payments and discharge, debtors are not entitled to refund or credit for value of property that was never actually surrendered.).
Jiminez v. NYCTL 1996-1 Trust (In re Jiminez), No. 04-03149 (JMP), 2008 WL 2026147 (Bankr. S.D.N.Y. May 9, 2008) (unpublished) (Peck) (Debtor bound by confirmed plan that recognized validity of city tax lien and contained lien-retention clause; city bound by plan provision for 9% rather than 18% statutory interest when city did not object to confirmation.).
Jiminez v. NYCTL 1996-1 Trust (In re Jiminez), No. 04-03149 (JMP), 2008 WL 2026147 (Bankr. S.D.N.Y. May 9, 2008) (unpublished) (Peck) (Debtor is bound by confirmed plan that recognized validity of city tax lien and that contained lien-retention clause; alleged mistakes by tax claimant leading debtor to believe lien had been satisfied do not alter effect of confirmation.).
Jiminez v. NYCTL 1996-1 Trust (In re Jiminez), No. 04-03149 (JMP), 2008 WL 2026147, at *5 (Bankr. S.D.N.Y. May 9, 2008) (unpublished) (Peck) (Quoting Lawrence Tractor Co. v. Gregory, 705 F.2d 1118, 1122 (9th Cir. 1983), when confirmed plan recognized lien of tax claimant and contained lien-retention clause, plan "provided for" claim; providing for claim only requires that plan "deal with it or refer to it." "The Supreme Court in Rake v. Wade subsequently adopted this broad definition. 508 U.S. 464, 474-75, 113 S. Ct. 2187 (1993).").
In re Jafary, 333 B.R. 680 (Bankr. S.D.N.Y. Nov. 18, 2005) (Morris) (Res judicata effect of confirmation bound trustee, who must move for modification before completion of plan payments to have authority to disburse funds to unsecured creditors when trustee received refund of overpayment after trustee certified plan completion.).
Western District of New York
In re Gollnitz, 456 B.R. 733 (Bankr. W.D.N.Y. Sept. 20, 2011) (Bucki) (Surrender of property through plan without acceptance by lienholder or taxing authorities did not absolve debtor of responsibility for environmentally challenged property that vested in debtor at confirmation.).
In re Ober, 390 B.R. 60 (Bankr. W.D.N.Y. June 27, 2008) (Bucki) (Confirmation of plan prior to conversion precludes Chapter 7 trustee from asserting that case was automatically dismissed under § 521(i) when debtor failed to file all required payment advices during Chapter 13 case.).
Vermont
In re Flory, No. 10-10748, 2012 WL 627670 (Bankr. D. Vt. Feb. 24, 2012) (Brown) (Failure to report or turn over inherited funds put debtor in contempt of confirmation order requirement to report new assets or income to trustee. Contempt was punished by dismissal with one-year bar to refiling.).
In re Budziak, No. 05-10668, 2009 WL 3297791, at *5 (Bankr. D. Vt. Oct. 13, 2009) (unpublished) (Brown) (Under § 1327, confirmation orders are not susceptible to collateral attack by creditors, and Bankruptcy Rule 9006(b) does not excuse bank's failure to timely object to modification of confirmed plan. Bank had notice of motion to modify confirmed plan, permitting sale of residence and surrender to senior mortgage lender if sale could not be consummated. Bankruptcy Rule 9006 contains no "language . . . to suggest that it provides a mechanism for re-opening a time period which has come to its legal conclusion by virtue of the entry of an order. . . . Hence, the Court finds Rule 9006 does not offer the Bank a basis for extending the due date of the Bank's objection or excusing its untimely filing of an objection based upon excusable neglect.").
In re Budziak, No. 05-10668, 2009 WL 3297791, at *5 (Bankr. D. Vt. Oct. 13, 2009) (unpublished) (Brown) (Rule 9006(b) does not excuse bank's failure to timely object to modification of confirmed plan when bank had notice of debtor's motion to modify confirmed plan, permitting sale of residence and surrender to senior mortgage lender if sale could not be consummated. "Bankruptcy Rule 9006 does not offer the Bank a basis for extending the due date of the Bank's objection or excusing its untimely filing of an objection based upon excusable neglect.").
In re Porter, 382 B.R. 29, 32-33, 36-37, 44 (Bankr. D. Vt. Feb. 8, 2008) (Brown) (Plan language attempting to preserve postconfirmation causes of action under state, federal and common law that were not-yet-ripe nor directed toward specific defendants is too vague to satisfy res judicata and due process. Proposed language stated, "'Confirmation of this plan shall constitute a finding that the debtor does not waive[,] release or discharge but rather retains and reserves for herself and the Chapter 13 Trustee any and all pre-petition claims and any and all post-petition claims that they could or might assert against any part[y] or entity arising under or otherwise related to any state or federal consumer statute or under state or federal common law including but not limited to fraud, misrepresentation, breach of contract, unfair and deceptive acts and practices, TILA violations, RESPA violations, FDCPA violations, FCRA violations, and any and all violations arising out of rights or claims provided for by Title 11 of the United States Code, by the Federal Rules of Bankruptcy Procedure and by the Local Rules of this Court.'" This reservation of rights conflicted with finality and res judicata effect of confirmation orders, citing Celli v. First National Bank of Northern New York (In re Layo), 460 F.3d 289 (2d Cir. 2006). Extremely broad language in reservation "would allow post-confirmation litigation of any claim, even if the res judicata bar would have otherwise applied to that claim (because treatment of that claim had been determined in the confirmation process). This result unquestionably diminishes the res judicata effect of confirmation order guaranteed by § 1327(a). Consequently, the Proposed Language is 'inconsistent' with Title 11 and there is no authority to include it in a plan under § 1322(b)(11)." Drawing a "rough parallel" to discharge by declaration provisions rejected by Educational Credit Management Corp. v. Whelton (In re Whelton), 432 F.3d 150 (2d Cir. 2005), court is unable to make finding regarding undefined causes of action, and due to vagueness, merits of causes of action could not be litigated at confirmation so as to justify res judicata effect. Reservation of causes of action available in Chapter 11 cases may be possible in Chapter 13 plans but only if the causes of action are expressly specific, citing Hearn v. Bank of New York (In re Hearn), 337 B.R. 603 (Bankr. E.D. Mich. 2006). "First, the Proposed Language is inconsistent with § 1327 and is not appropriate to include in a Chapter 13 plan under § 1322. Second, the Proposed Language is unnecessary to preserve post-confirmation claims that may be resolved only through an adversary proceeding or which otherwise do not meet all of the prongs of the res judicata test. Third, the Proposed Language is too vague to fit within the exception to res judicata that permits debtors to preserve post-confirmation claims and causes of action only if they are described with particularity. Fourth, the Proposed Language does not meet basic due process requirements. Finally, the Court rejects the Debtors' and Trustee's argument that the Debtors need the Proposed Language to preserve rights that could not be discovered by reasonable due diligence.").
United States v. Bartlett (In re Bartlett), 353 B.R. 398 (Bankr. D. Vt. Nov. 1, 2006) (Brown) (Rural Housing Authority is bound by confirmed plan recognizing debtors' right of redemption and curing opportunity as to residential property that was subject of prebankruptcy foreclosure.).
D. Third Circuit
SLW Capital, LLC v. Mansaray-Ruffin (In re Mansaray-Ruffin), 530 F.3d 230, 237-42 (3d Cir. June 24, 2008) (Rendell, Greenberg, Van Antwerpen) (Distinguishing In re Szostek, 886 F.2d 1405 (3d Cir. 1989), confirmed plan that discharged disputed mortgage lien upon payment of $1,000 claim filed by debtor did not release lien because debtor did not file adversary proceeding—notwithstanding that mortgage holder had notice and did not object to confirmation. EMC had notice of plan that disputed its lien. Debtor filed $1,000 claim on behalf of EMC and plan provided that payment of $1,000 claim would satisfy mortgage. EMC did not object to confirmation or appeal confirmation order. Several months after confirmation, EMC filed adversary proceeding "to determine secured status pursuant to 11 U.S.C. § 506." "It is appropriate that the Rules permit lien invalidation to occur only through litigation in an adversary proceeding—and not through a provision in a plan—for the invalidation of a lien on the property of the debtor held by a specific creditor is a matter of particularly great consequence . . . . EMC's failure to object to the plan did not do away with Mansaray-Ruffin's duty to file a complaint and serve EMC pursuant to Rules 7001, 7003, and 7004. EMC had the legal right to do nothing and insist upon being served with a summons and a complaint in order for its lien to be invalidated. . . . [W]hile Szostek does note the importance of finality, it recognizes that the policy of finality must yield to the principle that a plan cannot violate a mandatory provision of the Code. . . . [T]he adversary proceeding Rule at issue here is mandatory and establishes a right to specific process that must be afforded. Its mandatory nature is grounded in principles of due process that trump 'finality.' . . . [W]e refuse to treat confirmed bankruptcy plans as res judicata with respect to the claims of creditors who did not receive notice that was sufficient under the circumstances—even where adherence to the plain language of the relevant statute would have made the confirmed plan binding on all creditors. . . . [A] creditor's actual knowledge regarding the bankruptcy proceedings does not eliminate our due process concerns. . . . EMC had the due process right to assume that, unless Mansaray-Ruffin commenced the adversary proceeding required by the Rules and served it with a complaint and a summons, its lien could not be invalidated. Whatever actual knowledge EMC may have had regarding the plan's treatment of its lien did not eliminate this right and neither did the provisions of § 1327. . . . [W]e do not hold that the failure to adhere to every Rule of Bankruptcy Procedure implicates due process. Rather, we hold only that, where the Rules require an adversary proceeding—which entails a fundamentally different, and heightened, level of procedural protections—to resolve a particular issue, a creditor has the due process right not to have that issue resolved without one.").
Henthorn v. GMAC Mortgage Corp. (In re Henthorn), No. 03-4156, 2005 WL 293646, at *2 (3d Cir. Feb. 9, 2005) (unpublished) (Scirica, McKee, Chertoff) (Because plan provided that debtor would make home mortgage payments directly to GMAC Mortgage, debtor cannot challenge $845 charge for costs and attorney fees collected by GMAC when debtor sold real property and satisfied mortgage after confirmation. "The plan itself excluded the mortgaged property and the corresponding lien agreement with GMAC from bankruptcy, and the property re-vested in plaintiffs upon confirmation. 11 U.S.C. § 1327(b). Plaintiffs then sold the property, and satisfied their obligations to GMAC, 'outside' of bankruptcy. . . . Having excluded their contractual relationship with GMAC from the plan—a decision that, among other things, allowed plaintiffs to sell the mortgaged property without oversight from the Bankruptcy Court, payment of bankruptcy trustee's fees, or remittance of any profits on the sale to creditors with stripped liens—plaintiffs cannot later, post-confirmation, invoke § 506(b) and § 105(a) to superintend the 'reasonableness' of fees collected by GMAC from the proceeds of the sale of its collateral.").
New Jersey
Jacobo v. BAC Home Loans Servicing, LP, 477 B.R. 533 (D.N.J. June 21, 2012) (Hillman) (Failure to properly serve BAC Home Loan Servicing with proposed plan precluded res judicata effect of confirmation of plan that crammed down debt. Bankruptcy Rule 7004(h) requires service by certified mail on officer of federally insured depository institution.).
Bank of Am., NA v. Nathanson (In re Nathanson), No. 09-4537(GEB), 2010 WL 1850185 (D.N.J. May 6, 2010) (unpublished) (Brown) (Bank of America did not object to confirmation or appeal confirmation order and was bound by confirmed plan that gave its junior lien no value; Bank may not use reconsideration of its proof of claim to evade binding effect of confirmation.).
IRS v. DiPasquale, No. 06-106(MLC), 2006 WL 1207990 (D.N.J. Apr. 28, 2006) (unpublished) (Cooper) (Citing In re Szostek, 886 F.2d 1405 (3d Cir. Oct. 12, 1989) (Mansmann, Mygaard, Aldisert), confirmed plan that provided full payment for IRS and release of IRS's lien upon completion of payments was binding and lien was released without payment when IRS filed proof of claim that omitted its secured debt.).
Hutchinson v. Delaware Sav. Bank FSB, 410 F.Supp.2d 374 (D.N.J. Jan. 25, 2006) (Voluntary conversion from Chapter 13 to 7 prevents confirmation order from being final judgment; confirmation is provisional determination of debtors' and creditors' rights and upon conversion res judicata does not bind either party to abandoned plan.).
In re Gonzalez, No. 12-19139 (DHS), 2013 WL 1197666 (Bankr. D.N.J. Mar. 25, 2013) (unpublished) (Steckroth) (Plan that stripped down junior mortgage lien lacked binding effect because it was not properly served to attention of officer or agent. Claim must be treated as secured.).
In re LaTorre, No. 10-31867, 2012 WL 1565242 (Bankr. D.N.J. May 2, 2012) (Ferguson) (Confirmation vested personal injury cause of action in debtor, and bankruptcy court had no jurisdiction to compel debtor's acceptance of settlement.).
In re Tarby, No. 11-32886/JHW, 2012 WL 1390201, at *4 (Bankr. D.N.J. Apr. 20, 2012) (unpublished) (Wizmur) (Vesting of property in debtor at confirmation did not completely empty estate; taxing authority was prevented from collecting income taxes in prior case, triggering hanging sentence in § 507(a)(8) and extending three-year look-back period for priority status. "[P]roperty of the estate retains its status as such, even through confirmation of the debtor's Chapter 13 plan, until dismissal, closure or conversion of the case, as § 1306(a) provides. At confirmation, the 'vesting' of property of the estate in the debtor, as provided in § 1327(b), means that the debtor's rights and interest in the property become fixed as of the confirmation of the plan, and are effected when the provisions of the debtor's Chapter 13 plan are satisfied. This interpretive approach recognizes that the debtor retains possession of all property of the estate, except as otherwise provided for in the debtor's confirmed plan or the order confirming the plan, see 11 U.S.C. § 1306(b), and that upon confirmation, the debtor is obligated to make such payments from property of the estate as are provided for in the plan, see 11 U.S.C. § 1325. The act of confirmation 'vests' all of the property of the estate in the debtor to allow the debtor to take the necessary steps to comply with the confirmed plan. 11 U.S.C. § 1327(b). The statute does not state that the event of confirmation changes the characterization of the property from property of the estate into property of the debtor. Instead, it merely confirms the debtor's ability to utilize property of the estate, notwithstanding that designation, in satisfaction of the debtor's obligations under the confirmed plan. As property of the estate, the debtor's resources necessary to consummate the plan remain protected by the automatic stay. 11 U.S.C. § 362(c). The property that vests in the debtor pursuant to section 1327 is free and clear upon the debtor's completion of the confirmed plan and upon the debtor's receipt of a Chapter 13 discharge.").
In re Garcia, No. 10-23707 (MBK), 2011 WL 2551184 (Bankr. D.N.J. June 24, 2011) (Kaplan) (Confirmation did not preclude amended claim by Bank when confirmed plan provided that proofs of claims could be submitted after confirmation order. Bank could amend claim filed by debtors on its behalf, adding redemption cost of tax sale certificate. Bank had right under mortgage to protect interest by redeeming certificate, which was akin to transfer of prepetition claim.).
In re Jackson-Bostic, No. 02-52127(RTL), 2006 WL 4457347 (Bankr. D.N.J. June 14, 2006) (unpublished) (Lyons) (Motion to enforce cramdown feature of completed plan is granted based on res judicata effect of confirmed plan that clearly provided for second mortgage to have no value.).
In re Jackson-Bostic, No. 02-52127(RTL), 2006 WL 4457347 (Bankr. D.N.J. June 14, 2006) (unpublished) (Lyons) (Motion to enforce cramdown feature of completed plan is granted based on res judicata effect of properly noticed confirmed plan that clearly provided second mortgage had no value.).
Pennsylvania
Eastern District of Pennsylvania
Pollilo v. Harleysville Nat'l Bank (In re Pollilo), No. 09-0287, 2010 WL 235125 (Bankr. E.D. Pa. Jan. 15, 2010) (unpublished) (Fox) (Although confirmed plan bound creditor, cause of action for violation of confirmation order alleging that creditor failed to supply certificate of vehicle title after completion of plan and closing of bankruptcy case sought only damages—relief available in state court. Bankruptcy court lacked subject matter jurisdiction to hear breach of contract claim that arose after plan completion.).
In re McGill, No. 07-13086 SR, 2009 WL 2912503 (Bankr. E.D. Pa. June 11, 2009) (Raslavich) (Under In re Szostek, 886 F.2d 1405 (3d Cir. Oct. 12, 1989) (Mansmann, Nygaard, Aldisert), car lender that received notice and failed to object is bound by confirmation of plan that surrendered car that had been destroyed postpetition.).
Kohler v. Astoria Fed. Sav. (In re Kohler), No. 08-146, 2009 WL 2912484 (Bankr. E.D. Pa. Apr. 22, 2009) (unpublished) (Raslavich) (Provision for payment of regular monthly mortgage installments directly by debtor was not a finding that all postpetition monthly installments were actually paid.).
In re Stuart, 402 B.R. 111 (Bankr. E.D. Pa. Mar. 15, 2009) (Frank) (Confirmed plan providing that litigation of debtor's rescission claim under TILA would proceed in state court, that mortgage would be paid outside plan after conclusion of litigation and that automatic stay would remain in effect until resolution of state litigation, did not provide for mortgage claim.).
In re Janssen, 396 B.R. 624 (Bankr. E.D. Pa. Nov. 7, 2008) (Frank) (Violation of § 1327(a) can be remedied under § 105(a). Closed case is reopened to permit prosecution of adversary proceeding alleging that mortgage creditor failed to properly apply payments to prepetition arrearage.).
Padilla v. GMAC Mortgage Corp. (In re Padilla), 389 B.R. 409, 420-21, 429 (Bankr. E.D. Pa. June 30, 2008) (Frank) (When prepetition default was cured under § 1322(b)(5) in confirmed plan, creditor's subsequent demand for payment of prepetition fees and other charges violated § 1327(a) and may be remedied through § 105(a) but contempt is not the appropriate remedy. Confirmation of plan establishes new contract between parties. "[C]ontempt does not lie because the confirmation order is not a coercive court order directing creditors to act in conformity with the terms of the confirmed plan. . . . A breach of contract that would not give rise to a contempt remedy outside the bankruptcy context is not transformed into a violation of a coercive court order and therefore, subject to contempt just because the new 'global contract' between the chapter 13 debtor and his or her creditors has been 'confirmed' by order of the bankruptcy court. A good analogy is to compare the court's approval of a chapter 13 plan to a court's approval of a settlement agreement. A subsequent breach of the terms of a settlement agreement that has been approved by a court to resolve outstanding litigation does not generally give rise to contempt remedies." Section 1327(a) is distinguishable from § 524 and § 506(a), under which other courts have found no private right of action. "Given the role of the confirmed plan in the chapter 13 system, the principle that a confirmed chapter 13 plan must be enforceable requires no extended or elaborate justification. It is difficult to conceive how the chapter 13 system could function if confirmed chapter 13 plans were not judicially enforceable. The principle that confirmed plan are enforceable is manifested in 11 U.S.C. § 1327(a), which declares unequivocally that the terms of the confirmed plan 'bind the debtor and each creditor.' However, § 1327(a) contains no specific enforcement mechanism. This is precisely why it is appropriate that 11 U.S.C. § 105(a) be invoked to enforce § 1327(a)."), related to In re Padilla, 365 B.R. 492 (Bankr. E.D. Pa. Mar. 26, 2007) (Frank).).
Padilla v. GMAC Mortgage Corp. (In re Padilla), 389 B.R. 409, 420-21 (Bankr. E.D. Pa. June 30, 2008) (Frank) (Contempt is not appropriate remedy for violation of confirmed plan when creditor assessed prepetition fees and charges in violation of confirmed plan that cured default under § 1322(b)(5). Complaint states viable cause of action for violation of § 1327(a), that may be remedied by exercise of § 105(a).), related to In re Padilla, 365 B.R. 492 (Bankr. E.D. Pa. 2007).).
In re Smith, 388 B.R. 603 (Bankr. E.D. Pa. Feb. 1, 2008) (Fox) (Debtor may not modify plan to provide for a mortgage that was not provided for in confirmed plan. "[D]ebtor's previous express and intentional election not to provide for the allowed secured claim of Wachovia . . . in his confirmed chapter 13 plan cannot be retracted post-confirmation over the objection of the creditor and the chapter 13 trustee, and after the secured creditor has obtained relief from the bankruptcy stay.").
In re Bryant, 323 B.R. 635, 639-45 (Bankr. E.D. Pa. Apr. 19, 2005) (Confirmed plan which provided for home mortgage that "Bal Paid in Full $41,471.59" limited the mortgage holder's lien to that amount and when the $41,471.59 was paid in full through the plan, the lien was discharged; in subsequent Chapter 13 case, mortgage holder's proof of claim was disallowed except to the extent it sought repayment of postconfirmation fees, costs and escrow advances. "The language of the plan is clear: 'bal in full $41,471.59. . . . Under the holding in [In re Szostek, 886 F.2d 1405 (3d Cir. 1989)], Claimant is bound by the Plan, and the fact that the amount is incorrect to pay the claim in full as stated in the proof of claim filed post-confirmation would not compel a different result. . . . The confirmed Plan . . . dictates whether the lien that secures the debt will be discharged. Section 1327(b) provides that confirmation vests all of the property of the estate in the debtor except as otherwise provided in the plan or confirmation order. Section 1327(c) provides that such vesting shall be free and clear of any claim or interest of any creditor provided for by the plan. . . . Since a 'lien' is a 'claim' in a Chapter 13 case, Johnson v. Home State Bank, 501 U.S. 78, 111 S. Ct. 2150, 115 L. Ed.2d 66 (1991), whether a secured creditor's lien rights survive confirmation depends upon whether the plan 'provides for' the lienholder. . . . Upon confirmation all lien rights were defined by the Plan and upon completion of the payments under the Plan . . . the identified debt . . . was paid in full. Thus, the lien that secured that debt and which was retained for the life of the Plan did not survive the Debtor's discharge.").
Middle District of Pennsylvania
In re Koppenhaver, 555 B.R. 463, 464 (Bankr. M.D. Pa. July 6, 2016) (Thomas) (Confirmed plan that inappropriately stripped down first mortgage to value of the property was binding on mortgagee at modification after confirmation when mortgagee did not object to confirmation of original plan; modification to increase the monthly payment does not reopen strip-down that occurred at confirmation. Citing In re Szostek, 886 F.2d 1405 (3d Cir. Oct. 12, 1989), and United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), “Debtors’ request to increase the monthly payment in order to fulfill the financial requirements of the plan does not offer the Objector an opportunity to relitigate those issues that were heretofore waived by its failure to object.”).
In re Davis, 503 B.R. 609 (Bankr. M.D. Pa. Dec. 12, 2013) (Opel) (Confirmation of plan was binding and made it unnecessary to determine whether agreement was executory contract that could be rejected or a judicial lien that could be avoided.).
Bubczyk v. Mers, Inc. (In re Bubczyk), No. 1:11-ap-00235MDF, 2012 WL 425332, at *2 (Bankr. M.D. Pa. Feb. 9, 2012) (France) (Confirmation precluded debtors from revaluing property to treat lien as wholly unsecured when plan committed to pay claim in full. After confirmation debtors sought by adversary proceeding, claim objection and motion to modify plan to treat second mortgage as wholly unsecured. Proposed modification was not due to discovery of new evidence or changed circumstances. "Debtors' failure to accurately value their property when they filed their petition does not provide grounds to set aside the confirmation order.").
Schatz v. Chase Home Fin. (In re Schatz), 452 B.R. 544, 553 (Bankr. M.D. Pa. July 25, 2011) (Opel) (Vesting of estate in debtor at confirmation denies bankruptcy court jurisdiction in debtor's class action against mortgage holder. "Since these potential causes of action arose prior to the confirmation of the Debtor's plan, at confirmation the Schatzes' interest in these causes of action vested in the Debtor and are no longer considered property of the estate. The interest of Tracy L. Schatz, a non-debtor, in the causes of action, was never property of the estate.").
In re Chang, 438 B.R. 77 (Bankr. M.D. Pa. Oct. 15, 2010) (France) (Adopting "reconciliation" approach, property acquired and earnings received postpetition remain property of bankruptcy estate until confirmation, and when confirmation revests property in debtor, any property and earnings received postconfirmation become estate property. Here, real property vested in debtor at confirmation, and postpetition creditor's filing of mechanic's lien against that property did not violate automatic stay.).
In re Caruso, 433 B.R. 135 (Bankr. M.D. Pa. Aug. 6, 2010) (Opel) (Applying In re Szostek, 886 F.2d 1405 (3d Cir. Oct. 12, 1989) (Mansmann, Nygaard, Aldisert), and citing United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), trustee's feasibility objection to modified plan is precluded by confirmation when original and modified plan had same provisions for payment of mortgage arrearage—even if original confirmation was defective.).
In re Michael, 436 B.R. 323, 329 (Bankr. M.D. Pa. July 23, 2010) (France) (Although confirmation binds trustee and debtor, at conversion after confirmation, confirmation effects cease and undistributed funds belong to debtor, not creditors. Distinguishing In re Szostek, 886 F.2d 1405 (3d Cir. Oct. 12, 1989) (Mansmann, Nygaard, Aldisert), conversion ended Chapter 13 case, "effectively vacating the order confirming the Chapter 13 plan and depriving it of any res judicata effect."), aff'd, 446 B.R. 665 (M.D. Pa. Apr. 4, 2011) (Jones).).
Biege v. Sallie Mae Servicing, L.P. (In re Biege), 417 B.R. 697 (Bankr. M.D. Pa. Oct. 16, 2009) (Thomas) (When confirmed plan provided for payment of student loan but did not provide for interest nor prohibit accrual of interest, student loan creditor's claim for postpetition interest was not discharged and no preclusive effect of confirmation prevented collection.).
Biege v. Sallie Mae Servicing, L.P. (In re Biege), 417 B.R. 697 (Bankr. M.D. Pa. Oct. 16, 2009) (Thomas) (When confirmed plan provided for payment of student loan but did not provide for interest nor prohibit accrual of postpetition interest, student loan creditor’s claim for postpetition interest was not discharged, and no preclusive effect from confirmation prevented collection.).
Woltman v. PNC Bank (In re Woltman), No. 1:07-bk-01647MDF, 2008 WL 5157477 (Bankr. M.D. Pa. Nov. 18, 2008) (unpublished) (France) (Binding effect of confirmation prevents debtors from avoiding judgment lien when confirmed plan provided that lien would be paid in full; failure to adequately investigate lien prior to confirmation does not overcome binding effect.).
Western District of Pennsylvania
In re Vastadore, 516 B.R. 772, 775-76 (Bankr. W.D. Pa. Sept. 24, 2014) (Deller) (Funds held by trustee after "pot plan" completed early due to mortgage modification and stripping of unsecured junior lien must be distributed to unsecured creditors, not returned to debtors. "[W]hile the plan estimated that no distribution would be made to unsecured creditors, the confirmed plan fixed neither a minimum nor maximum distribution to unsecured creditors. The . . . ultimate distribution to unsecured creditors was left to the conclusion of the case when the universe of claims had been established and all the payments had been made by the Debtors. . . . A 'pot plan' is a defined contribution plan where the amount paid by the debtor is fixed, and the dividend paid to creditors can vary based upon the universe of claims filed and allowed. . . . Debtors fully funded their 'pot plan' and now want to empty the pot away from the creditors. Such a result is not appropriate because the Funds on Hand are property of the bankruptcy estate pursuant to 11 U.S.C. § 1306 and are for the benefit of the creditors under the plan.").
In re Borkowski, 446 B.R. 220 (Bankr. W.D. Pa. Feb. 22, 2011) (Deller) (Applying United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), Wells Fargo was bound by confirmation and by order finding mortgage current; contention that mortgage was underfunded in plan had to be raised during case. 110 days after case closed, Wells Fargo filed motion to set aside order finding mortgage current. Wells Fargo contended that mortgage was underfunded in plan. During pendency of case, Wells Fargo filed notice of increase in mortgage payment, but notice was contrary to confirmation order, which required any payment change to be noticed to trustee and debtor at least 20 days before taking effect. Wells Fargo's notice of payment change did not include proposed order nor did it seek modification of plan. Wells Fargo never brought underfunding issue before court until its motion to vacate order. Wells Fargo slept on its rights when it did not object to, or pursue prompt relief from, confirmation order or order finding mortgage current.).
Wilson v. DaimlerChrysler Fin. Servs. Ams., LLC (In re Wilson), 409 B.R. 72 (Bankr. W.D. Pa. July 30, 2009) (Fitzgerald) (Debtor bound by confirmation order setting deadline for § 506 valuation motions; motion filed 14 months late was denied.).
In re Presco, No. 08-20390JAD, 2009 WL 8556808 (Bankr. W.D. Pa. Mar. 16, 2009) (Deller) (Confirmed plan bound debtors to assumption of vehicle lease; provision that debtors would obtain replacement vehicle at lease expiration established intent not to exercise lease purchase option. Stay relief granted to lessor, and debtors ordered to surrender leased vehicle within 30 days. Lessor must file amended proof of claim reflecting only amounts remaining owed for lease term.).
In re Mellors, 372 B.R. 763, 769 (Bankr. W.D. Pa. July 26, 2007) (Deller) (Balancing finality of confirmation under In re Szostek, 886 F.2d 1405 (3d Cir. Oct. 12, 1989) (Mansmann, Nygaard, Aldisert), with § 1329(a)'s "limited exception to the binding effect of confirmed plans," changed circumstances permit modification to surrender vehicle when defect making vehicle inoperable was discovered postconfirmation.).
In re McFadden, No. 04-11005, 2007 WL 7645302 (Bankr. W.D. Pa. June 1, 2007) (Bentz) (Motion to marshal assets was untimely and barred by confirmation. Debtor was bound by confirmed plan that necessarily determined secured creditor's interest. Some collateral had been sold, but mortgage on residential properties remained for balance that could be substantially satisfied from funds held by trustee.).
Honda Lease Trust v. Szalinski (In re Szalinski), 360 B.R. 104 (Bankr. W.D. Pa. Feb. 5, 2007) (Deller) (Honda is bound by confirmed plan when it had notice and did not object; under Branchburg Plaza Associates, L.P. v. Fesq (In re Fesq), 153 F.3d 113 (3d Cir. Aug. 18, 1998) (Stapleton, Alito, Shadur), only means for relief from confirmation order is § 1330(a) revocation, which requires proof of fraud. Plan modified lease to amortize prepetition balance, arrearages and amount of purchase option over life of plan.).
Miller v. Countrywide Home Loans (In re Miller), No. 99-25616JAD, 2007 WL 81052 (Bankr. W.D. Pa. Jan. 9, 2007) (unpublished) (Deller) (Countrywide was bound by confirmation when Countrywide received amendments to confirmed plan, accepted payments under amended plan and filed no proof of claim for pre- or postconfirmation arrearages. Confirmation had binding effect under § 1327(a) since there was no lack of notice, plan's provisions were clear, and Countrywide did not object to postconfirmation amendments. After discharge, Countrywide demanded unpaid prepetition arrearages of $13,000. Case was reopened, res judicata effect was given to plan provision for $6,400 arrearages, which were paid, and confirmation resulted in mortgage reinstatement.).
E. Fourth Circuit
LVNV Funding, LLC v. Harling, 852 F.3d 367, 372–74 (4th Cir. Apr. 6, 2017) (Agee, Keenan, Thacker) (Because claims allowance process is separate from confirmation in Chapter 13 cases, confirmation is not res judicata with respect to allowance of any particular unsecured debt. Plan provided that allowed claims of unsecured creditors would be paid pro rata. Plan also preserved the right to object to claims after confirmation. LVNV filed a proof of claim before confirmation. After confirmation, debtors objected that claim was barred by statute of limitations. LVNV argued that confirmation precluded the claim objection. "Section 1322 allows a debtor's Chapter 13 plan to treat unsecured creditors as a single class. . . . When the plan does so . . . the bankruptcy court examines only the 'pool' of funds available to the class as a whole during plan confirmation. . . . . In other words, the Bankruptcy Code requires the proposed plan to address at plan confirmation only the collective amount that all the Chapter 13 debtor's unsecured creditors as a class will receive . . . . No provision of the Bankruptcy Code provides for the determination of the merits of an individual unsecured claim within the class of unsecured claims as part of plan confirmation. . . . [T]hat function is reserved by statute for the claims allowance procedure, which stands separate and apart under the Bankruptcy Code from plan confirmation. . . . Unlike the general provision for the class of unsecured creditors, a Chapter 13 plan must address the rights of each secured creditor individually by setting out the mode of satisfying that claim in relation to the secured creditor's collateral. . . . No parallel provision exists for unsecured creditors' claims . . . . Nothing in either § 502, § 1325, or elsewhere in the Bankruptcy Code ties adjudication of the allowance of an unsecured creditor's claim to the process or event of Chapter 13 plan confirmation. . . . [F]or res judicata purposes, a bankruptcy court's later § 502 determination to allow or disallow an unsecured creditor's claim is not based on any matter that was before the bankruptcy court as part of plan confirmation. . . . [W]hether an objection to an unsecured creditor's claim is filed before or after plan confirmation makes no difference in the plan confirmation proceeding.").
Covert v. LVNV Funding, LLC, 779 F.3d 242, 248, 246-49 (4th Cir. Mar. 3, 2015) (Shedd, Niemeyer, Keenan) (FDCPA class action against debt buyer for illegally filing proofs of claim without a Maryland debt collection license is precluded by res judicata effect of confirmation under §1327(a). "Plaintiffs should have raised these statutory claims during the plan confirmation hearings, and their failure to do so means that these claims are barred by res judicata." "[C]onfirmation of a bankruptcy plan is a final judgment on the merits. . . . [Section 1327(a)] gives plan confirmation the res judicata effect of a final judgment. . . . Plaintiffs and the Defendants in this action were parties to the earlier Chapter 13 plan confirmation proceedings. . . . Plaintiffs' current claims are based upon the same cause of action as the Defendants' claims in the confirmed bankruptcy plans. . . . A finding for the Plaintiffs on any of these claims, therefore, would entail a holding that the Defendants' proofs of claim are invalid, which would directly contradict the bankruptcy court's plan confirmation order approving those proofs of claim as legitimate. . . . The Plaintiffs . . . could have objected to LVNV's proofs of claim at the time they were filed on the basis that they violated these consumer protection statutes. . . . The Plaintiffs could also have brought their affirmative claims for damages during the bankruptcy process under Federal Rule of Bankruptcy Procedure 7001(1) . . . . But the Plaintiffs were not free to raise statutory objections after the court had entered its confirmation order when those objections were known or should have been known to them during the bankruptcy proceedings. . . . Were we to hold that proofs of claim are subject to post-confirmation challenge, we would risk undermining this purpose by creating an incentive for debtors to enrich themselves at the expense of their creditors. . . . Moreover, allowing these kinds of post-confirmation collateral attacks on a bankruptcy plan's terms would 'destroy the finality that bankruptcy confirmation is intended to provide.' . . . [T]he district court . . . read [Cen-Pen Corp. v. Hanson, 58 F.3d 89 (4th Cir. June 22, 1995) (Wilkinson, Hamilton, Heaney),] to create a blanket rule that plan confirmation does not have preclusive effect as to any issue that must have been decided through an adversary process. . . . This reading of Cen-Pen is too broad. . . . Cen-Pen dealt with the status of secured claims . . . . Here, by contrast, Plaintiffs challenge the legality of the process used to collect an unsecured claim. There is no analogous rule or statute establishing that claims challenging the filing process pass through bankruptcy unaffected, nor any rule that unsecured claims pass through bankruptcy unaffected. Indeed, the opposite is true. . . . [O]ur reasoning in Cen-Pen was motivated by the need to protect the rights of parties in interest who are not directly involved in a bankruptcy proceeding."), aff'g on other grounds No. CIV. A. DKC 13-0698, 2013 WL 6490318 (D. Md. Dec. 9, 2013) (Chasanow) (Res judicata barred unjust enrichment claim as collateral attack on confirmation order because it amounted to an objection to claims provided for in confirmed plan; however, confirmation "does not serve as res judicata to bar the putative class action for alleged violations of federal and state consumer laws.").
Murphy v. O'Donnell (In re Murphy), 474 F.3d 143, 154 (4th Cir. Jan. 18, 2007) (Without resolving five different interpretations of interplay between §§ 1306(a) and 1327(b), when debtor sells condominium 11 months after confirmation and realizes 51.6% increase in value, Chapter 13 trustee can use modification under § 1329 to force higher payment percentage to unsecured creditors notwithstanding that confirmed plan vested property in debtor. "Under [Arnold v. Weast (In re Arnold), 869 F.2d 240 (4th Cir. 1989),] a debtor cannot use plan confirmation as a license to shield himself from the reach of his creditors when he experiences a substantial and unanticipated change in his income. . . . [E]ven though property vested in Murphy upon confirmation, this fact did not prevent the Chapter 13 trustee from seeking to modify Murphy's plan.").
Maryland
In re Wiley, 581 B.R. 441, 451–52 (Bankr. D. Md. Jan. 26, 2018) (Rice) (Because confirmed plan did not vest property of the estate in the debtor, homeowners’ association is precluded from collecting postpetition fees and assessments from debtor’s postpetition earnings and property; HOA is granted stay relief for limited purpose of taking judgment against the debtor and enforcing that judgment against property of the debtor but not against property of the Chapter 13 estate. “Although the Debtor’s Chapter 13 Plan has been confirmed in this case, the property of the estate did not vest in the Debtor pursuant to § 1327(b) because the order confirming the plan provides that such property does not vest in the Debtor until he is granted a discharge or his case is dismissed. Thus, any action by the Condominium to enforce its post-petition assessments claim against the Debtor in personam is currently stayed under § 362(a)(3) and § 362(a)(4) to the extent the Condominium seeks to obtain possession of, or to create, perfect, or enforce a lien against, property of the estate. . . . The Condominium is bound by the Chapter 13 Plan under § 1327(a). A bankruptcy court should be cautious in such circumstances about permitting in personam collection actions against the Debtor’s post-petition wages or property of his estate. Otherwise, action by a creditor bound by a confirmed Chapter 13 plan might adversely impact the success of that plan. . . . Accordingly, I conclude that there is cause to grant relief under § 362(d) to terminate [ ] the automatic stay to the limited extent necessary to permit the Condominium to reduce its post-petition claims against the Debtor to judgment and enforce them against the Debtor, but that it is premature to permit enforcement of any such judgment against property of the Debtor’s bankruptcy estate.”).
In re Jones, No. 03-16931-WIL, 2006 WL 4595783, at *4 (Bankr. D. Md. Aug. 11, 2006) (Lipp) (Plan provisions that secured creditors retained liens and that debtor did not anticipate filing lien avoidance actions were not res judicata bar to avoidance of judicial lien that was not litigated, when lien avoidance issue did not arise during confirmation. "Neither the Debtor nor [the creditor] had a full and fair opportunity to litigate the issue at the time of confirmation. It simply did not come up. The court finds that for the same reasons res judicata does not apply here, estoppel is equally inapplicable.").
In re Saunders, No. 02-21699 NVA, 2006 WL 4854454, at *2 (Bankr. D. Md. Mar. 31, 2006) (unpublished) (Alquist) (Citing Bankruptcy Rule 3015(f) and Universal American Mortgage Co. v. Bateman (In re Bateman), 331 F.3d 821, 830 (11th Cir. May 22, 2003) (Birch, Dubina, Kravitch), government's assertion that Mr. Saunders should pay more than 10% provided in confirmed plan is an objection which "could and should have been made at the original confirmation hearing.").
North Carolina
Eastern District of North Carolina
In re Eldridge, No. 09-03589-8-SWH, 2013 WL 64756 (Bankr. E.D.N.C. Jan. 4, 2013) (Humrickhouse) (Residence vested in debtor at confirmation and was not property of estate; homeowners association did not need stay relief to pursue postpetition assessment under state law. Debtor not required to pay association's attorney fees for unnecessary stay relief motion.).
In re Perry, No. 09-04429-8-JRL, 2011 WL 5909065 (Bankr. E.D.N.C. Oct. 24, 2011) (Leonard) (Secured creditor was bound by confirmed plan and entitled only to insurance proceeds from wrecked car to extent of balance of allowed secured claim; remaining proceeds will be held by trustee and paid to debtors upon completion of plan. In event of conversion or dismissal, trustee would pay balance of proceeds to secured creditor on its lien reinstated under § 349(b)(1)(C).).
In re Kinney, No. 10-06411-8-RDD, 2010 WL 5376217, at *4 (Bankr. E.D.N.C. Dec. 27, 2010) (Doub) (United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), made it "clear that a plan which proposes to discharge student loan obligations without an undue hardship determination violates §§ 1328(a)(2) and 523(a)(8)." Plan providing for partial discharge of student loan without adversary proceeding and without finding of undue hardship could not be confirmed.).
In re Male, 362 B.R. 238 (Bankr. E.D.N.C. Jan. 25, 2007) (Doub) (Confirmed plan treating judicial lienholder as unsecured had binding effect, and debtors' motion after reopening case to avoid lien was not prejudicial.).
Middle District of North Carolina
In re Foreman, No. 06-81434, 2010 WL 2696630 (Bankr. M.D.N.C. July 7, 2010) (unpublished) (Carruthers) (Creditor was bound by confirmed plan that required notice to trustee and debtor in writing before any change in monthly payments, or within 30 days after such change, and that failure to provide notice would be waiver of right to increase payments. Trustee's motion to deem mortgage current at end of case was granted. Creditor gave notice to debtors of payment change but failed to notify trustee. Creditor accepted payments from trustee for three years, allowing arrearage to grow, without taking any action to notify trustee of payment increase. Creditor waived its right to collect the increase in monthly payments.).
Regional Acceptance Corp. v. Williams (In re Williams), Nos. 06-80695 13, 06-09024, 2007 WL 128891, at *3-*5 (Bankr. M.D.N.C. Jan. 12, 2007) (unpublished) (Citing Piedmont Trust Bank v. Linkous (In re Linkous), 990 F.2d 160 (4th Cir. 1993), Banks v. Sallie Mae Servicing Corp. (In re Banks), 299 F.3d 296 (4th Cir. 2002), and Cen-Pen Corp. v. Hanson (In re Hanson), 58 F.3d 89 (4th Cir. 1995), confirmed plan that bifurcated 910-day PMSI car claim was not binding and car lender's lien would not be discharged when plan did not provide adequate notice that there was a 910-day PMSI car claim and that it was not being treated consistent with BAPCPA. "[W]hether RAC's silence constitutes acceptance is intertwined with issues of res judicata and due process. A finding that RAC's failure to object was equivalent to acceptance of the Plan is meaningless if the Plan is not res judicata and entitled to preclusive effect. The court cannot find that the Plan is entitled to preclusive effect if such a finding would result in the denial of due process to RAC. . . . [T]he Debtor's Plan did not afford RAC with notice adequate to entitle it to preclusive effect. RAC was entitled to expect that its claim would be treated pursuant to the provisions of BAPCPA. Here, the Plan did not state that RAC's claim was, in fact, a 910 claim or set forth the date that the debt was incurred. As a result, RAC had no notice that it held a 910 claim which was being treated in a manner contrary to the provisions of BAPCPA. . . . [T]o the extent that its claim is not paid in full under the Plan, RAC is entitled to an order stating that its claim will not be discharged upon completion of the Plan and that the Vehicle will remain subject to RAC's lien until the claim has been paid in full.").
In re Lipford, No. 04-83766C-13D, 2006 WL 4458528 (Bankr. M.D.N.C. Mar. 10, 2006) (unpublished) (Stocks) (Res judicata effect of confirmed plan precludes modification to eliminate bifurcated unsecured claim based on debtors' prior Chapter 7 discharge. Debtors had opportunity to litigate that issue at confirmation.).
In re Holt, No. 04-13584C-13G, 2005 WL 6519612 (Bankr. M.D.N.C. June 3, 2005) (unpublished) (Stocks) (Confirmed plan providing that debtor would retain home and cure arrearage was not binding on mortgagee because foreclosure sale was completed before the petition, mortgagee was not a creditor and property did not become property of Chapter 13 estate. Mortgagee was not bound by § 1327(a), which provides that confirmed plan binds debtor and each creditor.).
Western District of North Carolina
In re Beatty, No. 11-51384, 2012 WL 3835855 (Bankr. W.D.N.C. Aug. 29, 2012) (Beyer) (Distinguishing United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), Wells Fargo promptly moved for reconsideration of confirmation of plan that impermissibly modified mortgage by altering interest rate. Confirmation order amended to require mortgage payment with contractual adjustable interest.).
South Carolina
In re Gillespie, No. 11-07910-JW, 2017 WL 7660641, at *3 (Bankr. D.S.C. Oct. 18, 2017) (Waites) (Santander held in contempt and ordered to pay attorney fees and $1,200 sanction for failing to comply with confirmed plan and subsequent orders to surrender car title to Chapter 13 debtors. Confirmed plan crammed down car loan held by Santander and required surrender of title upon completion of payments. Rogue employee of Santander fabricated contacts with counsel and hid contempt motions and orders. “Santander agrees that its conduct has been ‘egregious’ and admits that it is ‘throwing [itself] on the mercy of the Court.’ Santander’s counsel has described this matter as a situation where ‘people made really bad mistakes.’ . . . Santander’s conduct goes beyond a mere mistake or misjudgment and indicates a systematic failure of its internal procedures and controls as well as a blatant disregard of the Court’s directives and orders. Despite the clear language of the confirmed chapter 13 plan, Santander failed to timely satisfy its lien, and then caused further delay and expense by ignoring the attempts of Debtors, their counsel, and the Court to get Santander to provide the satisfaction. . . . Santander’s bankruptcy specialist for this loan . . . fabricated an alleged agreement between Santander and Debtors’ counsel . . . . This fabrication does not appear to be an isolated incident . . . .”).
In re Ross, No. 11-04792-HB, 2015 WL 3781074, at *4-*5 (Bankr. D.S.C. June 16, 2015) (Burris) (Confirmation without objection of plan that bifurcated motorcycle-secured claim in violation of hanging sentence at end of § 1325(a) is binding at destruction of collateral before completion of payments when insurer tenders proceeds greater than balance of secured claim; lienholder is entitled to immediate payment of balance of secured claim and remaining proceeds must be held by trustee or by debtor's attorney until completion of payments under the plan. "Harley-Davidson failed to object to the Plan or appeal the confirmation order. Therefore, it is bound by the order confirming the Plan and by its treatment under the Plan. . . . Pursuant to § 348, Harley-Davidson's lien would be reinstated in full and it would be owed the contractual amount upon the conversion of Debtors' case prior to completion of the Plan. . . . To resolve the tension between the provisions of the not yet completed Plan that binds Harley-Davidson and Harley-Davidson's rights reserved under §§ 348 and 349, and as a result of the creditor's objection, the Court must provide some balance . . . . The amount of the insurance proceeds available is $6,578.00. . . . Of Harley[-]Davidson's $3,024.87 demand, only $563.79 is due at this time pursuant to the Plan . . . . The remaining $2,461.08 must be held until Debtors have completed payments under the Plan and, thus, conversion or dismissal is no longer a concern.").
Russo-Chestnut v. Wells Fargo Home Mortg. (In re Russo-Chestnut), 522 B.R. 148, 157-61 (Bankr. D.S.C. Oct. 28, 2014) (Waites) (Confirmed plan that cured arrearage and maintained payments on mortgage was not preclusive of action for damages for misconduct by mortgagee in connection with failed loan modification; general reservation of rights provision in confirmed plan trumps res judicata effect of confirmation. "[T]he claims set forth in the Complaint were not adjudicated by the confirmed plan because Debtor's rights to later bring those claims were expressly reserved through the Reservation Language in the confirmed plan. . . . The debtor's inclusion of an express provision reserving her right to bring avoidance actions in the confirmed plan has been found sufficient to allow her to bring a post-confirmation proceeding to avoid a mortgage lien, despite general principles of claim preclusion or the res judicata effect of the confirmed plan. . . . A creditor or other party in interest that wishes to prevent a debtor from reserving pre-confirmation claims should timely raise an objection prior to confirmation for determination by the Court. . . . [T]he reservation of rights regarding causes of action must be specific or the language will have no effect. While specificity is the better rule, it is up to affected creditors, by timely objection, or the Court, sua sponte, to raise such concerns at or before confirmation.").
Nix v. Household Fin. Corp. II (In re Nix), No. 12-80062-HB, 2012 WL 27667, at *7 (Bankr. D.S.C. Jan. 5, 2012) (Burris) (Blanket reservation of rights in form plan was insufficient to defeat res judicata effect of confirmation with respect to causes of action "based on pre-confirmation activity that arise from the same or related facts that were relevant to confirmation." Plan language stated: "Nothing herein is intended to waive or affect adversely any rights of the debtor, the trustee, or party with respect to any causes of action owned by the debtor." Accord Ginn v. CitiMortgage, Inc. (In re Ginn), No. 11-80054-HB, 2012 WL 112974 (Bankr. D.S.C. Jan. 11, 2012) (Burris); Pressley v. CitiMortgage (In re Pressley), No. 11-80048-HB, 2012 WL 115379 (Bankr. D.S.C. Jan. 12, 2012) (Burris).).
In re Jeter, No. 08-07872-HB, 2011 WL 6014173 (Bankr. D.S.C. Dec. 1, 2011) (Burris) (Confirmation of plan that cured mortgage arrearage to CIT Group and maintained payments is res judicata with respect to any challenge to standing of CIT Group to seek relief from stay.).
In re Davis, No. CA 10-02249-JW, 2010 WL 5173187 (Bankr. D.S.C. Oct. 12, 2010) (Waites) (Mortgagee that failed to object to confirmation was bound by plan notwithstanding that debtor acquired property by prepetition transfer in violation of due-on-sale clause. Under Johnson v. Home State Bank, 501 U.S. 78, 111 S. Ct. 2150, 115 L. Ed. 2d 66 (June 10, 1991), contractual privity was not required.).
In re Dendy, 396 B.R. 171 (Bankr. D.S.C. May 5, 2008) (Waites) (Confirmation of properly noticed plan that treated second mortgage as wholly unsecured and void is binding on creditor that failed to object but lienholder is not obligated to release or cancel mortgage after discharge; in rem and in personam obligations are satisfied and debt is uncollectible but mortgagee did not violate confirmed plan, confirmation order or discharge injunction by failing to take independent steps to release mortgage of record. Confirmation voided mortgage and court can order that recorder reflect mortgage was voided.).
In re Workman, 373 B.R. 460 (Bankr. D.S.C. July 31, 2007) (Waites) (When mortgage creditor actively participated and didn't object to confirmation that relied upon arrearage amount in its proof of claim, res judicata precludes amended claim for larger arrearage.).
In re Sawyer, 373 B.R. 454, 458-60 (Bankr. D.S.C. July 10, 2007) (Provision of confirmed plan valuing mortgagee's claim at zero dollars is not binding because plan and motion to value were not served consistent with Bankruptcy Rule 7004; § 342(c) applies only to general notices in a bankruptcy case and does not trump service requirements with respect to contested matters and adversary proceedings. Citing Banks v. Sallie Mae Servicing Corp. (In re Banks), 299 F.3d 296 (4th Cir. 2002): "The Fourth Circuit has previously distinguished between the providing of 'notice,' a matter generally directed to all creditors, and providing a particular creditor with notice for due process as directed by more specific provisions of the Federal Rules of Bankruptcy Procedure. . . . This distinction between 'notice' and service of process applies with equal force following the Reform Act. The revised law does not alter the pre-existing scheme of notice but merely sets forth the contents of the notice and where notice is to be sent. 11 U.S.C. § 342(c)(2)(A) does not determine the manner of service or who is to receive service in adversaries or contested matters, which are specifically addressed by Fed. R. Bankr. P. 7004 and 9014(b) . . . . Valuation of a creditor's security interest is a contested matter pursuant to Fed. R. Bankr. P. 3012 that must be brought by motion. . . . Debtor failed to serve Bank of America with this motion pursuant to Fed. R. Bankr. P. 7004(h). . . . [T]he confirmation order cannot be given preclusive effect as to Bank of America because the order would result in a denial of due process. . . . [T]he Plan, in this case, appears to do more than value Bank of America's lien but may alter the priority of Bank of America's lien. . . . [T]o the extent Bank of America has the senior lien on Debtor's residence that could not be valued or stripped off, the confirmation order cannot be given preclusive effect since no adversary proceeding was initiated to alter Bank of America's priority or subordinate its claim.").
Virginia
Eastern District of Virginia
Broadnax v. Department of Veteran Affairs Washington Mut. Bank, No. Vic.A. 2:04CV693, 2005 WL 1185809 (E.D. Va. May 19, 2005) (unpublished) (Jackson) (Confirmed plan precludes district court litigation in which debtor asserts that mortgage holder imposed improper charges and improperly accounted for payments prior to confirmation; unconfirmed plan in subsequent Chapter 13 case has no res judicata or collateral estoppel effect in litigation between debtor and mortgage holder.).
Pierce v. New Generations Fed. Credit Union (In re Pierce), No. APN 11-03288-KRH, 2012 WL 1903263 (Bankr. E.D. Va. May 24, 2012) (Huennekens) (Confirmed plan that treated junior lien as secured precluded debtors' adversary proceeding to value and strip lien as wholly unsecured. Debtors proposing to modify wholly unsecured lien should begin process in plan, and if confirmed plan provides for modification, then pursue adversary proceeding to determine validity, extent and priority of lien.).
In re DelConte, No. 07-30583, 2012 WL 1739788, at *2 (Bankr. E.D. Va. May 15, 2012) (Tice) (Citing Arnold v. Weast (In re Arnold), 869 F.2d 240 (4th Cir. Mar. 6, 1989) (Ervin, Murnaghan, Wilkinson), vesting of property in debtor at confirmation under § 1327(b) did not prevent trustee from capturing value of inherited property for unsecured creditors when postconfirmation inheritance and transfer of inherited property was not disclosed and value involved was substantial and unanticipated. In late 2010, debtor inherited one-half interest in property worth $133,000 and revealed neither the inheritance nor the subsequent transfer of that interest to her sister. Final payment under plan was due in February 2012. Confirmed plan vested all property in the debtor. Citing Murphy v. O'Donnell (In re Murphy), 474 F.3d 143 (4th Cir. Jan. 18, 2007) (Williams, Traxler, Hamilton): "'If a substantial, unanticipated salary increase warrants a modification, we see no reason why substantial, unanticipated income realized from the sale of property would not also warrant a modification of a confirmed plan. Thus, even though property vested in Murphy upon confirmation, this fact did not prevent the Chapter 13 trustee from seeking to modify Murphy's plan.'").
In re DelConte, No. 07-30583, 2012 WL 1739788 (Bankr. E.D. Va. May 15, 2012) (Tice) (That property of the estate vests in the debtor at confirmation did not defeat trustee's motion to modify plan after confirmation to capture inheritance for unsecured creditors. Debtor did not reveal inheritance or subsequent transfer of that inheritance to sister. Value of inheritance was substantial and unanticipated change in circumstances that required debtor to modify plan to pay unsecured creditors in full within 30 days.).
In re Jones, No. 09-14499-BFK, 2011 WL 5025329, at *4 (Bankr. E.D. Va. Oct. 21, 2011) (Kenney) (Plan provision that creditors "should" report debts to credit reporting agencies in form as altered by confirmed plan was ambiguous and was not violated when creditor reported debts based on contracts. "The Court is unaware of any authority in which a party has been held in contempt of a Court Order where the language is that the party 'should' do something, as opposed to 'shall.'" Debtor was essentially seeking to have Capital One debt reported as discharged at confirmation rather than on completion of plan and discharge.).
In re Hughes, No. 09-17266-SSM, 2010 WL 7351804, at *1 n.2, *2 (Bankr. E.D. Va. Feb. 25, 2010) (Mitchell) (Citing Cen-Pen v. Hanson, 58 F.3d 89 (4th Cir. June 22, 1995) (Wilkinson, Hamilton Heaney), timely secured proof of claim filed after confirmation of plan that did not treat lienholder as secured creditor does not necessarily entitle lienholder to stay relief. "[M]ere failure of a chapter 13 plan to treat a claim as secured does not avoid the creditor's lien. . . . On the other hand, a creditor's failure to object to confirmation of a plan that fails to provide adequate protection of its security interest may be fatal to a subsequent motion for relief from stay on the ground that the creditor is not adequately protected." Consent order between debtor and Cash Point, resolving postconfirmation motion for stay relief was not approved when it would pay 300% interest and monthly payments far in excess of scheduled net income. Assuming SCS Credit Corp. v. Till, 541 U.S. 465, 124 S. Ct. 1951, 158 L. Ed. 2d 787 (May 17, 2004), interest rate were applied, and that CashPoint was in fact secured, "[t]he difference in the amount needed to pay CashPoint's secured claim would be dramatic: $7,724 if paid through the plan as opposed to the $16,052 the debtor would be paying under the proposed consent order. That difference—assuming the debtor indeed has the ability to make the payments required by the consent order—could provide at least a modest dividend to unsecured creditors, who are currently receiving nothing under the plan." CashPoint's motion for stay relief was reset to determine if its secured claim should be treated in modified plan.).
In re Meyers, No. 06-11348-SSM, 2007 WL 4119071, at *2 (Bankr. E.D. Va. Nov. 16, 2007) (unpublished) (Mitchell) (County did not object and is bound by confirmation of plan that provided improperly for its claim to be unsecured when it was secured by personal property lien—"even if that treatment is contrary to law." Confirmation does not extinguish County's lien, in absence of an adversary proceeding, citing Cen-Pen Corp. v. Hanson, 58 F.3d 89 (4th Cir. June 22, 1995) (Wilkinson, Hamilton, Heaney).).
In re Huddle, No. 06-11076-SSM, 2007 WL 2332390, at *6 (Bankr. E.D. Va. Aug. 13, 2007) (Distinguishing Cen-Pen Corp. v. Hanson (In re Hanson), 58 F.3d 89 (4th Cir. 1995), Piedmont Trust Bank v. Linkous (In re Linkous), 990 F.2d 160 (4th Cir. 1993), Deutchman v. IRS (In re Deutchman), 192 F.3d 457 (4th Cir. 1999), and Banks v. Sallie Mae Servicing Corp. (In re Banks), 299 F.3d 296 (4th Cir. 2002), unambiguous provision of confirmed plan that surrendered RV in full satisfaction of debt is binding notwithstanding that lienholder's debt was not purchase money and not subject to hanging sentence; creditor cannot avoid binding effect of confirmation by modifying plan under § 1329 because there has been no substantial change in circumstances and Bankruptcy Rule 9024 is not available because allowing a deficiency would prejudice other unsecured creditors. "The plan provision at issue in this case . . . does not impair the creditor's right to enforce its lien against the collateral nor does it result in discharge of an otherwise nondischargeable obligation. Accordingly, the special due process concerns articulated in Cen-Pen, Linkous, Deutchman, and Banks do not apply to limit the otherwise binding effect of plan confirmation on unauthorized plan provisions, at least when the plan itself is clear and the bankruptcy rules would not otherwise require the bringing of an adversary proceeding. . . . The general rule is that ambiguous bankruptcy plan provisions are construed so as to comport with rather than contravene express provisions of the Bankruptcy Code. . . . This is not a plan . . . in which the intent to surrender in full satisfaction is buried deep within boilerplate. Both the tabular format and the prominent typographical placement of the 'Yes' response underneath the heading 'Full Satisfaction Y/N' should have put 1st Advantage on notice of the debtor's intention—or at the very least should have raised a red flag and a duty to inquire further. Having failed to do so, 1st Advantage cannot justifiably complain that the plan was misleading with respect to the treatment of its claim. . . . [I]t is bound by the provision for 'full surrender' and is precluded from asserting a deficiency claim.").
In re Griffiths, No. 06-50256-A, 2007 WL 1309049 (Bankr. E.D. Va. May 3, 2007) (When notice is adequate, failure to object to confirmation of plan that surrenders 910-day PMSI car claim in full satisfaction of debt is res judicata and precludes car lender's deficiency claim.).
Johnson v. Stemple (In re Stemple), 361 B.R. 778, 797 (Bankr. E.D. Va. Feb. 14, 2007) (If confirmation obtained by fraud, "binding nature of the doctrines of res judicata and/or collateral estoppel will not apply.").
Johnson v. Stemple (In re Stemple), 361 B.R. 778, 796-97 (Bankr. E.D. Va. Feb. 14, 2007) (St. John) (Confirmation "implicitly determines eligibility . . . [which] became final upon entry of the confirmation order," but if obtained by fraud, "binding nature of the doctrines of res judicata and/or collateral estoppel will not apply.").
Johnson v. Stemple (In re Stemple), 361 B.R. 778, 796-97 (Bankr. E.D. Va. Feb. 14, 2007) (Quoting Moen v. Hull (In re Hull), 251 B.R. 726, 730-31 (B.A.P. 9th Cir. 2000), confirmation "implicitly determines eligibility . . . [which] became final upon entry of the confirmation order," but if obtained by fraud, "binding nature of the doctrines of res judicata and/or collateral estoppel will not apply.").
In re West, 343 B.R. 541, 545 (Bankr. E.D. Va. Apr. 13, 2006) (Applying American Bankers Insurance Co. of Fla. v. Maness (In re Houska), 101 F.3d 358 (4th Cir. 1996), insurance proceeds from an automobile policy purchased after the petition are payable to the lienholder as loss payee without regard to confirmed plan. "[W]e have debtors who purchased an automobile insurance policy post-petition. The insured vehicle was then destroyed and a payment made . . . pursuant to the insurance policy. According to Virginia law that payment does not constitute proceeds of the vehicle, but rather of the insurance policy. As such, the proceeds do not belong to the estate, but should pass according to the contract between the debtor and the insurer . . . . The trustee has no right to any of the proceeds . . . . The proceeds rightfully belong to NAE as the loss payee on the insurance policy.").
In re Tittle, 346 B.R. 684 (Bankr. E.D. Va. Mar. 20, 2006) (Under § 1327(c), real property vests in the debtor at confirmation free and clear of lien claim of landlord except to extent of landlord's allowed claim as capped by § 502(b)(6); plan need only pay allowed capped amount of landlord's claim to satisfy landlord's prepetition judgment lien.).
In re Hedrick, 343 B.R. 762, 765-66 (Bankr. E.D. Va. Jan. 27, 2006) (Mayer) (Failure to object to confirmation of plan that provided 100% payment of unsecured claims but was silent with respect to postpetition interest is fatal to § 1325(a)(4) argument for postpetition interest when estate was solvent; unsecured creditor cannot solve this problem by filing an amended proof of claim after confirmation that includes postpetition interest. "Had the matter been brought to the court's attention at the confirmation hearing, the plan would not have been confirmed without a provision for payment of postpetition interest on allowed joint unsecured claims. It was not and the plan was confirmed. Confirmation orders are final orders and are binding on the parties. . . . Postpetition interest is not part of an allowed proof of claim but is payable . . . in a chapter 13 case pursuant to a confirmed plan, if provided in the chapter 13 plan. Here, there was no such provision in the confirmed chapter 13 plan.").
Western District of Virginia
In re Ulrey, 511 B.R. 401 (Bankr. W.D. Va. June 2, 2014) (Black) (Mortgage foreclosure sale 45 minutes prior to Chapter 13 filing was complete under Virginia law when auctioneer noted buyer's name and bid amount at bottom of bidding procedures sheet; however, failure to object to confirmation of plan that provided for mortgage bound bank to terms of plan.).
In re Martin, 427 B.R. 573 (Bankr. W.D. Va. Apr. 13, 2010) (Krumm) (Assignee of car lender's deficiency claim was in privity with lender that had notice of plan providing for surrender of vehicle in full satisfaction; under Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), creditor's argument that debtor should have filed adversary proceeding was lost by failure to object to confirmation.).
In re Martin, 427 B.R. 573 (Bankr. W.D. Va. Apr. 13, 2010) (Krumm) (Applying Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), deficiency creditor's argument that debtor should have filed adversary proceeding was lost by failure to object to confirmation of plan that surrendered car in full satisfaction of debt. Assignee of original car lender was in privity and bound by confirmation.).
Fort v. Florida Dep't of Revenue (In re Fort), 412 B.R. 840, 858-59 (Bankr. W.D. Va. June 30, 2009) (Stone) (When amount of state's support claim was fixed in confirmed plan, state's postconfirmation continuation of wage deduction did not violate stay but did violate § 1327(a) to extent it sought payment of prepetition support; bankruptcy court order partially disallowing state's proof of claim and confirmed plan providing for payment of lesser amount than state asserts were inconsistent with Florida state court's authority to determine amount of support. "The Court concludes that the boundaries of its own jurisdiction and that of the Florida court need to be clearly defined with no overlapping territory and that proper comity to that court dictates that any determination of the viability of the disallowed portion of the state's claim ought to be made in that [state] court.").
In re Linkous, 339 B.R. 375, 379 (Bankr. W.D. Va. Mar. 24, 2006) (Krumm) (Car lender with notice of plan that provided for ongoing monthly payments but eliminated contractual balloon is bound by confirmation. Any ambiguity in plan shifted burden to creditor "to explore their rights as affected by the plan prior to confirmation of the plan.").
In re Linkous, 339 B.R. 375 (Bankr. W.D. Va. Mar. 24, 2006) (Although secured creditor with adequate notice is bound by elimination of contractual balloon payment in confirmed plan, creditor's proof of claim is allowed in absence of objection and lien is retained until allowed claim is paid.).
West Virginia
Southern District of West Virginia
West Virginia State Tax Dep't v. Mullins (In re Mullins), No. 2:00-0571, 2009 WL 3160361, at *6 (S.D. W. Va. Sept. 30, 2009) (unpublished) (Copenhaver) (In appeal decided nine years after bankruptcy court's order, postconfirmation tax liens did not violate automatic stay because confirmed plan did not overcome vesting of estate property in debtors. Reviewing various approaches to vesting at confirmation, district court adopted Woodard v. Taco Bueno Restaurants, Inc., No. 4:05-CV-804-Y, 2006 WL 3542693 (N.D. Tex. Dec. 8, 2006) (Means), "as the most logical resolution of such inconsistency as may exist between sections 1306(a) and 1327(b).").
F. Fifth Circuit
Brown v. Chestnut (In re Chestnut), No. 09-10145, 2009 WL 4885018, at *2 n.3 & *2-*6 (5th Cir. Dec. 17, 2009) (unpublished) (King, Garza, Haynes) (Citing Travelers Indemnity Co. v. Bailey, 557 U.S. 137, 129 S. Ct. 2195, 174 L. Ed. 2d 99 (June 18, 2009), and distinguishing Sun Finance Co. v. Howard (In re Howard), 972 F.2d 639 (5th Cir. Sept. 8, 1992) (Higginbotham, Duhe, Hunter), Simmons v. Savell (In re Simmons), 765 F.2d 547 (5th Cir. July 19, 1985) (Clark, Randall, Jolly), and IRS v. Taylor (In re Taylor), 132 F.3d 256 (5th Cir. Jan. 6, 1998) (King, Jones, Werlein), res judicata bars mortgagee's jurisdictional challenge to release of its lien through confirmed Chapter 13 plan when mortgagee had notice, did not object to confirmation and did not appeal order of confirmation, and jurisdictional challenge is raised for the first time when debtor moved to enforce confirmed plan; adversary proceeding was not required to release lien because neither validity, priority nor extent of lien was at issue. Separate property of nonfiling spouse was scheduled by debtor and plan treated mortgage holder as a secured creditor to be paid in full. Plan valued allowed secured claim and provided that mortgage holder would release its lien upon completion of payments. Lienholder did not object to plan, did not object to valuation and did not appeal confirmation order. Debtor completed payments under plan, and when lienholder refused to release lien, debtor moved to enforce confirmed plan and to compel release of lien. "The sole issue before this court on appeal is whether res judicata bars Templeton from now asserting that, because there was no explicit finding by the bankruptcy court that the Eastland property was property of the estate, the lien on the Eastland property need not be released. . . . Templeton is precluded in this appeal from challenging the bankruptcy court's subject matter jurisdiction during the confirmation proceedings. The issue of a bankruptcy court's subject matter jurisdiction may be raised on direct appeal; however, a party to the original proceeding that had a fair chance to challenge jurisdiction may not raise the question of jurisdiction in a collateral attack. Travelers Indem. Co. v. Bailey, . . . . Templeton could have raised the issue of jurisdiction before the bankruptcy court by objecting to the proof of claim filed on its behalf, by objecting to the plan, or by directly appealing the confirmation order. It followed none of those courses of action, and the bankruptcy court's subject matter jurisdiction is therefore insulated from Templeton's collateral attack. . . . While the Supreme Court's decision in Travelers Indemnity Co. v. Bailey did not involve a Chapter 13 plan, the text of the Bankruptcy Code supports the application of res judicata to such plans. . . . We are also aided in this decision by the consequences to the Chapter 13 Trustee system were we to undo the finality of a confirmed and completed Chapter 13 plan at the behest of a creditor that had notice of the plan and an opportunity to object. Tim Truman, the Chapter 13 Trustee . . . involved in this case, filed an amicus brief urging the application of res judicata to the confirmed plan. . . . We reject Templeton's argument that an adversary proceeding under Rule 7001(2) was needed for res judicata to apply here. . . . Rule 7001(2) does not apply to this dispute. . . . The confirmed plan does not challenge the validity of Templeton's lien, its priority over any other lien on the Eastland property, or its extent to the full value of Templeton's claim. Instead, the plan expressly acknowledged that Templeton's claim was fully secured and required—upon full payment of the claim—that Templeton release any lien securing the claim. . . . Here, Mr. Chestnut filed a proof of claim on Templeton's behalf, and no party ever contested the claim or the validity of the lien. Mr. Chestnut's Chapter 13 plan did not seek to void or reduce the lien, but instead provided that the lien would be released upon full payment of Templeton's claim, which was done. Applying res judicata to Mr. Chestnut's confirmed plan does not run afoul of In re Simmons, In re Howard, and In re Taylor, which stand for the unremarkable proposition that a Chapter 13 plan must be consistent with the provisions of the Bankruptcy Code. . . . Templeton did not take advantage of Mr. Chestnut's filing of a claim on its behalf or the confirmation process to raise its questions about the separate or community character of the Eastland property and whether it was properly treated in the plan. . . . To raise these issues now, in the context of resisting compliance with a provision of a completed plan, would run afoul of the finality required of such a plan."), aff'g 400 B.R. 74 (N.D. Tex. Jan. 6, 2009) (McBryde) (Res judicata effect of confirmation prevents mortgage creditor from challenging plan provision for release of its lien by disputing ownership of property; creditor was party to confirmation and cannot now contend that property belonged to former spouse.), aff'g No. 03-41050-DML-13, 2008 WL 2962943, at *3, *4 (Bankr. N.D. Tex. July 29, 2008) (unpublished) (Nelms) (Creditor's argument that property was community asset owned by nonfiling spouse is barred by confirmation order and res judicata. "Preclusion of the ownership issue also results from the binding effect of section 1327 of the Code." Because creditor did not object to its treatment under the plan, "section 1327(a) closes the door to actions or objections that were raised or could have been raised prior to or at confirmation of a plan. Thus the binding effect of section 1327(a) operates consistently with the general doctrine of res judicata.").
Brown v. Chestnut (In re Chestnut), No. 09-10145, 2009 WL 4885018, at *5 (5th Cir. Dec. 17, 2009) (unpublished) (King, Garza, Haynes) (That lienholder did not contest confirmation and did not object to proof of claim filed by debtor on its behalf precludes lienholder from challenging confirmed plan that released its lien upon completion of payments; adversary proceeding is not required because neither validity, priority nor extent of lien was at issue when confirmed plan required release of lien upon payment of allowed secured claim. "Mr. Chestnut filed a proof of claim on Templeton's behalf, and no party ever contested the claim or the validity of the lien. Mr. Chestnut's Chapter 13 plan did not seek to void or reduce the lien, but instead provided that the lien would be released upon full payment of Templeton's claim, which was done. Applying res judicata to Mr. Chestnut's confirmed plan does not run afoul of [Simmons v. Savell (In re Simmons), 765 F.2d 547 (5th Cir. Juy 19, 1985) (Clark, Randall, Jolly), Sun Finance Co. v. Howard (In re Howard), 972 F.2d 639 (5th Cir. Sept. 8, 1992) (Higginbotham, Duhe, Hunter)], and [IRS v. Taylor (In re Taylor), 132 F.3d 256 (5th Cir. Jan. 6, 1998) (King, Jones, Werlein)], which stand for the unremarkable proposition that a Chapter 13 plan must be consistent with the provisions of the Bankruptcy Code. . . . The absence of an adversary proceeding here does not affect our conclusion that res judicata bars Templeton's challenge to Mr. Chestnut's Chapter 13 plan.").
Louisiana
Eastern District of Louisiana
Countrywide Home Loans, Inc. v. Stewart, No. 10-3589, 2011 WL 1899820, at *8, *11, *12 (E.D. La. May 16, 2011) (McNamara) (Distinguishing United Student Aid Funds, Inc. v. Espinosa, __ U.S. __, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), when plan was confirmed before deadline for filing claims, "the failure of a creditor to object to a plan on the grounds that the plan has misstated the amount of the claim cannot, consistent with due process, bind the creditor with respect to the amount which the creditor is required to identify no earlier than the deadline for filing proofs of claim. Thus, the Debtor's proposed plan treatment of Countrywide's secured claim—payment of less than the full pre-petition arrearage—would not, standing alone, preclude the bankruptcy court from reaching a post-confirmation conclusion that the amount of Countrywide's claim for pre-petition arrearage is greater than that set forth in the Debtor's Chapter 13 plan." Applying Simmons v. Savell (In re Simmons), 765 F.2d 547 (5th Cir. July 19, 1985) (Clark, Randall, Jolly), Chapter 13 plan does not substitute for objection to secured creditor's proof of claim and "a secured creditor is not bound by a plan which purports to reduce its claim where no objection to the plan has been filed." Quoting Sun Finance Co. v. Howard (In re Howard), 972 F.2d 639 (5th Cir. Sept. 8, 1992) (Higginbotham, Duhé, Hunter), "a Chapter 13 plan which purports to reduce or eliminate a creditor's secured claim is res judicata [sic] as to that creditor only if the debtor has filed an objection to the creditor's claim. If no objection is filed to a secured claim, the creditor is entitled to rely upon its lien and not participate in the bankruptcy proceedings. . . . The court finds in this case that, while it was appropriate for the bankruptcy court to review of [sic] Countrywide's proof of claim, the creditor was not sufficiently . . . placed on notice that the substance of its claim was placed at issue. There was no challenge pursuant to 11 U.S.C. § 502(j) raised by any party. Countrywide was also not so informed by the Trustee's Motion to Dismiss for Unfeasibility . . . . Countrywide was given no clue that the substance of its proof was at issue until bankruptcy court's order issued after [the hearing]." Bankruptcy court improperly reconsidered proof of claim, substantially disallowing prepetition arrearage claim.), rev'g and vacating No. 03-18462, 2010 WL 3490976, at *6-*8 (Bankr. E.D. La. Aug. 23, 2010) (unpublished) (Magner) (United Student Aid Funds, Inc. v. Espinosa, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), changes the rule announced in Simmons v. Savell (In re Simmons), 765 F.2d 547 (5th Cir. July 19, 1985) (Clark, Randall, Jolly): mortgage arrearage amount in confirmed plan trumps higher amount in mortgagee's later-filed proof of claim. Countrywide had notice of plan but did not object to confirmation. Plan provided for less prepetition debt than amount in Countrywide's late-filed proof of claim. "Under the precedent set by Espinosa, Countrywide's failure to object to its treatment under the Plan after notice, results in a reduction of the amount owed regardless of the amount set forth in its proof of claim. That amount forms the maximum amount Countrywide may receive for its claim." Simmons had "turned on whether or not the confirmation process could substitute for a formal claim objection and, through confirmation, alter a claim's treatment. The Simmons Court began by analyzing the objection process and whether or not the confirmation process satisfied its due process concerns. All claims objections must be filed as either contested matters or adversary proceedings. In either instance, the Simmons Court reasoned that notice of the objection or service of the complaint would be required on the claimant. Because the plan confirmation process did not specifically require service of the plan itself, or necessarily highlight the proponent's intention to reduce or object to a filed claim, the Simmons Court concluded that notice of confirmation was procedurally insufficient to substitute for an objection to the claim. Without proper notice, the claimant had not been afforded due process. As a result, the confirmation order was not res judicata on the issue. . . . The Espinosa Court held that a confirmed plan was binding on the parties and a claimant's failure to object to its treatment in a plan bound it to the plan's provisions even if those provisions violated the Code or accomplished discharge or disallowance of a claim through a procedurally defective method. . . . Espinosa cannot be distinguished from Simmons or its progeny. In both Simmons and Espinosa, the claimants were noticed of the bankruptcy case and the confirmation hearing, objection deadline and plan. Both claims were entitled to treatment not provided for by the plans but both plans were confirmed, and the orders became final. While Simmons reasoned that a debtor's failure to follow the procedural requirements for challenging a claim constituted a failure of due process, Espinosa squarely rejected this argument." Although court had previously permitted Countrywide to file late proof of claim, that order did not allow claim. Under Federal Rule of Civil Procedure 60(a) and Bankruptcy Rule 9024, court may correct mistake sua sponte. Order allowing untimely claim was in error. Section 502(j) also allows reconsideration of Countrywide's claim.).
Colonial Mortgage & Loan Corp. v. Ellzey, 445 B.R. 674, 677 (E.D. La. Feb. 28, 2011) (Lemelle) (Distinguishing United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), and citing Simmons v. Savell (In re Simmons), 765 F.2d 547 (5th Cir. July 19, 1985) (Clark, Randall, Jolly), mortgagee is bound by amount in proof of claim notwithstanding higher amount in confirmed plan. "[T]he Proof of Claim provides prima facie evidence of the validity and the amount of the claim. . . . To rebut the proof of claim the debtor must file an objection under [Bankruptcy Rule] 3007. If no objection is filed, the Proof of Claim is deemed allowed under the Chapter 13 Plan. . . . Therefore, when a mortgage lender files a lesser amount than is included in the Chapter 13 plan the Trustee will adjust the amount to be paid to the creditor to match the Proof of Claim.").
In re Stewart, No. 03-18462, 2010 WL 3490976, at *6-*8 (Bankr. E.D. La. Aug. 23, 2010) (unpublished) (Magner) (United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), overruled Simmons v. Savell (In re Simmons), 765 F.2d 547 (5th Cir. July 19, 1985) (Clark, Randall, Jolly): mortgage arrearage amount in confirmed plan trumps higher amount in mortgagee's later-filed proof of claim. "Under the precedent set by Espinosa, Countrywide's failure to object to its treatment under the Plan after notice, results in a reduction of the amount owed regardless of the amount set forth in its proof of claim. That amount forms the maximum amount Countrywide may receive for its claim. . . .[ Simmons] turned on whether or not the confirmation process could substitute for a formal claim objection and, through confirmation, alter a claim's treatment. The Simmons Court began by analyzing the objection process and whether or not the confirmation process satisfied its due process concerns. All claims objections must be filed as either contested matters or adversary proceedings. In either instance, the Simmons Court reasoned that notice of the objection or service of the complaint would be required on the claimant. Because the plan confirmation process did not specifically require service of the plan itself, or necessarily highlight the proponent's intention to reduce or object to a filed claim, the Simmons Court concluded that notice of confirmation was procedurally insufficient to substitute for an objection to the claim. Without proper notice, the claimant had not been afforded due process. As a result, the confirmation order was not res judicata on the issue. . . . The Espinosa Court held that a confirmed plan was binding on the parties and a claimant's failure to object to its treatment in a plan bound it to the plan's provisions even if those provisions violated the Code or accomplished discharge or disallowance of a claim through a procedurally defective method. . . . Espinosa cannot be distinguished from Simmons or its progeny. In both Simmons and Espinosa, the claimants were noticed of the bankruptcy case and the confirmation hearing, objection deadline and plan. Both claims were entitled to treatment not provided for by the plans but both plans were confirmed, and the orders became final. While Simmons reasoned that a debtor's failure to follow the procedural requirements for challenging a claim constituted a failure of due process, Espinosa squarely rejected this argument."), rev'd and vacated by No. 10-3589, 2011 WL 1899820 (E.D. La. May 16, 2011) (McNamara).).
In re Guidry, 350 B.R. 661, 664-66 (Bankr. E.D. La. Sept. 15, 2006) (Magner) (Citing Sun Finance Co. v. Howard (In re Howard), 972 F.2d 639 (5th Cir. 1992), and Boyle Mortgage Co. v. Cook (In re Cook), No. 93-7459 (5th Cir. June 2, 1994), confirmed plan that fixes value of car and allowed amount of secured claim does not trump timely filed proof of claim asserting higher or different value unless objection to claim is also filed. Confirmed plan recited that Hibernia National Bank would be crammed down to a reduced secured claim of $16,518.25 to be paid with interest and no adversary proceeding would be filed. Hibernia unquestionably had notice and filed an inconsistent proof of claim before confirmation asserting a secured amount of $24,012.33. "At the time of confirmation, HNB's proof of claim was valid, prima facie evidence of its secured claim. No objection had been filed, and therefore, the claim was an allowed claim under § 502, as well as, an allowed, secured claim under § 506. Until the claim was successfully challenged, Debtor was not free to reduce or deviate from treatment of the claim as required by § 1325(a)(5). . . . [A] debtor must 'affirmatively object to a secured claim, pursuant to 11 U.S.C. § 506(a), and the associated Bankruptcy Rules 3007 and 9014, in order to modify or avoid a creditor's lien in bankruptcy.' . . . [T]he confirmation of Debtor's Plan is not binding on the secured creditor, HNB, either to eliminate or reduce its claim. Elimination or reduction of a claim can only be accomplished through an objection to claim.").
Middle District of Louisiana
In re Franklin, 448 B.R. 744 (Bankr. M.D. La. Mar. 4, 2011) (Dodd) (Applying United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), Ocwen was bound by arrearage amount and other terms of confirmed plan; untimely filed claim asserting larger arrearage amount was not deemed allowed by § 502(c), and motion to file late claim stated no ground for relief from Bankruptcy Rule 3002(c). Espinosa compelled different analysis and different result than Simmons v. Savell (In re Simmons), 765 F.2d 547 (5th Cir. July 19, 1985) (Clark, Randall, Jolly), and Sun Finance Co. v. Howard (In re Howard), 972 F.2d 639 (5th Cir. Sept. 8, 1992) (Higginbotham, Duhé, Hunter).).
Saylor v. Select Portfolio Servicing, Inc. (In re Saylor), No. 06-8035, 2007 WL 128789 (Bankr. M.D. La. Jan. 12, 2007) (unpublished) (Sawyer) (Confirmation vested home in debtor; under "estate transformation" approach, Telfair v. First Union Mortgage Corp., 216 F.3d 1333, 1340 (11th Cir. 2000), debtor's complaint that mortgage creditor improperly assessed postconfirmation charges did not impact bankruptcy estate and was dismissed with prejudice.).
Western District of Louisiana
Johns v. James, No. 15-1865, 2016 WL 6462168 (W.D. La. Oct. 31, 2016) (Hicks) (On motion for reconsideration, bankruptcy court can implement a policy that permits, but does not require, insurance proceeds to be paid to the trustee upon destruction of property during a Chapter 13 case.).
Sikes v. Samuel, 559 B.R. 135, 138
In re Wilson, 555 B.R. 547, 551-53 (Bankr. W.D. La. Aug. 5, 2016) (Kolwe) (Adopting “estate-replenishment approach,” proceeds of settlement of postconfirmation car accident are property of Chapter 13 estate subject to capture on trustee’s § 1329 motion to modify. “[T]he Fifth Circuit has not rendered an opinion concerning the interplay between §§ 1306 and 1327 of the Code. . . . [T]here are no less than five separate approaches . . . . ‘Estate-termination approach . . . . Estate-transformation approach . . . . Estate-replenishment approach . . . . Estate-preservation approach . . . . Conditional-vesting approach . . . . ’ . . . Virtually all of the approaches have been criticized. . . . This Court . . . adopts the estate-replenishment approach. This approach gives effect to § 1306 by recognizing that all property acquired by the debtor after confirmation is property of the estate, while at the same time giving effect to § 1327 by recognizing that all property of the estate at the time of confirmation vests in the debtor. Therefore, all post-confirmation assets, including a debtor’s personal injury cause of action, are property of the estate which must be scheduled . . . ‘so that the Trustee’s or a creditor’s right to seek modification is a meaningful right’ under 11 U.S.C. § 1329.”).
In re James, No. 13-12826, 2015 WL 3464129, at *2 (Bankr. W.D. La. May 29, 2015) (Norman) (Trustee receives and accounts for insurance proceeds upon postconfirmation destruction of car but is not entitled to commission on portion payable to lienholder. "This Court has routinely required insurance proceeds in all Chapter 13 cases be paid to the Chapter 13 Trustee. Such a requirement ensures that all parties, including the debtor, secured creditors and unsecured creditors, only receive funds to which they are entitled. This requirement additionally ensures accurate record[ ] keeping . . . .").
In re Aycock, No. 10-80516, 2014 WL 1047803, at *3 (Bankr. W.D. La. Mar. 18, 2014) (Hunter) (Debtor with completed Chapter 13 plan ordered to show cause why case should not be converted to Chapter 7 when debtor failed to disclose large lawsuit settlement acquired postconfirmation. Citing Flugence v. Axis Surplus Insurance Co. (In re Flugence), 738 F.3d 126 (5th Cir. Nov. 22, 2014) (per curiam), "the debtor in Chapter 13 has a continuing duty to disclose the post-confirmation acquired asset so that its status as property of or outside the estate may be determined by the Bankruptcy Court. . . . Unlike in Flugence, where the debtor was merely silent as to the acquisition of post-petition cause of action, this debtor not only failed to adequately disclose the cause of action for more than two years, but blatantly contradicted its known value when he finally amended Schedule B to state 'post petition accident' of an 'unknown' value just four months after he signed a Settlement Agreement pursuant to which he was awarded over $4,000,000. . . . Such blithe disregard for the truth [can be] grounds for . . . sua sponte conversion . . . .").
In re Larry, No. 12-50461, 2013 WL 1187880, at *1 (Bankr. W.D. La. Mar. 21, 2013) (Summerhays) (Ambiguous plan provision concerning effect of confirmation on inconsistent proofs of claim precluded disallowance of timely postconfirmation claim. Plan stated, "reservation of a creditor's right to have its claim challenged as part of the claims allowance process.").
In re James, 359 B.R. 602 (Bankr. W.D. La. Oct. 31, 2006) (Hunter) (Confirmed plan precluded stay relief to permit bank to pursue easement access to enclosed tract that had been surrendered.).
In re Bopp, No. 04-50836, 2006 WL 2846877 (Bankr. W.D. La. Apr. 12, 2006) (unpublished) (Schiff) (Debtor is bound by confirmed plan that fixed arrearage claim and regular monthly payment when debtor sought to refinance mortgage two years after confirmation.).
Mississippi
Northern District of Mississippi
Galloway v. EMC Mortgage Corp. (In re Galloway), No. 09-01124-NPO, 2010 WL 364336 (Bankr. N.D. Miss. Jan. 29, 2010) (unpublished) (Olack) (Mortgage creditor was bound by confirmation, and complaint states causes of action for violations of § 506, Bankruptcy Rule 2016, automatic stay and discharge injunction based on allegations that mortgage creditor misapplied plan payments.).
Texas
Eastern District of Texas
Moser v. Mullican (In re Mullican), 417 B.R. 389, 399-400 (Bankr. E.D. Tex. Sept. 30, 2008) (Rhoades) (Postconfirmation inheritance was property of estate at conversion to Chapter 7. Confirmed plan provided that property of estate vested in debtors until discharge or dismissal. "[M]ost courts seem to have adopted an approach treating all post-confirmation earnings and post-confirmation property as property of the estate under § 1306(a) . . . . [M]ost courts analyzing post-petition windfalls, such as an inheritance, have found them to be property of a Chapter 13 estate.... With respect to post-confirmation property, this Court concludes that the approach adopted by the courts in [United States v. Harchar, 371 B.R. 254 (N.D. Ohio 2007),] and [Barbarosa [v. Soloman, 235 F.2d 31 (1st Cir. 2000),] among others, is the most logical reconciliation of §§ 1306(a) and 1327(b). . . . The estate is not extinguished by confirmation, but rather is comprised of new property acquired by the debtor post-confirmation, whether via inheritance, wages or other means.").
Northern District of Texas
Kleibrink v. Kleibrink (In re Kleibrink), No. 3:07-CV-0088-K, 2007 WL 2438359, at *4, *6 (N.D. Tex. Aug. 28, 2007) (unpublished) (Kinkeade) (Objection to claim and plan confirmation did not adequately advise mortgagee that debtor was attempting to avoid its lien. "Appellee was denied a full and fair opportunity to litigate the issue of whether its lien was extinguished because the Claim Objection did not give Appellee adequate notice nor was Appellee afforded an adversary proceeding." Simmons v. Savell (In re Simmons), 765 F.2d 547 (5th Cir. 1985), held that confirmation does not extinguish lien when no claims objection was filed. Lien may be extinguished through an appropriate plan provision, such as paying the debt, or by use of § 506(d). "The Court agrees with the bankruptcy court's analysis that a motion is sufficient to strip a lien where the lien stripping occurs as a result of a § 506(a) valuation and an adversary proceeding is required where a debtor seeks to extinguish a lien by its validity, priority or extent," citing Chase Automotive Finance, Inc. v. Kinion (In re Kinion), 207 F.3d 751 (5th Cir. 2000).), aff'g 346 B.R. 734, 748-53 (Bankr. N.D. Tex. Aug. 2, 2006) (Interpreting In re Simmons, 765 F.2d 547 (5th Cir. 1985), and In re Howard, 972 F.2d 639 (5th Cir. 1992), confirmation of Chapter 13 plan may not extinguish a lien under § 506, but claim objection can if objection clearly notifies the lienholder that its lien is at risk. "[T]here are two ways in which a lien may be extinguished: (i) by operation of Section 506(d) of the Bankruptcy Code, or (ii) by providing for, and paying in full, the underlying debt under a confirmed plan. . . . [T]he mechanism described in Rule 3012 can be used to extinguish a lien when the basis for its avoidance is a valuation of the collateral under Section 506(a), but . . . the mechanism described in Rule 7001 is required where the basis to extinguish the lien is a challenge to its validity, priority or extent. . . . [T]he claim objection process may 'substitute' for an adversary proceeding where the claim objection is clearly joined with a demand for relief of the kind specified in Rule 7001—i.e., where the claim objection gives clear notice that the debtor is challenging the validity, priority, or extent of the lien and seeks to abrogate a creditor's right to look to its collateral, and the debtor complies with the procedural safeguards set forth in Part VII of the Federal Rules of Bankruptcy Procedure. . . . [A] motion is sufficient to strip a lien where the lien stripping occurs . . . as a result of a Section 506(a) valuation. . . . [W]here the debtor challenges the validity, priority, or extent of a lien, and seeks to extinguish the lien on that basis, an adversary proceeding is required. . . . Simmons and Howard are best understood as standing for the proposition that at least a claim objection is required before a creditor's lien will be extinguished under Section 506. . . . [T]he Claim Objection in [the debtor's prior case] did not 'clearly' notify Wilmington that not only was its secured claim at risk, but that the Debtor sought to extinguish its ability to look to its collateral . . . . [T]he Claim Objection did not clearly notify Wilmington that the Debtor sought to extinguish its lien in addition to valuing its claim at zero. . . . [W]hen a debtor seeks to extinguish a lien, in addition to disallowing a claim, a motion is sufficient when the basis to avoid the lien is a Section 506(a) valuation. However, when the debtor seeks to extinguish a lien under Section 506(d), on the ground that it secures a claim which is not an allowed secured claim due to a successful challenge to the validity, priority, or extent of the lien, then an adversary proceeding is required, unless the debtor files a claim objection which affords the creditor due process before extinguishing its property right. The claim objection process may 'substitute' for an adversary proceeding where the claim objection is clearly joined with a demand for relief of the kind specified in Rule 7001.").
Woodard v. Taco Bueno Rests., Inc., No. 4:05-CV-804-Y, 2006 WL 3542693, at *2, *9 (N.D. Tex. Dec. 8, 2006) (unpublished) (Means) (Employment discrimination action that accrued two years after confirmation was property of Chapter 13 estate, but court declined to apply judicial estoppel due to "law's uncertainty in this [Fifth] circuit as to the status of assets acquired by a debtor after the confirmation of his chapter 13 bankruptcy plan and as to the duty of the debtor to disclose those belatedly acquired assets." Court discusses vesting effect of confirmation and four views of postconfirmation acquisition of causes of action: (1) estate-termination approach, where all property of estate becomes debtor's property upon confirmation, as explained in Telfair v. First Union Mortgage Corp., 216 F.3d 1333, 1340 (11th Cir. 2000); (2) estate-preservation approach, where all property remains in estate until discharge, dismissal or conversion, as explained in Telfair, 216 F.3d at 1340; (3) "splitting the baby" or estate-transformation approach, where only such property as necessary for plan execution remains in estate, as adopted by Telfair, 216 F.3d at 1340; and (4) cessation of estate approach, where upon confirmation all property vests fully in debtor, as explained in Barbosa v. Doreen, 235 F.3d 31, 36-37 (1st Cir. 2000). District court adopts fifth approach, one giving "full meaning" to "vesting" under combination of § 1306 and § 1327, as conditional right to "enjoy" an asset but one that "the debtor does not enjoy until he faithfully completed his obligations under the plan and is entitled to a discharge.").
In re Hazlewood, 570 B.R. 557, 559-61 (Bankr. N.D. Tex. May 12, 2017) (Mullin) (When plan made no provision for unliquidated lawsuit that debtor valued at “unknown,” confirmation vested the lawsuit in the debtor free and clear of the claims of creditors and proceeds from postconfirmation liquidation of the lawsuit cannot be captured for creditors by the trustee’s motion to modify under § 1329. During the confirmation process in 2013 the debtor revealed an interest in a lawsuit of “unknown” value. The plan made no provision for this lawsuit or for disposition of any potential recovery. “Consequently, upon confirmation . . . the White Lawsuit and its proceeds vested in Debtor free and clear of any claims or interest of any creditor provided for in the Confirmed Plan . . . . [T]he White Lawsuit was no longer property of the estate. . . . [N]either the Confirmed Plan nor the Order Confirming Plan included a provision excepting the White Lawsuit or its proceeds from vesting in Debtor upon confirmation. Therefore, pursuant to §§ 1327(b) and (c), upon confirmation of the Confirmed Plan, the White Lawsuit vested in Debtor ‘free and clear of any claim or interest of any creditor provided for by the plan.’ . . . [J]ust because the White Lawsuit was not reduced to a judgment until after the Confirmation Date does not change or transform the White Lawsuit, or its proceeds, from property of Debtor back into property of the estate.”).
In re Hymond, No. 09-45346-dml-13, 2012 WL 6692196 (Bankr. N.D. Tex. Dec. 21, 2012) (Nelms) (Adopting estate reconciliation approach—under which estate property existing at confirmation vests in debtor but property subsequently acquired becomes property of estate—postconfirmation tax refund did not vest in debtor at confirmation but is not subject to turnover because only debtor can possess and use estate property in a Chapter 13 case.).
In re Hymond, No. 09-45346-dml-13, 2012 WL 6692196 (Bankr. N.D. Tex. Dec. 21, 2012) (Nelms) (Addressing problems created by IRS's misbehavior in United States v. Carroll, 667 F.3d 742 (6th Cir. Jan. 30, 2012) (Norris, Sutton, Griffin), trustee not entitled to turnover of postconfirmation tax refunds because debtors have exclusive right to possess and use property of the estate; however, trustee could seek plan modifications if trustee can show that tax refund is a changed circumstance. Court adopts estate reconciliation approach—under which estate property existing at confirmation vests in debtor but property subsequently acquired becomes property of estate—to explain why tax refund did not vest in debtor at confirmation.).
In re Powers, 435 B.R. 385 (Bankr. N.D. Tex. June 24, 2010) (Jones) (Debtors and creditors are bound by confirmed plan under § 1327(a); when debtors completed plan payments before receiving proceeds of class action Vioxx settlement, proceeds became property of estate, but it was too late to modify plan—debtors get the proceeds.).
In re Powers, 435 B.R. 385, 389 (Bankr. N.D. Tex. June 24, 2010) (Jones) (Vioxx settlement proceeds received postpetition became property of estate, but since debtors had completed plan payments, it was too late to modify confirmed plan to capture proceeds; under § 1306(b), settlement proceeds belonged to debtors. "Court is inclined to endorse the view that estate property that exists at the time of confirmation vests in the debtor per section 1327(b), but property acquired by the debtor after confirmation becomes estate property under section 1306(a)(1). If the latter described property may potentially enhance the dividend to creditors, then the debtor, the trustee, or an unsecured creditor can move under section 1329 to modify the debtor's chapter 13 plan to increase the debtor's payments. . . . But the debtors here have completed their payments and have long since received their discharge. Section 1329 provides that a modification may be proposed 'after confirmation . . . but before the completion of payments. . . .'").
In re Powers, 435 B.R. 385 (Bankr. N.D. Tex. June 24, 2010) (Jones) (Vioxx settlement proceeds received postpetition became property of Chapter 13 estate but belonged to debtors because plan payments had been completed and it was too late to modify confirmed plan.).
In re Hamilton-Simmons, No. 08-34897-SGJ-13, 2009 WL 2778293, at *4 (Bankr. N.D. Tex. Aug. 31, 2009) (Jernigan) (Although confirmation typically binds creditors having notice of plan in time to object, when debtor voluntarily converted case to Chapter 7 subsequent to confirmation, it was inequitable to bind creditor to confirmed plan. "This court construes [Friendly Finance Service-Eastgate Inc. v. Dorsey (In re Dorsey), 505 F.3d 395 (5th Cir. 2007)], to stand for the proposition that, despite the finality of a Chapter 13 confirmation order, a Debtor, as a matter of equity, can no longer enforce such order where she abandons the underlying plan prior to completion of the plan.").
In re Williams, No. 05-47644-DML-13, 2007 WL 4522326, at *2 (Bankr. N.D. Tex. Dec. 19, 2007) (unpublished) (Lynn) (Debtor is bound by federal homestead exemption claimed at confirmation and cannot change to Texas homestead. "The law is clear that an issue that could have or should have been raised in connection with confirmation of a plan is res judicata by virtue of the confirmation order.").
Rosetti v. Chase Home Fin. LLC (In re Rosetti), No. 07-04063-DML, 2007 WL 2669265, at *3 (Bankr. N.D. Tex. Sept. 6, 2007) (unpublished) (Lynn) (When Chase Home Finance did not raise debtor's ineligibility under § 109(g)(2) in its objection to confirmation, Chase is bound by confirmation and precluded from raising ineligibility postconfirmation. Citing Republic Supply Co. v. Shoaf, 815 F.2d 1046 (5th Cir. May 4, 1987) (Garwood, Jolly, Hill), "not only did Chase have full notice of the Plan and the confirmation hearing, it actually objected to confirmation of the Plan. Having failed in (or before) its objection to raise the issue of eligibility, Chase is now precluded from doing so.").
In re Moffitt, No. 04-91391-DML-13, 2007 WL 1118287 (Bankr. N.D. Tex. Apr. 12, 2007) (unpublished) (Confirmation subsequent to conditional stay relief order precludes enforcement of conditions.).
In re Gellington, 363 B.R. 497, 502-03 (Bankr. N.D. Tex. Mar. 8, 2007) (Hale) (Although Texas did not violate automatic stay by garnishing debtor's wages to collect child support arrears because § 362(b)(2)(C) excepts collection of a DSO from stay, garnishment did violate confirmation order because plan provided payment of DSO arrears through the plan. "[A]fter confirmation, the terms of the plan and the confirmation order control. Here, the confirmed Plan indicates that Debtor would pay the claim at issue, the pre-petition arrears, in monthly payments under the Plan. There was not a provision in the Plan allowing the Attorney General to garnish the Debtor's wages. . . . [G]arnishment for prepetition arrears would be contrary to the Confirmation Order and section 1327. . . . Section 362(b)(2)(C) acts as an exception to the automatic stay in a bankruptcy proceeding for the withholding of the domestic support obligation at issue. However, under section 1327 of the Bankruptcy Code, the provisions of a confirmed Chapter 13 plan are res judicata and bind all creditors, including . . . the State of Texas. . . . Because the actions were not willful and because the State has agreed to promptly refund the garnished funds to the Debtor, no sanctions are in order.").
Beal Bank, S.S.B. v. Fernandez (In re Fernandez), No. 05-03705, 2006 WL 3147385 (Bankr. N.D. Tex. Oct. 27, 2006) (unpublished) (Hale) (Beal Bank did not have notice of reinstatement of dismissed case or of opportunity to object to plan that treated Beal as wholly unsecured; citing In re Kleibrink, 346 B.R. 734 (Bankr. N.D. Tex. 2006), lack of due process prevented Beal from being bound by confirmed plan.).
Southern District of Texas
In re Shank, 569 B.R. 238, 249
In re Pennington, No. 11-80101-G3-13, 2015 WL 7746295, at *3 (Bankr. S.D. Tex. Nov. 30, 2015) (Paul) (Car lender not entitled to adequate protection or to any portion of insurance proceeds at destruction of car when plan paid lender's secured claim in full with interest. Car lender not entitled to contract amount due but is bound by plan to accept the amount of its proof of claim even though the amount claimed was less than the contract amount to which the lender would have been entitled outside of bankruptcy. Confirmed plan provided for car lender's claim in the amount of $19,529.22 with 5.25% interest. The car lender filed a secured proof of claim for the same $19,529.22. Debtor paid the secured claim with interest before the car was destroyed and insurance company tendered $8,632.48. The parties stipulated that under the original contract, the car lender was still owed $5,890.98. "[F]iling of a proof of claim does constitute sufficient participation in the reorganization to bind the creditor. . . . Toyota filed a proof of claim. . . . Toyota received distribution on its claim through the plan in the allowed amount of its claim. In contrast to [Sun Finance Co. v. Howard (In re Howard), 972 F.2d 639 (5th Cir. Sept. 8, 1992) (Higginbotham, Duhé, Hunter)], the plan . . . paid Toyota . . . everything it was due pursuant to its proof of claim. . . . Toyota participated in the reorganization, and is bound by its proof of claim and the confirmed plan. . . . Toyota has no interest in the insurance proceeds, and thus Debtor need not provide adequate protection.").
In re Bratcher, No. 08-36225, 2013 WL 5309549, at *4, *5 (Bankr. S.D. Tex. Sept. 19, 2013) (Isgur) (Settlement of postconfirmation personal injury action is property of Chapter 13 estate. Plan "provision ma[de] it clear that the property of the estate does not vest in the debtor until entry of the discharge. All property acquired by the debtor, including post confirmation property, is property of the estate until entry of the discharge order. Regardless of how the Court interprets §§ 1306(a) and 1327(b), the settlement proceeds from the accident are property of the estate." Absent vesting provision, result would be the same: "'While the case is pending, the post-petition property . . . [is] added to the estate until confirmation, the event that triggers [section] 1327(b) and "vests" the property of the estate in the debtor. That is, the property interests comprising the pre-confirmation estate property are transferred to the debtor at confirmation, and this "vesting" is free and clear of the claims or interests of creditors provided for by the plan, [section] 1327(b), (c). Finally, the property of the estate once again accumulates property by operation of [section] 1306(a) until the case is "closed, dismissed, or converted."'").
Pompa v. Wells Fargo Home Mortg., Inc. (In re Pompa), No. 11-3651, 2012 WL 2571156 (Bankr. S.D. Tex. June 29, 2012) (Isgur) (Applying Padilla v. Wells Fargo Home Mortgage, Inc. (In re Padilla), 379 B.R. 643 (Bankr. S.D. Tex. Aug. 3, 2007) (Isgur), complaint alleging postpetition charges in violation of confirmed plan survived Wells Fargo's motion to dismiss.).
Vega v. Garza (In re Vega), No. 10-07025, 2011 WL 5239748 (Bankr. S.D. Tex. Oct. 28, 2011) (Isgur) (Wells Fargo was not bound by confirmed plan of which it had no notice. Debtor purchased home by assumption deed, without lender's knowledge, and debtor could not treat mortgage claim in plan.).
In re Munoz, 459 B.R. 621 (Bankr. S.D. Tex. June 21, 2011) (Schmidt) (Creditor was bound by plan confirmed in first case that treated debt as secured claim; creditor cannot object to confirmation in second case on basis that debt is lease rather than secured claim.).
In re Ammoune, No. 05-39723-H3-13, 2010 WL 2010928 (Bankr. S.D. Tex. May 14, 2010) (unpublished) (Paul) (When confirmed plan provided that secured creditors retained liens, after vehicle was totaled in accident, creditor retained lien on insurance proceeds and stay relief was appropriate to permit creditor to recover proceeds.).
In re Vasquez, No. 09-20565, 2010 WL 934210 (Bankr. S.D. Tex. Mar. 10, 2010) (unpublished) (Schmidt) (Without discussion, tax lien purchased by third party must be paid with interest at Texas statutory rate under § 511 notwithstanding confirmed plan that provided a lower interest rate; timely filed claim that demanded interest at the higher rate trumped confirmed plan.).
Rodriguez v. Countrywide Home Loans, Inc. (In re Rodriguez), 421 B.R. 356 (Bankr. S.D. Tex. Dec. 9, 2009) (Isgur) (Fact issues remain with respect to whether Countrywide violated plan terms or confirmation orders by misallocating mortgage payments during Chapter 13 case, resulting in declaration of default after discharge. Section 1327(a) binds both debtor and creditor. Confirmation obligated mortgage lender to ensure that debtor had opportunity to cure arrearages under § 1322(b)(5). Mortgage creditor was obligated to allocate payments properly among principal, interest and arrearages as prescribed in plan. When creditor admitted misapplication of some mortgage payments, but disputed amounts, genuine issue of material fact existed.).
Rodriguez v. Countrywide Home Loans, Inc. (In re Rodriguez), 421 B.R. 356, 374, 378, 380 (Bankr. S.D. Tex. Dec. 9, 2009) (Isgur) (Mortgage lender must file Bankruptcy Rule 2016 application before collecting reimbursable fees and costs during Chapter 13 case because postconfirmation earnings remain property of the estate. Analyzing four approaches to vesting under § 1327(b), court adopts estate reconciliation approach announced in Waldron v. Brown (In re Waldron), 536 F.3d 1239, 1243 (11th Cir. Aug. 4, 2008) (Edmondson, Pryor, Johnson). Reconciliation approach is "only one of the four approaches that interpret §§ 1327(b) and 1306(a)(2) in harmony." Reconciliation approach "determines that Rule 2016 applies to acts to collect fees from post-confirmation earnings of the debtor because such earnings are property of the estate." Rule 2016 continues to apply when fees and expenses were assessed during bankruptcy but not collected until after discharge. Assuming that literal reading would terminate Rule 2016 on discharge, § 105 would then present issue whether Countrywide had prevented debtors from obtaining fresh start by "obviating the Debtor's ability to implement § 1322(b)(5).").
Ramos v. Castillo (In re Castillo), No. 09-5005, 2009 WL 3854261 (Bankr. S.D. Tex. Nov. 17, 2009) (unpublished) (Steen) (When confirmed plan provided that property of estate would not vest in debtors until discharge, right to prosecute state court lawsuit remained vested in estate, subject to administration by trustee and bankruptcy court; debtors had no authority to prosecute claims in state court, and debtors' action in state court violated automatic stay. Confirmation of plan had not adjudicated title to property or determined rights of other parties claiming interest in property.).
In re Lucio, No. 04-81962-G3-13, 2008 WL 5479110 (Bankr. S.D. Tex. Nov. 21, 2008) (Letitia Clark) (Mortgage creditor that participated in confirmation was aware of, and bound by, local Chapter 13 procedures for administration of home mortgages that required creditor to give notice of any payment adjustments to debtor, debtor's counsel and trustee; failure to give required notice limits reimbursement for forced-placed insurance to same amount as prior year.).
Harris v. Fidelity Nat'l Info. Servs. Inc. (In re Harris), No. 08-3014, 2008 WL 924939, at *5 (Bankr. S.D. Tex. Apr. 4, 2008) (unpublished) (Bohm) (Complaint alleging mortgage servicer engaged in unauthorized fee splitting with law firms does not state cause of action for violation of confirmed plan because "there are no provisions in the Code which make a plan binding upon a non-creditor third party." Complaint does state potential cause of action for violation of Rule 2016(a), to extent mortgage servicer paid fees to law firms.).
Padilla v. Wells Fargo Home Mortgage, Inc. (In re Padilla), 379 B.R. 643, 663 (Bankr. S.D. Tex. Aug. 3, 2007) (Isgur) (Claims for postconfirmation fees and expenses arise under new contract imposed by confirmed plans; Rule 2016(a) requires lenders to seek approval of postconfirmation fees and expenses, which must be reasonable under Texas contract law. Upon confirmation, rights of mortgage lenders and debtors "no longer arose from their pre-petition contracts. Their rights arose from the confirmed plan." Disgorgement is an appropriate remedy under § 105(a), upon showing of failure to seek court approval or unreasonableness. Further hearing is required to establish whether contested charges were actually imposed and collected.).
Padilla v. Wells Fargo Home Mortgage, Inc. (In re Padilla), 379 B.R. 643, 663, 669 (Bankr. S.D. Tex. Aug. 3, 2007) (Isgur) (Confirmation does not bar debtor's challenge to postconfirmation charges for fees and expenses by mortgage lenders. Although upon confirmation, rights of mortgage lenders and debtors "arose from the confirmed plan[,]" res judicata does not insulate unauthorized postconfirmation charges. Debtors are not objecting to plan provisions; rather, they are "object[ing] to how a plan provision is being implemented. Specifically, the [debtors] do not object to the plan provision that provides for future payments to be made in accordance with their mortgage contracts. The [debtors] object to the nature (charging fees and expenses without disclosure) and amount (reasonable or unreasonable) of charges made pursuant to [the mortgage] contracts." Rule 2016(a) applies to require lenders to seek approval of fees and expenses, which must be reasonable under Texas contract law. Disgorgement is appropriate remedy under § 105(a), upon showing of failure to seek court approval or unreasonableness. Further hearing is required to establish whether contested charges were actually imposed and collected.).
Sanchez v. Ameriquest Mortgage Co. (In re Sanchez), 372 B.R. 289, 301 (Bankr. S.D. Tex. July 24, 2007) (Bohm) (Under plan, property of estate did not vest in debtors until discharge; estate continues to exist and court has jurisdiction over debtors' complaint attacking Ameriquest's collection of pre- and postconfirmation charges from estate property. Even if estate ceased to exist, court would retain jurisdiction under Fifth Circuit's "'more exacting theory of post-confirmation bankruptcy jurisdiction' which limits the jurisdiction of bankruptcy courts, once a debtor's estate ceases to exist, to those matters pertaining to the implementation or execution of the plan. Bank of Louisiana v. Craig's Stores of Tex., Inc. (In re Craig's Stores of Tex., Inc.), 266 F.3d 388, 390-91 (5th Cir. 2001); see also In re U.S. Brass, 301 F.3d 296, 304 (5th Cir. 2002).").
Sanchez v. Ameriquest Mortgage Co. (In re Sanchez), 372 B.R. 289, 305, 308 (Bankr. S.D. Tex. July 24, 2007) (Bohm) (Ameriquest's reliance on res judicata effect of confirmation is "misplaced" in debtors' attack on its undisclosed pre- and postconfirmation fees and charges. Although Ameriquest's claim was allowed as part of confirmation process and debtors did not object to claim until after confirmation, "[r]es judicata cannot bar objections to charges that debtors did not know existed . . . . [T]hey cannot be expected to object to the reasonableness of fees and costs pursuant to § 506(b) when they have no notice of the amount of such fees or costs." "The three most important words in the bankruptcy world are: disclose, disclose, disclose.").
In re Gamble, No. 06-36485, 2007 WL 895809 (Bankr. S.D. Tex. Mar. 22, 2007) (unpublished) (Isgur) (Confirmed plan that bifurcated secured claim and released lien upon payment of secured portion lost its effect when Chapter 13 case was dismissed notwithstanding that secured claim was paid in full before dismissal; when debtor immediately refiled, balance of debt was an allowed secured claim; confirmation order in first case was not "for cause" relief from § 349(b) which reinstated property rights to positions prior to first bankruptcy case.).
In re Turner-Mayo, No. 05-44726, 2007 WL 484614, at *5 (Bankr. S.D. Tex. Feb. 8, 2007) (unpublished) (Isgur) (Distinguishing Sun Finance Co. v. Howard (In re Howard), 972 F.2d 639 (5th Cir. Sept. 8, 1992) (Higginbotham, Duhe, Hunter), plan did not affect validity of Chase Home Finance LLC's lien or its claim amount, only the interest rate. "Code's provision that protects a mortgage lender [§ 1322(b)(2)] must yield to the Code's policy of promoting the finality of the Court's confirmation order and principles of res judicata [§ 1327(a)].").
In re Turner-Mayo, No. 05-44726, 2007 WL 484614, at *5 (Bankr. S.D. Tex. Feb. 8, 2007) (unpublished) (Isgur) (Since Chase Home Finance LLC's admitted notice of plan that altered interest rate but not amount or validity of lien, Chase's failure to object bound it to plan's interest rate, notwithstanding Sun Finance Co. v. Howard (In re Howard), 972 F.2d 639 (5th Cir. 1992).).
In re Allison, No. 06-30040, 2006 WL 2620480, at *4-*10 (Bankr. S.D. Tex. Sept. 12, 2006) (unpublished) (Isgur) (Even if eligibility is jurisdictional, confirmation is final order that is res judicata with respect to eligibility and with respect to subject matter jurisdiction. "A final confirmation order is generally res judicata as to all justiciable issues which were or could have been decided at the confirmation hearing, including a debtor's eligibility to commence a chapter 13 case. . . . [Promenade National Bank v. Phillips (In re Phillips), 844 F.2d 230 (5th Cir. May 6, 1988) (Timbers, King, Higginbotham),] teaches that this Court's subject matter jurisdiction exists separately from the determination of eligibility. . . . [O]nce a court makes a determination that it has jurisdiction and renders a final decision, the decision is binding unless reversed on appeal even if that decision was erroneous. . . . [I]mplicit in the Court's final order confirming the Debtor's chapter 13 plan was a determination that the Court has subject matter jurisdiction. . . . [T]he issue of the Court's subject matter jurisdiction was central to the Court's exercise of jurisdiction when it confirmed the Debtor's plan. Union Federal could only prevail on its motion to dismiss based on the Debtor's ineligibility or lack of subject matter jurisdiction if the Court first determined that the confirmation order was entered in error for those same reasons—arguments barred by res judicata. Thus, the same cause of action is involved and res judicata bars the relitigation of the issue of subject matter jurisdiction.").
In re Moore, 319 B.R. 504, 514 (Bankr. S.D. Tex. Jan. 18, 2005) (Citing Sun Finance Co. v. Howard (In re Howard), 972 F.2d 639 (5th Cir. 1992), and Simmons v. Savell, 765 F.2d 547 (5th Cir. 1985), in the Fifth Circuit confirmation of a Chapter 13 plan cannot resolve the tension between the plan and an inconsistent proof of claim; to realize binding effect of a confirmed plan with respect to the value of collateral and the extent of liens, debtors must timely and properly object to inconsistent proofs of claim, and secured claims must be determined prior to plan confirmation or at the hearing on confirmation and after adequate notice to affected claim holders. A plan that values a car at less than the amount claimed in a timely filed proof of claim is not effective as an objection to the claim, and the separate objection filed by the debtor 14 days before the confirmation hearing is not adequate notice of the claim objection. Notice of the confirmation hearing from the trustee that collateral will be valued and the extent of liens determined at the confirmation hearing is not sufficient—a separate claim objection is required that includes "a specific statement of which claim is to be adjudicated and when the hearing will be held." An objection to claim or motion to value collateral must be filed at least 20 days before the confirmation hearing.).
G. Sixth Circuit
Harchar v. United States (In Harchar), 694 F.3d 639, 644 (6th Cir. Sept. 12, 2012) (Batchelder, Griffin, Cohn) (Temporary freeze of tax refund for manual processing did not violate any provision of confirmed plan; § 1327 does not contain an express cause of action for damages. Confirmed plan provided that IRS would be paid in regular monthly payments over life of plan. "[N]othing in these provisions prohibits the IRS from manually processing her refund. . . . [T]he statutory provision declaring that confirmation [sic] plans are 'binding'—does not contain an express cause of action for damages.").
United States v. Carroll, No. 10-1400, 2012 WL 1570386 (6th Cir. Apr. 27, 2012) (unpublished) (Norris, Sutton, Griffin) (On petition for rehearing, mandamus not appropriate because there was no jurisdiction to support the government's declaratory action against the standing trustees; government has adequate means to raise its sovereign immunity argument by direct appeal in a specific case.), denying reh'g of 667 F.3d 742 (6th Cir. Jan. 30, 2012) (Norris, Sutton, Griffin) (United States lacked standing to seek injunctive and mandamus relief to prevent use and enforcement of provisions in confirmation orders that compelled IRS to pay postconfirmation tax refunds to trustees. Bankruptcy Code authorized bankruptcy court to fashion tax refund provision, and parties other than Chapter 13 trustees, including debtor and creditors, had interest in ensuring tax refunds were paid to trustees. Simply suing trustees did not redress perceived problem. United States should have taken direct appeal from any confirmation order.), vacating 423 B.R. 294, 299-302 (E.D. Mich. Jan. 20, 2010) (Hood) (Form confirmation order requiring IRS to direct future tax refunds to the Chapter 13 trustee was beyond bankruptcy court jurisdiction because IRS had not waived sovereign immunity; trustee was enjoined from seeking to enforce the redirection provision in any Chapter 13 case in the district, and writ of mandamus issued prohibiting bankruptcy court from entering future confirmation orders containing the redirection provision. "The Bankruptcy Court did not give notice to the IRS prior to entering the confirmation orders with the redirection provisions in any of the individual bankruptcy cases. . . . A confirmed plan is only binding between the debtor and creditors. . . . The Trustees have not identified an explicit statutory provision which waives the IRS' sovereign immunity from proceedings redirecting a debtor's future tax refund to the Trustees instead of the debtor.").
Ruskin v. DaimlerChrysler Servs. N. Am., L.L.C. (In re Adkins), 425 F.3d 296, 302 (6th Cir. Oct. 4, 2005) (Extending Chrysler Financial Corp. v. Nolan (In re Nolan), 232 F.3d 528 (6th Cir. 2000), to postconfirmation repossessions, classification of DaimlerChrysler's claim fixed its secured status and amount, and claim may not be reclassified postconfirmation even though DaimlerChrysler obtained stay relief and sold its collateral. Deficiency claim must be paid as secured. "The Nolan decision was also anchored on the provisions of section 1325(a)(5)(B), holding that this provision 'mandates that a secured claim is fixed in amount and status and must be paid in full once it has been allowed.'" Quoting Nolan, 232 F.3d at 533.).
Ruehle v. Educational Credit Mgmt. Corp. (In re Ruehle), 412 F.3d 679, 683-84 (6th Cir. June 23, 2005) ("This case, unlike [Andersen v. UNIPAC-NEBHELP (In re Andersen), 179 F.3d 1253 (10th Cir. 1999),] and [Great Lakes Higher Education Corp. v. Pardee (In re Pardee), 193 F.3d 1083 (9th Cir. 1999)], fails to reflect that the original creditor or its successor, Educational Credit, had reasonable notice of the proposed plan or an opportunity to be heard prior to the confirmation. . . . [E]ven the Ninth and Tenth Circuits appear to be backing away from, at least narrowly cabining, their holdings in Pardee and Andersen. . . . [Educational Credit Mgmt. Corp. v. Repp (In re Repp), 307 B.R. 14 (B.A.P. 9th Cir. 2004),] explicitly agreed with the Fourth Circuit's Banks analysis and joined 'an emerging consensus' that an illegal 'discharge by declaration' provision violates the creditor's due process. . . . Likewise in Poland v. Education Credit Management Corporation (In re Poland), 382 F.3d 1185, 1189 n.2 (10th Cir. 2004), the Tenth Circuit directly criticized its previous holding in Andersen . . . . We conclude that the decisions in [Banks v. Sallie Mae Servicing Corp. (In re Banks), 299 F.3d 296 (4th Cir. 2002),] and [Hanson v. Educational Credit Management Corp. (In re Hanson), 397 F.3d 482 (7th Cir. 2005),] represent an evolving majority view that a purported 'discharge by declaration' of student loan debt is not only invalid but void and, therefore, subject to being set aside upon a Rule 60(b)(4) motion."), aff'g 307 B.R. 28, 32-34 (B.A.P. 6th Cir. Mar. 17, 2004) (Following Banks v. Sallie Mae Servicing Corp. (In re Banks), 299 F.3d 296 (4th Cir. 2002), and rejecting Andersen v. UNIPAC-NEBHELP (In re Andersen), 179 F.3d 1253 (10th Cir. 1999), and Great Lakes Higher Education Corp. v. Pardee (In re Pardee), 193 F.3d 1083 (9th Cir. 1999), confirmed plan that contained a finding of undue hardship for § 523(a)(8) purposes denied student loan creditor due process; creditor granted Rule 60 relief from the discharge order and from the order of confirmation. "Pursuant to Bankruptcy Rule 4007 and 7001(6) an action to determine dischargeability of a debt must be brought as an adversary proceeding. . . . There is no authority in the Bankruptcy Code or Bankruptcy Rules for including a discharge by declaration provision in the Debtor's plan. . . . [W]e choose to follow the growing trend finding that the student loan lender has been denied due process where a debtor attempts to discharge a student loan through a discharge by declaration provision.").
Salt Creek Valley Bank v. Wellman (In re Wellman), 322 B.R. 298, 301-02 (B.A.P. 6th Cir. Dec. 28, 2004) (Cook, Gregg, Whipple) (Confirmation precludes relief from the stay that is inconsistent with the plan notwithstanding that motion for stay relief was filed before confirmation and decided after confirmation. "[T]he provisions of the Debtors' confirmed plan bound the Bank and pretermitted its motion from relief from stay, absent a post-confirmation default in carrying out the plan. . . . Once a plan is confirmed, it is treated as the exclusive and transcendent relationship between the debtor and the creditor. . . . When a debtor and creditor have been bound to a confirmed plan, an action by the creditor seeking relief that is incompatible with the plan is properly overruled.").
Kentucky
Eastern District of Kentucky
In re Ridings, No. 11-61253, 2015 WL 9434769 (Bankr. E.D. Ky. Dec. 22, 2015) (Schaaf) (Citing Chrysler Financial Corp. v. Nolan (In re Nolan), 232 F.3d 528 (6th Cir. Oct. 24, 2000) (Krupansky, Norris, Suhrheinrich), when IRS filed secured proof of claim for $199,000 before confirmation and confirmed plan required payment of allowed secured claims in full, debtor cannot modify plan after confirmation or object to claim based on argument that value of property only secures IRS for $160,000. Debtor should have sought valuation before confirmation and should have objected to trustee's notice of claims allowance that listed IRS with secured claim of $199,000.).
In re Granville, No. 13-51923, 2014 WL 1347039 (Bankr. E.D. Ky. Apr. 4, 2014) (Wise) (Postconfirmation tort committed against debtor that resulted in destruction of vehicle was property of estate under § 1306(a); insurance proceeds were property of the estate.).
In re Kelley, No. 11-51197, 2012 WL 5457331, at *3-*4 (Bankr. E.D. Ky. Nov. 8, 2012) (Wise) (Confirmed plan can modify interest rate of car lender notwithstanding hanging sentence in § 1325(a), but car lender retains its lien until payment in full consistent with nonbankruptcy law or discharge. When car is destroyed after confirmation and insurance company tenders proceeds in excess of amount necessary to pay allowed claim in full with interest calculated at rate in confirmed plan, lender retains lien to secure interest rate differential. "[W]hile the Plan did not modify the claim of Tidewater based on the value of the vehicle, it did alter the interest rate to be paid on the claim from the contract rate of 20.95% to 4.25%. Such alteration of interest rates on 910-claims is permissible. . . . Tidewater retains its lien in the surplus insurance proceeds pending the Debtor's performance under the confirmed plan and entry of her discharge. . . . [T]he Debtor may not use the surplus insurance proceeds unless she offers Tidewater adequate protection.").
In re Kelley, No. 11-51197, 2012 WL 5457331 (Bankr. E.D. Ky. Nov. 8, 2012) (Wise) (At destruction of car after confirmation, lienholder's interest in insurance proceeds is limited to balance of its allowed secured claim with interest at rate in confirmed plan notwithstanding hanging sentence at the end of § 1325(a); lienholder retains lien in excess insurance proceeds—to be held by debtor's counsel—until discharge or payment in full consistent with nonbankruptcy law.).
In re Kelley, No. 11-51197, 2012 WL 5457331 (Bankr. E.D. Ky. Nov. 8, 2012) (Wise) (At destruction of car after confirmation, lienholder's interest in insurance proceeds is limited to balance of its allowed secured claim with interest calculated at rate in confirmed plan; lienholder retains lien in excess insurance proceeds—to be held by debtor's counsel—until discharge or payment in full consistent with nonbankruptcy law.).
In re Blackaby, No. 05-10755, 2006 WL 3885134 (Bankr. E.D. Ky. Sept. 21, 2006) (unpublished) (Scott) (Res judicata effect given to confirmed plan that treated Countrywide as wholly unsecured. Creditor's own records showed notice of filing before bar date for timely proofs of claims, and Countrywide also received notice of the debtor's amended plan in time to object. Notices were mailed to post office box in California, and Countrywide's affidavit stated that using that post office box address (apparently the payment address) "added an additional layer of review" and delay.). Accord In re Brown, No. 05-50975, 2006 WL 3885126 (Bankr. E.D. Ky. Feb. 2, 2006) (unpublished) (Howard) (same findings and conclusions with different creditor, CitiCorp Trust Bank); In re Crady, No. 05-54401, 2006 WL 3876503 (Bankr. E.D. Ky. July 14, 2006) (unpublished) (Scott) (same findings and conclusions with different creditor, U.S. Bank).).
Western District of Kentucky
Green Tree Servicing, LLC v. Mann (In re Mann), No. 3:07-CV-549-S, 2008 WL 793632 (W.D. Ky. Mar. 24, 2008) (Simpson) (Insurance proceeds from postconfirmation loss of debtors' mobile home contractually belong to mortgagee. Debtors attempted to recover insurance proceeds to replace mobile home. Contract provided that insurance could be used only to restore or repair home to extent economically feasible. Home had been declared total loss. Replacement did not fall within repair or restoration.).
Ray v. Branch Banking & Trust Co., No. 1:07-CV-00103, 2007 WL 3071521 (W.D. Ky. Oct. 19, 2007) (unpublished) (McKinley) (Section 1327(a) does not supersede agreed order granting prospective stay relief in prior case, notwithstanding mortgagee's failure to object to confirmation in current case.).
Owens v. Coffey (In re Coffey), No. 17-3040, 2018 WL 1162535 (Bankr. W.D. Ky. Mar. 1, 2018) (Stout) (Distinguishing United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), confirmation of Chapter 13 plan was not preclusive of dischargeability complaint under § 523(a)(2)(A) because plan said nothing about discharge of former fiancé’s debt and plan did not provide notice that dischargeability of fraud claim was at issue.).
In re Lane, No. 17-32237(1)(13), 2018 WL 718403 (Bankr. W.D. Ky. Feb. 5, 2018) (Lloyd) (Motion to dismiss with prejudice filed after confirmation that raises same issues decided against creditor at confirmation is precluded by confirmation order. Issues of feasibility and good faith could have been raised and litigated at confirmation but weren’t; finality of confirmation order can’t be avoided by filing a motion to dismiss.).
Hazelwood v. Fifth Third Bank (In re Hazelwood), 513 B.R. 323, 331 (Bankr. W.D. Ky. July 15, 2014) (Stout) (Creditor bound by modified plan that authorized debtors to pursue lien avoidance under § 544 when creditor failed to object to postconfirmation modification that reclassified claim from secured to unsecured if debtor successfully avoided lien. "[I]f a motion to modify a confirmed plan is filed, noticed for objection, and no objections are received, the modification is effective as the plan. . . . By electing not to object to this language, [creditor] is bound to it by § 1327(a) and [United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (2010)] . . . . [T]his is not a § 1329(a) modification case, but rather a § 1327(a) case. The time to dispute the Plaintiffs' modification was [when the motion to modify was filed].").
Hazelwood v. Fifth Third Bank (In re Hazelwood), 513 B.R. 323, 331 (Bankr. W.D. Ky. July 15, 2014) (Stout) (Creditor bound by modified plan that authorized debtors to pursue lien avoidance under § 544 when creditor failed to object to postconfirmation modification that reclassified claim from secured to unsecured if debtor successfully avoided lien. "[I]f a motion to modify a confirmed plan is filed, noticed for objection, and no objections are received, the modification is effective as the plan. . . . By electing not to object to this language, [creditor] is bound to it by § 1327(a) and [United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (2010)] . . . . [T]his is not a § 1329(a) modification case, but rather a § 1327(a) case. The time to dispute the Plaintiffs' modification was [when the motion to modify was filed].").
In re Scott, No. 09-12198(1)(13), 2010 WL 4809340 (Bankr. W.D. Ky. Nov. 19, 2010) (Lloyd) (Mobile home lender was bound by confirmed plan that bifurcated claim. Creditor had notice of plan and did not attempt to object until two years after confirmation. Motion to vacate confirmation was denied.).
In re Ray, 337 B.R. 597 (Bankr. W.D. Ky. Feb. 14, 2006) (Cooper) (Although confirmed plan fixed value of vehicle, Regional Acceptance had not filed an objection, reasonably relying upon higher valuation established by court-appointed appraiser; therefore, cause existed to grant Regional's motion to amend confirmation order to increase value from $10,000 to $14,175.).
Michigan
Eastern District of Michigan
Capital One Auto Fin. Inc. v. Bolden (In re Bolden), No. 12-14979, 2013 WL 3897048 (E.D. Mich. July 29, 2013) (Roberts) (Car lender failing to object to confirmation was bound by confirmed plan that reduced principal to fair market value of car and reduced interest rate by 10%. Car lender was obligated to release lien upon completion of payments under plan.).
Michigan Dep't of Treasury v. Senczyszyn (In re Senczyszyn), 444 B.R. 750 (E.D. Mich. Feb. 11, 2011) (Cleland), aff'g on other grounds 426 B.R. 250, 253 (Bankr. E.D. Mich. Apr. 7, 2010) (Shefferly) (Confirmed plan that provided $1,900 for State of Michigan's priority claim for income taxes did not preclude State from objecting to proof of claim filed by debtors after deadline for governmental claims when model plan in district provided that proofs of claim at variance with plan provisions supersede the plan. "The model plan that is widely used in this district, and used by the Debtors in this case, provides that proofs of claim filed at variance with the plan supersede the plan. As a result, issues regarding the allowance or disallowance of claims are routinely addressed post-confirmation in the claims allowance process that the Bankruptcy Code expressly and specifically creates.").
Ausilio v. United States (In re Ausilio), No. 08-12988, 2010 WL 55507 (E.D. Mich. Jan. 6, 2010) (Zatkoff) (Confirmed plan in dismissed Chapter 13 case that contained handwritten notation that secured claim of IRS would be paid zero and survive discharge had no preclusive effect in subsequent Chapter 11 case.).
Lewis v. Countrywide Home Loans (In re Lewis), No. 09-11093, 2009 WL 2777005 (E.D. Mich. Aug. 27, 2009) (Roberts) (Complaint alleging violations of TILA, RESPA and HOEPA was barred by res judicata effect of confirmed plan which listed Countrywide as creditor and included postconfirmation agreement to surrender property to Countrywide.).
Flint v. Bekofske (In re McGee), 414 B.R. 132 (E.D. Mich. Mar. 18, 2009) (Duggan) (City is bound by confirmed plan that classifies its claim as wholly unsecured notwithstanding inconsistent filed proof of claim. "Absent an objection to the claim, the City's proof of claim only provided prima facie evidence of the amount of its claim and the validity of the claim[.]" City was properly served with copy of plan and had opportunity to object to confirmation.).
Ford Motor Credit Co. v. Estate of Benn, 362 B.R. 1 (E.D. Mich. Jan. 25, 2007) (Taylor) (Confirmation bound Ford Motor Credit, when plans provided assumption of lease and direct lease payments from debtors. Since the leases were never of benefit to the bankruptcy estates, Ford was not entitled to administrative expense claims when debtors defaulted after confirmation.).
In re Marcola, No. 07-23438-dob, 2011 WL 7789569 (Bankr. E.D. Mich. Apr. 22, 2011) (Opperman) (IRS permitted to set off prepetition tax refunds against prepetition debts but not permitted to offset postpetition tax refunds against prepetition debt, without first obtaining stay relief.).
Charlick v. Community Choice Credit Union (In re Charlick), 444 B.R. 762 (Bankr. E.D. Mich. Mar. 4, 2011) (Shapero) (Debtors were bound by value and classification of junior lienholder in confirmed plan and could not later relitigate value of property in attempt to strip off lien.).
In re White, 370 B.R. 713, 718 (Bankr. E.D. Mich. July 3, 2007) (Tucker) (When confirmed plan assumed car lease and required debtor to make payments directly to lessor, and property of the estate vested in debtor at confirmation, excess mileage and other charges at end of lease are owed directly by debtor and are not administrative expenses, citing City of Covington v. Covington Landing Ltd. Partnership, 71 F.3d 1221, 1226 (6th Cir. Dec. 22, 1995) (Merritt, Kennedy, Joiner). "Class Three of the Plan did not designate and treat Ford's claim under the assumed Lease as an administrative expense claim. . . . [A]ny claim Ford may have for sums due under the assumed Lease is to be treated as is provided in Class Three. That treatment is that such sums are to be paid directly by Debtors, not by the Chapter 13 Trustee.").
Hearn v. Bank of N.Y. (In re Hearn), 337 B.R. 603, 611 (Bankr. E.D. Mich. Feb. 3, 2006) (Shefferly) (Confirmed plan binds defendants to debtor's standing to bring avoidance actions. Distinguishing Ruehle v. Educational Credit Management Corp. (In re Ruehle), 412 F.3d 679 (6th Cir. June 23, 2005) (Daughtrey, Gibbons, Sargus), reservation of standing in plan is not due process violation and is not illegal. Plan provision that classified mortgagee as secured creditor was not preclusive because plan specifically contemplated avoidance action. "[T]he filing of this adversary proceeding was explicitly contemplated by and disclosed in the Debtor's modified plan. Section 1327(a) does not bar the Debtor from bringing this action.").
In re Grice, 319 B.R. 141, 146 (Bankr. E.D. Mich. Dec. 27, 2004) (Because plan provided that all property of the estate vested in the debtor at confirmation, at hardship discharge, bankruptcy court rejects trustee's argument that actual income in excess of projected disposable income should have been paid into the plan. "The Court rejects the contention that the Debtor has somehow misappropriated property of the estate. The Debtor's plan . . . provides that, under § 1327(b) of the Bankruptcy Code, all property of the estate vested in the Debtor upon confirmation. . . . The Debtor's income only became property of the estate to the extent that the income was projected disposable income. . . . The additional income, which was not projected as of confirmation, never became projected disposable income and remained vested in the Debtor. Neither the Code nor the confirmed plan obligated the Debtor in this case to pay the additional income to the Trustee. Therefore, her failure to do so does not evidence a lack of good faith or improper conduct that prevents a hardship discharge.").
Western District of Michigan
Ujlaky v. Ujlaky (In re Ujlaky), Nos. 98-03626, 1:01-CV-359, 2001 WL 36088108 (W.D. Mich. Nov. 14, 2001) (Quist) (Because estate vested in joint debtors at confirmation, postconfirmation divorce decree that divided property and allocated Chapter 13 plan payments did not implicate stay and did not impact property of bankruptcy estate.).
In re Carouthers, 449 B.R. 752 (Bankr. W.D. Mich. May 27, 2011) (Dales) (Applying United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), when confirmed plan treated unperfected security interest in vehicle as unsecured claim, credit union received constitutionally sufficient notice that its interest was in jeopardy and enforcement of confirmed plan did not offend due process. Security interest did not pass through bankruptcy unaffected because confirmed plan treated it as unsecured.).
In re Carouthers, 449 B.R. 752, 757 (Bankr. W.D. Mich. May 27, 2011) (Dales) (Confirmed plan that treated credit union as unsecured provided for credit union's claim. Debtors listed credit union as unsecured creditor in Schedule F, and plan did not preserve alleged security interest. "Under recognized canons of statutory construction, it is impossible to hold that the Debtors' Plan 'provided for' the Credit Union's in personam rights and discharged its claim pursuant to § 1328(a) simply by making a categorical reference to 'unsecured creditors' yet find that the Plan failed to 'provide for' the Credit Union's claim for purposes of extinguishing its lien. . . . Given the nearly identical language in Sections 1328(a) and 1327(c), the court concludes that the Debtors' Plan 'provided for' both components of the Credit Union's claim, in personam and in rem—contrary to Fed. R. Bankr. P. 7001(2)—but provided for the Credit Union's claim nevertheless." Applying United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), credit union received constitutionally sufficient due process notice of plan that did not preserve its unperfected lien.).
In re Peckens-Schmitt, No. DK 10-04164, 2010 WL 2851520 (Bankr. W.D. Mich. July 16, 2010) (unpublished) (Dales) (Exercising independent duty of bankruptcy judge under United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), plan that would avoid unperfected mortgage cannot be confirmed because Bankruptcy Rule 7001 requires an adversary proceeding.).
In re Peckens-Schmitt, No. DK 10-04164, 2010 WL 2851520 (Bankr. W.D. Mich. July 16, 2010) (unpublished) (Dales) (Exercising independent duty of bankruptcy judge under United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), plan that would avoid unrecorded mortgage cannot be confirmed—notwithstanding lack of objection—because Bankruptcy Rule 7001(2) requires adversary proceeding to determine validity of lien.).
In re Robinson, 427 B.R. 412, 414 (Bankr. W.D. Mich. Apr. 16, 2010) (Dales) (Because confirmed plan did not overcome vesting effect of confirmation under § 1327(b), car vested in debtor at confirmation and ceased to be protected by automatic stay under § 362(c)(1) without regard to whether stay that expired 30 days after petition under § 362(c)(3) was stay with respect to property of the estate or property of the debtor or both. "The court has interpreted 11 U.S.C. § 362(c)(3)(A) as drawing a distinction between actions against the debtor or property of the debtor, on the one hand, and actions against property of the estate, on the other. . . . This interpretation of § 362(c)(3)(A), however, does not help the Debtor in this case because, under the Plan, the Car is no longer property of the estate and therefore no longer protected by the automatic stay. See 11 U.S.C. § 362(c)(1) . . . . Because the Debtor did not timely move to extend the automatic stay in accordance with 11 U.S.C. § 362(c)(3)(B), the stay terminated with respect to the Debtor and property of the Debtor. . . . [A]t confirmation, in accordance with the vesting language of the Plan and 11 U.S.C. § 1327, the Car again became property of the Debtor, and lost the protection of the automatic stay under 11 U.S.C. § 362(c)(1).").
In re Brown, 375 B.R. 362 (Bankr. W.D. Mich. Sept. 5, 2007) (One effect of vesting of property in debtor at confirmation under § 1327(b) is to remove property from estate for purposes of exemption; when debtor's residence was removed from Chapter 13 estate at confirmation by § 1327(b), subsequent conversion to Chapter 7 gave rise to new opportunity for Chapter 7 trustee to object to exemptions but because residence was no longer property of the estate, objection was meaningless.).
In re Van Stelle, 354 B.R. 157, 172-73 (Bankr. W.D. Mich. Oct. 4, 2006) (Insurance proceeds from destruction of car vested in debtor by exemption under § 522(l) or at confirmation under § 1327(b), and § 363(b) does not force lienholder to allow use of insurance proceeds to purchase replacement collateral. "Section 1327(b) and Section 1306(a) are reconcilable. . . . [P]roperty that had become property of the estate in a Chapter 13 proceeding either by operation of Section 541 or Section 1306 prior to confirmation will again become the debtor's property upon confirmation by operation of Section 1327(b) unless the plan or confirmation order provides otherwise. However, the bankruptcy estate will continue regardless of whether it is depleted of property at confirmation so that it will be available to serve as a receptacle under Section 1306 for debtor's post-confirmation acquisition of property.").
In re Van Stelle, 354 B.R. 157, 172-73 (Bankr. W.D. Mich. Oct. 4, 2006) (Insurance proceeds from destruction of car vested in debtor by exemption under § 522(l) or at confirmation under § 1327(b), and debtor cannot use § 363(b) to force lienholder to accept substitute collateral. Plan bifurcated car claim into secured claim for $9,000 and unsecured claim for balance. Between petition and confirmation, car was destroyed and insurance company tendered $10,763 payable jointly to debtors and lienholder. After confirmation, debtor moved to use insurance proceeds to replace car. Plan provided that property of estate vested in debtor at confirmation. "Section 1327(b) and Section 1306(a) are reconcilable. . . . [P]roperty that had become property of the estate in a Chapter 13 proceeding either by operation of Section 541 or Section 1306 prior to confirmation will again become the debtor's property upon confirmation by operation of Section 1327(b) unless the plan or confirmation order provides otherwise. However, the bankruptcy estate will continue regardless of whether it is depleted of property at confirmation so that it will be available to serve as a receptacle under Section 1306 for debtor's post-confirmation acquisition of property. . . . Debtors' interest in the insurance proceeds is no longer property of the estate. Either that interest passed to Debtors by operation of Section 522(l) when Ms. Van Stelle claimed the Malibu as exempt without objection or it passed to Debtors by operation of Section 1327(b) when their plan was confirmed. . . . Debtors have correctly cited Section 363(b) and (e) . . . . However, those sections are not applicable in this instance because they apply only with respect to property interests held by the bankruptcy estate and the . . . insurance claim . . . is no longer property of the bankruptcy estate by operation of either Section 522(l) or Section 1327(b).").
In re Stiller, 323 B.R. 199, 205-15 & n.23 (Bankr. W.D. Mich. Apr. 4, 2005) (Hughes) (Distinguishing Fireman's Fund Mortgage Corp. v. Hobdy (In re Hobdy), 130 B.R. 318 (B.A.P. 9th Cir. Aug. 23, 1991) (Volinn, Perris, Jones), Fleet Real Estate Funding Corp. v. Fewell (In re Fewell), 164 B.R. 153 (Bankr. D. Colo. Jan. 14, 1993) (Brooks), and Universal American Mortgage Co. v. Bateman (In re Bateman), 331 F.3d 821 (11th Cir. May 22, 2003) (Birch, Dubina, Kravitch), $4,000 arrearage amount stated specifically in confirmed plan was binding on mortgage holder notwithstanding proof of claim filed eight days after confirmation asserting arrearage of $10,510.23. "A confirmed plan is res judicata with respect to the provisions of that plan. . . . U.S. Bank is bound by the terms of the Debtors' confirmed plan concerning the Section 1322(b)(5) cure of U.S. Bank's arrearage. . . . [W]hile it may be customary for parties, practitioners, and even the courts to speak of a home mortgage arrearage as a 'claim' that must be paid by the debtor as part of his Chapter 13 plan, it is not a claim as that term is used in the context of claims allowance under Section 502. A lender's claim for purposes of Section 502 is the amount owed to that creditor under the terms of the lending agreement as of the date of the debtor's bankruptcy petition. . . . [T]he cure of a home mortgage lender's arrearage under Section 1322(b)(5) is a confirmation issue, not a claims allowance issue. The amount of the arrearage and the time within which it is to be cured has everything to do with whether the debtor's plan can meet the confirmation standard of Section 1325(a)(1) with respect to the debtor's proposed treatment of the home mortgage lender and nothing to do with the amount of the home mortgage lender's Section 502 claim (i.e., (1) unpaid principal balance, plus (2) secured but unpaid interest, plus (3) other unpaid charges). . . . [T]he July 14 plan unequivocally states that the amount of the arrearage to U.S. Bank for purposes of Section 1322(b)(5) is $4,000.00. U.S. Bank had an opportunity to object . . . . I have no choice but to enforce the confirmed plan as written. . . . U.S. Bank is at fault for the predicament in which it now finds itself. . . . U.S. Bank is barred under the plan from enforcing its rights under its loan contract and mortgage so long as Debtors comply with the Section 1322(b)(5) cure provisions included in that plan. However, the amount of U.S. Bank's claim against Debtors remains unaffected. While U.S. Bank's failure to object to Debtors' plan may delay recovery of the amount it is owed by Debtors under their contract, the fact remains that Debtors still owe U.S. Bank the full amount due under their loan agreement with U.S. Bank." In a footnote, "[t]he practical effect of Debtors' apparent understatement of U.S. Bank's arrearage in their plan is to create a 'balloon' that must be accounted for at the conclusion of the promissory note's term. While such a balloon might be inconsistent with the original terms of the promissory note, it is nonetheless a permissible modification because of the Section 1322(b)(5) exception.").
Ohio
Northern District of Ohio
United States v. Harchar, 371 B.R. 154, 268, 265 (N.D. Ohio June 6, 2007) (Gaughan) (Follows "growing majority of other courts to address the issue that property acquired after confirmation of the chapter 13 plan is property of the estate"; this approach "harmonizes Sections 1327 and 1306 by giving effect to the requirement that property continues to enter the estate until the case is closed, dismissed or converted," citing Barbosa v. Soloman, 235 F.3d 31 (1st Cir. 2000).).
In re Jeffers, 572 B.R. 681, 685-86 (Bankr. N.D. Ohio June 30, 2017) (Koschik) (Confirmation of plan that was silent with respect to ex-spouse is irrelevant to ex-spouse’s right to relief from stay to seek a QDRO when domestic relations court awarded ex-spouse an interest in the debtor’s retirement account before the Chapter 13 petition. Citing McCafferty v. McCafferty (In re McCafferty), 96 F.3d 192 (6th Cir. Sept. 18, 1996) (Lively, Kennedy, Siler), “the prepetition divorce decree created a separate property interest in the assets in the person of the nondebtor ex-spouse, and the nondebtor ex-spouse’s equitable interest in the assets, by operation of 11 U.S.C. § 541(d), simply never became property of the bankruptcy estate. . . . [A] chapter 13 plan cannot simply identify property that is not property of the estate, provide that such property shall vest in the debtor upon confirmation, and rely on a lack of objections to effectuate that result. . . . [H]er right to those assets was unaffected by the plan or the confirmation order.”).
In re Best, No. 14-30692, 2014 WL 3700698, at *4 (Bankr. N.D. Ohio July 24, 2014) (Whipple) (Confirmed plan that cured default and maintained payments on residential mortgage precluded creditor's objection that prepetition sheriff's sale cut off debtor's rights when creditor did not object to confirmation. "It is true . . . that a debtor may not provide in her Chapter 13 plan for the cure of a default with respect to a lien on the debtor's principal residence if a foreclosure sale has already occurred. . . . However, because no objection to confirmation was made based upon a foreclosure sale having taken place, this provision does not render Debtor's confirmed Plan unenforceable. . . . As a result of confirmation, the issue raised by the Motion is a § 1327(a) issue and not a § 1322(c)(1) issue.").
In re Slade-Lanier, Nos. 12-13436, 13-4328, 2014 WL 2565919 (Bankr. N.D. Ohio June 6, 2014) (unpublished) (Harris) (Citing United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 269, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), tax certificate purchaser was bound by confirmed plan even if plan violated Bankruptcy Code.).
In re Tirone, No. 11-31883, 2012 WL 3249551 (Bankr. N.D. Ohio Aug. 7, 2012) (Whipple) (Chapter 13 plan confirmation process controlled value and interest rate, not postconfirmation proof of claim. Plan was adequately noticed and clearly provided for value and interest rate on vehicle loan.).
In re Loveday, No. 10-64110, 2012 WL 1565479 (Bankr. N.D. Ohio May 2, 2012) (unpublished) (Kendig) (Oil and gas royalties did not vest in debtors at confirmation because scheduling real property did not also schedule oil and gas rights; postconfirmation motion to allow retention of oil and gas royalties is granted when debtors needed money for medical bills, home and car repairs and saving for future expenses.).
In re Loveday, No. 10-64110, 2012 WL 1565479 (Bankr. N.D. Ohio May 2, 2012) (unpublished) (Kendig) (Oil and gas royalties did not vest in debtors at confirmation because scheduling real property did not also schedule oil and gas rights; postconfirmation motion to allow retention of oil and gas royalties is granted when debtors needed money for medical bills, home and car repairs and saving for future expenses. Confirmed plan provided that all scheduled property of the estate vested in the debtor pursuant to § 1327(b), but property "not properly scheduled" did not vest in the debtors. Scheduling the real property itself did not automatically also schedule oil and gas royalties, thus royalties were property of the estate. Trustee objected that royalties were disposable income that must be committed to unsecured creditors. Debtors convinced the court that they needed the royalties for household expenses.).
In re Smith, No. 11-61791, 2012 WL 1122975 (Bankr. N.D. Ohio Apr. 3, 2012) (Kendig) (Confirmed plan providing that stated amount of claim was subject to timely contrary proof of claim was binding; CitiMortgage's timely proof of claim established arrearage and precluded disallowance based on contrary amount in plan.).
In re O'Connor, No. 08-36756, 2012 WL 764438 (Bankr. N.D. Ohio Mar. 7, 2012) (Speer) (City was in contempt of confirmation order when plan provided for payment of water arrearage and City sent billing statements and termination notices after confirmation. Continuous pattern of post-confirmation wrongful billing exposed City to actual damages and reasonable attorney fees, but § 106(a)(3) prohibited punitive damages.).
In re Strauder, No. 10-34733, 2011 WL 4597377 (Bankr. N.D. Ohio Sept. 30, 2011) (Whipple) (At dismissal after confirmation, confirmation order bound debtor and Code required trustee to distribute funds in accordance with plan. Debtor's request for return of funds on hand at dismissal was denied.).
In re Menden, No. 07-33707, 2011 WL 4433621 (Bankr. N.D. Ohio Sept. 21, 2011) (Whipple) (Confirmed plan that surrendered vehicle in full satisfaction should have barred deficiency claim of creditor with adequate notice; when debtors delayed three years to object, deficiency claim would be disallowed going forward, but debtors were not entitled to refund of what creditor already received from trustee.).
In re Menden, No. 07-33707, 2011 WL 4433621 (Bankr. N.D. Ohio Sept. 21, 2011) (Whipple) (Adequate notice of confirmed plan surrendering vehicle in full satisfaction barred deficiency claim going forward; but, when debtors delayed three years objecting to deficiency, debtors were not entitled to refund of disbursements by trustee.).
In re Woods, 406 B.R. 293 (Bankr. N.D. Ohio Apr. 3, 2009) (Speer) (910-day PMSI car creditor was entitled to rely on proof of claim to alert debtor of contest with respect to plan provision for surrender in full satisfaction; creditor did not object to confirmation, but court found ambiguities in plan that would mislead creditor.).
In re Woods, No. 08-32651, 2009 WL 1587359 (Bankr. N.D. Ohio Jan. 30, 2009) (Speer) (Citing Ruehle v. Educational Credit Management Corp. (In re Ruehle), 412 F.3d 679 (6th Cir. 2005), notwithstanding failure to object to confirmation, creditor is entitled to relief from confirmation when plan improperly provided for surrender of 910-day PMSI car in full satisfaction of debt.).
Boday v. Franklin Credit Mgmt. Corp. (In re Boday), 397 B.R. 846, 851 (Bankr. N.D. Ohio Oct. 2, 2008) (Speer) (Binding effect of confirmation required mortgage creditor to split claim under § 1322(b)(5) into prepetition arrearages and ongoing mortgage payments. Confirmed plan "provided that the Defendant was required to adjust its record so as to indicate that all arrearages had been paid, and that the amount due should correspond to the Parties' original amortization schedule." Creditor is ordered to adjust its records to reflect that prepetition arrearages had been paid and debtors have cured prepetition defaults.).
Harchar v. United States (In re Harchar), No. 00-1184, 2006 WL 3196846 (Bankr. N.D. Ohio Oct. 4, 2006) (unpublished) (Morgenstern-Clarren) (Debtors' complaint alleged violation by IRS of terms of confirmed plan, but failed to specify any plan provision violated.).
In re Vargas, 342 B.R. 762 (Bankr. N.D. Ohio Apr. 17, 2006) (Speer) (Applying In re Schultz, 325 B.R. 197 (Bankr. N.D. Ohio 2005), IRS is not per se entitled to relief from stay to set off prepetition tax refund against prepetition tax liability; debtor is entitled to turnover of prepetition tax refund because confirmed plan provides 100% payment of the IRS's prepetition debt.).
In re Perry, 337 B.R. 649, 653-55 (Bankr. N.D. Ohio Dec. 14, 2005) (Confirmed plan did not sufficiently alert creditor that debtor intended to avoid its judgment lien as wholly unsecured. Plan term provided "[s]ecured creditors will retain their liens and will be paid in full to the extent of the value of their collateral . . . in accordance with Section 506, and to the extent that their claims are in excess of the collateral value, they will be treated as unsecured. . . . When seeking to avoid a lien interest, requiring a degree of specificity so as to be 'provided for by the plan' within the meaning of § 1325(a)(5)(B) and § 1327 makes sense. To begin with, liens are a property interest, thereby entitling them to deference. Additionally, a primary function served by a plan is to convey clear and concise information to a creditor as to how the debtor intends to treat its claim; creditors are not . . . expected to guess how their claim will be treated. Thus, while the question still remains open as to the degree of detail which is required to avoid a creditor's lien through a Chapter 13 plan, this much is certain: some specificity is required for a claim to be 'provided for by the plan' for purposes of cramming it down under § 1325(a)(5)(B) or § 1327. This holding also has as its underpinning the United States Constitution. . . . When seeking to avoid a lien, such notice must reasonably appraise [sic] and impart to the lienholder that its interest is being placed at stake; a boilerplate provision would not appear to meet this threshold." Plan did not name or otherwise alert judgment creditor that its lien was being impaired.).
In re Perry, 337 B.R. 649, 653, 655-56 (Bankr. N.D. Ohio Dec. 14, 2005) (Under § 1325 and § 1327(c), confirmation vests property free and clear of liens only if "provided for by the plan"; boilerplate plan term did not provide sufficiently clearly that judgment creditor's lien was avoided as wholly unsecured. Confirmed plan provided for vesting of property of estate in debtor upon confirmation "free and clear of any claim or interest of any creditor provided for by this plan. Secured creditors will retain their liens and will be paid in full to the extent of the value of their collateral . . . in accordance with Section 506, and to the extent that their claims are in excess of the collateral value, they will be treated as unsecured." This term did not name or otherwise alert judgment creditor that its lien was being avoided as unsecured. "For reasons then of statutory implementation, as well as concerns of due process, . . . when a debtor seeks to modify a secured party's rights under § 1322(b)(2), by cramming down their interest under § 1325(a)(5)(B) and § 1327(b)/(c), this intent must be set forth with some particularity in the plan. At a minimum, this should impart to the creditor that its interest is being placed in jeopardy. Although there is no consensus if a further action is then required when seeking cram down in a Chapter 13, the sufficiency of such notice should mention the creditor by name in the plan followed by a description as to the treatment of its claim.").
In re Thaxton, 335 B.R. 372, 374, 375 (Bankr. N.D. Ohio Oct. 27, 2005) (Baxter) (Creditor with a lien on the debtors' primary residence was bound by the terms of a confirmed plan that established its arrearage at $2,590 notwithstanding its timely filed proof of claim for $4,088.56. The debtors' Chapter 13 plan proposed to cure the default on certain unpaid condominium fees to Clareshire scheduled in the amount of $2,590. The plan was confirmed without objection. Subsequent to confirmation, Clareshire filed a proof of claim in the amount of $4,088.56. Debtors objected to the claim. The court found that Clareshire had notice of the terms of the plan and an opportunity to object. "The opportunity to object to the plan is not merely an option to be exercised at the convenience of the creditors. The policy favoring finality of a plan places an obligation on creditors to make a timely objection prior to confirmation. . . . Clareshire cannot excuse or otherwise circumvent its failure to file a timely objection by filing a Proof of Claim for a higher arrearage amount, merely because it may have been entitled to such a recovery had the issue been raised properly. A timely filed proof of claim is not an alternate forum for the creditor to raise objections that were not made before the plan confirmation." Accordingly, Clareshire was barred from recovering an arrearage in an amount greater than the amount provided in the confirmed plan.).
In re Shultz, 325 B.R. 197, 201 (Bankr. N.D. Ohio May 9, 2005) (Speer) (IRS not entitled to relief from stay to set off prepetition refund against prepetition tax liability when confirmed plan provided for payment, in installments, of the IRS debt. "Once a plan is . . . confirmed . . . its provisions are final and binding. . . . [O]nce a plan is confirmed, 'cause' for relief from stay must be based upon post-confirmation circumstances such as a default by the debtor under the terms of the plan. . . . The Debtors' Chapter 13 plan . . . has no provision providing the IRS with an immediate right of set off. Instead . . . the Debtors' plan proposed to pay the IRS in deferred payments. And presently, the Debtors are not in default on this post-confirmation obligation." Court noted that after October 17, 2005, § 362(b)(26) would authorize setoff.).
In re Burner, 321 B.R. 432, 434-36 (Bankr. N.D. Ohio Oct. 4, 2004) (Citing Ruehle v. Education Credit Management Corp. (In re Ruehle), 307 B.R. 28 (B.A.P. 6th Cir. 2004), Chapter 13 debtor cannot invalidate a lien on a car through the confirmed plan or by motion but must instead file an adversary proceeding; res judicata effect of confirmation does not include that liens are avoided, citing Cen-Pen Corp. v. Hanson, 58 F.3d 89 (4th Cir. 1995). "Although this case does not involve a student-loan debt, the exact same principles apply. Pursuant to Bankruptcy Rule 7001, a debtor wishing to avoid a creditor's lien must bring an adversary proceeding; a debtor bears the burden to establish the necessary grounds to invalidate a lien . . . and paragraphs (1) through (9) of § 1322(b) do not provide any independent basis for avoiding a lien. Therefore, just as it was improper for the debtor in In re Ruehle to seek a determination of dischargeability through her plan, it is also improper in this case for the Debtor, as opposed to initiating an adversary proceeding, to seek to avoid the Creditor's lien through a provision placed in his Chapter 13 plan of reorganization." That the lienholder did not file a proof of claim and thus the debtor cannot put the lien at issue through the claims allowance process is a "dilemma" that is "simply the nature of a secured interest in bankruptcy . . . . [N]othing in the Bankruptcy Code or Bankruptcy Rules requires that a secured creditor file a proof of claim . . . . [I]t has been fundamental to bankruptcy jurisprudence that liens and other secured interests in property pass through bankruptcy.").
Southern District of Ohio
Magee v. Weller, No. 3:13-cv-249, 2013 WL 5366092 (S.D. Ohio Sept. 24, 2013) (Black) (Failure to object in writing to valuation in plan bound mortgagee to value of nonresidential properties in appraisals incorporated in plan.).
Magee v. Weller, No. 3:13-cv-249, 2013 WL 5366092 (S.D. Ohio Sept. 24, 2013) (Black) (Cramdown of debt on nonresidential real properties does not violate Fifth Amendment to the U.S. Constitution.).
Simmons v. Federal Home Loan Mortg. Corp. (In re Simmons), 560 B.R. 308 (Bankr. S.D. Ohio Nov. 8, 2016) (Caldwell) (Plan and agreed order preserved debtors’ standing to pursue § 544 avoidance action after confirmation with respect to mortgage recorded in wrong county. “[T]he Plan treated Defendants’ asserted Mortgage as an unsecured claim, subject to the commencement of litigation for this Court to make a final determination. Further, the Plan includes the standard . . . language conferring standing upon the Plaintiffs to pursue such litigation.”).
In re Wolfe, 534 B.R. 158 (Bankr. S.D. Ohio June 19, 2015) (Caldwell) (Equitable lien granted by state court survives plan that vests home in debtors free and clear of liens. Debtors moved into abandoned property and lived there for eight years paying property taxes, insurance, maintenance and improvements. Debtors were entitled to compensation for expenses that benefitted equitable lienholder. Debtors given opportunity to modify plan to finance home.).
Pees v. CitiMortgage, Inc. (In re Crum), 479 B.R. 734 (Bankr. S.D. Ohio Sept. 24, 2012) (Hoffman) (Confirmed plan providing for surrender of mortgaged property to lender precluded trustee from avoiding defective mortgage. Judicial estoppel and res judicata barred avoidance.).
Bennett v. Springleaf Fin. Servs. (In re Bennett), 466 B.R. 422 (Bankr. S.D. Ohio Jan. 12, 2012) (Humphrey) (Junior mortgage creditor was bound by value of residence fixed by confirmation. In compliance with local rule, debtor's appraisal was filed with court, noticed to creditor and incorporated in confirmed plan. Form plan contained conspicuous colored box with bold text advising that plan may modify rights and that confirmation hearing would include valuation under § 506(a) and Bankruptcy Rule 3012. Plan specifically provided that debtor was filing adversary proceeding and/or motion to avoid lien of junior mortgage creditor. Plan notice sufficiently advised creditor that confirmation hearing would serve as valuation hearing for lien-stripping purposes.).
In re Smoak, 461 B.R. 510, 525 (Bankr. S.D. Ohio Sept. 28, 2011) (Humphrey) (Home mortgage creditor with short-term note is bound by modified plan that provided for less than full payment over 10-year amortization at 4.75%. With respect to argument that modified plan was ambiguous: "[I]ssues as to vagueness or ambiguity of a plan must be raised at the confirmation stage. Such issues cannot be raised later after the plan or modification has become binding under Bankruptcy Code §§ 1327 and 1329.").
In re Passavant, 444 B.R. 378 (Bankr. S.D. Ohio Oct. 19, 2010) (Caldwell) (Applying United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), even if provision requiring mortgage creditor to notify trustee and debtors' counsel, by amended proof of claim, of any change in monthly payments violated protection from modification in § 1322(b)(2), creditor with notice of plan was bound by confirmation. Debtor was entitled to order deeming mortgage current upon completion of payments under plan. Creditor waived right to assert arrearage claim when it did not follow confirmed plan. Bankruptcy Rule 7001 did not apply. Motion to deem mortgage current is not request to determine validity, priority or extent of lien. Motion is not proceeding to obtain declaratory judgment and it is not in nature of injunction or other equitable relief. Bankruptcy Rule 7001(7) excludes from adversary proceeding requirement request for relief under Chapter 13 plan.).
In re Miller, 428 B.R. 791, 798 (Bankr. S.D. Ohio May 14, 2010) (Walter) (Order confirming modified plan vacated because motion to modify was not properly served on mortgage creditor—an insured depository institution—as required by Rule 7004(h). Due process had been denied to creditor by confirmation of modified plan that reclassified creditor as unsecured. Under rationale of Chrysler Financial Corp. v. Nolan (In re Nolan), 232 F.3d 528 (6th Cir. Oct. 24, 2000) (Krupansky, Norris, Suhrheinrich), "once a claim has been allowed as a secured claim and treated as such in a debtor's confirmed Chapter 13 plan, a debtor cannot subsequently modify the plan to reclassify the claim as unsecured.").
In re McLemore, 426 B.R. 728, 735 (Bankr. S.D. Ohio Mar. 30, 2010) (Humphrey) (Purchaser of tax certificate was bound by confirmed plan that provided interest rate below state statutory rate when creditor failed to object or raise § 511. Notice of plan was not "qualitatively defective." Plan described treatment of all secured claims, classifying secured claims and clearly providing for prime rate, plus 1.5% risk factor. If tax purchaser thought plan language was ambiguous, it should have objected to confirmation.).
In re McLemore, 426 B.R. 728, 740-41 (Bankr. S.D. Ohio Mar. 30, 2010) (Humphrey) (Payment of property tax claim as secured with interest at prime plus 1.5% risk factor was controlled by plan confirmation rather than claims allowance process; tax claim purchaser filed proof of claim asserting higher statutory interest rate consistent with § 511 but failed to object to unambiguous plan provision for lesser rate. "Tension between the plan confirmation process and the claim allowance process is heightened when a creditor files a proof of claim prior to the plan confirmation hearing, does not object to the treatment of its claim provided by the debtor's plan, and after the plan is confirmed the debtor objects to the creditor's proof of claim. . . .[A]s a general rule, only when the treatment provided in the plan directly contravenes a provision of the Bankruptcy Code or of the Federal Rules of Bankruptcy Procedure have some courts determined that the treatment provided by the plan does not prevail. The filing of a proof of claim which sets forth an interest rate that is different than that provided by the plan does not trump the rate set forth in the plan absent a timely-filed objection to the plan.").
Bivens v. M & I Bank FSB (In re Bivens), No. 08-3361, 2009 WL 9121302, at *6-*7, *8-*10 (Bankr. S.D. Ohio Sept. 30, 2009) (Humphrey) (Valuation of real property in plan did not preclude litigation of value in adversary proceeding to strip off unsecured junior mortgage when plan did not explicitly give creditor notice that value would be determined at confirmation. "[A] provision of a Chapter 13 plan only has preclusive effect if: a) the notice of the plan is satisfactory under the circumstances and does not deny due process . . . and b) the pertinent plan provision is clear and unambiguous . . . . [Citing Green Tree Acceptance, Inc. v. Calvert (In re Calvert), 907 F.2d 1069 (11th Cir. Aug. 1, 1990) (Peckham, Edmondson, Johnson), and Piedmont Trust Bank v. Linkous (In re Linkous), 990 F.2d 160 (4th Cir. Apr. 1, 1993) (Murnagham, Chapman, Young),] if the creditor whose lien was being attacked did not receive specific notice that the confirmation hearing would serve as a § 506(a) or BR 3012 valuation hearing, then the creditor's due process rights had been violated and the confirmation order was not binding on the creditor for lien stripping purposes. . . . 'Mere notice that the bankruptcy court will hold a confirmation hearing on a proposed bankruptcy plan, without inclusion of notice specifically directed at the security valuation process, does not satisfy the requirement of Rule 3012.' . . . '[A] mere possibility that they will consider collateral valuation' is not sufficient to avoid a due process violation." Local model plan language that provided, "'You should read this Plan carefully. Confirmation of this Plan by the Bankruptcy Court may modify your rights by providing for payment of less than the full amount of your claim, by setting the value of the collateral securing your claim, by providing for a treatment of your claim contrary to your current status, and/or by setting the interest rate on your claim. The Court may confirm this case if no objection to confirmation is filed within ten (10) days after the § 341 Meeting of Creditors is concluded' . . . [was] in the vein of the 'mere possibility' language that the Calvert court held was not sufficient and not specific enough to provide adequate notice to the Bank that the confirmation hearing would serve as a valuation hearing under § 506(a) or BR 3012. . . . [T]he value placed in the Plan did not have preclusive effect because the Plan was ambiguous as to whether the confirmation hearing was serving as a valuation hearing and whether the Plan was setting the value of the residence for lien stripping purposes. Because a plan is a contract between a debtor and his creditors, any ambiguity in the terms of the plan must be construed against the debtor. . . . [T]he reference to the value of the Property in the Plan constitutes a simple, bare statement that the Property 'is valued at $42,000' . . . [and] is nothing more than a statement of fact from the Debtors' perspective. . . . [Further,] the provision of the Plan addressing the treatment of the Bank's claim specifically indicated that the Debtors were going to file an adversary proceeding to strip the mortgage lien and would file an objection to any proof of claim filed by the Bank as a 'secured' claim. . . . [T]he confirmation process and confirmation hearing did not serve as a valuation hearing for the Debtors' residence because neither the notice of the confirmation hearing, the language of the Plan, nor any other document served on the Bank provided the Bank with 'a hearing on notice to the holder of the secured claim' as required by BR 3012 and elementary principles of due process.").
In re Parker, 391 B.R. 411 (Bankr. S.D. Ohio July 21, 2008) (Preston) (Although confirmation binds debtor and creditors, plan that treated unperfected mortgage as unsecured debt did not preclude debtor's objection to mortgagee's untimely proof of claim. Mortgagee's theory that confirmation prevented debtor from objecting to tardy proof of claim "would render Rule 3002(c) mere surplusage, in violation of a basic tenet of statutory construction that statutes and rules are to be interpreted in a manner that gives effect to each.").
In re Wells, 378 B.R. 557 (Bankr. S.D. Ohio Nov. 5, 2007) (Hopkins) (Debtor is bound by assumption of car lease in confirmed plan; upon postconfirmation default, lessor is entitled to administrative expense under § 365(g)(2)(A).).
Pees v. DAN Joint Venture II (In re Claar), 368 B.R. 670 (Bankr. S.D. Ohio Apr. 30, 2007) (Hoffman) (Summary judgment is granted on trustee's complaint to value home and strip off second mortgage as wholly unsecured; defendant's objection to use of § 506(d) by trustee is meaningless since debtor's confirmed plan, which treated DAN as unsecured, would have accomplished same result as adversary proceeding.).
In re Murray, 350 B.R. 408 (Bankr. S.D. Ohio Sept. 11, 2006) (Waldron) (MERS is bound by confirmation of plan that cures default and maintains payments notwithstanding that no automatic stay came into effect under § 362(c)(4); although MERS is entitled to an order confirming that no automatic stay is in effect, property remains within exclusive jurisdiction of bankruptcy court under 28 U.S.C. § 1334(e)(1) and any action with respect to property must take place in bankruptcy court where MERS must address binding effect of confirmed plan under § 1327(a).).
In re Murray, 350 B.R. 408 (Bankr. S.D. Ohio Sept. 11, 2006) (Because plan overcame vesting effect in § 1327(b), home remained property of Chapter 13 estate within exclusive jurisdiction of bankruptcy court under 28 U.S.C. § 1334(e)(1) notwithstanding that no automatic stay came into effect under § 362(c)(4).).
Tennessee
Eastern District of Tennessee
Dempsey v. Florida Dep’t of Revenue, No. 1:16-CV-328, 2017 WL 2656154, at *2 (E.D. Tenn. June 20, 2017) (McDonough) (Citing Florida Department of Revenue v. Gonzalez (In re Gonzalez), 832 F.3d 1251 (11th Cir. Aug. 11, 2016) (Jordan, Rosenbaum, Siler), Florida Department of Revenue is bound by confirmed plan to accept payment of child support arrears in the manner provided in the plan and was properly enjoined from issuing wage-withholding orders inconsistent with that plan. Florida was not in contempt because of unsettled nature of law prior to Gonzalez. “The United States Court of Appeals for the Eleventh Circuit . . . [held] that Congress’s changes to the Bankruptcy Code under the BAPCPA did not operate to allow the Department to seek collection of domestic support obligations outside the terms of the debtor’s post-confirmation plan. . . . [T]he bankruptcy court did not err in enjoining the Department from continuing to pursue collection of Dempsey’s child support arrearages outside the terms of his Chapter 13 plan.”).
In re Stokes, No. 06-11296, 2010 WL 3980232, at *2 (Bankr. E.D. Tenn. Oct. 8, 2010) (Cook) (When confirmation order overcame vesting effect in § 1327(b) and state law made property taxes a lien and a personal liability of the property owner on January 1 of each tax year, property taxes for postpetition tax years are administrative expenses under § 503(b)(1)(B)(i), not postpetition claims under § 1305(a)(1). Chapter 13 case was filed on May 3, 2006. Debtor failed to pay real property taxes for tax years 2007, 2008 and 2009. City made request for payment of administrative expenses for unpaid property taxes on July 16, 2010. Confirmed plan provided that property of the estate did not vest in the debtor until completion of the plan. State law provided that real property taxes became a lien and a personal debt of the property owner on January 1 of the tax year. "Upon the filing of the petition, [the] real property became property of the estate . . . . [T]he order confirming the plan in this case 'otherwise provide[s],' stating that '[p]roperty of the estate does not vest in the debtor(s) until completion of the plan.' . . . [T]he Sylvan Drive property became property of the estate on May 3, 2006, and has remained property of the estate continuously thereafter. Because the owner of the property on January 1, 2006, was the prepetition debtor and not the chapter 13 estate, the 2006 taxes were not 'incurred by the estate' and cannot, therefore, constitute an administrative expense. However, because the property belonged to the debtor's chapter 13 estate on January 1 of each of the three succeeding years, the 2007, 2008, and 2009 taxes were 'incurred by the estate.' . . . [Section] 503(b)(1)(B)(i) applies when the tax is 'incurred by the estate' and § 1305(a)(1) applies when the governmental entity 'holds a claim against the debtor.' . . . Hence, so long as the property remains property of the estate, § 503(b)(1)(B)(i) applies and § 1305 does not. . . . Section 1305 would . . . apply, and § 503(b)(1)(B)(i) would not, with respect to real property taxes when the plan or confirmation order does not provide that property of the estate remains property of the estate after confirmation; in that event, any tax becoming a personal liability of the owner of the property after confirmation would be a 'claim against the debtor' because, after confirmation, it would be the debtor, not the bankruptcy estate, that owns the property.").
In re Cox, 381 B.R. 525 (Bankr. E.D. Tenn. Jan. 4, 2008) (Stair) (Debtor is bound by terms of confirmed plan and voluntary dismissal order which provided that trustee would disburse funds on hand in accordance with confirmed plan. Debtor's interest in cause of action pending at time of bankruptcy filing became property of bankruptcy estate, and settlement proceeds were in hands of trustee at time of dismissal.).
In re Jackson, No. 06-10655, 2007 WL 954751 (Bankr. E.D. Tenn. Mar. 29, 2007) (unpublished) (Stinnett) (Finding no lack of due process to pawnbroker that is treated in confirmed plan as secured creditor, Rule 60(b)(4) motion to reconsider confirmation is denied. Pawnbroker's filing of secured proof of claim was an election of remedies and an acceptance of plan's secured treatment even though state law redemption period had expired.).
In re Kitts, No. 06 31215, 2006 WL 3337515 (Bankr. E.D. Tenn. Nov. 16, 2006) (unpublished) (Stair) (In a case after BAPCPA but without regard to hanging sentence in § 1325(a), confirmation of plan that surrendered car "in full satisfaction of the debt" is binding on lienholder and precludes deficiency claim.).
In re Cleveland, 349 B.R. 522, 534 (Bankr. E.D. Tenn. Sept. 20, 2006) (Stair) (Countrywide is bound by confirmed plan that it negotiated for payment "in full" of arrears of $11,285.56 with interest; proof of claim for postpetition property taxes and homeowner's insurance is disallowed. Postpetition advances for escrow payments were an unmatured prepetition debt that will be discharged at completion of payments under confirmed plan. "Countrywide negotiated its own treatment in the Confirmed Plan, and it cannot now seek to revise that treatment because it failed to include an additional amount necessary to satisfy the Debtor's escrow obligation.").
In re Toney, 349 B.R. 516, 519-20 (Bankr. E.D. Tenn. Sept. 7, 2006) (Cook) (Confirmed plan cannot resurrect mortgage that was foreclosed before the petition. Mortgage holder completed foreclosure sale before Chapter 13 petition but did not object to confirmation of plan that purported to cure mortgage defaults. "There is no basis in the law for obtaining property belonging to another through a plan provision. . . . [T]he plan does not expressly reinstate the mortgage, nor does it contain any language resurrecting the debtor's ownership interest or terminating Beneficial's new ownership interest in the property. . . . [T]he plan is wholly insufficient to revive the debtor's terminated interest in the property, reinstate the mortgage, and strip Beneficial of its ownership of the property.").
H. Seventh Circuit
Bartlett v. Fifth Third Bank (In re Bartlett), No. 14-2508, 2015 WL 4257564, at *2-*3 (7th Cir. July 15, 2015) (unpublished) (Manion, Rovner, Hamilton) (Bank not bound by confirmed plan that crammed down mortgage on real property owned by debtors' wholly owned corporation because notice of Chapter 13 case received by bank concerned property owned by the corporation, not by the debtors. Debtors owned a farming corporation that borrowed money from bank. In Chapter 13 case, for reasons "unknown," debtors claimed that they own the property. Plan crammed down mortgage on the farm property. Bank received notice of the bankruptcy but did not participate. The bankruptcy court confirmed the plan. Two years later, bank moved for stay relief claiming that the property was not property of the Chapter 13 estate. "The Bartletts did not have an equitable interest in the property. The property was owned by High-Q Farms. . . . [United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010),] . . . does not apply to Fifth Third because it did not receive adequate notice of the Bartletts' bankruptcy proceeding. Fifth Third received notice of the Bartletts' bankruptcy proceeding concerning the Bartletts' supposed property. But Fifth Third did not possess collateral in the Bartletts' name; it had a mortgage on a property owned by High-Q Farms, a corporation that was not a party to the bankruptcy proceeding. Fifth Third did not receive adequate notice and is therefore not barred from collaterally attacking the judgment of the bankruptcy court for lack of subject matter jurisdiction. . . . [T]he erroneous notice provided in this case did not rise to the level of the 'informal actual notice' that would bind a creditor such as Fifth Third.").
In re Burgess, Nos. 03 C 71, 04-3896, 2005 WL 1772872 (7th Cir. July 27, 2005) (unpublished) (Bauer, Easterbrook, Manion) (Provisions of confirmed plan are binding on debtor and creditors; party challenging confirmed plan must appeal confirmation order or file adversary proceeding to revoke confirmation.).
Illinois
Central District of Illinois
Illinois Dep't of Revenue v. Ayre (In re Ayre), 360 B.R. 880, 884 (C.D. Ill. Jan. 16, 2007) (Scott) (Confirmation without objection bound Illinois Department of Revenue to amount fixed in plan for its priority claim, because plan process litigated the disputed amount; confirmation binds "creditors if the plan provision at issue could have been litigated in the confirmation process." Adair v. Sherman, 230 F.3d 890, 894 (7th Cir. Aug. 25, 2000) (Bauer, Easterbrook, Ripple). Department was properly noticed, filed proof of claim for $104,000, which was disputed in the plan, but then Department did not object to confirmation of plan that proposed to pay the claim in full at $10,500. Confirmation process provided the same due process protections as a separate contested matter. This claims dispute was distinguishable from student loan "discharge by declaration" because no adversary proceeding is required for claim resolution.), aff'g 339 B.R. 684, 688 (Bankr. C.D. Ill. Mar. 27, 2006) (Gorman) (Adequately noticed plan that classified Illinois Department of Revenue claim as priority but disputed and that proposed to pay IDOR $10,500 was binding on IDOR notwithstanding postconfirmation filing of proofs of claim exceeding $100,000. Distinguishing In re Escobedo, 28 F.3d 34 (7th Cir. June 22, 1994) (Flaum, Rovner, Williams), "debtors clearly disclosed the existence of IDOR's potential priority claim on their schedules and included a section in their Chapter 13 Plan to specifically deal with priority claims. . . . The Debtors' Plan is clear and unambiguous in its proposed treatment of IDOR's claims. . . . The proposed treatment does not ignore the mandatory provisions of Section 1322(a)(2) but, rather, seeks to resolve the disputed amount of the claim entitled to priority.").
Illinois Dep't of Revenue v. Ayre (In re Ayre), 360 B.R. 880, 886 (C.D. Ill. Jan. 16, 2007) (Scott) (Due process was satisfied by confirmation without objection, binding Illinois Department of Revenue to amount fixed in plan for its priority claim. "[T]he confirmation process and the claims adjudication process are alternative methods to resolve a disputed claim. Since both result in litigation as contested matters, due process is met through the use of either method." Department was properly noticed, had filed its proof of claim for $104,000, which was disputed in the plan, but then the Department did not object to confirmation of the plan, which proposed to pay the claim in full at $10,500.).
In re Johnson, No. 10-91970, 2011 WL 1884584 (Bankr. C.D. Ill. May 16, 2011) (Fines) (Applying United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), confirmation order bound debtor and voided disclaimer of interest in father's estate when plan was confirmed with understanding that estate proceeds would be turned over to trustee. Disclaimer was executed two days after confirmation.).
In re Stassi, No. 09-71563, 2009 WL 3785570 (Bankr. C.D. Ill. Nov. 12, 2009) (unpublished) (Gorman) (Citing Bankruptcy Rules 9014(b) and 7004(h), although junior lienholder did not object to plan that stripped off its lien, confirmation order must be vacated because notice of plan was not served in same manner as adversary complaint was served.).
In re Erwin, 376 B.R. 897, 902 (Bankr. C.D. Ill. Oct. 1, 2007) (Equal-monthly-installment requirement in § 1325(a)(5)(B)(iii)(I) is binding on debtor and creditors but is not binding on trustee; plan does not violate equal-payment requirement when payments by debtor to trustee will be the same in every month, but because of payment of attorney fees, pro rata distributions to secured creditors will not be exactly equal in every month. "The specific terms of a confirmed plan are binding on the debtor and each creditor, but not on the trustee. 11 U.S.C. § 1327(a). Simply stated, neither the debtor nor any creditor has the right or power to dictate to the Chapter 13 trustee exactly how a claim is to be paid—the trustee determines those details. . . . The TRUSTEE'S argument that the equal payment provision is aimed at debtors, not trustees, is well-founded. . . . Since the equal payment provision was added to Section 1325, not Section 1326, . . . it serves as a restriction on how debtors may propose payments, not as a directive as to how trustees must make payments.").
In re Ayre, 339 B.R. 684, 688 (Bankr. C.D. Ill. Mar. 27, 2006) (Distinguishing In re Escobedo, 28 F.3d 34 (7th Cir. 1994), plan that provided $10,500 for priority claim of Illinois Department of Revenue and that disputed the claim was binding on IDOR when notice was adequate and IDOR failed to object to confirmation, notwithstanding timely proof of claim exceeding $100,000. "Contested matters may be resolved as part of the confirmation process. . . . Objections to claims and the determination of the amount of a claim are contested matters. . . . [D]etermination of the amount of IDOR's claim was properly before the Court as part of the confirmation process. . . . Debtors clearly disclosed the existence of IDOR's potential priority claim on their schedules and included a section in their Chapter 13 Plan to specifically deal with priority claims. . . . The Debtors' Plan is clear and unambiguous . . . . IDOR had an opportunity to object . . . but failed to do so. The proposed treatment does not ignore the mandatory provisions of Section 1322(a)(2) but, rather, seeks to resolve the disputed amount of the claim entitled to priority.").
Northern District of Illinois
Litton Loan Serv'g, L.P. v. Ephraim, No. 07 c 2605, 2008 WL 3849914, at *3 (N.D. Ill. Aug. 14, 2008) (unpublished) (Dow) (Mortgagee that objected to confirmation but failed to appear at confirmation hearing, failed to move for reconsideration and failed to appeal confirmation order is bound by plan that made no payments on mortgage and offset mortgage debt against debtor's claims under Illinois Interest Act. Debtor's lack of success in adversary proceeding against mortgagee does not defeat binding effect of confirmation under § 1327. "[U]nder the terms of the Plan, (i) the underlying debt to Provident was satisfied by an offset against a claim that the Debtor had asserted against Provident under the Illinois Interest Act and (ii) Provident would be required to provide a release of its lien within 30 days of confirmation. The terms of the proposed Plan thus gave Provident advance warning that it would not receive any payment other than the offset against the Debtor's IIA claim." Court rejects mortgagee's argument that plan violated § 1322(b)(2) prohibition against modification and should not have been confirmed. Citing In re Pence, 905 F.2d 1107 (7th Cir. July 13, 1990) (Wood, Coffey, Noland), court concludes collateral attacks on confirmation are barred except as provided by § 1330(a) or by appeal.).
In re Contreras, 571 B.R. 789, 792 (Bankr. N.D. Ill. Aug. 14, 2017) (Schmetterer) (Distinguishing Adair v. Sherman, 230 F.3d 890 (7th Cir. Aug. 25, 2000) (Bauer, Easterbrook, Ripple), plan confirmation does not preclude objection to unsecured claim filed before confirmation when ground for objection is that underlying judgment is dormant and not enforceable. “Although the objection has been filed after the plan had been confirmed, Adair does not apply . . . . [T]his is a unitary proceeding and the filed objection is not a collateral attack. The issue is not precluded[.]”).
In re Clark, 512 B.R. 906 (Bankr. N.D. Ill. July 3, 2014) (Schmetterer) (Lien creditor's failure to object to unsecured treatment under confirmed plan and acceptance of payments judicially estopped creditor to assert secured claim more than four years after discharge in context of action to revive judgment lien.).
In re Brisco, 502 B.R. 212 (Bankr. N.D. Ill. Aug. 20, 2013) (Schmetterer) (Plan provided for claim notwithstanding creditor's failure to file a proof of claim. That creditor would receive no distribution because it did not hold an allowed (secured) claim did not alter effect of plan provision that vested property in debtor free and clear of claims and interests.).
In re Evon, 489 B.R. 88 (Bankr. N.D. Ill. Mar. 21, 2013) (Cassling) (Although applicable commitment period was five years, trustee was bound by "early out" provision of confirmed plan that allowed debtors to complete payments in 29 months by tendering more than the base of $50,000 and by exceeding minimum required unsecured repayment of 20%. Debtors completed plan in 29 months by paying more than $66,000 from net operating losses. Allowed unsecured claims were paid 65%. The confirmed plan provided that income tax refunds would be turned over to the trustee and that the plan could be concluded before the end of 60 months if the debtors paid a base amount of $50,000 and at least 20% to unsecured creditors. Net operating losses permitted the debtors to pay more than $50,000 and that amount paid more than 65% to allowed unsecured claim holders. The court acknowledged a split of authority with respect to whether debtors with CMI greater than applicable median family income must make plan payments for the full five-year applicable commitment period, finding instead that all parties were bound by the confirmed plan, which allowed early completion of payments.).
In re Jones, No. 10 B 04352, 2011 WL 748427 (Bankr. N.D. Ill. Feb. 24, 2011) (Hollis) (Pawnbroker with notice that plan treated debt as secured claim was bound by confirmation and lacked standing to seek postconfirmation modification.).
Malec v. Cook Cnty. Clerk (In re Malec), 442 B.R. 130 (Bankr. N.D. Ill. Jan. 4, 2011) (Cox) (Citing In re Chappell, 984 F.2d 775 (7th Cir. Jan. 14, 1993) (Coffey, Ripple, Eschbach), County was bound by confirmed plan that provided for treatment of modified tax lien; when County received payments on lien provided for in plan, lien was satisfied and did not survive discharge. County violated discharge injunction by continuing to assess interest and penalties and by selling tax lien after discharge.).
In re Grant, 428 B.R. 504 (Bankr. N.D. Ill. May 24, 2010) (Squires) (Debtor was bound by confirmation under § 1327(a) to pay unsecured creditors in full with interest in five years; cause for dismissal when debtor defaulted in payments and could not complete full payment of unsecureds within five years. Debtor not permitted to continue plan payments for 12 to 18 months beyond 60-month maximum period.).
In re Hernandez, No. 08 B 72148, 2009 WL 1024621 (Bankr. N.D. Ill. Apr. 14, 2009) (unpublished) (Barbosa) (Absent postconfirmation default, GMAC was bound by confirmed plan, and any issue not raised at confirmation was waived under Adair v. Sherman, 230 F.3d 890 (7th Cir. Aug. 25, 2000) (Bauer, Easterbrook, Ripple).).
In re Simmons, 379 B.R. 143 (Bankr. N.D. Ill. Aug. 30, 2007) (Sonderby) (Mortgagee is bound by confirmation, which included arrearages based on mortgagee's proof of claim, and mortgagee accepted plan payments for two years; mortgagee is not entitled to relief from the confirmation order to increase arrearages. Distinguishing In re Escobedo, 28 F.3d 34 (7th Cir. June 22, 1994) (Flaum, Rovner, Williams), confirmed plan did not violate mandatory provisions of § 1322(a)(2), when mortgagee participated in confirmation and order of confirmation was entered without objection.).
In re Simmons, 379 B.R. 143 (Bankr. N.D. Ill. Aug. 30, 2007) (Sonderby) (Mortgagee had knowledge of proposed plan and participated in confirmation after filing its proof of claim for arrearages, permitting confirmation to be entered with that arrearage amount and accepting plan payments for two years; mortgagee is precluded from increasing arrearage based on escrow advances that had been made at time of confirmation. Distinguishing In re Escobedo, 28 F.3d 34 (7th Cir. 1994), confirmation was not in violation of § 1322(b) but rather incorporated cure of arrearages under § 1322(b)(5).).
In re Andreas, 373 B.R. 864 (Bankr. N.D. Ill. Aug. 23, 2007) (Revesting of estate upon confirmation does not insulate debtors' attorney from inquiry into collection of excessive fees; court orders attorney to disgorge fees collected in excess of those approved at confirmation.).
In re Barton, 359 B.R. 681 (Bankr. N.D. Ill. Nov. 8, 2006) (Black) (County with adequate notice of plan and of debtors' proof of claim filed on behalf of county is bound by confirmation to payment of property taxes without interest. County enjoined from collecting more than confirmed plan paid.).
In re Turnbull, 350 B.R. 429 (Bankr. N.D. Ill. Aug. 11, 2006) (At destruction of debtors' car after confirmation, car lender gets insurance proceeds and plan is modified to reduce allowed secured claim, but debtor cannot modify plan to pay insurance proceeds to other creditors because only car lender had interest in insurance proceeds.).
McDonald v. Bank Fin. (In re McDonald), 336 B.R. 380, 383, 385 (Bankr. N.D. Ill. Jan. 17, 2006) (Schmetterer) (Mortgagee violated discharge injunction by refusing to reinstate loan and attempting to collect prepetition arrearages when confirmed plan unambiguously and clearly set forth arrearage amount to be paid by trustee "regardless of contrary proofs of claim." Mortgagee filed proof of claim after confirmation. Citing In re Chappell, 984 F.2d 775 (7th Cir. Jan. 14, 1993) (Coffey, Ripple, Eschbach), and distinguishing Universal American Mortgage Co. v. Bateman (In re Bateman), 331 F.3d 821 (11th Cir. May 22, 2003) (Birch, Dubina, Kravitch): "Because there is no dispute that the arrears specified in the Debtor's Plan were paid in full and that the current post-petition mortgage payments were made when due, the . . . loan should have been reinstated upon entry of the Debtor's discharge as the confirmed Plan required.").
In re Forte, 341 B.R. 859, 866 (Bankr. N.D. Ill. Oct. 6, 2005) (Citing Black v. United States Postal Serv. (In re Heath), 115 F.3d 521 (7th Cir. 1997), absent plan provision preserving estate until case is closed, bankruptcy court would lack jurisdiction to consider trustee's motion to modify plan after confirmation to capture proceeds from refinancing of the debtor's home. "The holding in Black is that bankruptcy courts have no jurisdiction to deal with property of the debtor after confirmation. Accordingly, a bankruptcy court has no jurisdiction to entertain a motion by a trustee or creditor under § 1329 seeking to take property acquired by a debtor after confirmation unless the court concludes that the property is property of the bankruptcy estate rather than property of the debtor. . . . The revesting provision in the confirmation order in this case is much more inclusive than that in Black, revesting all of the Debtors' property into the bankruptcy estate. Although the language in Black raises a question whether this inclusive revesting provision is objectionable, to this point its efficacy has not been attacked by any party. . . . [G]iving full effect to the revesting provision in the confirmation order, I conclude that the proceeds of the Debtor's refinancing became property of the bankruptcy estate by operation of that confirmation order. . . . I do have subject matter jurisdiction under Black to decide the Trustee's § 1329 motion.").
In re Drew, 325 B.R. 765 (Bankr. N.D. Ill. June 23, 2005) (Citing Black v. United States Postal Serv. (In re Heath), 115 F.3d 521 (7th Cir. 1997), when debtors refinance real property postconfirmation and realize cash, refinancing proceeds are property of the estate subject to capture by trustee's motion to modify because proceeds were acquired by Debtors for use in making payments under confirmed plans.).
Southern District of Illinois
In re Koger, No. 12-31409, 2013 WL 4666738 (Bankr. S.D. Ill. Aug. 30, 2013) (Altenberger) (Holder of nondischargeable unsecured claim bound by confirmed plan that provided no distribution to unsecured creditors. Nondischargeable claim holder could not challenge plan by postconfirmation request for stay relief.).
In re Hurtte, No. 09-32585, 2012 WL 566869 (Bankr. S.D. Ill. Feb. 21, 2012) (Grandy) (Confirmation of plan bound trustee and precluded objection to amended plan on ground that debtors had not correctly stated disposable income. Trustee had notice of alleged discrepancy in disposable income prior to original confirmation. Res judicata effect of confirmation barred objection to modified plan.).
In re Kirkland, No. 09-40219, 2010 WL 2013451, at *2 (Bankr. S.D. Ill. May 20, 2010) (unpublished) (Altenberger) (Creditor was bound by confirmation of plan that fixed value of collateral; confirmation trumped value on proof of claim filed before confirmation. "The binding effect [of confirmation] extends to any issue actually litigated by the parties and any issue necessarily determined by the confirmation order, including whether the plan complies with Sections 1322 and 1325 of the Bankruptcy Code. . . . Where the debtors value a secured claim in their Chapter 13 plan and the plan is confirmed, with or without the objection of the secured creditor, the creditor is bound by the plan's value notwithstanding that the creditor filed a proof of claim stating a higher value before confirmation that was not objected to.").
In re Curtis, No. 09-41396, 2010 WL 1444851, at *2 (Bankr. S.D. Ill. Apr. 9, 2010) (unpublished) (Altenberger) (Confirmation of plan necessarily included finding that petition was filed in good faith under § 1325(a)(7); confirmation precludes motion to dismiss for bad faith—notwithstanding that motion to dismiss was filed before confirmation of plan—when the movant failed to also object to confirmation. "Pennell raised the good faith issue in her motion to dismiss under § 1307(c) prior to confirmation. However, although she received notice that the Debtor had filed an amended plan, she did not file an objection to confirmation of the amended plan. When the Court confirmed the plan, it necessarily found that the Debtor's petition was filed in good faith, and under § 1327(a), Pennell is now bound by that determination. Accordingly, Pennell's motion to dismiss the Debtor's Chapter 13 case is denied as moot.").
In re Myers, No. 06-32029, 2008 WL 345527, at *1, *3, *4 (Bankr. S.D. Ill. Feb. 6, 2008) (Altenberger) (Reservation of rights to object to proof of claim, when plan accepted amount of arrearage claim of mortgagee, is inconsistent with res judicata effect of confirmation under Adair v. Sherman, 230 F.3d 890, 894 (7th Cir. 2000), which held that "'when a proof of claim is filed prior to confirmation, and the debtor does not object prior to confirmation, the debtor may not file a post-confirmation collateral action that calls into question the proof of claim.'" Plan provided "'Debtor reserves the right to lodge a written objection to any proof of claim filed in this case at any time either before or after confirmation of the plan. Inclusion of a creditor or information regarding a claim does not constitute waiver of the right to object to a Proof of Claim and is not to be deemed an admission.'" Court finds language to be vague, with no specific identification of a creditor or cause of action: "to avoid a defense of res judicata, the reservation of a cause of action must be both express and the claim or cause of action must be specifically identified.").
Lawhon v. United States (In re Lawhon), Nos. 99-42068, 99-42037, 04-4143, 04-4129, 2005 WL 3704221 (Bankr. S.D. Ill. May 19, 2005) (unpublished) (Confirmed plan that provided for prepetition mortgage arrearages but was silent with respect to arrearages or escrow adjustments that might arise after confirmation was not preclusive when debtor completed payments under plan but escrow for taxes was in default.).
Indiana
Northern District of Indiana
Miller v. Laskowski (In re Laskowski), 384 B.R. 518 (Bankr. N.D. Ind. Feb. 27, 2008) (Dees) (Mortgagee is bound by plan term requiring it to notify debtor and/or trustee of changes in escrow payments; res judicata effect of confirmed plan binds mortgagee.).
Yoon v. Krick (In re Krick), 373 B.R. 593 (Bankr. N.D. Ind. Sept. 12, 2007) (Klingeberger) (Confirmation of plan that provided for co-tenancy interest in real estate, which had been conveyed to debtor jointly with her parents, established that at time of confirmation debtor had an interest that became property of estate. Confirmation revested that interest in debtor.).
Yoon v. Krick (In re Krick), 373 B.R. 593, 605 (Bankr. N.D. Ind. Sept. 12, 2007) (Acknowledging four views of § 1327(b), at confirmation bankruptcy estate ceased to exist and all property acquired before or after confirmation became property of debtor; upon conversion to Chapter 7, debtor's postconfirmation transfer of interest in property left nothing in possession or control under § 348(f)(1)(A) that would become property of Chapter 7 estate.).
In re Viney, 369 B.R. 392 (Bankr. N.D. Ind. Apr. 27, 2007) (Grant) (Binding effect of confirmation does not negate need for adversary proceeding when trustee seeks to compel Midland Mortgage to accept payments under confirmed plan. Court construed trustee's motion as seeking injunctive and declaratory relief, requiring adversary proceeding.).
Southern District of Indiana
PNC Bank v. Black, No. 4:10-cv-45-TWP-WGH, 2010 WL 5418898, at *5 (S.D. Ind. Dec. 23, 2010) (unpublished) (Pratt) (Mortgage creditor that was paid in accordance with confirmed plan and the proof of claim it filed cannot collect escrow advances from debtor after completion of plan. If creditor was owed more than proof of claim, it had obligation to inform trustee during bankruptcy case. "PNC argues . . . that the Debtors have been unjustly enriched by its making the escrow disbursements. The bank cites to no authority for the proposition that a debtor in bankruptcy is unjustly enriched when a creditor either does not pursue or is not paid money which it advanced on behalf of the debtor prior to the debtor's discharge. . . . This is a case where a creditor made assumptions which placed its rights at risk and then neglected to follow or even follow-up during the course of the Chapter 13 Plan which yielded several occasions where a prudent creditor would have realized that its assumptions were wrong.").
Renner v. U.S. Bank Nat’l Ass’n (In re Renner), No. 16-50180, 2017 WL 2773526, at *2 (Bankr. S.D. Ind. June 26, 2017) (Carr) (Because confirmation vested property of the estate in the debtor, mortgagee did not violate automatic stay by foreclosing and changing locks on property after confirmation. “[T]he Property was not property of the estate at the time of the alleged acts. Plan confirmation vested the Property in Debtor on July 5, 2011 (which was nearly five years before the alleged acts . . . ). . . . The automatic stay was not in place as to the Property at the time of the alleged acts, so Five Brothers could not have violated it.”).
Moore v. Ocwen Loan Servicing (In re Moore), No. 12-50328, 2013 WL 2028585 (Bankr. S.D. Ind. May 14, 2013) (Moberly) (Confirmed plan that provided full payment of mortgage and arrearage precluded debtor's challenge to assignment and validity of mortgage.).
Taylor v. Chase Home Fin., LLC (In re Taylor), No. 11-50299, 2012 WL 1808858 (Bankr. S.D. Ind. May 17, 2012) (Metz) (Confirmed plan was binding contract between debtor and creditors that survived entry of discharge.).
In re Wright, No. 09-06323-JKC-13, 2010 WL 3522231, at *2-*3 (Bankr. S.D. Ind. Sept. 7, 2010) (Coachys) (Citing United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), confirmed plan was binding that contained language discharging student loan as hardship when creditor did not object and trustee's other objections were resolved; confirmation was not the sort of "mistake" contemplated by Rule 60. Court repeats warning from Espinosa: "[T]he Court wants to make it extremely clear to Debtors and their counsel—and to the consumer bar in general—that it takes an extremely dim view of their inclusion of the Student Loan Provision. Counsel insisted that he included the provision in order to treat 'every claim' in the plan. If that were true, then the plan presumably could have merely stated only that Debtors intended to file an adversary proceeding to seek discharge of their student loan obligation as an undue hardship. . . . Debtors' counsel and the consumer bar are well advised to take heed of [the Espinosa Court's] language and to exercise more care in how they treat student loans within Chapter 13 plans; otherwise they could, and probably should, be looking down the barrel of a Rule 9011 motion for sanctions." Trustee's motion to set aside confirmation order due to mistake was denied, when alleged mistake was not type contemplated by Rule 60(b)(1).).
In re Worland, No. 008-2148-AJM-13, 2009 WL 1707512 (Bankr. S.D. Ind. June 16, 2009) (Metz) (Child Support Division of Marion County Prosecutor's Office did not violate automatic stay by garnishing wages and intercepting tax refund because of exceptions in § 362(b)(2)(C) and (F); however, MCPO was bound by confirmed plan that paid domestic support obligation in full, and postconfirmation collection efforts violated confirmation order. No monetary sanction was appropriate because MCPO immediately returned tax refund and stopped garnishment.).
In re Worland, No. 008-2148-AJM-13, 2009 WL 1707512 (Bankr. S.D. Ind. June 16, 2009) (Metz) (Although wage garnishment and tax refund intercept did not violate stay because of new exceptions in § 362(b)(2)(C) and (F), those acts violated confirmation order when plan provided full payment of domestic support obligation as a priority debt. Child support collection agency was bound by confirmed plan under § 1327(a). No monetary sanction was appropriate because agency immediately returned tax refund and stopped garnishment.).
Wisconsin
Eastern District of Wisconsin
Nissan Motor Acceptance Corp. v. Smith, No. 07 C 0698, 2010 WL 4005056, at *3 (E.D. Wis. Oct. 12, 2010) (unpublished) (Clevert) (Car lender that failed to object to confirmation is bound by bifurcation provision notwithstanding hanging sentence at end of § 1325(a); confirmed plan trumps contrary proof of claim. "Nissan, who received adequate notice of the amended plan, filed no objections. If a secured creditor fails to object to confirmation, it will be bound by the confirmed plan's treatment of its secured claim under § 1325(a)(5) because the failure to object constitutes acceptance of the plan. Shaw v. Aurgroup Financial Credit Union, 552 F.3d 447, 457 (6th Cir. [Jan. 9, 2009) (Boggs, Merritt, Griffin)]. . . . [T]he Seventh Circuit has long held that a party with adequate notice of a bankruptcy proceeding cannot ordinarily attack a confirmed plan. See Matter of Pence, 905 F.2d 1107, 1109 (7th Cir. [June 27, 1990) (Wood, Coffey, Noland)].").
Nissan Motor Acceptance Corp. v. Smith, No. 07 C 0698, 2010 WL 4005056, at *3-*4 (E.D. Wis. Oct. 12, 2010) (unpublished) (Clevert) (Confirmed plan trumps contrary proof of claim; car lender is bound by bifurcation provision of confirmed plan notwithstanding timely filing of contrary proof of claim. "[T]he Seventh Circuit has long held that a party with adequate notice of a bankruptcy proceeding cannot ordinarily attack a confirmed plan. See Matter of Pence, 905 F.2d 1107, 1109 (7th Cir. [June 27, 1990) (Wood, Coffey, Noland)]. . . . The Seventh Circuit held that even assuming a sophisticated creditor did not get notice of a confirmation hearing, that would not avoid the effects of a binding reorganization plan. . . . Nissan, a sophisticated and secured creditor, had adequate notice."), aff'g No. 06-20127, 2007 WL 1544366 (Bankr. E.D. Wis. May 29, 2007) (Pepper) (Making sense of In re Pence, 905 F.2d 1107 (7th Cir. June 27, 1990) (Wood, Coffey, Noland), In re Harvey, 213 F.3d 318 (7th Cir. May 2, 2000) (Kanne, Rovner, Wood), and Adair v. Sherman, 230 F.3d 890 (7th Cir. Aug. 25, 2000) (Bauer, Esterbrook, Ripple), confirmed plan that bifurcated car claim is binding when car lender had notice of content of plan, car lender filed preconfirmation proof of claim and car lender did not timely object to confirmation. "Taken together, the Pence, Harvey and Adair decisions mandate that a creditor who has adequate pre-confirmation notice of how the debtor intends to treat its claim, but does not object to that treatment pre- confirmation, is bound by the terms of the confirmed plan." Court need not reach question whether car acquired for use by debtor's fiancée was acquired for personal use of debtor for purposes of hanging sentence at the end of § 1325(a) because confirmed plan is binding on car lender.).
Patterson v. Homecomings Fin. LLC, 425 B.R. 499, 505, 501 (E.D. Wis. Mar. 24, 2010) (Clevert) (When confirmation order delayed revesting of property in debtors until discharge, conversion or dismissal, complaint stated cause of action for stay violations based on collection of undisclosed charges by mortgage holder at refinancing during Chapter 13 case. "[C]ourt is unpersuaded that money obtained from a mortgage on a homestead does not constitute proceeds of the real property and thus estate property under the bankruptcy court's confirmation order in the Pattersons' case. The funds were generated from the homestead, which at all times was estate property." Complaint for stay violation was actionable under Price v. Rochford, 947 F.2d 829, 830-31 (7th Cir. June 10, 1991) (Cudahy, Coffey, Fairchild), which held that § 362(h) [now (k)] "creates a cause of action which may be enforced even after bankruptcy proceedings have terminated.").
Ruhl v. HSBC Mortgage Servs., Inc., 399 B.R. 49, 60 (E.D. Wis. Dec. 23, 2008) (Adelman) (Debtors are bound by confirmed plan that pays interest on mortgage arrearages; debtors are precluded from arguing that § 1322(e) barred interest. "[N]othing in § 1322(e) forbids a bankruptcy court from confirming a plan in which the debtor proposes to pay more than was is 'necessary' to cure default."), aff'g, 394 B.R. 469 (Bankr. E.D. Wis. Mar. 19, 2008) (Shapiro).).
Phifer v. City of Milwaukee (In re Phifer), 547 B.R. 288, 291 (Bankr. E.D. Wis. Mar. 11, 2016) (Kelley) (At confirmation, § 1327(c) vested residence in debtor free and clear of unsecured portion of undersecured tax lien. Citing In re Penrod, 50 F.3d 459 (7th Cir. Mar. 22, 1995) (Posner, Rovner, Moran), "The City's lien is an interest in property, and this powerful provision [§ 1327(c)] effectively extinguished it, except to the extent that the Debtor's plan retained the lien. . . . [A]fter the Debtor's Chapter 13 discharge stripped the lien, the City had no in rem rights to exercise. . . . [T]he Debtor's plan dealt with the City's lien by stripping or avoiding it to the extent the lien exceeded the value of the Debtor's property.").
In re Moncree, 511 B.R. 922 (Bankr. E.D. Wis. June 27, 2014) (Kelley) (Res judicata effect of confirmed plan bound debtor to value assigned to senior mortgage in plan.).
In re Pugh, 510 B.R. 862, 868 (Bankr. E.D. Wis. May 27, 2014) (McGarity) ("[A] plan cannot force payment of a refund unauthorized by tax law to the debtor while taxes are unpaid." The right to a refund is property of the estate under § 541(a)(7), but the amount is calculated under I.R.C. § 6402. Postpetition tax refund calculated under 26 U.S.C. § 6402(a) provides IRS with a statutory right of setoff that allows it to net postpetition overpayments against prepetition tax liabilities.).
American Family Mut. Ins. Co. v. Reichartz (In re Reichartz), 488 B.R. 620 (Bankr. E.D. Wis. Mar. 19, 2013) (Kelley) (Complaint to determine nondischargeability of postpetition interest was barred by confirmed plan that unambiguously provided for discharge of postpetition interest on judgment arising out of operation of motor vehicle while intoxicated.), rev'd and remanded 498 B.R. 217 (E.D. Wis. Aug. 22, 2013) (Adelman).).
In re Kearney, 439 B.R. 694, 698 (Bankr. E.D. Wis. Dec. 3, 2010) (Kelley) (Modification to reduce plan payments and not pay postconfirmation tax refunds to trustee fails good-faith analysis when debtor misrepresented net income by manipulating expense deductions. "Court is not creating an absolute rule that an above-median income debtor who modifies her plan and decreases the dividend to creditors must contribute tax refunds to establish good faith. Rather, the Court will continue to evaluate good faith on a case by case basis.").
In re Luedtke, No. 02-35082-svk, 2008 WL 2952530, at *6 (Bankr. E.D. Wis. July 31, 2008) (unpublished) (Kelley) (Credit union violated confirmation order by incorrectly reporting to credit reporting agency balance of original loan and continuing delinquency rather than secured amount in confirmed plan; although debtor could have proceeded under Fair Credit Reporting Act, remedy is available for violation of confirmation order. "[T]he Credit Union did violate the confirmation order by its affirmative reports to CRAs. Just as a creditor can violate the discharge injunction for deliberately refusing to submit accurate information, the confirmation order prevents those same actions during the course of a Chapter 13 case. . . . When the Credit Union reports that the Debtor owes amounts according to the original loan, those reports are not accurate, and violate the confirmation order." Because of credit union's good faith belief that it was properly reporting, remedy is for it to cause credit reporting agencies to remove disputed information.).
In re Rither, No. 05-23558, 2008 WL 1780934, at *2 (Bankr. E.D. Wis. Apr. 16, 2008) (unpublished) (McGarity) (Debtor's motion to modify plan to dedicate only one-half of future tax refunds is rejected when it appears debtor had been substantially overwithholding taxes. Although practice in district had been to require debtors to "commit one-half of their income tax refunds to a chapter 13 plan as long as the plan is in effect," intentional overwithholding of taxes raises good-faith issue.).
Case v. Wells Fargo Bank, NA (In re Case), 394 B.R. 469 (Bankr. E.D. Wis. Mar. 19, 2008) (Shapiro) (Debtor is bound by plan provision that paid interest on interest—more than required to cure default under § 1322(e). Citing In re Szostek, 886 F.2d 1405 (3d Cir. Oct. 12, 1989) (Mansmann, Nygaard, Aldisert), § 1322(e) is discretionary plan provision, and "[t]here is nothing illegal about parties agreeing to pay more than what is required under the § 1322(e) formula." Adversary proceedings asserting confirmed plans paid mortgagees more than § 1322(e) would have required, by paying interest on interest, are dismissed. Confirmation binds debtors, citing Adair v. Sherman, 230 F.3d 890 (7th Cir. Aug. 25, 2000) (Bauer, Easterbrook, Ripple): "What persuades this court that res judicata applies is that the challenge to interest on interest payments has been brought by the debtors—the very same parties who proposed such payments in their plans." Court distinguishes In re Escobedo, 28 F.3d 34 (7th Cir. June 22, 1994) (Flaum, Rovner, Williams), which found confirmation to be invalid because of failure to comply with mandatory provision of § 1322(a)(2).).
In re Wetzel, 381 B.R. 247, 253, 254 (Bankr. E.D. Wis. Jan. 29, 2008) (Kelley) (Discussing "three basic interpretations of the tension between §§ 1306(a)(1) and 1327(b)," postconfirmation acquisitions and windfalls—including inheritance in this case—become property of estate. "[O]nly those property interests existing at confirmation revest in the debtor. The estate is not extinguished by confirmation, but rather is comprised of new property acquired by the debtor post-confirmation, whether via inheritance, wages or other means. Under this rule, the Debtors' post-confirmation inheritance and post-confirmation business income is [sic] property of the estate, and is [sic] the proper subject of a plan modification.").
In re Hardin, 375 B.R. 506 (Bankr. E.D. Wis. Sept. 11, 2007) (When confirmation order vested car in debtors, insurance proceeds from destruction of car postconfirmation were payable to Ford only to extent of Ford's secured claim, with excess belonging to debtors.).
In re Hardin, 375 B.R. 506 (Bankr. E.D. Wis. Sept. 11, 2007) (When car was destroyed postconfirmation, insurance proceeds paid by third party's liability carrier were payable to Ford only to extent of Ford's remaining secured claim, with excess payable to debtors. Under UCC in Wisconsin, secured creditor had security interest in proceeds only to extent of its secured claim balance.).
In re Averhart, 372 B.R. 441, 443, 445 (Bankr. E.D. Wis. July 12, 2007) (Shapiro) (Under In re Harvey, 213 F.3d 318, 321 (7th Cir. May 2, 2000) (Kanne, Rovner, Wood), "a party with adequate notice of a bankruptcy proceeding cannot ordinarily attack a confirmed plan"; Wells Fargo Financial is bound by 4.89% interest rate in plan rather than 9.5% asserted in its proof of claim. "Wells Fargo had ample opportunity to object to the proposed interest rate of 4.89% in debtor's plan but failed to do so.").
In re Averhart, 372 B.R. 441, 445 (Bankr. E.D. Wis. July 12, 2007) (Interest rate in confirmed plan trumps conflicting interest rate asserted by creditor in proof of claim. Proposed local rule—which provides that if a proof of claim does not set out an interest rate the rate contained in the plan controls—if interpreted to permit proof of claim interest rates to dominate over confirmed plan, would conflict with law in the district "that confirmed plans control over proofs of claim in the absence of pre-confirmation objections," citing In re Schultz, 363 B.R. 902 (Bankr. E.D. Wis. 2007), and In re Westenberg, 365 B.R. 895 (Bankr. E.D. Wis. 2007).).
In re Smith, No. 06-20127, 2007 WL 1544366 (Bankr. E.D. Wis. May 29, 2007) (unpublished) (Pepper) (Confirmed plan that bifurcated car lender's claim was binding under § 1327(a) when creditor filed proof of claim preconfirmation, creditor had notice of treatment under plan and creditor did not object to confirmation; court need not reach question whether car acquired for use by debtor's fiancé was acquired for "personal use" of debtor for purposes of hanging sentence in § 1325(a) because car lender is bound by failure to object to confirmation.).
In re Westenberg, 365 B.R. 895 (Bankr. E.D. Wis. Mar. 30, 2007) (McGarity) (Plan that included payment of secured claims beyond plan term was accepted by creditors' lack of objection and was binding on trustee; trustee's motion to dismiss denied when debtors complied with plan.).
Western District of Wisconsin
Kolve v. IRS (In re Kolve), 459 B.R. 376, 384 (Bankr. W.D. Wis. Sept. 22, 2011) (Utschig) (Agreeing with California Franchise Tax Board v. Kendall (In re Jones), 657 F.3d 921 (9th Cir. Sept. 14, 2011) (Nelson, McKeown, Gould), three-year look-back in § 507(a)(8) was not tolled during prior Chapter 7 case because revesting of property in debtors at confirmation permitted IRS to attempt collection from debtors. "This revesting meant that the automatic stay—which had previously acted to prevent post-petition creditors from pursuing property of the estate—was no longer 'in effect' as to those assets. The stay never prohibited the IRS from pursuing a collection action against the debtors, and at the time these tax claims came due, the 'stay of proceedings' was in effect (at most) as to only a portion of the debtors' post-confirmation assets.").
In re Carr, 318 B.R. 517, 521 (Bankr. W.D. Wis. Nov. 30, 2004) (Martin) (Citing Rule 60 and In re Escobedo, 28 F.3d 34 (7th Cir. 1994), Wells Fargo is granted relief from confirmation order that bifurcated its claim secured by the debtor's principal residence. Plan confirmed without objection treated Wells Fargo as a partially secured creditor with respect to its non-purchase money mortgage on the debtor's principal residence. Wells Fargo filed a proof of claim to which no objection was filed. Many months later, Wells Fargo moved to vacate the confirmation order. "Set against the putative finality of a confirmation is the statutory presumption of validity of a properly-filed claim. . . . It is the policy of this Court to confirm plans quickly so that creditors get paid quickly. . . . Our policy can work only if the confirmation can be reviewed and the order vacated when the claims actually filed alter the assumptions on which the confirmation was granted.").
I. Eighth Circuit
Burnett v. Burnett (In re Burnett), 646 F.3d 575, 581 (8th Cir. July 20, 2011) (Smith, Beam, Benton) (Citing United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), and Travelers Indemnity Co. v. Bailey, 557 U.S. 137, 129 S. Ct. 2195, 174 L. Ed. 2d 99 (June 18, 2009), confirmed plan that allowed ex-spouse to return to state court after Chapter 13 case only with respect to interest on child support prohibited ex-spouse from seeking interest on prepetition spousal support—notwithstanding that plan would not have been confirmable had ex-spouse objected to this limitation. Prepetition state court order found that debtor owed $57,402.70 for child and spousal support arrears. Issue of interest on prepetition support arrears was interrupted by Chapter 13 petition. Confirmed plan required debtor to pay $300 per month toward the total arrearage claim and reserved to ex-spouse right to litigate interest on child support arrears after discharge. Ex-spouse returned to state court and received judgment that included interest on prepetition spousal support. "[P]ost-confirmation, § 1327(a) affords the confirmed plan res judicata effect and bars Ms. Burnett's attempts in a collateral state-court proceeding to expand her entitlement to relief to include interest on her pre-petition spousal support. . . . The plan explicitly limited Ms. Burnett's privilege to return to family court for the sole purpose of litigating child-support interest. Although the Bankruptcy Code provides that, to be confirmed, a plan must provide for the full payment of accrued interest on child and spousal support, 11 U.S.C. § 101(14A) . . . , a confirmed plan is given res judicata effect even when it violates the Code.").
McCarty v. Jenkins (In re Jenkins), 428 B.R. 845 (B.A.P. 8th Cir. Apr. 26, 2010) (Schermer, Mahoney, Saladino) (Failure to object to modifications that cured postconfirmation mortgage defaults by increasing monthly payments without increasing base amount bound trustee and precluded argument that plan was in material default; internal trustee calculations of base amount that increased each time the plan was modified to increase the monthly payment were not consistent with the plan as actually modified.).
Burnett v. Burnett (In re Burnett), 408 B.R. 233 (B.A.P. 8th Cir. July 7, 2009) (Schermer, Mahoney, Saladino) (Confirmed plan that determined principal amount of alimony and support but reserved allowance of interest until after completion of payments did not preclude former spouse from returning to state court after discharge for calculation and collection of interest.), aff'd in part, rev'd in part and remanded, 646 F.3d 575 (8th Cir. 2011) (Smith, Beam, Benton).).
IRS v. Ealy (In re Ealy), appeal dismissed, 396 B.R. 20 (B.A.P. 8th Cir. Nov. 5, 2008) (Kressel, Schermer, McDonald) (Appeal of denial of stay relief to setoff postpetition tax refund and stimulus payment against postpetition tax liability is moot because IRS paid refund and stimulus payment to debtor and no longer has right of setoff.), dismissing appeal as moot, 392 B.R. 408, 414 (Bankr. E.D. Ark. Aug. 11, 2008) (Taylor) (Although IRS has statutory right to set off postpetition tax refund and economic stimulus payment against postpetition tax claim, effect of confirmation under § 1327 trumps setoff right when confirmed plan provides for payment of IRS claim in full and IRS is adequately protected by performance of plan. "[T]his court acknowledges that nothing in the Code expressly abrogates the IRS's right to set off mutual postpetition obligations. But neither does any provision in the Code prevent such a right from being trumped by § 1327, as is the case with prepetition obligations under § 553. Lacking 'unequivocal language' in the Code declaring that confirmation of a plan does not affect a creditor's postpetition setoff rights, this court holds that § 1327 takes precedence and that the IRS is therefore unable to exercise its postpetition right of setoff absent a sufficient basis for a postconfirmation lifting of the automatic stay.").
Russell v. Transport Funding LLC (In re Russell), 386 B.R. 229, 231-32 (B.A.P. 8th Cir. Apr. 9, 2008) (Kressel, Federman, Venters) (Debtor bound by confirmed plan that provided amount and interest rate for secured creditor and cannot use claim objection filed three and one-half years after confirmation as collateral attack on secured creditor's treatment under the plan. "The binding effect of a confirmed Chapter 13 plan is a basic tenet of bankruptcy law. . . . An unappealed, confirmed plan is res judicata, and its terms are not subject to collateral attack. . . . [O]nce the Debtor's Chapter 13 plan was confirmed, the Debtor was bound by it, and he cannot collaterally attack its terms now that they are no longer advantageous or convenient to him. The Debtor's objection to Transport's claim constitutes an impermissible attack on the confirmation order, and the bankruptcy court correctly overruled the objection.").
Russell v. Transport Funding LLC (In re Russell), 386 B.R. 229, 232 (B.A.P. 8th Cir. Apr. 9, 2008) (Kressel, Federman, Venters) (Debtor is bound by confirmed plan and cannot later object to claim when debtor had objection opportunity preconfirmation. "In summary, once the Debtor's Chapter 13 plan was confirmed, the Debtor was bound by it, and he cannot collaterally attack its terms now that they are no longer advantageous or convenient to him. The Debtor's objection to Transport's claim constitutes an impermissible attack on the confirmation order, and the bankruptcy court correctly overruled the objection.").
Arkansas
Eastern District of Arkansas
Stringfellow v. Federal Nat'l Mortg. Ass'n, No. 1:12-cv-84-DPM, 2014 WL 105019 (E.D. Ark. Jan. 9, 2014) (Marshall) (Confirmed plan that provided for mortgage is res judicata in action five years later to invalidate mortgage. Debtors had ample opportunity to object to claim and through confirmed plan made $40,000 in monthly payments against mortgage.).
United States v. Davis, No. 5:08CV00021 JMM, 2008 WL 1930546, at *2 (E.D. Ark. Apr. 28, 2008) (unpublished) (Moody) (Without discussing § 1327(c), district court limits bankruptcy court order fixing amount of secured claim on debtor's residence; "[b]ecause [under § 1322(b)(2)] defendant cannot reduce the value of plaintiff's claim secured by a mortgage on her residence, the bankruptcy court's order sustaining defendant's objection [to claim] is res judicata only to the amount of the claim allowance, not to the amount of the debt liability.").
In re Wertz, 557 B.R. 695, 705
In re Wells, 536 B.R. 264, 272 (Bankr. E.D. Ark. Aug. 14, 2015) (Jones) (Mortgagee that foreclosed and sold property prepetition was bound as lessor by terms of plan that provided for mortgagee's claim. Creditor's failure to object to plan constituted consent, "thereby creating or, at least[,] acquiescing to, a lease for the term of the plan.' . . . '[S]ince the debtor is, as of the date of the petition, merely a tenant at sufferance, and the confirmed plan essentially provides for rent, the debtor may continue to reside in the residence for the duration of the plan, paying the rent specified in the confirmed plan. The debtor resides on the property not as owner, but as lessee.'").
Western District of Arkansas
Smith v. Rushmore Loan Mgmt. Servs., LLC (In re Smith), 575 B.R. 869, 874
Smith v. Rushmore Loan Mgmt. Servs., LLC (In re Smith), 575 B.R. 869, 874
In re Strzelecki, 509 B.R. 671, 674 (Bankr. W.D. Ark. Apr. 21, 2014) (Barry) (Upon postconfirmation collision with deer, car lender gets insurance proceeds under § 1325(a)(5)(B) notwithstanding that confirmed plan crammed down claim and secured portion had been paid in full. Plan confirmed in 2010 bifurcated AmeriCredit's allowed claim of $15,497 into an allowed secured claim of $6,000 and an unsecured claim for the balance. In late 2013, a deer collided with AmeriCredit's collateral and State Farm Insurance offered $3,960 to cover damage. The debtor moved to use the insurance proceeds to purchase another car. The Chapter 13 trustee argued for distribution to unsecured creditors. AmeriCredit argued that it owned the proceeds based on its lien. Citing § 1325(a)(5)(B), "Congress has now stated unequivocally that the holder of an allowed secured claim will retain the lien securing its allowed secured claim until either (1) the debtor receives a discharge . . . or (2) the underlying debt under nonbankruptcy law has been paid. . . . The 'underlying debt' in this case is the remaining obligation for which AmeriCredit filed its proof of claim . . . $15,497 (less approximately $6620 the trustee has already paid to AmeriCredit). . . . AmeriCredit has retained its lien . . . and is entitled to the insurance proceeds in partial satisfaction of that lien." There is no discussion of cash collateral or adequate protection.).
Iowa
Northern District of Iowa
In re Keller, No. 07-01516, 2012 WL 1918580 (Bankr. N.D. Iowa May 25, 2012) (Kilburg) (Postconfirmation bonus must be paid into plan for benefit of creditors; motion to use bonus for roof replacement denied. Sixty-month plan was three months from completion and proposed expense was excessive.).
In re Wright, 461 B.R. 757, 762-63 (Bankr. N.D. Iowa Dec. 28, 2011) (Kilburg) (Mortgage servicer, American Home Mortgage Servicing, Inc. (AHMSI), violated confirmed plan by failing to notify trustee, debtors and debtors' attorney of changes in mortgage payments. AHMSI also failed to respond to debtors' requests for payment information. AHMSI's conduct was willful, its attitude and conduct indefensible. Debtors awarded actual damages of $10,000, punitive damages of $40,000, plus attorney fees. "AHMSI is prohibited from raising the amounts due by Debtors to AHMSI, either base amount, escrow, or other 'administrative' fees of any kind without motion to this Court and specific approval by this Court of such an increase.").
In re Lynch, 415 B.R. 712 (Bankr. N.D. Iowa Oct. 1, 2009) (Kilburg) (Debtors can retain part of postconfirmation tax refund to repair vehicle but not additional refund for purpose of paying prepetition student debt; University was violating automatic stay by requiring debtor to pay prepetition tuition bill as condition of remaining in school.).
In re Lundeen, No. 05-03980S, 2008 WL 5429714 (Bankr. N.D. Iowa Dec. 12, 2008) (unpublished) (Edmonds) (When debtors breached plan provision requiring turn over of tax refunds to trustee, motion to modify plan to cure defaults is denied; debtors may seek extension of plan to pay trustee refund amounts over time.).
In re White, No. 06-01373, 2007 WL 2413013, at *2 (Bankr. N.D. Iowa Aug. 21, 2007) (Motion to amend confirmed plan should be "recast" as motion to reconsider claims when debtor seeks to delete 28 claims for which she is not obligated. Section 502(j) reconsideration of claims is "an exception to res judicata effect of § 1327 and exists as a separate and independent authority for reducing claims based on the equities of the case. . . . The bankruptcy court may consider a § 502(j) motion at any time, even after a Chapter 13 plan has been confirmed.").
Minnesota
In re Reiser, 569 B.R. 499, 502 (Bankr. D. Minn. June 26, 2017) (Ridgway) (Car lessor is bound by modified confirmed plan that surrendered car subject to assumed lease but did not provide administrative priority for any charges under the contract. Debtor assumed car lease in plan confirmed in 2016. In 2017 plan was modified to surrender the leased car. Lessor did not object. After surrender, lessor moved for an administrative priority for charges generated under the contract for excessive wear, excessive mileage and unpaid payments. “The binding effect of a confirmed chapter 13 plan decides this issue. . . . [T]he debtor’s confirmed plan does not list a claim of CAB West for any amount as one entitled to priority under § 507. . . . CAB West is not entitled to an administrative expense claim under 11 U.S.C. § 503(b)(1)(A). The terms of the confirmed chapter 13 plan bind CAB West.”).
Atkins v. Bank of Am., N.A. (In re Atkins), 497 B.R. 568 (Bankr. D. Minn. Sept. 4, 2013) (Sanberg) (Absent jurisdictional error or violation of due process, under United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (2010), confirmed plan that treated junior lien as unsecured was enforceable.).
In re Bailey, 425 B.R. 825, 827 (Bankr. D. Minn. Mar. 30, 2010) (O'Brien) (Properly noticed modified plan that decreased plan length from 60 months to 36 months was preclusive of subsequent modification to increase plan length back to 60 months. "[T]rustee's proposed modification [to extend term] is simply a collateral attack on the . . . confirmed modified plan that was not objected to and from which no appeal was taken. The doctrine of res judicata bars consideration of the trustee's modified plan.").
Missouri
Western District of Missouri
In re Cotton, No. 11-42420-13-drd, 2015 WL 5601454, at *2-*3 (Bankr. W.D. Mo. Sept. 22, 2015) (Federman) (When insurance proceeds exceed secured portion of bifurcated car claim, insurer gets balance of allowed secured claim and trustee must hold excess under § 1325(a)(5)(B) until debtors become entitled to a discharge. At discharge, remaining proceeds should be paid "in accordance with plan." If dismissal occurs before discharge, remaining proceeds should be paid to car lender. "In contrast to pre-BAPCPA law, '[t]he focus is no longer on the "lien securing such claim", rather, the focus is on the underlying debt under state law.' . . . [S]ince the Debtors here have not yet received a discharge, Toyota must retain its lien . . . . [U]nder the Bankruptcy Code as it existed . . . in 1996, the creditor's secured claim was limited to value under § 506. Thus, the debtor . . . was entitled to the insurance proceeds in excess of the lender's allowed secured claim. . . . But § 1325(a)(5)(B) was subsequently modified to change that result. . . . [P]ayment of Toyota's 'allowed secured claim' in this bankruptcy case does not pay the 'underlying debt determined under nonbankruptcy law,' and Toyota's lien in the proceeds cannot be released at this point. . . . Toyota's lien will remain in the insurance proceeds until such time that the Debtors receive their discharge . . . . In order to protect Toyota's interest in the proceeds remaining after payment of the allowed secured claim, the Chapter 13 Trustee shall hold such proceeds until the Debtors receive a discharge. Upon discharge, the Trustee shall pay the remaining proceeds in accordance with the Plan. In the event that the Debtors do not obtain a discharge, the Trustee shall pay such funds over to Toyota Motor Credit.").
In re Carter, 390 B.R. 648 (Bankr. W.D. Mo. July 11, 2008) (Federman) (Distinguishing Educational Credit Management Corp. v. Mersmann (In re Mersmann), 505 F.3d 1033 (10th Cir. 2007), confirmed plan that surrendered property in full satisfaction of first and second mortgages is res judicata with respect to deficiency claim of second mortgage holder. Confirmed plan recited that property would be surrendered "in lieu of the entire debt[s]" of the first and second mortgage holders. Noone objected to confirmation. Second mortgage holder filed unsecured deficiency claim and sought to be paid 100% together with other unsecured creditors. There was no dispute that second mortgage holder receive notice of plan. "While confirmed plans are . . . generally enforced, courts have recognized two exceptions to that premise. The first exception occurs when enforcing the disputed provision would violate the creditor's due process rights or would contradict other provisions of the Bankruptcy Code and Rules. . . . [I]n contrast to a discharge-by-declaration, there is no requirement that a debtor initiate an adversary proceeding or otherwise engage in heightened procedural and notice processes in order to propose to surrender collateral in lieu of a debt. The Credit Union concedes that it received the required notice for plan confirmation. Because a surrender and satisfaction of debt does not invoke the procedural safeguards and heightened service of process required as in an adversary proceeding . . . the Credit Union's due process rights were not violated. . . . In contrast to a proceeding for nondischargeability, which deals with what happens to a claim after completion of the plan and has nothing to do with the proposals made in the plan itself, § 506 and claim classification are directly related to plan confirmation because that is the entire purpose of a plan: to classify claims and propose particular treatment of the classes. . . . [T]he Credit Union had an allowed secured claim which, according to the claim itself, was fully secured. . . . [I]f the Credit Union had reason to believe that its claim was wholly or partially unsecured, and did not want to accept surrender in lieu of its claim—then the time to raise that issue was at confirmation. . . . [N]othing in [Capital One Auto Finance v. Osborn, 515 F.3d 817 (8th Cir. 2008),] says that a creditor is not permitted to waive its rights to a deficiency and agree to a plan that proposes a surrender in lieu. By failing to object to the Plan, that is what the Credit Union did.").
In re Robinson, No. 05-46936, 2006 WL 1522688, at *3-*5 (Bankr. W.D. Mo. May 17, 2006) (unpublished) (Dow) (Tax refunds for prepetition tax years have mutuality with and can be offset against prepetition tax liabilities; confirmed plan that pays tax liability but is silent with respect to setoff is trumped by IRS's statutory right to setoff after relief from the stay under § 553(a). "By December 31, 2003 and December 31, 2004, respectively, all of the events necessary to establish Debtor's tax refund for her 2003 and 2004 tax years had occurred. . . . [B]ecause Debtor's bankruptcy petition was filed on September 22, 2005, the tax refunds . . . arose prior to the commencement of the case. . . . [Section] 553 preserves . . . the right of setoff notwithstanding any other provision of 'this title' . . . § 1327 is one of the provisions of 'this title.' . . . [Section] 553 . . . states that the right to offset a mutual debt is tempered only by the automatic stay of § 362, and the limitations on the use, sale or lease of property as controlled by § 363. . . . [S]etoff is not affected by the confirmation process under § 1327. . . . [T]he fact that Debtor's plan had already been confirmed under § 1327 does not affect the ability of the IRS to exercise its right to offset the debts under § 553 and § 6402 of the Internal Revenue Code.").
South Dakota
In re Ninas, No. 05-50342, 2009 WL 136683 (Bankr. D.S.D. Jan. 20, 2009) (Nail) (Confirmation of plan does not extinguish judgment lien unless lienholder participates in bankruptcy case by filing proof of claim and plan either deals with or provides for claim.).
J. Ninth Circuit
Eickerman v. La Jolla Grp., II (In re Eickerman), No. 12-17425, 2015 WL 500655, at *1 (9th Cir. Feb. 6, 2015) (unpublished) (Tallman, Rawlinson, Murphy) (Confirmed plan did not preclude lienholder's recovery of postconfirmation fees and expenses incurred when debtor defaulted during Chapter 13 plan. "[T]he Chapter 13 plan lacked any res judicata effect on LJG's right to seek post-confirmation attorney's fees and other expenses provided for in the promissory note and deed of trust . . . . [T]he plan did not encompass post-confirmation fees and expenses.").
California Franchise Tax Bd. v. Kendall (In re Jones), 657 F.3d 921, 928-29 (9th Cir. Sept. 14, 2011) (Nelson, McKeown, Gould) (Without choosing among four approaches to vesting effect in § 1327(b), some property of the estate revested in debtor at confirmation of prior Chapter 13 case, state could have collected postpetition taxes without violating stay and equitable tolling is not available to save taxes from discharge in subsequent Chapter 7 case. "Resolution of this case does not require us to adopt one of the other specific approaches. Regardless of whether and to what extent the estate continues as a legal entity post-confirmation, we hold that, at the very least, some estate property revests in the debtor at confirmation. . . . [W]e hold that under the plain language of § 1327(b), the property of the estate revests in the debtor upon plan confirmation, unless the debtor elects otherwise in the plan. Because Jones did not elect otherwise, she once again became the owner of her property at confirmation, except as to those sums specifically dedicated to fulfillment of the plan. Accordingly, the FTB was not precluded from collecting the post-petition tax debt from property that revested in Jones upon plan confirmation. . . . Since the tax debt arose after plan confirmation, the FTB could have collected on the debt during the three-year lookback period, and as a result the limitations period is not statutorily suspended. . . . Equitable tolling is not appropriate where a creditor does not timely take the steps available to preserve its claim and where, in fact, the creditor faces no prohibition on asserting its claim during the limitations period."), aff'g on other grounds 420 B.R. 506, 512-16 (B.A.P. 9th Cir. Nov. 24, 2009) (Baum, Dunn, Jury) (Adopting "estate termination approach," because property of the estate vested in debtor at confirmation, California Franchise Tax Board was free of stay to collect postpetition taxes, and it is not appropriate to equitably toll counting periods for priority under § 507(a)(8) in a subsequent Chapter 7 case. Debtors filed Chapter 13 on July 22, 2002, and their 2002 state income tax return was due with extension on October 15, 2003. Confirmed plan that submitted future income of the debtors "to the supervision and control of the Trustee, as is necessary for the execution of the Plan" did not trigger the "except as otherwise provided" election in § 1327(b). Because the 2002 state income taxes were not priority debts under § 507(a)(8)(A)(i), statutory tolling added to § 507(a)(8) by BAPCPA was not available. Equitable tolling was not appropriate because after vesting in the debtor, no stay prevented the FTB from collecting the postpetition taxes from the debtor. "When interpreting Sections 1306 and 1327, the courts have split into four groups . . . . The Ninth Circuit has not decided this issue. . . . 'The estate preservation approach'—Property of the estate exists until the case is closed, dismissed or converted. . . . 'The modified estate preservation approach'—Existing estate property vests in the debtor at confirmation, and estate property continues to exist from postpetition income. . . . 'The estate transformation approach'—Only property needed to fund the plan is estate property, all other property is under the debtor's control. . . . 'The estate termination approach'—All property revests in the debtor and estate property is terminated upon confirmation. . . . We . . . adopt the estate termination approach . . . . Under the estate termination approach, the vesting of all estate property in the debtor at confirmation (unless the plan or confirmation order provides otherwise) and the concomitant termination of estate property gives effect to both Sections 1306 and 1327. . . . [C]onfirmation changes estate property to property of the debtor unless the plan or confirmation order specifically provides otherwise. . . . Section 1327(b) expressly provides the debtor with the ability to vest in itself all, none, or some combination of estate property. . . . [C]ollection of a post-petition debt can occur against a Chapter 13 debtor who does not otherwise provide in the plan or confirmation order that all property remains property of the estate. . . . '[V]ests' as used in Section 1327(b) means more than obtaining possession of estate property because Section 1306(b) already provides that debtors remain in possession of all estate property. . . . '[V]ests' means absolute ownership, not mere possession. . . . Under the estate termination approach, . . . there was no automatic stay in effect at the time the return was filed. . . . [T]here was no estate property for the automatic stay to protect, leaving the FTB free to collect on its tax claim.").
California Franchise Tax Bd. v. Kendall (In re Jones), 657 F.3d 921, 928-29 (9th Cir. Sept. 14, 2011) (Nelson, McKeown, Gould) (Declining to choose among four approaches, some property of estate vested in debtor at confirmation of prior Chapter 13 case, FTB could have collected postpetition taxes without violating stay and equitable tolling is not available to save taxes from discharge in subsequent Chapter 7 case. "[W]e hold that under the plain language of § 1327(b), the property of the estate revests in the debtor upon plan confirmation, unless the debtor elects otherwise in the plan. Because Jones did not elect otherwise, she once again became the owner of her property at confirmation, except as to those sums specifically dedicated to fulfillment of the plan. Accordingly, the FTB was not precluded from collecting the post-petition tax debt from property that revested in Jones upon plan confirmation. . . . Since the tax debt arose after plan confirmation, the FTB could have collected on the debt during the three-year lookback period, and as a result the limitations period is not statutorily suspended. . . . Equitable tolling is not appropriate where a creditor does not timely take the steps available to preserve its claim and where, in fact, the creditor faces no prohibition on asserting its claim during the limitations period."), aff'g on other grounds 420 B.R. 506, 515-17 (B.A.P. 9th Cir. Nov. 24, 2009) (Baum, Dunn, Jury) (Adopting "estate termination approach," because all property of Chapter 13 estate vested in debtor at confirmation in prior case, California Franchise Tax Board was free to collect postpetition taxes from debtor and debtor's property, and it is not appropriate to equitably toll lookback periods in § 507(a)(8) for time during which debtor was a debtor in prior Chapter 13 case. In a Chapter 13 case filed on July 22, 2002, state income tax return for 2002 was due, with extension, on October 15, 2003. Confirmation order did not overcome vesting effect in § 1327(b). After Chapter 13 case failed, debtor filed Chapter 7 case and FTB asserted that prior case tolled counting periods for priority and nondischargeability under §§ 507(a)(8) and 523(a)(1). Acknowledging four approaches to the effect of confirmation under § 1327(b)—the estate preservation approach, the modified estate preservation approach, the estate transformation approach and the estate termination approach—BAP adopts estate termination approach: "Under the estate termination approach, the vesting of all estate property in the debtor at confirmation (unless the plan or confirmation order provides otherwise) and the concomitant termination of estate property gives effect to both Sections 1306 and 1327. . . . [C]onfirmation changes estate property to property of the debtor unless the plan or confirmation order specifically provides otherwise. . . . [W]e conclude that collection of a post-petition debt can occur against a Chapter 13 debtor who does not otherwise provide in the plan or confirmation order that all property remains property of the estate. . . . '[V]ests' as used in Section 1327(b) means more than obtaining possession of estate property because Section 1306(b) already provides that debtors remain in possession of all estate property. . . . Under the estate termination approach, . . . there was no automatic stay in effect at the time the return was filed. Here, estate property revested in Jones on September 12, 2002, when her Chapter 13 plan was confirmed. When she filed her return on October 15, 2003 . . . there was no estate property for the automatic stay to protect, leaving the FTB free to collect on its tax claim. . . . The confirmation order stated: 'the future income of the Debtor(s) is submitted to the supervision and control of the Trustee, as is necessary for the execution of the Plan.' . . . Such language does not rise to the level of triggering the 'except as otherwise provided' election in Section 1327(b). . . . The 'supervision and control' language gives the trustee a basis for monitoring and requiring execution of the provisions of the plan. Such language does not negate the revesting of property at confirmation.").
California Franchise Tax Bd. v. Kendall (In re Jones), 657 F.3d 921 (9th Cir. Sept. 14, 2011) (Nelson, McKeown, Gould) (Because some property of estate vested in debtor at confirmation of prior Chapter 13 plan, franchise tax board could have collected postpetition taxes without violating automatic stay, and equitable tolling is not available to save taxes from discharge in subsequent Chapter 7 case.), aff'g on other grounds 420 B.R. 506 (B.A.P. 9th Cir. Nov. 24, 2009) (Baum, Dunn, Jury) (Because state income taxes for 2002 are postpetition debts in a Chapter 13 case filed on July 22, 2002, applying "estate termination approach," confirmation vested all property in debtors, and California Franchise Tax Board was free of the stay to collect its postpetition taxes from debtors and property of the debtors; not appropriate to toll counting periods for priority in § 507(a)(8) in a subsequent Chapter 7 case because no stay prevented FTB from collecting its postpetition taxes during prior Chapter 13 case.).
Keller v. New Penn Fin., LLC (In re Keller), 568 B.R. 118, 129 (B.A.P. 9th Cir. May 26, 2017) (Brand, Jury, Taylor) (Credit reporting during Chapter 13 case that debtor was past due or delinquent did not violate confirmation order that provided for curing default and maintaining payments when the confirmation order was silent with respect to credit reporting. “The confirmed plan is entirely silent on the issue of credit reporting. . . . To the extent Debtors contend the postpetition credit reporting is erroneous and does not match Defendants’ application of Debtors’ loan payments under the confirmed plan, as the bankruptcy court noted, the remedy for that is not in the Code but perhaps in the FCRA.”).
Sihabouth v. Bank of N.Y. Melon (In re Sihabouth), No. EC-13-1378-JuTaKu, 2014 WL 2978550, at *6 (B.A.P. 9th Cir. July 2, 2014) (unpublished) (Jury, Taylor, Kurtz) (Confirmation of plan that did not provide for mortgage and that allowed mortgaged property to revest in debtors divested bankruptcy court of subject matter jurisdiction to consider postconfirmation adversary proceeding challenging mortgagee's standing to enforce the note. "The bankruptcy court did not have jurisdiction over the claim-objection adversary proceeding under 28 U.S.C. §§ 157(b) or (c) . . . because debtors' challenge to BONY's ownership of the debt came after confirmation . . . . [P]ursuant to the terms of their confirmed plan, the real property allegedly subject to BONY's lien revested in debtors. . . . Because debtors elected to have the property revest, BONY's claim was not against the bankruptcy estate, and thus the claim-objection adversary proceeding did not involve a right created by bankruptcy law or arising only in bankruptcy. . . . [W]hether or not the bankruptcy court allowed or disallowed BONY's [claim] based on the claims asserted in the adversary, the outcome could not conceivably have had an affect [sic] on debtors' estate.").
Atighi v. DLJ Mortgage Capital, Inc. (In re Atighi), No. 99-18593, 2011 WL 3303454, at *5 (B.A.P. 9th Cir. Jan. 28, 2011) (unpublished) (Dunn, Kirscher, Pappas) (Distinguishing California Franchise Tax Board v. Jones (In re Jones), 420 B.R. 506 (B.A.P. 9th Cir. Nov. 24, 2009) (Baum, Dunn, Jury), when confirmed plan provided that property of the estate did not vest in the debtor until discharge, real estate debtor purchased after confirmation but before 10-year-old Chapter 13 case was closed became property of the estate and was protected by automatic stay; however, stay was appropriately annulled to validate postpetition foreclosure sale by mortgagee that was without notice of the Chapter 13 case. "[T]he rationale of Jones does not apply here. . . . Here, the debtor's plan provided that estate property did not revest in the debtor unless and until he received a discharge or the case was dismissed. Neither of these events have [sic] occurred. Because the property of the estate never vested in the debtor, it still was protected by the automatic stay.").
Countrywide Home Loans v. United States Trustee (In re Reavis), No. HI-06-1301-BKMo, 2007 WL 7540962, at *4 (B.A.P. 9th Cir. Mar. 1, 2007) (unpublished) (Brandt, Klein, Montali) (When confirmed plan stated that proof of claim would control amount to be paid, junior lienholder is bound by amount stated in its proof of claim notwithstanding that valuation of collateral would have produced a larger dividend. Countrywide filed a proof of claim for its second mortgage for $100,500. Debtor paid that amount with interest through the plan. Countrywide objected to trustee's final report, contending that it should have received a larger sum based on the value of the property and the amount of senior encumbrances. "Countrywide provides no argument or authority for the proposition . . . that the trustee may properly pay a creditor more than that creditor's allowed claim plus interest.").
Alonso v. Summerville (In re Summerville), 361 B.R. 133 (B.A.P. 9th Cir. Feb. 7, 2007) (Brandt, Klein, Montali) (Plan that provided direct payment of real estate-secured debt by debtor and payment of small arrearage through trustee did not address amount or terms of underlying mortgage and was not preclusive of state court litigation of those issues after debtor defaulted and relief from stay was granted to mortgage holder.).
DeSousa v. Gilton (In re Gilton), No. EC-06-1000-SJB, 2006 WL 6810991, at *4 (B.A.P. 9th Cir. Sept. 29, 2006) (unpublished) (Smith, Jury, Brandt) (In pre-BAPCPA case, motion to dismiss for bad faith filed 10 days before confirmation hearing was not precluded by confirmation. "As Appellants filed their motion to dismiss ten days prior to the confirmation hearing, we find the motion to be timely and not precluded by the entry of the confirmation order. . . . We are equally unpersuaded . . . that finding a plan has been proposed in good faith necessarily means that the case was commenced in good faith.").
Litton Loan Servicing v. Garvida (In re Garvida), 347 B.R. 697, 703-04 (B.A.P. 9th Cir. July 31, 2006) (Ordinarily, claim objection cannot be resolved in confirmation process and timely filed proof of claim prevails; because Litton and debtors considered confirmation hearing to include an objection to Litton's claim, bankruptcy court appropriately allocated burdens of proof consistent with a claim objection and resolved evidence in favor of debtors. "It ordinarily is procedural error to resolve objections to claims in plan confirmation proceedings. . . . [T]he confirmation of a plan providing for payment on a claim in a particular amount does not trump a proof of claim for a higher amount without compliance with standard claim objection procedure. . . . [Section] 1327(a) binds the parties as to the amounts to be distributed under the chapter 13 plan but does not alter the allowed amount of the claim, which is what the trustee must pay. . . . Although an objection to claim under Federal Rule of Bankruptcy Procedure 3007 is required to contest a claim, it nevertheless is possible to object to a creditor's claim through a proposed plan, so long as proper notice is given. . . . In this instance, it is unambiguous that the debtors and Litton litigated the plan confirmation as if it was a claim objection proceeding.").
California Fid., Inc. v. Eaton (In re Eaton), No. EC-05-1261-PaNMa, 2006 WL 6810924, at *5-*6 (B.A.P. 9th Cir. Feb. 28, 2006) (unpublished) (Pappas, Naugle, Marlar) (Plan confirmed in 2001 did not strip off junior liens on residence, and motion in 2004 to value junior liens at $0 would modify plan; bankruptcy court erred by using collateral values as of original petition. Bankruptcy court should have used value at time of modification. Because of depreciation, junior liens were then fully secured and could not be stripped off. "To extinguish a creditor's lien, a chapter 13 plan must 'provide for' the creditor's claim secured by that lien. § 1327(c) . . . . To 'provide for' a claim, the plan must make express provision for, deal with, or refer to a claim. . . . Absent a clear provision in a plan dealing with a secured creditor's claim, the debtor cannot extinguish the creditor's lien and that lien passes through bankruptcy unaffected. . . . If, as here, a plan is silent about the fate of a secured claim and does not provide clear notice to the secured creditor concerning its treatment under the plan, that plan cannot effectively avoid a lien or determine its value. . . . Appellees' 2001 confirmed plan did not 'provide for' the claims secured by their residence. . . . By failing to 'provide for' the Creditors' claims, their liens were not affected by Appellees' confirmed plan . . . . Because Appellees' 2004 and 2005 valuation motions sought to alter that result, and to significantly affect Appellant's rights as a secured creditor, the motions can only be seen as a proposal by Appellees to modify their confirmed plan.").
Sallie Mae Servicing Corp. v. Ransom (In re Ransom), 336 B.R. 790, 798 (B.A.P. 9th Cir. Dec. 27, 2005) (Confirmed plan barring accrual and collection of postpetition interest on student loan is refused binding effect; de facto discharge provision raises due process concerns. Applying Enewally v. Washington Mutual Bank (In re Enewally), 368 F.3d 1165 (9th Cir. 2004): "[C]onfirmed plan has no preclusive effect on issues that must be brought by adversary proceeding, or were not sufficiently evidenced in a plan to provide adequate notice to the creditor." Plan did not satisfy notice required by Rule 7001(6). Term barring interest accrual was ambiguous and misleading.).
Ventura Tax Collector v. Brawders (In re Brawders), 325 B.R. 405, 412-16 (B.A.P. 9th Cir. May 10, 2005) (Confirmed plan that ambiguously provided for tax claim did not limit tax lien, and taxing authority did not violate automatic stay by asserting lien rights after discharge. Confirmed plan in prior Chapter 13 case provided: "The value as of the effective date of the Plan, of the series of payments to be distributed under the Plan on account of each secured claim provided for by the Plan, is equal to the allowed amount of such claim. . . . Each creditor shall retain its lien." Ventura County was listed as a lienholder with an "amount in default" of $9,350. Ventura apparently filed then withdrew an untimely proof of claim. Debtors completed payments under the plan. Ventura proceeded to enforce its in rem rights against the debtors' house, and debtors filed second case. Bankruptcy court found that Ventura violated automatic stay because confirmed plan in first case limited its lien rights. BAP concluded that language of first plan was too unclear to have any limiting effect on Ventura's lien rights. "Debtors have not met their burden to establish that the Plan purported to have any effect on the amount of Ventura's tax assessment or its lien rights. . . . Debtors did not combine confirmation of their Plan with an adversary proceeding seeking a declaratory judgment or partial lien avoidance limiting Ventura's in rem rights, nor did the Plan give notice that Debtors had any such intent. . . . Ventura did not file a timely proof of claim in the First Case and it withdrew its untimely claim, so the only Chapter 13 payments to which Ventura was entitled were those that Debtors provided in the plan—$9,35.00 over time, with interest. In addition, though, Ventura retained its in rem rights against Debtors' House, and those rights and the amount of the underlying debt owed to Ventura have not been affected by confirmation of Debtors' Plan in the First Case. . . . As [Work v. County of Douglas, 58 B.R. 868 (Bankr. D. Or. 1986),] observed, claims and interests are not the same thing. . . . [A] plan that provides for a claim but does not provide for an interest in property securing that claim does not affect the interest of the creditor in the property. The property vests free of the claim, but not free of the interest, which in this case is the lien of Ventura."), aff'd, 503 F.3d 856, 862 (9th Cir. 2007) (Stipulation that "'the County's pre-petition claim against the Debtors has been paid in full and the real property subject to said lien revested in the Debtors free of any lien interest held by the County on account of its pre-petition claims'" addressed only the debtors' personal liability and did not limit the county's lien to the amount stated in the confirmed plan.).
Arizona
In re King, No. 206-BK-04089-JMM, 2007 WL 4097880, at *2 (Bankr. D. Ariz. Nov. 13, 2007) (unpublished) (Section 1327 "means that all state court pre-bankruptcy collection proceedings have been nullified by the confirmed plan. The plan's provisions now supercede a creditor's pre-bankruptcy rights under state law." Prebankruptcy writ of garnishment is nullified, and any funds subject to writ must be returned to debtors.).
In re Wegscheid, 361 B.R. 144, 147 (Bankr. D. Ariz. Jan. 29, 2007) (Haines) (Applying Great Lakes Higher Education Corp. v. Pardee (In re Pardee), 193 F.3d 1083 (9th Cir. Oct. 25, 1999) (Lay, Pregerson, Hawkins), confirmation has res judicata effect when creditor "failed to object to a plan that clearly and unequivocally stated its lien was wholly unsecured and therefore modifiable.").
In re Wegscheid, 361 B.R. 144 (Bankr. D. Ariz. Jan. 29, 2007) (Haines) (Plan clearly providing for wholly unsecured mortgage to be unsecured, with lien to be avoided at entry of discharge, had res judicata effect in absence of objection to confirmation, and debtor's post-discharge motion to avoid lien is granted.).
In re Wegscheid, 361 B.R. 144, 147 (Bankr. D. Ariz. Jan. 29, 2007) (Haines) (Applying Great Lakes Higher Education Corp. v. Pardee (In re Pardee), 193 F.3d 1083 (9th Cir. Oct. 25, 1999) (Lay, Pregerson, Hawkins), and disagreeing with Sun Finance Co. v. Howard (In re Howard), 972 F.2d 639 (5th Cir. Sept. 8, 1992) (Higginbotham, Duhe, Hunter), debtor is not required to file objection to creditor's claim before confirmation has res judicata effect when creditor "failed to object to a plan that clearly and unequivocally stated its lien was wholly unsecured and therefore modifiable.").
In re Greene, 359 B.R. 262 (Bankr. D. Ariz. Jan. 24, 2007) (Marlar) (Confirmation is preclusive of "trustee's conditional objection to exemptions" because confirmation resolved best-interests-of-creditors test, which includes consideration of exemptions.).
California
Central District of California
In re Richter, 525 B.R. 735, 750-53 (Bankr. C.D. Cal. Jan. 20, 2015) (Yun) (Buyer at prepetition foreclosure sale is not bound by confirmed plan that purported to cure default and pay lien because buyer received no notice consistent with due process requirements; notice to homeowners' association did not suffice when homeowners' association foreclosed its lien before the petition and sold the property to third-party buyer. "A confirmed plan does not have preclusive effect on a party who did not receive notice sufficient to satisfy its due process rights. . . . Rustling Oaks' due process rights would be violated if the Court found that it was bound by a plan that it did not know existed. . . . [E]ven if Rustling Oaks did receive notice about Debtor's bankruptcy case, Debtor's Plan would still not bind Rustling Oaks because the Plan's provisions did not clearly describe what Debtor was trying to accomplish. A 'confirmed plan has no preclusive effect on issues that . . . were not sufficiently evidenced in a plan to provide adequate notice to the creditor' or other party affected by the plan. . . . If Debtor intended to exercise and modify his statutory right of redemption, then his Plan failed to demonstrate this entirely. . . . If Debtor intended to cure the default to MCA, simply listing MCA's name and the amount of the delinquent assessments in Class 2 was also not enough. . . . [I]t was reasonable for [the purchaser] to ignore Debtor's Plan.").
In re Gonzales, 512 B.R. 255 (Bankr. C.D. Cal. Apr. 9, 2014) (Jury) (In an advisory opinion to state court, confirmation order "vesting" property in debtor at discharge or dismissal was not preclusive of ownership dispute in pending state court action to quiet title.).
In re Gonzales, No. 6:13-bk-11471-MJ, 2014 WL 1509293, at *5 (Bankr. C.D. Cal. Apr. 9, 2014) (Jury) (Property revesting in debtor after completion of confirmed plan vests in debtor "whatever property rights she had in the property when the case commenced. Unless her confirmed chapter 13 plan, or some other proceeding which occurred while under the bankruptcy court jurisdiction, affected title, [debtor] retains the Real Property subject to any prepetition claims[.]").
In re Gonzales, 512 B.R. 255, 262 (Bankr. C.D. Cal. Apr. 9, 2014) (Jury) (Applying Brawders v. County of Ventura (In re Brawders), 503 F.3d 856 (9th Cir. Sept. 11, 2007) (Bennett), confirmed plan that did not purport to affect third party's interest in real property beyond delayed revesting provision, gave debtor the property "in the same legal condition as at the commencement of the case, [and] the plan has no preclusive effect on the quiet title action [ ] pending in state court. That action should proceed to determine ownership rights to the Real Property.").
In re Diaz, 459 B.R. 86, 88, 89, 91-92, 93 (Bankr. C.D. Cal. Oct. 3, 2011) (Jury) (Disagreeing with Freeman v. Schulman (In re Freeman), 86 F.3d 478 (6th Cir. June 27, 1996) (Merritt, Boggs, O'Meara), and citing Anderson v. Satterlee (In re Anderson), 21 F.3d 355, 358 (9th Cir. Apr. 12, 1994) (Browning, Norris, O'Scannlain), prepetition tax refund is property, not income, and is not captured by projected disposable income test or by confirmation order that stated, "[I]n addition to regular monthly payments, all tax refunds are pledged into the plan." Trustee moved to dismiss case when debtors failed to turn over prepetition tax refund. Court interpreted confirmation order to exclude prepetition refunds, an interpretation "consistent with the law regarding projected disposable income and future earnings in sections 1322(a) and 1325(b) . . . . Any decision to the contrary would be anomalous; it would vest the Chapter 13 Trustee with unfettered discretion to seek contribution of all tax refunds, regardless of when those refunds were earned." Section 1322(a)(1) uses phrase "future income" rather than "current monthly income" and only includes income earned postpetition. Section 1325(b)(1)(B) modifies "disposable income" by predicate "projected," capturing only future income. "The rationale for including tax refunds in the plan is to prevent debtors from overstating their tax withholdings. . . . A debtor's overstatement of prepetition taxes does not justify turnover of the overstated amount to the creditors because, unlike a postpetition refund, the debtor would not have been required to turn over the corollary increase in income had they not overstated their tax expense. The only relevance of a debtor's prepetition tax withholdings to disposable income is to use it as a 'projection' of their postpetition tax withholdings." "Tax refunds received by debtors postpetition but accrued on prepetition earnings are property, not income, and are not subject to turnover to the Chapter 13 Trustee.").
In re Hileman, 451 B.R. 522, 523, 524 (Bankr. C.D. Cal. June 13, 2011) (Tighe) (Confirmed plan paying mortgage arrearage and maintaining direct payment of ongoing monthly obligation was binding on creditor notwithstanding preconfirmation termination of stay under § 362(c)(3)(A). While confirmed plan did not "explicitly address the expiration of the automatic stay pre-confirmation," it did provide for payment of secured claims. OneWest Bank ceased accepting mortgage payments postconfirmation and proceeded with foreclosure. Debtor filed emergency motion for injunctive relief. "The automatic stay does not spring back into effect just because a plan was confirmed, but . . . [§] 1327(a) provides that the provisions of a confirmed plan bind the debtor and each creditor, whether or not such creditor has objected to, has accepted, or has rejected the plan.").
Eastern District of California
In re Clark, No. 14-21394-B-13, 2015 WL 6164003, at *3-*4 (Bankr. E.D. Cal. Oct. 20, 2015) (unpublished) (Jamie) (Citing California Franchise Tax Board v. Kendall (In re Jones), 657 F.3d 921 (9th Cir. Sept. 14, 2011) (Nelson, McKeown, Gould), and California Franchise Tax Board v. Kendall (In re Jones), 420 B.R. 506 (B.A.P. 9th Cir. Nov. 24, 2009) (Baum, Dunn, Jury), confirmation vested 50% ownership of corporation in debtor notwithstanding provision of plan that required debtor to contribute at least $160,000 from sale of that interest; valuation and sale of debtor's interest in corporation were controlled by state law, not by § 363 because interest in corporation was not property of estate after confirmation. At the petition, debtor owned 50% interest in a corporation. After the petition, debtor elected to dissolve the corporation under California law. Stay relief was granted to carry out dissolution and in meantime, plan was confirmed that vested all property in the debtor. Plan required debtor to contribute no less than $160,000 from the sale of 50% interest to fund the plan. "Upon confirmation . . . § 1327(b) operated to revest the co-debtor's corporate interest in the co-debtor. Revesting fundamentally transformed the nature of the co-debtor's 50% interest from property of the estate to property of the debtor. . . . [U]pon confirmation of the third modified plan the estate ceased to exist, the co-debtor's 50% corporate interest revested in the co-debtor, and the co[-]debtor's corporate interest lost its status as property of the estate. No longer property of the estate, the co-debtor's 50% interest in the corporation could not be sold under § 363 which applies only to sales of property of the estate.").
Luchini v. JPMorgan Chase Bank, N.A. (In re Luchini), 511 B.R. 664 (Bankr. E.D. Cal. June 4, 2014) (Sargis) (Consistent with binding effect of confirmed plan under § 1327(a), upon completion of payments, debtor entitled to judgment that stripped junior lien treated as unsecured is void under § 506(d).).
Martin v. CitiFinancial Servs., Inc. (In re Martin), 491 B.R. 122 (Bankr. E.D. Cal. Apr. 10, 2013) (Sargis) (Confirmation bound wholly unsecured junior lienholder; after completion of plan providing zero payment of junior mortgage, lien was terminated and rendered unsecured.).
Northern District of California
Nomellini v. IRS (In re Nomellini), No. 5:15-cv-04122-EJD, 2017 WL 3969413, at *3
Gaudin v. Saxon Mortg. Servs., Inc., 850 F.Supp.2d 1051 (N.D. Cal. Aug. 22, 2011) (Seeborg) (Class action for failing to properly evaluate HAMP application was not precluded by confirmation because issue was not raised as part of confirmation and defendant failed to show inconsistent position taken in schedules or confirmed plan.).
In re Rascon, 321 B.R. 48, 51-53 (N.D. Cal. Feb. 18, 2005) (White) (Plan that treated creditor's first lien as fully secured and treated creditor's second lien as wholly unsecured "provided for" both claims, and confirmation vested real property in debtor free and clear of second lien. "As a general rule, unchallenged liens pass through bankruptcy unaffected. . . . However, a creditor's lien may be avoided through the Chapter 13 plan confirmation process where the basis for avoidance is lack of collateral value. . . . Confirmation of a plan can void an unsecured lien if the creditor is 'provided for by the plan.' 11 U.S.C. § 1327(c). What is required to adequately 'provide for' the creditor is a function of due process. . . . The phrase 'provided for' is commonly understood to mean that the plan 'makes a provision for, deals with, or even refers to a claim.' Rake v. Wade, 508 U.S. 464, 113 S. Ct. 2187, 124 L. Ed. 2d 424 (1993). To adequately 'provide for' a creditor in a Chapter 13 plan, the plan must, at a minimum, identify the creditor by name and clearly and accurately characterize a claim. . . . A plan that seeks to eliminate a lien for lack of collateral value should 'reveal' that intent, at least by implication. . . . [H]ere, Debtor's Original Plan identifies Salah by name twice and accurately characterizes his secured claim. The Original Plan first lists Salah as a secured creditor in the amount of $250,000 . . . . Salah is then referenced a second time as a secured creditor to be paid directly by Debtor at 10% interest until the $250,000 balance is paid in full. . . . Salah was put on notice that the total value of the collateral securing his liens was $250,000. . . . As a result of the property's valuation however, the $100,000 lien was left unsecured . . . . Although the Original Plan did not expressly list the $100,000 lien as an unsecured claim on which Salah would be paid nothing, this was the necessary implication to be drawn from the other provisions of the plan. . . . Because the Original Plan . . . identifies Salah as a creditor and 'provides for' both the secured and unsecured liens, the Original Plan provided sufficient notice in accordance with due process requirements.").
Morgan v. Preferred Fin. Grp., Inc. (In re Morgan), No. 17-4084, 2018 WL 735346, at *2 (Bankr. N.D. Cal. Feb. 6, 2018) (Novack) (Because plan did not overcome vesting effect of confirmation under § 1327(b), real property vested in the debtor at confirmation and ceased to be property of the estate for purposes of the automatic stay in § 362 and for purposes of turnover under § 542. Plan proposed to sell real property and to pay Preferred Financial the full amount of its filed proof of claim. After confirmation the property sold and Preferred Financial claimed an additional $24,471 for postpetition attorney fees and costs. Debtor alleged that Preferred’s demand for the extra money violated the automatic stay and that the additional amount, paid from escrow at the time of sale, could be recovered by turnover under § 542(b). “The Plan expressly revested all of the estate property . . . in the Morgans upon confirmation. . . . Preferred’s motion to dismiss the Morgans’ § 362(k) claim is therefore granted. . . . For the same reason, this court grants Preferred’s motion to dismiss the turnover claim for relief. . . . Whatever Preferred owes to the Morgans is not property of the estate under any theory known to this court.”).
In re Sheppard, No. 11-41693, 2011 WL 6835027, at *3 (Bankr. N.D. Cal. Dec. 22, 2011) (Lafferty) (Plan provision for $1,000 monthly, to be paid "outside the plan," bound creditor to altered monthly payments for life of plan, but plan only altered present payment rights and did not affect validity of mortgage or total amount of creditor's claim; § 1322(b)(2) prevented mortgage claim from being crammed down, and creditor would retain lien until claim was paid in full. Res judicata effect of confirmation "cannot extend beyond the provisions of the Plan that purport to modify Deutsche's rights, i.e., the provision that modifies the amount presently payable on a monthly basis. Nothing in the Plan purported to modify Deutsche's rights as a creditor with a claim secured by the Debtor's residence.").
In re Ventura, No. 09-31234 SFC, 2010 WL 702898 (Bankr. N.D. Cal. Feb. 24, 2010) (unpublished) (Carlson) (Ambiguous plan was not binding as to treatment of mortgage creditor's claim; plan and confirmation order did not fix monthly payment clearly, and further hearing was required to determine postpetition arrearages.).
Southern District of California
Needelman v. Pennsylvania Higher Educ. Assistance Agency, 399 B.R. 695 (S.D. Cal. Jan. 5, 2009) (Lorenz) (Applying Espinosa v. United Student Aid Funds, Inc., 553 F.3d 1193 (9th Cir. Dec. 10, 2008) (Kozinski, Tashima, Smith), properly noticed student loan creditor is bound by confirmation of plan that paid only part of debt and discharged balance.).
In re Gamboa, No. 10-14560-A13, 2013 WL 2460514 (Bankr. S.D. Cal. June 3, 2013) (unpublished) (Adler) (In almost completed plan, tax refunds must be turned over to trustee for distribution to unsecured creditors, but debtors were not obligated to pay additional amount for trustee's administrative expenses.).
Idaho
In re Alonso, 570 B.R. 622, 627-29 (Bankr. D. Idaho May 2, 2017) (Pappas) (Earned Income Credit and Additional Child Tax Credit are included in “tax refunds” that confirmed plan required debtor to pay to trustee; debtor cannot “retroactively” modify plan to remove obligation to pay over refunds. “[I]f a proposed plan commits tax refunds to plan payments, the debtors may simply agree to turn them over to the trustee when received, or the debtors may prorate the expected refund over 12 months, thereby increasing their current monthly income by one
In re Smith, No. 14-00546-JDP, 2016 WL 7496104 (Bankr. D. Idaho Dec. 30, 2016) (Pappas) (Debtor is bound by confirmed plan that provided bank had a secured claim of $152,285.51 and debtor cannot object to amount of claim after confirmation.).
McCallister v. Bernt (In re Thiel), No. 14-6028-JDP, 2015 WL 2398555, at *2, *5 (Bankr. D. Idaho May 18, 2015) (Pappas) (Debtor's right under divorce decree to receive half of sale proceeds when/if marital residence was sold did not remain property of Chapter 13 estate after confirmation; trustee could not maintain § 363(h) action against former spouse to force sale of house. Divorce decree provided that marital residence would be sold "as soon as reasonably possible" and proceeds divided equally between the debtor and former spouse with specified adjustments. House remained unsold at petition. Confirmed plan provided, "'trustee shall retain the right, post confirmation to recover moneys, to recover property and to avoid liens pursuant to 11 U.S.C. § 541 et seq.'" "[A]ccording to [California Franchise Tax Board v. Jones (In re Jones), 420 B.R. 506 (B.A.P. 9th Cir. Nov. 24, 2009) (Baum, Dunn, Jury),] the bankruptcy estate ceases to exist upon plan confirmation, except for property clearly reserved for the bankruptcy estate in the plan or order confirming the plan. . . . [I]t is undisputed that the plan dictated that property of the estate would vest in Debtor upon plan confirmation. As a result, the bankruptcy estate ceased to exist upon plan confirmation except for property clearly reserved for the bankruptcy estate in the plan or the order confirming the plan. . . . [T]he confirmation order did not clearly provide that the Property would remain property of the estate . . . .").
In re Cluff, No. 09-41244-JDP, 2012 WL 1552391 (Bankr. D. Idaho Apr. 30, 2012) (unpublished) (Pappas) (Confirmed plan bound debtor to turn over all tax refunds to trustee, not just net after nonfiling spouse's share. Debtor failed to turn over 2010 tax return, offering only net refunds remaining after husband's share. Debtor married after filing Chapter 13 but was not excused from delivering entire refund to trustee, subject to determination of trustee's entitlement to retain and distribute entire refund under plan. Debtor would not be eligible to receive discharge until default was cured.).
In re Davidson, No. 09-01735-TLM, 2009 WL 2477758 (Bankr. D. Idaho Aug. 11, 2009) (unpublished) (Myers) (Plan could not be confirmed due to inadequate service on secured creditor; notwithstanding certified mail, service did not comply with Bankruptcy Rule 7004(b)(3) requirement for service on corporation.).
In re Allen, No. 07-20389-TLM, 2009 WL 856985 (Bankr. D. Idaho Mar. 31, 2009) (Myers) (Confirmed plan that contemplated sale of property and acknowledged secured claims precludes debtors from later contesting validity of notes or mortgages.).
In re Jackson, 403 B.R. 95, 99, 99-100 (Bankr. D. Idaho Mar. 5, 2009) (Pappas) (Adopting "growing majority" view that all property acquired after the petition is property of estate, when plan allowed revesting of property in debtors at confirmation, only property in existence at confirmation revested in debtors; property inherited by debtors after confirmation did not revest and remained property of estate. Judgment creditor violated § 362(a)(4) by obtaining lien against inherited property but did not violate stay with lien that attached to property that had revested. "As the Court sees it, confirmation of a chapter 13 plan operates to adjust the rights of creditors and the debtor in relation to the assets existing at that time. However, because it necessarily takes years for a debtor to perform a plan, a debtor's acquisition of significant post-petition assets can not [sic] be seen to inure solely to the benefit of any post-petition creditors. . . . Because this interpretation best balances the interests of all creditors, the Court holds that, under § 1327(b), a provision in a confirmed plan that property 'revest' in the debtor applies solely to property in existence at the time of confirmation. Any assets acquired by the debtor after confirmation, but before the case is closed, converted or dismissed, become property of the bankruptcy estate under § 1306(a).").
Scott v. Countrywide Home Loans, Inc. (In re Scott), 376 B.R. 285, 295 (Bankr. D. Idaho Sept. 4, 2007) (Pappas) (When Countrywide and its privy had notice of plan, which contained clear lien-stripping language, lender is barred by res judicata effect of confirmation from claiming that value of property was misrepresented. "The value of [debtors'] house, and whether Defendants' second mortgage lien was completely unsecured or not, were issues that 'could have or should have been litigated at the confirmation hearing,'" quoting Duplessis v. Valenti (In re Valenti), 310 B.R. 138, 150 (B.A.P. 9th Cir. May 11, 2004) (Montali, Perris, Marlar).).
Scott v. Countrywide Home Loans, Inc. (In re Scott), 376 B.R. 285, 292 (Bankr. D. Idaho Sept. 4, 2007) (Pappas) (Rejecting Countrywide's argument that it was denied due process in confirmation that stripped its second mortgage lien, plan contained clear lien-stripping language and Countrywide had sufficient notice to raise value of its lien at confirmation. Plan provided: "The claim of Countrywide Home Loans on Account Number 083466215, which may be secured by an interest in Debtors' residence, is junior to the Countrywide Home Loans claim under Account Number 083466223 described in paragraph 5.1 below. The balance due on the note secured by the first deed of trust exceeds the value of the real property. Debtors propose to strip the lien claim of Countrywide Home Loans under Account Number 083166215, and render that claim unsecured upon confirmation of the Plan.").
In re Olson, No. 05-40733, 2005 WL 4705071, at *2 (Bankr. D. Idaho Nov. 9, 2005) (unpublished) (Because U.S. Bank is a federally insured depository institution, service of plan by first-class mail was deficient under Bankruptcy Rule 7004(h) and confirmation is set aside. "[B]y its express terms, Rule 7004(b) only applies if Rule 7004(h) does not apply. Rule 7004(h) . . . established special notice provisions for federally insured banks . . . 'by certified mail addressed to an officer of the institution' . . . . Because Debtors' plan was not properly served on U.S. Bank in accordance with Rule 7004(h), it did not receive proper notice of Debtors' attempt to strip its lien on their home. Therefore, the order confirming the Chapter 13 Plan must be set aside.").
In re Jennings, No. 02-40724, 2003 WL 25273845, at *3 n.4 (Bankr. D. Idaho Aug. 19, 2003) (unpublished) (Confirmation of plan that cured prepetition arrearages and maintained payments on a mortgage was not binding and did not justify equitable relief when mortgage holder was granted relief from the stay before conversion from Chapter 7 to Chapter 13 and completed foreclosure sale before confirmation. "[S]tay relief had already been granted, and the foreclosure sale completed prior to confirmation. . . . [T]here was no 'justifiable issue' with respect to Creditor's right to foreclose at the time of confirmation, and therefore the plan was not res judicata with respect to Creditor.").
In re Arriaga, Nos. 02-41989, 02-41686, 2003 WL 25273842 (Bankr. D. Idaho Feb. 6, 2003) (unpublished) (Pappas) (Confirmation of plan is res judicata with respect to eligibility.).
In re Quist, No. 94-03192, 2002 WL 33939726, at *4 (Bankr. D. Idaho May 23, 2002) (unpublished) (Confirmed plan silent with respect to dischargeability of student loans did not discharge student loans at completion of payments notwithstanding incorrect discharge order that did not except student loans from discharge. "The decisions in [Great Lakes Higher Education Corp. v. Pardee (In re Pardee), 193 F.3d 1083 (9th Cir. 1999),] and [Andersen v. UNIPAC-NEBHELP (In re Andersen), 179 F.3d 1253 (10th Cir. 1999),] . . . presume the proposed Chapter 13 plan contains a provision inconsistent with the discharge statutes that clearly warns the creditor its statutory rights are in jeopardy. Only if the plan expressly advises the creditor of the risk of discharge will traditional notions of due process be satisfied. . . . Here there is no specific provision in the Debtor's Plan warning that confirmation of the plan would . . . serve as a basis for discharge of the student loan debt.").
Montana
In re Wirshing, No. 13-60990-13, 2015 WL 3525061, at *2 (Bankr. D. Mont. June 3, 2015) (Kirscher) (Because trustee is not identified in § 1327(a), confirmed plan does not preclude trustee's motion to modify under § 1329 to capture an inheritance received more than 180 days after the petition. "[Section] 1327(a) does not include the term 'trustee' as a person bound by a confirmed plan. . . . Section 1329(a) authorizes a debtor or trustee to request that a plan be modified after confirmation but before the completion of payments under such plan. If Congress intended a chapter 13 trustee to be bound by confirmation under § 1327(a), it could have included 'trustee' in that section. It did not, and thus it is presumed that Congress acted intentionally and purposely in excluding 'trustee' from § 1327(a).").
Hart v. Luckman (In re Luckman), No. 12-00013, 2012 WL 6708586 (Bankr. D. Mont. Dec. 26, 2012) (Kirscher) (Distinguishing United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), confirmed plan that made no provision for payment of DSO to former spouse and which said nothing about discharge of debt to former spouse did not preclude determination of nondischargeability in postconfirmation adversary proceeding.).
In re Launderville, No. 11-61117-13, 2011 WL 4900022, at *7 (Bankr. D. Mont. Oct. 14, 2011) (Kirscher) (Objecting secured creditor would be bound by plan providing for subdivision and sale of nonresidential ranch; without deciding whether creditor must consent to subdivision, should consent be improperly withheld, "Court would entertain a request by Debtors to appoint someone in [creditor's] stead, such as the Chapter 13 Trustee, to sign the necessary consent for Debtors to obtain subdivision approval.").
In re Whitney, No. 04-62483-13, 2007 WL 1687273 (Bankr. D. Mont. June 7, 2007) (unpublished) (Kirscher) (Debtors are bound by confirmed plan to pay tax refunds to trustee; dedication of "other income" for 60 months includes tax refunds.).
Oregon
In re Ruiz, No. 12-63323-tmr13, 2014 WL 1576825, at *2 (Bankr. D. Or. Apr. 17, 2014) (Renn) (Postconfirmation homeowners association fees and charges are not administrative expenses under § 503(b)(1) when neither plan nor confirmation order prevented revesting of estate in debtor. "[W]ith no estate in existence post-confirmation, charges then arising cannot have administrative expense status under § 503(b)(1)(A)." Court reserved question whether the claims could be allowed as postconfirmation claims under § 1305(a)(2).).
In re Norred, No. 09-40186-elp13, 2011 WL 4433598 (Bankr. D. Or. Sept. 21, 2011) (Perris) (BAPCPA did not change rule that, at postconfirmation destruction of a car, lienholder is only entitled to balance of crammed-down amount of allowed secured claim; however, new § 1325(a)(5)(B) retains car lender's lien until discharge. Chapter 13 trustee is instructed to hold excess insurance proceeds pending discharge.).
In re Norred, No. 09-40186-elp13, 2011 WL 4433598, at *3-*4 (Bankr. D. Or. Sept. 21, 2011) (Perris) (Distinguishing First Fidelity Bank v. McAteer, 985 F.2d 114 (3d Cir. Feb. 3, 1993) (Mansmann, Hutchinson, Bartle), BAPCPA did not change rule that at destruction of car after confirmation, lienholder is only entitled to balance of crammed-down secured claim; but new lien retention requirement in § 1325(a)(5)(B) requires that insurance proceeds above balance of allowed secured claim be held by Chapter 13 trustee until discharge. "OnPoint is entitled to payment only to the extent of its interest in the vehicle. That interest has been reduced through cram-down and plan payments to approximately $2,200, which is all that OnPoint is entitled to receive from the proceeds. . . . If the proceeds are property of the estate, then the excess proceeds above what is necessary to satisfy OnPoint's secured claim should be paid to the trustee. If the proceeds are not property of the estate, they should be paid to debtors. Whether or not the proceeds are property of the estate does not change the fact that OnPoint's secured claim is fixed by the confirmed plan. . . . [OnPoint] is not required to release its lien until debtor gets a discharge. As required by § 1325(a)(5)(B), . . . [u]ntil debtors complete their plan and obtain a discharge or the unsecured claim is paid, OnPoint retains its lien. . . . In order to protect the interest of OnPoint, the trustee shall hold the insurance proceeds that exceed the amount paid to OnPoint on its secured claim until debtors obtain a discharge. Upon discharge, the trustee shall pay the remaining proceeds to unsecured creditors pursuant to the plan. If debtors do not complete their plan and obtain a discharge, OnPoint will be entitled to the excess proceeds.").
In re McIntyre, No. 08-34900-tmb13, 2009 WL 3823039 (Bankr. D. Or. Nov. 13, 2009) (Brown) (When confirmed plan did not preserve bankruptcy estate, adversary proceeding vested in debtors and debtors can divide settlement proceeds with attorney without paying settlement funds to trustee for plan distribution.).
Washington
Eastern District of Washington
In re Hale, 359 B.R. 310, 315, 316, 317 (Bankr. E.D. Wash. Jan. 24, 2007) (Williams) (Surrender of home pursuant to confirmed plan could not create a deficiency claim not allowed by state law. Res judicata effect was not given to the following plan language: "To the extent the collateral does not satisfy such creditor's claim, the creditor shall be treated as the holder of an unsecured claim and paid as provided in . . . section III.A8 (Unsecured Claims).").
K. Tenth Circuit
Taumoepeau v. Manufacturers & Traders Trust Co. (In re Taumoepeau), 523 F.3d 1213, 1219 (10th Cir. Apr. 22, 2008) (Tymkovich, Gorsuch, Parker) (Confirmed plan did not address postpetition mortgage payments and does not trump preconfirmation stipulation for relief from stay in the event of default. "[T]he amended bankruptcy plan sought to address only pre-petition arrears—the mortgage payments missed by the Taumoepeaus prior to filing for bankruptcy—and did not seek to address the separate and distinct question of the Taumoepeaus' post-petition arrears, a matter exclusively addressed by the parties' stipulation."), aff'g 350 B.R. 628 (B.A.P. 10th Cir. Aug. 29, 2006) (Table decision text available at 2006 WL 2473440, at *3) (Confirmed plan that cured prepetition mortgage defaults but was silent about postpetition defaults was not res judicata with respect to preconfirmation stipulation and order for relief from stay based on postpetition defaults. Before confirmation, debtor and Fairbanks executed stipulation that required cure of postpetition arrearages. Debtor defaulted, and order was entered for relief from stay. Plan was then confirmed that addressed prepetition arrearages only. Fairbanks foreclosed after confirmation. "[T]he issue of the postpetition default in the Trust Deed payments was not litigated at the confirmation hearing and was not addressed by the Modified Plan or the Confirmation Order. . . . Therefore, the Confirmation Order and the Modified Plan did not affect the validity of the Stay Order.").
Educational Credit Mgmt. Corp. v. Mersmann (In re Mersmann), 505 F.3d 1033, 1047-50 (10th Cir. Sept. 24, 2007) (Overruling Andersen v. UNIPAC-NEBHELP (In re Andersen), 179 F.3d 1253 (10th Cir. 1999), discharge of student loans through plan provision is not binding under § 1327 or res judicata when an adversary proceeding was not initiated. "Discharge-by-declaration deserves no preclusive effect under § 1327(a) because it fails to comport with the provisions of the Bankruptcy Code and Rules governing discharge. . . . When a debt is not automatically dischargeable, Bankruptcy Rule 7001(6) commands that the debt must not be discharged without an adversary proceeding. . . . Simply embedding a 'meaningless incantation of undue hardship' in a confirmation plan [sic] falls short of the 'affirmative' action required by Congress and the Supreme Court. . . . Giving preclusive effect to a discharge-by-declaration through § 1327(a) renders part of § 1328(a)(2) nugatory. . . . Since discharge-by-declaration does not comport with a number of provisions of the Bankruptcy Code and Rules, it is undeserving of res judicata effect. . . . Res judicata will not apply where there is inadequate notice. . . . Congress has specified that a debtor must initiate an adversary proceeding, complete with individualized service of process, to establish 'undue hardship' for the discharge of student loan debts. . . . It is true that a line of cases holds that confirmed plans deserve res judicata effect notwithstanding conflicts with the Bankruptcy Code or Rules. . . . But the principles of res judicata must yield where the failure to follow the Code and Rules goes to the heart of the creditor's notice of the bankruptcy plan itself. Discharge-by-declaration also fails the first element of res judicata—whether the claim was 'adjudicated on the merits.' . . . [B]ankruptcy matters requiring an adversary proceeding do not meet these requirements. . . . In short, if an issue must be raised through an adversary proceeding it will not have a preclusive effect unless it is actually litigated.").
Countrywide Home Loans v. Davis (In re Davis), No. 05-6214, 2006 WL 1734250, at *4 (10th Cir. June 21, 2006) (unpublished) (Murphy, Anderson, O'Brien) (Denial of motion for relief from the stay after confirmation of plan that treated Countrywide's mortgage as unperfected precluded adversary proceeding to determine whether claim was secured. Confirmed plan stated, "Countrywide Home Loans is secured by an unperfected mortgage that will be avoided upon plan completion." After confirmation, Countrywide filed a motion for relief from the automatic stay, asking in the alternative for modification of the plan or for a declaration that its mortgage was valid. Relief from the stay was denied and not appealed. Countrywide then filed an adversary proceeding to determine whether its claim was secured. "We agree with the BAP that the bankruptcy court failed to accord the proper preclusive effect to the court's prior orders on [Countrywide's] motion for a stay [sic] or for other relief. . . . [Countrywide] asserts the same cause of action in the instant proceeding as it did in its motion for relief from the automatic stay . . . . [I]t clearly had multiple opportunities to protect its lien rights during the Chapter 13 proceeding itself. . . . [Countrywide] received Davis's proposed Plan, which clearly indicated that [Countrywide's] claim was to be treated as unsecured because of an unperfected mortgage . . . . [Countrywide] failed to attend the meeting of creditors or the hearing on confirmation of the Plan, nor did it challenge the Plan once it was confirmed . . . . [Countrywide] may not now have yet another attempt to prevail on a claim already resolved adversely to it by the bankruptcy court."), aff'g No. BAP WO-04-057, 2005 WL 1278096, at *1 (B.A.P. 10th Cir. May 26, 2005) (unpublished) (McFeeley, Clark, McNiff) (Order in adversary proceeding that confirmation did not invalidate Countrywide Home Loan's lien was precluded by prior bankruptcy court orders denying motion for relief from the stay when prior orders found that adversary proceeding was not required to invalidate liens. Confirmed plan provided "Countrywide Home Loans is secured by an unperfected mortgage that will be avoided upon plan completion." Countrywide did not object to confirmation. Nine months after confirmation, Countrywide filed a motion for relief from the stay, alleging that its lien survived confirmation because an adversary proceeding was required to avoid its lien. Bankruptcy court denied motion for relief from the stay in two orders finding that Rule 7001 was not applicable and an adversary proceeding was not required. Several months later, Countrywide filed an adversary proceeding seeking a declaration of the validity of its lien. Bankruptcy court (different judge) held that confirmation of the plan did not invalidate Countrywide's lien. On further appeal, BAP concluded that the adversary proceeding was an attempted collateral attack on the prior rulings that an adversary proceeding was not required to invalidate Countrywide's lien.).
Hamilton v. Washington Mut. Bank, FA (In re Colon), 563 F.3d 1171 (10th Cir. May 4, 2009) (Murphy, Brorby, Hartz), rev’g on other grounds 376 B.R. 33, 37 (B.A.P. 10th Cir. Sept. 19, 2007) (Bohanon, Brown, McNiff) (Confirmed plan that treated mortgage holder as unsecured creditor based on avoidable, improperly perfected mortgage was binding because mortgage holder failed to object to confirmation or to timely appeal order of confirmation. "[T]he confirmed plan is res judicata as to its treatment of Washington Mutual's claim and distribution of the mortgage loan payments, whether or not that treatment violates § 1322(b)." Trustee successfully avoided mortgage in separate adversary proceeding.), aff'g 376 B.R. 22 (Bankr. D. Kan. Jan. 26, 2007) (Karlin).).
Vannordstrand v. Hamilton (In re Vannordstrand), 356 B.R. 788 (B.A.P. 10th Cir. Jan. 31, 2007) (table decision) (Clark, Cornish, Tallman) (When confirmed plan delayed vesting of property for § 1327(b) purposes, inheritance received almost two years after petition was property of the estate and debtor was properly ordered to turn over inheritance to trustee. "[Section] 1306(a)(1) broadens the definition of estate property . . . . [Section] 1306 modifies the § 541 time period in Chapter 13 cases. . . . Since § 1327(b) specifically allows a plan to provide for different vesting, and the plan in this case does so, vesting had not yet occurred when Debtor obtained the inheritance. . . . Since Debtor's case had not been closed, dismissed, or converted when he received the inheritance, that money is property of his estate. Therefore, the bankruptcy court's turnover order is affirmed.").
Colorado
Grillo v. JP Morgan Chase & Co., No. 13-cv-03233-RBJ-KLM, 2014 WL 4470439 (D. Colo. Sept. 8, 2014) (Jackson) (Res judicata effect of confirmed plan that surrendered property to mortgagee precluded collateral attack on foreclosure.).
McPherson v. Green Tree Servicing, LLC (In re McPherson), No. 13-cv-00536-RBJ, 2013 WL 6657599 (D. Colo. Dec. 17, 2013) (unpublished) (Jackson) (Confirmation precludes motion to strip wholly unsecured junior lien. Plan was confirmed without determination of value of property, junior lien was left intact, and debtor was bound by plan.).
Bank of Am., N.A. v. Gordon (In re Gordon), 471 B.R. 614, 625-26 (D. Colo. Mar. 27, 2012) (Blackburn) (Form plan that required debtors to modify plan to address claims timely filed after confirmation was not inconsistent with § 1327. Nonconforming language would bind creditors to terms of confirmed plan before deadline for filing proofs of claim, permitting plan to define claim amount and treatment of creditors, including arrearage claims. "Ultimately, the non-standard plan language proposed by the debtors and approved by the bankruptcy court in these cases conflicts with the claims processing procedures and other requirements of the Code and the Rules. Most important, the non-standard language improperly eliminates the requirement that a Chapter 13 plan remain in compliance with the Code even after the plan has been confirmed. On the other hand, the standard language . . . in the standard Chapter 13 plan form adopted in this district[] permits the court, the debtor, and the creditors to maintain compliance with all of the requirements of the Code, both before and after confirmation of a Chapter 13 plan."), appeal dismissed, Nos. 12-1140, 12-1143, 2014 WL 643007 (10th Cir. Feb. 20, 2014) (Gorsuch, Ebel, O'Brien).).
Sender v. Golden (In re Golden), 528 B.R. 803, 806-09 (Bankr. D. Colo. Mar. 16, 2015) (Tallman) (When confirmation order vested property of estate in debtor, nothing prevented sale of property after confirmation and disposition of proceeds before conversion to Chapter 7; because the debtor transferred property to almost former spouse before conversion, proceeds were not property of Chapter 7 estate and could not be recovered by Chapter 7 trustee under § 549. "[W]hen the homestead revested in the Debtor upon plan confirmation, ownership of the property left the estate and vested in the Debtor. . . . When property revests in the debtor under Section 1327(b), the debtor 'acquires something more than possession, which he held at the inception of the case under § 1306(b).' The 'something more' that the debtor enjoys, therefore, is 'absolute ownership and control of the property.' . . . Because . . . estate property revested in Debtor upon confirmation of the plan, the Debtor was not obligated to maintain possession of the property. Instead, the real property was owned and controlled by the Debtor and the Defendant and was no longer subject to administration by this Court. . . . Post-confirmation, Debtor and Defendant chose to sell the home and reap proceeds . . . . Debtor subsequently relinquished possession or control of his portion of the proceeds from sale by transferring such proceeds to Defendant. . . . On the date of conversion, Defendant, not the Debtor, was in possession and control of the proceeds. Section 348(f), therefore, does not operate to pull such proceeds into the Chapter 7 estate.").
In re Kurtz, 502 B.R. 238, 244 (Bankr. D. Colo. Nov. 26, 2013) (Campbell) (Extending rationale of Chrysler Financial Corp. v. Nolan (In re Nolan), 232 F.3d 528 (6th Cir. Oct. 24, 2000) (Krupansky, Norris, Suhrheinrich), debtor cannot surrender residence retained under confirmed plan and discharge any deficiency through plan modification. "If a debtor can modify the claims of his secured creditors whenever the value of the creditor's collateral depreciates, then that debtor has not been bound by his confirmed plan.").
In re Murphy, 493 B.R. 576, 582 (Bankr. D. Colo. June 7, 2013) (Brown) (At dismissal after confirmation, § 349(b) renders confirmation order of no further legal effect. Some courts have "fashioned a practical solution, which is to merely assume that the parties continue to be bound by the previously confirmed plan." When parties have substantially changed positions subsequent to dismissal, binding parties to terms of confirmed plan "would be akin to applying the automatic stay retroactively.").
In re Dabney, No. 10-30330 ABC, 2012 WL 3704719 (Bankr. D. Colo. Aug. 27, 2012) (Campbell) (Debtors were bound by confirmed plan that bifurcated vehicle loan and provided 100% payment of unsecured portion. Debtors cannot modify that confirmed plan to eliminate payment of unsecured portion when creditor filed fully secured proof of claim.).
Diaz v. Zeman (In re Diaz), 462 B.R. 804, 809, 810 (Bankr. D. Colo. Oct. 24, 2011) (Romero) (Debtor could not abrogate local rule and local plan form that required debtor to file and serve modified plan within one year of petition that provided for allowed priority and secured claims that were not filed at time of confirmation. Marking form provision "not applicable" was inconsistent with statutory requirement that timely filed proofs of claim be appropriately treated in plans. "Proofs of claim may be timely filed after plan confirmation. For the court to confirm a plan not containing a saving provision . . . would illegally modify a claim secured by the debtor's principal residence in contravention of § 1322(b)(2). To conclude otherwise would be to abrogate the claim filing, objection, and allowance process set out in §§ 501 and 502 and Rule 3001 et seq. Additionally, cutting off a creditor's rights through the plan confirmation process would also abrogate Rule 3002(a) because the deadline for filing proofs of claim set forth in the Court's corresponding notice to creditors upon the filing of a chapter 13 case would be rendered disingenuous and misleading. Moreover, this position shifts the claim objection burden to creditors by forcing a creditor to object to a proposed plan rather than requiring a debtor to object to a presumptively allowed claim. This shift in burden would make the presumption of the validity of a properly filed claim meaningless." Local Rule and plan provision did not exceed rule-making authority, did not violate § 1329 and did not conflict with res judicata effect of confirmed plan. 59 of 93 judicial districts had some provision "in local rules or local chapter 13 plan forms indicating distributions to creditors are made based on amounts appearing in allowed proofs of claim.").
In re Butcher, 459 B.R. 115, 123-34 (Bankr. D. Colo. Sept. 20, 2011) (Tallman) (Provision of form plan in district that requires debtor to modify plan after confirmation to provide for priority and secured claims not filed or allowed at time of confirmation is consistent with § 502 and strikes proper balance between accelerated confirmation required by BAPCPA and claims allowance process. "[T]he plan language . . . represents the balance the bankruptcy court is required to strike between the accelerated plan confirmation process required by BAPCPA and giving full force and effect to the claim allowance process set out in the Bankruptcy Code along with the claim filing time frames mandated by the Rules. . . . By the Court's count, 59 of the 93 judicial districts have a positive indication in local rules or in local chapter 13 plan forms directing that distributions to creditors are made based on amounts appearing in allowed proofs of claim. By contrast, the Court has identified 5 judicial districts where the plan form or rules contain a positive indication that claim amounts appearing in the confirmed plan will determine amounts of distributions instead of the proof of claim. The Court assigned no classification to the remaining 29 judicial districts. . . . Some published cases have identified three approaches to the perceived conflict between the § 1327 binding effect of plan confirmation and the § 502 allowance of claims. . . . [T]he Court doubts the existence of any genuine conflict between plan confirmation and claim allowance.").
In re Liehr, No. 08-21528 EEB, 2011 WL 3606903 (Bankr. D. Colo. Aug. 12, 2011) (Brown) (eCast's failure to object to amended plan that provided 100% payment of timely filed allowed claims was binding and precluded allowance of late-filed claim.).
In re Rutt, No. 07-12448 ABC, 2010 WL 3636419 (Bankr. D. Colo. Sept. 10, 2010) (unpublished) (Campbell) (Binding effect of confirmation prevented modification two years later to strip off junior lien that became unsecured as result of decline in value of property. Debtor could not strip off lien at confirmation because there was value to secure the debt and stripoff would have violated §§ 1322(b)(2). Adopting Chrysler Financial Corp. v. Nolan (In re Nolan), 232 F.3d 528 (6th Cir. Oct. 24, 2000) (Krupansky, Norris, Suhrheinrich), § 1329(a)(1) should not be read expansively to permit modification of secured claim that had been provided for in confirmed plan.).
In re Dagen, 386 B.R. 777 (Bankr. D. Colo. Mar. 26, 2008) (Brown) (Postconfirmation income is protected from collection efforts of domestic support creditor by confirmed plan that provided for past-due child support as priority debt; creditor "was contractually obligated to accept distributions from the Chapter 13 trustee in satisfaction of her prepetition claims." "It is the Plan, not the automatic stay, that prevents her from attempting to collect her prepetition debts from any source, other than receiving her distributions from the Chapter 13 trustee. But neither the Plan nor the automatic stay prevent [sic] her post-confirmation efforts to collect post-petition support.").
In re Dagen, 386 B.R. 777 (Bankr. D. Colo. Mar. 26, 2008) (Brown) (Adopting estate termination approach— "confirmation vests all property, including post-confirmation income necessary to fund the plan, in the Debtor,"— property of estate ceases to be protected by automatic stay, but when confirmed plan provided for full payment of priority prepetition support obligations, creditor is bound to accept payments from trustee. Neither plan nor automatic stay prohibited collection of postpetition support obligations.).
In re Dagen, 386 B.R. 777 (Bankr. D. Colo. Mar. 26, 2008) (Brown) (Although plan providing for full payment of prepetition priority support binds creditor to look only to plan payments for satisfaction, neither plan nor automatic stay prohibited support creditor from proceeding outside of bankruptcy to collect postpetition obligations.).
Kansas
Onyx Invs., L.L.C. v. Foster, No. 06-4053-SAC, 2007 WL 1347696 (D. Kan. May 8, 2007) (unpublished) (Crow) (Creditor whose unsecured lien was stripped is bound by confirmation when opportunity to object to confirmation satisfied due process; adversary proceeding is not necessary to strip lien.).
Williams v. M. Bruenger & Co. (In re Brannan), 532 B.R. 834 (Bankr. D. Kan. June 25, 2015) (Nugent) ("Res judicata effect" of confirmation under § 1327(a) precludes trustee's § 544 challenge to lien when confirmed plan treated lienholder as secured and trustee signed a preconfirmation agreed order acknowledging secured status—notwithstanding that claim revealing lien defect was filed after confirmation and after agreed order.).
In re Davenport, No. 08-41213, 2011 WL 6098068 (Bankr. D. Kan. Dec. 7, 2011) (Karlin) (Confirmed plan that delayed revesting of estate property in debtors until completion of plan and discharge, and confirmation order that prohibited debtors from selling, encumbering or disposing of assets without prior court approval, left debtors without authority to sell one-sixth interest in property postpetition. That debtors had exclusive control over property of estate did not permit sale without court permission. Debtors ordered to turn over remaining proceeds to trustee for distribution to unsecured creditors.).
In re Kuhasz, No. 07-20282, 2008 WL 5539788, at *4 (Bankr. D. Kan. Nov. 19, 2008) (Somers) (Debtors are bound by confirmation of plan that pays car lender in full and can't use claim objection or plan modification to delete negative equity from secured claim. "[P]ost-confirmation change in applicable bankruptcy law is not sufficient to warrant a revocation or modification of the terms of a confirmed and operating Chapter 13 plan.").
In re Jordan, No. 05-18287, 2008 WL 1743855 (Bankr. D. Kan. Apr. 11, 2008) (unpublished) (Nugent) (When confirmed plan provided that lien on vehicle would be retained by creditor until completion of plan payments, at destruction of vehicle after confirmation, insurance proceeds are used to pay balance of secured debt plus accrued interest, and remaining proceeds are held in trust by trustee pending completion of plan. If case is dismissed before plan completion, remainder of insurance proceeds will be paid to secured creditor.).
In re Munck, No. 02-41690, 2007 WL 4354418 (Bankr. D. Kan. Dec. 7, 2007) (unpublished) (Karlin) (Applying Andersen v. UNIPAC-NEBHELP (In re Andersen), 179 F.3d 1253 (10th Cir. June 7, 1999) (Anderson, McWilliams, Cook), state child support service is bound by confirmed plan that provided for discharge of debt when confirmation and claims objection processes effectively litigated discharge. Overruling of Andersen by Educational Credit Management Corp. v. Mersmann (In re Mersmann), 505 F.3d 1033 (10th Cir. Sept. 24, 2007) (Tacha, Seymour, Kelly, Henry, Briscoe, Lucero, Murphy, Hartz, O'Brien, McConnell, Tymkovich, Holmes), was prospective only.). Accord In re Bailey, No. 04-42258, 2007 WL 4563442 (Bankr. D. Kan. Dec. 20, 2007) (Karlin) (Discharge provision in pre-Mersmann plan met Andersen requirements.).
Reathaford v. Countrywide Home Loans, Inc. (In re Reathaford), No. 07-6077, 2007 WL 2903044 (Bankr. D. Kan. Oct. 2, 2007) (unpublished) (Somers) (Citing Autos, Inc. v. Gowin, No. 05-3415, 2007 WL 2269443, at *3-*4 (10th Cir. Aug. 9, 2007)(unpublished), debtor has standing to pursue automatic stay violations and violations of Fair Debt Collection Practices Act, when confirmation order did not vest property in debtor until discharge or dismissal and nothing in confirmation order vested property of estate in trustee.).
In re Reed, Nos. 03-40669-7, 03-42331-7, 04-42566-7, 07-40098-13, 2007 WL 2023577, at *1, *5 (Bankr. D. Kan. July 9, 2007) (unpublished) (Karlin) (Language in standard confirmation order that upon conversion tax refunds "shall be administered by the successor Trustee" conflicts with § 348(f) and must be stricken from future confirmation orders; however, debtors in three cases already converted to Chapter 7 are bound by order. Under Andersen v. UNIPAC-NEBHELP (In re Andersen), 179 F.3d 1253, 1258-59 (10th Cir. June 7, 1999) (Anderson, McWilliams, Cook), "need for finality in the confirmation process requires the enforcement of a confirmation order even if a provision of the order or the plan does not comply with a provision of the Bankruptcy Code." Debtors are subject to Chapter 7 trustee's administration of tax refunds received during Chapter 13 case, subject to debtors' opportunity to show that tax refunds were spent for plan-related or justified expenses or that use of refunds was necessary based upon reduction in income.), reconsideration denied, 2007 WL 2701118 (Bankr. D. Kan. Sept. 7, 2007) (Karlin).).
In re Reed, Nos. 03-40669-7, 03-42331-7, 04-42566-7, 07-40098-13, 2007 WL 2023577, at *1, *5 (Bankr. D. Kan. July 9, 2007) (unpublished) (Karlin) (Language in standard confirmation order that upon conversion tax refunds "shall be administered by the successor Trustee" conflicts with § 348(f) and language must be stricken from future confirmation orders; however, debtors in three cases already converted to Chapter 7 are bound by order. Under Andersen v. UNIPAC-NEBHELP (In re Andersen), 179 F.3d 1253, 1258-59 (10th Cir. 1999), "need for finality in the confirmation process requires the enforcement of a confirmation order even if a provision of the order or the plan does not comply with a provision of the Bankruptcy Code." Debtors in converted cases are subject to Chapter 7 trustee's administration of tax refunds received during Chapter 13 case, subject to debtors' opportunity to show that tax refunds were spent for plan-related or justified expenses or that use of refunds was necessary based upon reduction in income.), reconsideration denied, 2007 WL 2701118 (Bankr. D. Kan. Sept. 7, 2007).).
In re Ramsey, 356 B.R. 217 (Bankr. D. Kan. Dec. 13, 2006) (Statements in plan that debtor did not believe Novastar had perfected lien but that mortgage would be paid, with arrearages, and that if Novastar could not provide proof of its perfection, debt would be treated as unsecured, did not satisfy the requirements of Poland v. Educational Credit Management Corp. (In re Poland), 382 F.3d 1185 (10th Cir. 2004), to specifically and unambiguously advise the creditor how its claim would be treated in the plan. Debtor did not initiate an adversary proceeding nor actually litigate validity of Novastar's lien. Trustee's proposed settlement with Novastar was not approved since trustee lacked authority to sell property of bankruptcy estate.).
In re Brensing, 337 B.R. 376, 384-85 (Bankr. D. Kan. Jan. 24, 2006) (Berger) ("Nowhere in § 1327(b) does it state that property of the estate converts into property of the debtor upon confirmation and nowhere in this section does it state that § 1306 ceases to operate after confirmation of the plan. Section 1306 is most easily read to continue in effect after confirmation of the debtor's plan. If upon confirmation of the debtor's plan the property of the estate revests in the debtor and remains property of the estate, then such property remains subject to the terms of the confirmed plan and is entitled to all of the protections afforded under § 362(a). To hold otherwise renders § 1306 virtually irrelevant. . . . A Chapter 13 debtor's post-confirmation bankruptcy estate consists of that property that exists on the petition date plus any additional property that is added postpetition by operation of § 1306(a). By remaining property of the bankruptcy estate, the debtor's property is protected from pre- and postpetition creditors alike, allowing the debtor an effective reorganization during the pendency of her case. This is the most harmonious interpretation and application of these sections." Rejecting Black v. United States Postal Service (In re Heath), 115 F.3d 521 (7th Cir. 1997), neither §§ 1306(a) or 1327(b) "return to the debtor that property of the bankruptcy estate that is not necessary for completion of the debtor's plan.").
In re Rookard, No. 03-42320-13, 2005 WL 4147869 (Bankr. D. Kan. Oct. 17, 2005) (unpublished) (Karlin) (Trustee bound by confirmed plan that required return to the debtor of prepetition tax refund held by trustee until debtor completed payments to unsecured creditors sufficient to satisfy § 1325(a)(4); receipt of tax refund after confirmation did not convert refund into disposable income for § 1325(b) purposes because confirmed plan treated it otherwise.).
Hamilton v. Washington Mut. Bank, FA (In re Colon), 345 B.R. 723 (Bankr. D. Kan. Sept. 9, 2005) (Karlin) (Confirmed plan that preserved trustee's right to avoid unperfected mortgage is binding, and failure to object to confirmation forfeits mortgage holder's argument that it is unfair to allow the debtor to pay off the lien, if avoided, through 48 monthly plan payments.).
Hamilton v. Washington Mut. Bank, FA (In re Colon), 345 B.R. 723 (Bankr. D. Kan. Sept. 9, 2005) (Confirmed plan that delayed vesting of property until final report preserved trustee's standing to avoid unperfected mortgage.).
New Mexico
In re Hamilton, No. 14-10665 tl13, 2017 WL 1533382 (Bankr. D.N.M. Apr. 27, 2017) (Thuma) (Ambiguously worded plan is best interpreted to require debtor to pay arrearage stated on proof of claim filed by mortgagee rather than lesser amount stated in plan.).
Hunter v. Education Res. Inst., Inc. (In re Hunter), Nos. 13-03-16034 SA, 07-1057 S, 2008 WL 187936 (Bankr. D.N.M. Jan. 18, 2008) (Starzynski) (Applying Educational Credit Management Corp. v. Mersmann (In re Mersmann), 505 F.3d 1033 (10th Cir. 2007), student loan is not discharged by confirmed plan that equates failure to file proof of claim to discharge. Adversary proceeding seeking declaration that student loan was discharged due to creditor's failure to file timely proof of claim is dismissed because complaint does not rely on undue hardship.).
Arellano v. Montoya (In re Arellano), No. 07-1024 S, 2007 WL 1746246 (Bankr. D.N.M. June 14, 2007) (unpublished) (Starzynski) (Proposed plan that purports to waive arbitration provision in mortgage contract is not res judicata because plan is not confirmed.).
Arellano v. Montoya (In re Arellano), Nos. 13-06-11966 SL, 07-1024 S, 2007 WL 1746246, at *6 (Bankr. D.N.M. June 14, 2007) (unpublished) (Starzynski) (Because simple notice does not satisfy service requirement in Rule 9014(b), plan that waives arbitration clause in mortgage contract does not satisfy due process and is not binding on creditor. Plan provision is "reminiscent of the student loan chapter 13 cases that attempted to discharge student loans through confirmation . . . . Debtors are attempting to change the provision of a contract. Arguably this requires an adversary proceeding, but even if it did not, it at least constitutes a contested matter. See Bankruptcy Rule 9014. Contested matters must be 'served.' See Bankruptcy Rule 9014(b).").
Arellano v. Montoya (In re Arellano), Nos. 13-06-11966 SL, 07-1024 S, 2007 WL 1746246 (Bankr. D.N.M. June 14, 2007) (unpublished) (Starzynski) (Provision in proposed plan that waives arbitration clause in mortgage is not binding when plan is not yet confirmed.).
Oklahoma
Northern District of Oklahoma
In re Clark, 551 B.R. 910, 911–15 (Bankr. N.D. Okla. June 21, 2016) (Michael) (Confirmation of plan that provides a fixed percentage to unsecured creditors but does not allow or disallow any particular unsecured claim does not bar trustee’s postconfirmation objection that LVNV’s claim is disallowable because of state statute of limitations. “LVNV does not contest that its claim is barred by the statute of limitations. Instead, LVNV argues that the order confirming the Plan was res judicata on all issues of claim allowance and that, as a result of the Trustee’s failure to object to the LVNV Claim prior to confirmation, the LVNV Claim must stand as allowed. . . . The procedure for objecting to a proof of claim is found in Federal Rule of Bankruptcy Procedure 3007. That [R]ule contains no deadline for the filing of objections to claims. . . . The plan confirmation process runs on a different timetable. . . . [T]he first confirmation hearing in a Chapter 13 case is always held before the claims bar date . . . . [C]onfirmation of the Plan took place prior to the claims bar date. . . . If LVNV is correct, every order of plan confirmation entered in every Chapter 13 case operates as a final order allowing every unsecured claim in the case. . . . It is illogical to assume an order that predates the filing of a claim operates as a final order allowing that claim. . . . There is nothing in § 1325 that says a plan may not be confirmed because issues relating to the allowance of unsecured claims remain unresolved. . . . A Chapter 13 trustee is not required to file an objection to an unsecured claim prior to entry of the order of plan confirmation.”).
In re Henry, 532 B.R. 844, 849 (Bankr. N.D. Okla. July 1, 2015) (Michael) (Mortgagee that failed to file proof of claim or to object to confirmation cannot amend debtors' claim two years after confirmation to increase arrearage amount; mortgagee is bound by confirmed plan and has waived its right to any arrearage larger than the amount in the claim filed by the debtors. Confirmed plan stated that Chase had a prepetition arrearage of $11,400 that would be paid in full. Chase failed to file a proof of claim. Debtors filed a proof of claim on Chase's behalf for the amount stated in the confirmed plan. Two years later, Chase filed an "amended" claim stating the arrearage was $13,505.17. "Allowing a creditor to supercede or nullify a final, non-appealable order confirming a Chapter 13 plan by amending its claim and demanding that a debtor pay more based upon the amended claim would stand the Chapter 13 process on its head. . . . To the extent Chase now claims a greater arrearage than the one set forth in the Chase Claim and the Plan, it has waived its right to do so. Moreover, it is bound by § 1327(a) to the treatment of its claim in the Plan.").
Utah
In re Zisumbo, 519 B.R. 851, 855-58 (Bankr. D. Utah Oct. 6, 2014) (Thurman) (Under §§ 541(a)(5), 1306(a) and 1327(b) any inheritance received before case is closed, dismissed or converted is property of Chapter 13 estate. "The language of § 1306 is clear: any property as specified in § 541 received after the commencement of the case but before the case is closed, dismissed, or converted is property of the estate. In a Chapter 13 case, § 1306(a) governs the general provision of § 541(a)(5), and the 180-day language of § 541(a)(5) does not apply in a Chapter 13 case. . . . The more difficult issue presented, however, is the interplay between §§ 1306(a) and 1327(b). . . . Here, . . . each order confirming the Debtors' plans provides that '[a]t confirmation, property of the estate vests pursuant to the terms of the Plan and § 1327.'. . . Neither . . . plan addresses vesting. Although § 1306(a) provides that property received after the date of petition but before the closure, dismissal, or conversion of the case is property of the Chapter 13 estate, some courts have read the vesting provision of § 1327(b) to extinguish the Chapter 13 estate, thus rendering § 1306(a) inoperable unless otherwise provided for in the plan. This is commonly referred to as the 'estate termination approach.' Courts have used three other approaches. The 'estate preservation approach' reasons that all property of the Chapter 13 estate remains as such until one of the three events listed in § 1306 occurs, thus rendering § 1327(b) inoperable. . . . The 'estate transformation approach' argues that the Chapter 13 estate consists only of the property necessary to fund the Chapter 13 plan and all other property vests in the debtor. . . . Lastly, . . . the 'modified estate preservation approach[]' . . . holds that property of the estate at the time of confirmation vests in the debtor free and clear of all liens pursuant to § 1327(b) and (c), . . . but the estate does not cease to exist and it is replenished by regular income and post-petition after-acquired assets as provided for in §§ 1306(a) and 541. . . . Reading § 1327(b) in harmony with other provisions of the Bankruptcy Code makes it clear that the vesting provision does not extinguish the Chapter 13 estate . . . . [Section] 348(f)(2) provides: 'If a debtor converts a case under chapter 13 of this title to a case under another chapter under this title in bad faith, the property of the estate in the converted case shall consist of the property of the estate as of the date of conversion.' . . . From the plain reading of § 348(f)(2), whether before or after confirmation, the Chapter 13 estate exists until the closure, conversion, or dismissal of the case. . . . Basic statutory interpretation requires that a statute not be construed, if possible, to render any portion of it inoperable. In this Court's opinion, the estate preservation approach does just that to § 1327(b). The term 'vests' is not a defined term under the Bankruptcy Code, thus the Court gives the term its ordinary meaning. . . . The ordinary meaning of 'vest' is 'to confer ownership (of property) upon a person' or 'to invest (a person) with the full title to property.'. . . The Court believes that to hold that the Chapter 13 estate continues unaltered and the property does not become property of the debtor until the case is closed, dismissed, or converted completely disregards § 1327(b). Similarly, the Court is persuaded that the estate transformation approach misconstrues both §§ 1306(a) and 1327(b). . . . The estate transformation approach attempts to find a middle ground, but, in the view of the Court, it fails to give full meaning to either provision within the Bankruptcy Code. In the Court's opinion, the concept that only property necessary to effectuate the plan remains property of the estate is contrary to the plain language of § 1327(b). The plain language provides that property of the estate vests in the debtor upon confirmation, not that property required to carry out the plan is exempted from vesting. . . . Section 1306(a) provides that the bankruptcy estate is augmented by after-acquired post-petition assets, not that the estate is limited to only those assets necessary to carry out the plan as confirmed. In the view of this Court, the modified estate preservation approach provides the most harmonious reading of §§ 1306(a) and 1327(b). Under this approach, upon confirmation, unless otherwise provided for in the plan, the property of the Chapter 13 estate vests in the debtor free and clear of any liens pursuant to § 1327(b) and (c). This vesting, however, does not extinguish the Chapter 13 estate. Pursuant to § 1306(a), the Chapter 13 estate continues and is augmented by property acquired after confirmation until the closure, dismissal, or conversion of the case. . . . '[i]f Congress had intended for confirmation to so dramatically affect the expansive definition of property of the estate found in [section] 1306, it knew how to draft such a provision.'").
In re Skougard, 438 B.R. 738 (Bankr. D. Utah Oct. 27, 2010) (Thurman) (Tax refunds are included in projected disposable income, but debtors can retain up to $1,000 a year to provide some budget flexibility; in future cases, debtors receiving Earned Income Credit or Additional Child Tax Credit can retain $2,000 of their tax refunds.).
In re Underhill, 425 B.R. 614, 618-19 (Bankr. D. Utah Mar. 1, 2010) (Mosier) (Confirmation of plan that cures default and maintains payment would bind mortgage holder and preclude foreclosure notwithstanding that automatic stay did not come into effect in third bankruptcy case within a year under § 362(c)(4). "Even if § 362(c)(4)(A) applies and there is no stay in effect because the debtor has failed to seek an order that the stay take effect under § 362(c)(4)(B), a confirmed chapter 13 plan that provides for the curing of a prepetition default on a secured creditor's claim precludes a secured creditor from enforcing its lien with respect to the prepetition default. . . . [I]f the Plan is confirmed, MidFirst will effectively be stayed by the terms and conditions of the Plan. MidFirst will be bound to treat the Plan as a new agreement between the Debtor and MidFirst with a new obligation to be paid in the manner provided by the Plan. MidFirst may not commence any actions under state law until the Debtor defaults under the terms of the Plan. . . . Termination or lack of the § 362(a) stay may impact a chapter 13 plan but does not per se preclude confirmation of a plan. . . . Section 362(c)(4)(B) and (D) and § 1327(a) can be harmonized. Notwithstanding the lack of the § 362(a) stay, a chapter 13 plan that cures a debtor's prepetition default on a secured creditor's claim can comply with the Code.").
In re Hughes, No. 08-24736, 2009 WL 2252181 (Bankr. D. Utah July 17, 2009) (unpublished) (Mosier) (Provision of confirmed plan requiring payment of tax refunds exceeding $1,000 into plan cannot be eliminated by modification after confirmation because of best-interests-of-creditors test.).
In re Stauffer, 378 B.R. 333 (Bankr. D. Utah Oct. 27, 2006) (When motion to set aside confirmation is untimely for purposes of § 1330(a) revocation, and when creditor had adequate notice of plan, creditor is bound by confirmation. Notice to creditor at branch office is satisfactory. There is no requirement for notice to creditor's attorney, even though debtor knew attorney represented creditor in prior Chapter 7 adversary proceeding.).
Wyoming
In re Robbins, No. 13-21116, 2014 WL 3514104, at *4-*5 (Bankr. D. Wyo. July 14, 2014) (McNiff) (Timely filed arrearage claim trumps contrary amount in confirmed plan. "[D]ebtor may provide for the payment of mortgage arrears amount in a plan, but cannot modify the creditor's rights, if its claim is secured by a security interest in real property that is debtor's primary residence. . . . '[W]here the proof of claim, which may be timely filed after plan confirmation, reveals that the plan did not provide for a cure of the full amount of the mortgage arrearage, the court has confirmed a plan that does not contain a saving provision requiring the debtor to reconcile the plan to the allowed claim, the plan would illegally modify a claim secured by the debtor's principal residence in contravention of § 1322(b)(2). . . .' . . . [T]he Code provides for the confirmation of a chapter 13 plan at the accelerated time frame, but does not contain provisions that cut off a creditor's right to receive payment based upon a timely filed and allowed proof of claim. . . . The plan does not provide for curing the full amount of the arrears asserted by . . . proof of claim. . . . [T]he language in Form B truncates the time period for a creditor to file a proof of claims under the Bankruptcy Rules. The language is invalid . . . [and] illegal and therefore . . . the confirmed plan is also invalid. . . . Debtors must file an amended plan that does not modify [arrearage] claim to comply with the Bankruptcy Code and Rules.").
L. Eleventh Circuit
Nationstar Mortg., LLC v. Iliceto (In re Iliceto), 706 F. App’x 636 (11th Cir. Dec. 11, 2017) (Wilson, Rosenbaum, Robreno) (Citing United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), Nationstar as transferee of US Bank’s $500,000 mortgage was bound by confirmed plan that treated it as an unsecured creditor based on prior court orders sustaining objections to claims with findings that bank could not produce the mortgage or note and would forfeit its lien when the debtor completed payments and received a discharge. Nationstar was bound by confirmed plan and could not challenge findings that it was unsecured by objecting after completion of payments and discharge to the debtor’s motion to deem the mortgage lien extinguished.).
Title Max v. Northington (In re Northington), 876 F.3d 1302, 1308–15, 1314 n.9 (11th Cir. Dec. 11, 2017) (Wilson, Newsom, Moreno) (Distinguishing (poorly) United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 276, 130 S. Ct. 1367, 1380, 176 L. Ed. 2d 158 (Mar. 23, 2010), pawn broker is not bound by confirmed plan that pays title pawn in full with interest as a secured claim because pawn broker filed preconfirmation motion for stay relief; car subject to title pawn “dropped out” of Chapter 13 estate “automatically” when state law redemption period expired postpetition, nullifying the power to modify in § 1322(b)(2). Debtor filed Chapter 13 petition before state law grace period expired with respect to title pawn of car. Grace period under Georgia law expired and pawn broker moved for stay relief. Without objection from pawn broker, plan was confirmed that treated title pawn as secured claim for payment in full with interest. Bankruptcy court denied stay relief based on binding effect of confirmed plan. “TitleMax was not required to file an ‘Objection’
Title Max v. Northington (In re Northington), 876 F.3d 1302, 1308–15, 1314 n.9 (11th Cir. Dec. 11, 2017) (Wilson, Newsom, Moreno) (Distinguishing (poorly) United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 276, 130 S. Ct. 1367, 1380, 176 L. Ed. 2d 158 (Mar. 23, 2010), pawn broker is not bound by confirmed plan that pays title pawn in full with interest as a secured claim because pawn broker filed preconfirmation motion for stay relief; car subject to title pawn “dropped out” of Chapter 13 estate “automatically” when state law redemption period expired postpetition, nullifying the power to modify in § 1322(b)(2). Debtor filed Chapter 13 petition before state law grace period expired with respect to title pawn of car. Grace period under Georgia law expired and pawn broker moved for stay relief. Without objection from pawn broker, plan was confirmed that treated title pawn as secured claim for payment in full with interest. Bankruptcy court denied stay relief based on binding effect of confirmed plan. “TitleMax was not required to file an ‘Objection’
Florida Dep’t of Rev. v. Gonzalez (In re Gonzalez), 832 F.3d 1251, 1255-58 (11th Cir. Aug. 11, 2016) (Jordan, Rosenbaum, Siler) (Confirmed plan that provided full payment of domestic support obligation prohibited postconfirmation intercept of expense reimbursement payment by state holding DSO claim; BAPCPA amendment to § 362(b)(2)(C) excepted from the automatic stay withholding for certain DSO claims from postpetition wages and other income but did not abrogate the effect of confirmation under § 1327(a). The debtor owed the state of Florida a DSO. Confirmed plan provided for full payment of arrearage and direct payment of continuing child support. After confirmation, state intercepted a travel expense reimbursement payment. Bankruptcy court held state in contempt for violating confirmed plan. “Congress sought to enable a DSO creditor to reach assets of the estate post-petition without having to seek relief from stay because ‘a support creditor had no way of obtaining either on-going support or prepetition support arrearages.’ . . . But the same concerns do not exist post-confirmation. After all, not only are DSOs non-dischargeable in bankruptcy . . . but the Bankruptcy Code also requires that DSO creditors be paid in full in a Chapter 13 plan . . . . The DOR conflates post-petition and post-confirmation processes in the hopes of creating a conflict between §§ 326(b)(2)(C) and 1327(a) where one does not exist. Simply put, the post-BAPCPA code now allows a DSO creditor to collect after the imposition of the automatic stay, but that right ends after confirmation of the plan. Therefore, neither the legislative history nor intent of § 326(b)(2)(C) impacts the clear language of § 1327(a) that binds all creditors to the plan. . . . [T]he binding effect of a confirmed plan encompasses all issues that could have been litigated in Gonzalez’s case—including whether the DOR could intercept Gonzalez’s reimbursement payment.”), aff'g Florida Dep't of Rev. v. Gonzalez (In re Gonzalez), No. 1:15-cv-20023-KAM, 2015 WL 5692561, at *2-*3 (S.D. Fla. Sept. 29, 2015) (Marra) (Applying Florida Department of Revenue v. Rodriguez (In re Rodriguez), 367 F. App'x 25 (11th Cir. Feb. 22, 2010) (Dubina, Pryor, Anderson), cert. denied, 562 U.S. 833, 131 S. Ct. 128, 178 L. Ed. 2d (Oct. 4, 2010), state violated confirmation order that provided for domestic support obligations when it attempted to collect directly from the debtor. "[H]ad Congress intended the result [the state] urges this Court to adopt, it would have amended 11 U.S.C. § 1327 to provide that domestic support obligation creditors are not bound by confirmed plans. Congress did not do so. The Court rejects Appellant's argument that in the absence of a specific injunction directed to Appellant in the confirmation order, the order did not unambiguously proscribe its conduct . . . . Appellant's conduct was unambiguously proscribed by 11 U.S.C. § 1327(a). It was not necessary for the Bankruptcy Court to add anything to its order. It bears noting that Appellant filed a proof of claim in the underlying bankruptcy case, and the confirmed plan contained provisions to pay 100% of Appellant's claim over time. . . . Appellant did not object to this plan. . . . [I]t was within [the bankruptcy court's] discretion to hold Appellant in contempt and order Appellant to pay Debtor's reasonable attorney's fees and costs." Attorney fees, at a reduced rate, were properly awarded pursuant to 11 U.S.C. § 106(a)(3).), aff'g No. 12-23881-CIV, 2013 WL 5308020 (S.D. Fla. Sept. 20, 2013) (Marra), aff'g No. 11-23183-BKC-LMI, 2012 WL 2974813, at *4-*5 (Bankr. S.D. Fla. July 20, 2012) (Isicoff) (The State of Florida is bound by confirmation order that provided full payment of child support arrearage and faces contempt for intercepting an expense reimbursement check to the debtor. Confirmed plan included payment of ongoing child support and payment of $2,400 to cure support arrearage. After confirmation, the State of Florida Department of Revenue intercepted a travel reimbursement check to the debtor and the debtor responded with an action for contempt. "This Court agrees with [Florida Department of Revenue v. Rodriguez (In re Rodriguez), No. 09-13222, 2010 WL 597224 (11th Cir. Feb. 22, 2010) (unpublished) (Dubina, Pryor, Anderson),] that both domestic support creditors and debtors are bound by the terms of a chapter 13 plan . . . . [S]o long as the Debtor is meeting his obligations under the Plan, the DOR may not take any action inconsistent with the Plan. . . . [T]he DOR [is] in contempt for violating this Court's Confirmation Order. . . . [T]he Debtor is entitled to reasonable attorney fees and costs.").
Hope v. Acorn Fin., Inc., 731 F.3d 1189, 1193-95 (11th Cir. Sept. 26, 2013) (Barkett, Jordan, Schlesinger) (Confirmed plan that treats car lender as secured creditor precludes trustee's postconfirmation preference action when trustee knew of defective security interest and recommended confirmation; confirmed plan is binding on trustee notwithstanding omission of trustee in § 1327(a). "[Section] 1327(a) cannot be read in isolation, and other provisions of Chapter 13 strongly suggest that a confirmed plan is binding for at least some purposes on the trustee. . . . [The trustee] did not merely forego her opportunity to file a timely objection to Acorn's claim; she affirmatively recommended to the bankruptcy court that Mr. Fluellen's proposed plan—which listed Acorn as a secured creditor—be confirmed. . . . If a trustee, like a debtor or creditor, is obliged to make a timely objection to the confirmation of a plan, and foregoes an objection she is aware of, it is difficult to see why the trustee, like a debtor or creditor, would not also be bound by confirmation. . . . Our holding . . . is a narrow one, necessarily limited by the facts before us: a Chapter 13 trustee who is aware, prior to confirmation, about the defects in a creditor's security interest and who, despite that knowledge, does not object to the creditor's claim and affirmatively recommends confirmation of a proposed plan in which the creditor is given a secured position. We need not, and do not, address a scenario where the trustee is unaware of the defects in the creditor's security interest until after confirmation."), aff'g No. 5:11-CV-276 MTT, 2012 WL 74874 (M.D. Ga. Jan. 10, 2012) (unpublished) (Treadwell) (Citing Celli v. First National Bank of N. N.Y. (In re Layo), 460 F.3d 289 (2d Cir. Aug. 15, 2006) (Kearse, Sack, Hall), confirmation order and § 1327(a) apply to trustee and are preclusive of avoidance action of which trustee was aware.), aff'g 446 B.R. 612 (Bankr. M.D. Ga. Mar. 18, 2011) (Smith) (Applying United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), trustee's avoidance action was precluded by confirmation of plan that provided for car lender as secured creditor. Trustee was aware that lien would be avoidable, but trustee did not object to confirmation.).
Florida Dep't of Rev. v. Rodriguez (In re Rodriguez), No. 09-13222, 2010 WL 597224, at *3 (11th Cir. Feb. 22, 2010) (unpublished) (Dubina, Pryor, Anderson) (Florida Department of Revenue did not violate automatic stay by sending child support collection letters because of exception in § 362(b)(2)(B); state did violate confirmation order by seeking to collect more than was provided for in confirmed plan, and bankruptcy court appropriately found contempt and assessed attorney fees. State waived sovereign immunity under § 106(b) by filing a proof of claim. Carver v. Carver, 954 F.2d 1573 (11th Cir. Mar. 6, 1992) (Fay, Hatchett, Gibson), was distinguishable. "[A]lthough the State cannot be said to have violated the automatic stay provisions of § 362(a) because of the child support exception to that statute, it did violate the terms of Rodriguez's bankruptcy plan, as confirmed by the bankruptcy court. Because the State, like all creditors, was bound by the terms of the confirmed plan pursuant to § 1327(a), we conclude that the bankruptcy court did not err in granting Rodriguez's motion for contempt. . . . Although § 1327(b), which provides that following confirmation property revests with the debtor, allows a child support creditor to seek collection from the debtor, § 1327(a) forbids collection of any debt not confirmed by the plan.").
Florida Dep't of Rev. v. Rodriguez (In re Rodriguez), No. 09-13222, 2010 WL 597224, at *2 (11th Cir. Feb. 22, 2010) (unpublished) (Dubina, Pryor, Anderson) (Florida Department of Revenue did not violate automatic stay by sending child support collection letters because property of the estate vested in the debtor at confirmation under § 1327(b) and exception to stay in § 362(b)(2)(B) applied; state did violate confirmation order by seeking to collect amounts in excess of that provided for in confirmed plan, and damages were appropriately assessed for contempt. "This exception [§ 362(b)(2)(B)] applies here because, pursuant to 11 U.S.C. § 1327(b), after Rodriguez's plan was confirmed by the bankruptcy court, all of Rodriguez's property not necessary to fulfill the requirements of the plan was revested with Rodriguez personally as a matter of law. 11 U.S.C. § 1327(b); Telfair v. First Union Mortgage Corporation, 216 F.3d 1333, 1340 (11th Cir. [July 7, 2000) (Tjoflat, Marcus, Kravitch)]. Therefore, subsequent to confirmation, the property was 'not property of the estate' and subject to the § 362(b)(2)(B) child support exception.").
Robinson v. Tyson Foods, Inc., 595 F.3d 1269, 1274-75 (11th Cir. Feb. 5, 2010) (Marcus, Fay, Anderson) (When confirmed plan overcame vesting effect of confirmation and debtor failed to amend schedules to reveal postconfirmation employment discrimination lawsuit, judicial estoppel applied notwithstanding that full-payment plan was completed nine months after filing of lawsuit. "[A]ll qualified property acquired by Robinson during the pendency of her bankruptcy belonged to her bankruptcy estate and not her personally. . . . [W]hen Robinson filed her claim against Tyson while her bankruptcy was still pending, the claim vested in the bankruptcy estate and Robinson had a duty to notice the suit to all creditors. . . . By failing to update her bankruptcy schedule to reflect her pending claim, Robinson represented that she had no legal claims to the bankruptcy court while simultaneously pursuing her legal claim against Tyson in the district court. These actions, both taken under oath, are clearly inconsistent. . . . [T]he motive to conceal stems from the possibility of defrauding the courts and not from any actual fraudulent result.").
Waldron v. Brown (In re Waldron), 536 F.3d 1239 (11th Cir. Aug. 4, 2008) (Edmondson, Pryor, Johnson) (Distinguishing Telfair v. First Union Mortgage Corp., 216 F.3d 1333 (11th Cir. 2000), adopting Barbosa v. Soloman, 235 F.3d 31 (1st Cir. 2000), and citing City of Chicago v. Fisher (In re Fisher), 203 B.R. 958, 962 (N.D. Ill. 1997), uninsured motorist benefits from postconfirmation personal injury is property of estate because assets acquired after confirmation become property of estate. "As one court has explained, some property of the estate is vested in the debtor at confirmation, under section 1327(b), but property acquired later vests in the estate, under section 1306(a), until the case ends or is converted[.]" Bankruptcy court did not abuse its discretion by requiring debtors to amend schedules to disclose settlement of postpetition personal injury action. "The district court and bankruptcy court read our precedents as recognizing a debtor's continuing duty to disclose changes in his financial situation during the pendency of his bankruptcy.").
Alabama
Middle District of Alabama
In re Williams, Nos. 16-33245-DHW, 16-33271-DHW, 2017 WL 2628430 (Bankr. M.D. Ala. June 16, 2017) (Williams) (Citing United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), and § 1327(a), car lessor is bound by confirmation of plan that treated lease as a security agreement to be paid through the trustee. Lessor is not entitled to stay relief or to declaration that lease was rejected when lessor did not object to confirmation.).
Richardson v. PNC Mortg. (In re Richardson), 538 B.R. 594 (Bankr. M.D. Ala. Sept. 18, 2015) (Sawyer) (Citing Universal American Mortgage Co. v. Bateman (In re Bateman), 331 F.3d 821 (11th Cir. May 22, 2003) (Birch, Dubina, Kravitch), res judicata effect of confirmed plan defeated objection to amount of secured proof of claim.).
In re Meriweather, No. 11-80452-WRS, 2012 WL 37644 (Bankr. M.D. Ala. Jan. 9, 2012) (Sawyer) (Putative car lessor is bound by confirmation of plan that treated its debt as a secured claim; lessor's failure to object to confirmation is fatal to any argument that its lease was mistreated by the plan.).
In re Nolan, No. 11-80632-WRS, 2012 WL 37653 (Bankr. M.D. Ala. Jan. 9, 2012) (Sawyer) (Putative car lessor is bound by confirmation of plan that treated its debt as a secured claim; lessor's failure to object to confirmation is fatal to any argument that its lease was mistreated by the plan.).
In re Meriweather, No. 11-80452-WRS, 2012 WL 37644 (Bankr. M.D. Ala. Jan. 9, 2012) (Sawyer) (Confirmation bound putative lessor to treatment as a secured creditor.).
In re Nolan, No. 11-80632-WRS, 2012 WL 37653 (Bankr. M.D. Ala. Jan. 9, 2012) (Sawyer) (Confirmation bound putative lessor to treatment as a secured creditor.).
In re Harvel, No. 07-81303-WRS, 2011 WL 5149070 (Bankr. M.D. Ala. Oct. 28, 2011) (Sawyer) (Plan trumped claim pursuant to local rule with respect to secured claim amount. When plan modified value of collateral, creditor had burden to object to plan or contest value by motion. Credit union had notice, but did not object to modified plan that reduced value of Tahoe. Credit union was bound by value in plan, notwithstanding higher value in subsequent proof of claim.).
In re Harvel, No. 07-81303-WRS, 2011 WL 5149070 (Bankr. M.D. Ala. Oct. 28, 2011) (Sawyer) (Value in modified plan was binding on lienholder when car was stolen and insurance settlement exceeded balance of allowed secured clam. Credit union received balance of secured claim fixed by modified plan and debtor kept balance of proceeds to purchase another vehicle.).
In re Anderson, 439 B.R. 206 (Bankr. M.D. Ala. Aug. 17, 2010) (Williams) (Citing United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), unpaid balance of food stamp overpayment is a DSO that would normally be excepted from discharge by § 1328(a), but the debt is dischargeable at the completion of payments when confirmed plan treated the claim as general unsecured, Department of Human Resources filed a general unsecured claim, DHR did not object to confirmation and DHR accepted partial payments through the plan. DHR is bound by § 1327 to accept its status as a general unsecured creditor. Moreover, DHR is estopped by the equitable doctrine of laches from asserting that its claim is priority and nondischargeable for the first time after the completion of payments and when the debtor can no longer modify the plan to deal with the balance of the debt.).
In re Anderson, 439 B.R. 206, 210-11 (Bankr. M.D. Ala. Aug. 17, 2010) (Williams) (Citing United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), unpaid balance of food stamp overpayment is dischargeable at completion of payments when confirmed plan treated claim as general unsecured notwithstanding that it was entitled to priority under § 507(a)(1)(B). The Department of Human Resources filed a general unsecured claim, DHR did not object to confirmation and DHR accepted partial payment through the plan. DHR is bound by § 1327 to the terms of the confirmed plan. Further, DHR is "estopped under the equitable doctrine of laches from asserting that its claim is a priority one. . . . DHR's delay in insisting that its claim is a priority one cannot be excused. . . . [T]he debtors have completed payments under their plan and are prevented by the statute from modifying the plan. . . . [H]olding this debt nondischargeable as a result of DHR's having slumbered on its rights would deprive the debtors of the 'fresh start' that they sought at the inception of this case.").
In re Anderson, 439 B.R. 206 (Bankr. M.D. Ala. Aug. 17, 2010) (Williams) (Citing United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), and Universal American Mortgage Co. v. Bateman (In re Bateman), 331 F.3d 821 (11th Cir. May 22, 2003) (Birch, Dubina, Kravitch): unpaid balance of food stamp overpayment is a DSO that could be paid less than in full under §§ 1322(a)(4) and 507(a)(1)(B), and unpaid balance would normally be nondischargeable under § 1328(a); here, however, unpaid balance of food stamp overpayment is dischargeable when confirmed plan treated claim as general unsecured, Department of Human Resources filed a general unsecured claim, DHR did not object to confirmation and DHR accepted partial payments through the plan. Section 1327 binds DHR to accept its status as a general unsecured claim holder. Moreover, DHR is estopped by the equitable doctrine of laches from asserting that its claim is priority and nondischargeable for the first time after the completion of payments and when the debtor can no longer modify the plan to deal with the unpaid balance of the debt.).
In re Gonzalez, No. 09-11503-DHW, 2010 WL 1490057 (Bankr. M.D. Ala. Apr. 15, 2010) (unpublished) (Williams) (Mortgage creditor was bound by confirmed plan which provided that debtor would make all postpetition contractual mortgage payments according to contract terms; because mortgage was not in default at filing of petition, creditor may not recover an escrow shortage by filing an arrearage claim but must instead adjust the escrow payment in the manner allowed by the contract.).
In re Baxter, 374 B.R. 292 (Bankr. M.D. Ala. Aug. 20, 2007) (Williams) (Applying Telfair v. First Union Mortgage Corp., 216 F.3d 1313 (11th Cir. 2000), cert. denied, 531 U.S. 1073, 121 S. Ct. 765, 148 L. Ed. 2d 666 (2001), and Muse v. Accord Human Resources, Inc., 129 Fed. Appx. 487 (11th Cir. 2005), and distinguishing Burnes v. Pemco Aeroplex, Inc., 291 F.3d 1282 (11th Cir. 2002), cause of action for violation of automatic stay and for violation of Fair Debt Collection Practices Act that accrued after confirmation is unnecessary for execution of plan, and proceeds from that lawsuit are not property of Chapter 13 estate; settlement proceeds can be disposable income for purposes of trustee's postconfirmation modification under § 1329.), order denying certification for direct appeal, 2007 WL 2848829 (Bankr. M.D. Ala. Sept. 24, 2007).).
Tarver v. Citifinancial Auto, Ltd. (In re Tarver.), Nos. 05-12028-DHW, 07-1033-DHW, 2007 WL 1876369 (Bankr. M.D. Ala. June 28, 2007) (unpublished) (Williams) (TILA complaint not barred by judicial estoppel or res judicata effect of confirmation; TILA action could not have been effectively litigated at confirmation and debtors did not take an inconsistent position at confirmation as part of scheme to mislead court.).
In re Barnes, 326 B.R. 832, 842, 843 (Bankr. M.D. Ala. June 29, 2005) (Chapter 13 plan "provided for" claim of creditor even though address to which notice was sent was that of creditor's attorney; when plan provided for creditor as unsecured, judgment lien survived bankruptcy. Chapter 13 petition listed judgment creditor but listed address as creditor's attorney. Plan treated claim as unsecured even though creditor held judgment lien. Creditor did not file a claim and took no action until debtor received discharge. When creditor sought to enforce its lien, debtor initiated adversary proceeding to determine effect of discharge. Failure to list creditor with correct address was defective notice, but creditor had actual knowledge of bankruptcy filing. Chapter 13 discharged in personam liability of debtor. Plan, however, did not "provide for" judgment lien. "The Debtor in this case might have 'provided for' Sawyer's secured claim in his Chapter 13 plan. As Sawyer's judgment lien was only partially secured, Barnes could have provided in his Chapter 13 Plan for payment of the secured portion of the judgment, in full, while treating the remaining unsecured portion as an unsecured claim. . . . Instead, the Plan in the case at bar treated Sawyer's claim as unsecured. . . . As no action was taken in Barnes' Chapter 13 case [against the lien], Sawyer's judgment lien survived intact. . . . For this reason, the rule of Dewsnup applies and therefore Sawyer is entitled to appreciation in the property subsequent to the filing of the Chapter 13 petition." The creditor was free to pursue in rem rights against the debtor's property.).
In re Barron, 325 B.R. 17 (Bankr. M.D. Ala. Apr. 15, 2005) (Williams) (Debtor is only obligated to insure mobile home for $15,000 value in confirmed plan; Green Tree not justified to force-place insurance and not entitled to reimbursement for premium.).
Northern District of Alabama
Consumer Portfolio Servs., Inc. v. Coleman, 342 B.R. 817 (N.D. Ala. Mar. 16, 2006) (Guin) (Bankruptcy court had jurisdiction to determine whether confirmed and completed Chapter 13 plan precluded debtor's post-discharge state court lawsuit alleging that repossession and liquidation of a car pursuant to the confirmed plan was inconsistent with Alabama Uniform Commercial Code.).
In re Templeton, 538 B.R. 578, 593 (Bankr. N.D. Ala. Aug. 6, 2015) (Robinson) (Confirmation can sometimes cut off later-filed claims objections. Synthesizing Hope v. Acorn, 731 F.3d 1189 (11th Cir. Sept. 26, 2013) (Barkett, Jordan, Schlesinger), Universal American Mortgage Co. v. Bateman (In re Bateman), 331 F.3d 821 (11th Cir. May 22, 2003) (Birch, Dubina, Kravitch), and Wallis v. Justice Oaks II, Ltd. (In re Justice Oaks II, Ltd.), 898 F.2d 1544 (11th Cir. Apr. 25, 1990) (Tjoflat, Hatchett, Morgan), and discussing Covert v. LVNV Funding, LLC, 779 F.3d 242 (4th Cir. Mar. 3, 2015) (Niemeyer, Shedd, Keenan), "where: (1) the unsecured claims were filed preconfirmation, (2) the debtors' plans provided for payments to unsecured claimholders, (3) the plans were confirmed and payments commenced, (4) the grounds for the objections were patently obvious on face of the claims as filed, (5) no objection was made until several months, if not years following plan confirmation and commencement of payments, and (6) most importantly, there is no apparent justification for the delay in filing the objection, then an objection based on the statute of limitations will be precluded by virtue of the res judicata effect of plan confirmation. Further, . . . doctrine of laches will defeat objections to claims where, although res judicata is not applicable because the claims were filed postconfirmation, the statute of limitations defense was apparent on the face of the filed claim but the objection was not raised within a reasonable time after the claims were filed, especially where several plan payments were made and distributed to creditors.").
FNB Bank v. Carlton (In re Carlton), No. 10-40054-JJR, 2011 WL 3799885, at *5 (Bankr. N.D. Ala. Aug. 26, 2011) (unpublished) (Robinson) (Although automatic stay terminated under § 362(c)(3)(A) because of prior case dismissal, confirmed plan provided for retention of property and payment of mortgage, and publication of foreclosure notices violated confirmation order. Bank had retained plan payments and filed proofs of claim for arrears and ongoing principal. Court has authority under § 105(a) to award attorney fees for violation of confirmation order; but, citing Sternberg v. Johnston, 595 F.3d 937 (9th Cir. Feb. 8, 2010) (Hawkins, Berzon, Clifton), sanctions for civil contempt of confirmation order must be compensatory, not punitive or speculative. Once bank stopped foreclosure process, contempt ceased. Bank not required to compensate debtor for attorney fees incurred in attempting to collect damages for violation of confirmation order. No credible evidence of damages for emotional harm. "Although the contempt in this case arose from a violation of the confirmation order, not the automatic stay, the rationale with regard to an award of legal fees applies with equal force in the context of both situations, and there is no logical distinction between the two regarding what attorney's fees may be recovered." Minimal fees and expenses for enforcement of confirmation order were allowed.).
Gant v. Johnny's Auto & Truck Repair (In re Gant), No. 10-00157-BGC, 2011 WL 7069458 (Bankr. N.D. Ala. June 16, 2011) (Cohen) (When confirmation vested property in debtors, stay terminated as to vehicle and debtors' dispute with repairman should be pursued in state court.).
Jones v. Regional Acceptance Corp. (In re Jones), No. 08-40027-JJR, 2008 WL 4830538 (Bankr. N.D. Ala. Nov. 4, 2008) (unpublished) (Robinson) (Debtors are bound by confirmed plan that provided for payment in full of car lender's secured claim without reserving TILA action.).
Cline v. Deutsche Bank Nat'l Trust Co. (In re Cline), 386 B.R. 344 (Bankr. N.D. Ala. Feb. 11, 2008) (Robinson) (Confirmed plan that cured default and maintained payments on a mortgage is not binding on mortgage holder that received stay relief under § 362(c)(3) five days after entry of confirmation order. In Kimberly Cline's seventh bankruptcy case and Jimmy Cline's fifth case, bankruptcy court extended automatic stay under § 362(c)(3) with respect to Ameriquest Mortgage until January 31, 2007, to give the parties an opportunity to negotiate. During those negotiations, the debtor filed an amended plan that cured default and maintained payments on the Ameriquest mortgage. Ameriquest did not object, and plan was confirmed on January 26, 2007. Distinguishing Green Tree Financial Corp. v. Garrett (In re Garrett), 185 B.R. 620 (Bankr. N.D. Ala. 1995): "This Court is not convinced Congress intended for . . . repeat debtors to have another opportunity for de facto stay protection under Section 1327(a), after they failed to retain or receive stay protection under Sections 362(c)(3) or (4). In other words, Section 1327(a) should not be construed as elevating plan confirmation to super-priority status, providing relief tantamount to the automatic stay after bona fide stay protection was lost or never obtained under Sections 362(c)(3) and (4). . . . [O]nce a court finds there is no sufficient reason to justify an extension or imposition of the stay under Section 362(c)(3) or (4), confirmation of a plan should neither change that finding nor interfere with the creditor's uninterrupted right to exercise its remedies post-confirmation without seeking additional relief from the court. By not monitoring the debtor's case, the creditor is not foolishly letting down its guard, rather it is justifiably relying on a prior and final order of the court. . . . [T]his Court holds Section 1327(a) does not implicitly or otherwise overrule a pre-confirmation order allowing the stay to expire under Section 362(c)(3). The expiration or termination of the stay pursuant to Section 362(c)(3) transcends confirmation, and notwithstanding Section 1327(a) a creditor may continue to rely on such expiration or termination after confirmation when exercising its contractual and state court remedies.").
In re Jemison, Nos. 07-40761, 07-40917, 07-40803, 07-40916, 2007 WL 2669222, at *1-*3 (Bankr. N.D. Ala. Sept. 6, 2007) (Sua sponte, court denies confirmation of plans that postpone revesting of property of the estate. Citing Telfair v. First Union Mortgage Corp., 216 F.3d 1333 (11th Cir. 2000), and Black v. United States Postal Serv. (In re Heath), 115 F.3d 521 (7th Cir. 1997): "Although some courts find 'tension' between Sections 1306 and 1327, this Court finds none. . . . [W]hen it comes time for property of the estate to be returned to the debtor at confirmation, the plan and order of confirmation should provide for the estate to retain a sufficient portion of the debtor's future earnings, and occasionally other property, to fund the plan. . . . '"[T]he plan upon confirmation returns so much of that property of the debtor's control as is not necessary to the fulfillment of the plan."' . . . Each plan now under consideration provides that all property of the estate will not vest in the debtor until the case is closed, dismissed or converted. Much of the property to be retained by the estates in these cases will not be used to fund the debtors' plans or serve any other legitimate purpose contemplated by the plans or the Code . . . . Other than garnering extended automatic stay protection, from the debtors' perspective, there can be no other reason for the plans now under consideration to propose a delay in vesting all the estates' property in the debtors. . . . This Court does not interpret Sections 1322(b)(9) and 1327(b) as permitting an arbitrary delay in the vesting of the estate's property in the debtor in excess of the portion reasonably anticipated as needed to fund the plan within the confines of the Code. . . . [O]nly that portion of the estate's property reasonably calculated to provide for the payment of the plan over the applicable commitment period should be retained by the estate, and the remainder must be returned to the debtor. The estate is not a safe harbor in which debtors may moor their property, including earnings, for protection from post-petition creditors.").
Jones v. GMAC (In re Jones), No. 06-80150-JAC-13, 2007 WL 1725593 (Bankr. N.D. Ala. June 13, 2007) (unpublished) (Caddell) (Truth in Lending Act complaint attacking charge for GAP insurance is barred by res judicata effect of confirmed plan that pays GMAC in full. Four elements of res judicata are present in plan confirmation: valid prior judgment from court of competent jurisdiction, final judgment on merits, identity of parties, and same cause of action in both proceedings.).
Jones v. GMAC (In re Jones), No. 06-80150-JAC-13, 2007 WL 1725593 (Bankr. N.D. Ala. June 13, 2007) (unpublished) (Caddell) (Truth in Lending Act complaint attacking charge for GAP insurance is barred by confirmation of plan that proposed to pay GMAC in full.).
Consumer Portfolio Servs., Inc. v. Coleman (In re Coleman), Nos. 04-70048-CMS, 04-70049-CMS, 2007 WL 1526651 (Bankr. N.D. Ala. May 24, 2007) (unpublished) (Stilson) (Confirmed plan providing for surrender of car and payment of post-sale deficiency precludes debtor's cause of action for violation of Alabama UCC notice-of-sale requirements.).
Consumer Portfolio Servs., Inc. v. Coleman (In re Coleman), Nos. 04-70048-CMS, 04-70049-CMS, 2007 WL 1526651 (Bankr. N.D. Ala. May 24, 2007) (unpublished) (Stilson) (Under confirmation order, vesting in debtor did not occur until discharge, but preconfirmation cause of action for alleged violation of Alabama UCC's notice-of-sale requirements did not vest in debtor because it was not scheduled. As a result, debtor is barred by lack of standing and res judicata effect of confirmation from pursuing cause of action.).
Graves v. First Educators Credit Union (In re Graves), Nos. 06-40845-JJR-13, 06-40134, 2007 WL 824059, at *8 (Bankr. N.D. Ala. Mar. 14, 2007) (unpublished) (Accelerated confirmation hearing required by BAPCPA may require reconsideration of Eleventh Circuit's position in Universal American Mortgage Corp. v. Bateman (In re Bateman), 331 F.3d 821 (11th Cir. 2003); however, when confirmed plan included negotiated resolution of credit union's secured claim, § 1327(a) precludes postconfirmation TILA litigation. "[U]nder existing Eleventh Circuit precedent, secured creditors, . . . who have put debtors on notice by filing their claims before confirmation, and whose secured claims are specifically dealt with in a proposed plan in a manner that is not at odds with what is reflected in their proofs of claims, have a right to expect objections to their claims will be unequivocally raised, adequately noticed, and litigated before confirmation. Under those circumstances, post-confirmation objections come too late. 11 U.S.C. § 1327(a).").
In re Macklin, 349 B.R. 867 (Bankr. N.D. Ala. Sept. 8, 2006) (Lienholder is entitled to balance of its debt from insurance proceeds at destruction of debtor's car, but attorney's fee is reduced to reflect 15% cap in contract.).
Southern District of Alabama
In re Ferrouillat, 558 B.R. 938 (Bankr. S.D. Ala. Oct. 24, 2016) (Oldshue) (Failure to object to confirmation leaves purchaser at tax sale bound by plan that pays redemption amount over life of plan.).
In re Milligan, No. 04-17079, 2007 WL 484853 (Bankr. S.D. Ala. Feb. 9, 2007) (unpublished) (Allowance of GMAC's secured claim caused lien to attach to insurance proceeds for accidental loss of vehicle after confirmation; reopening/conversion to Chapter 7 did not release lien on proceeds.).
Florida
Middle District of Florida
Beacham v. Silva (In re Silva), No. 2:11-cv-282, 2012 WL 2996742 (M.D. Fla. July 23, 2012) (unpublished) (Hodges) (Creditor holding judgment lien on personal property was bound by confirmed plan that provided for payment outside plan. Although debtor originally proposed to treat claim as unsecured, to be paid substantially in full with other unsecured creditors, creditor could not now opt for that more favorable treatment. Creditor was not denied due process as it still had judgment lien and collection remedies under state law.).
Moscaritolo v. Akincibasi (In re Akincibasi), No. 3:05-cv-822-J-32HTS, 2006 WL 2466544, at *2 (M.D. Fla. Aug. 24, 2006) (unpublished) (Corrigan) (Confirmation order that disallowed claims renders moot appeal of order denying extension of time to file a proof of claim. "[A] confirmation order has res judicata effect on pending claims and is akin to a final judgment entered by a district court. . . . [T]he Confirmation Order addressed Moscaritolo's claim and is res judicata as to that claim . . . . Because Moscaritolo failed to appeal the Confirmation Order, which adjudicated his claim, Moscaritolo's claim is now moot.").
In re Adams, No. 9:10-bk-15218-FMD, 2014 WL 409043, at *2 (Bankr. M.D. Fla. Feb. 4, 2014) (Delano) (Confirmed plan that paid $20,741 to unsecured creditors precludes amendment of exemptions two years later when amendment would reduce minimum amount to which unsecured creditors would be entitled. "The Court's conclusion rests upon the interplay of § 1327(a) with Fed. R. Bankr.P. 1009. That rule states in relevant part that a 'schedule . . . may be amended by the debtor as a matter of course at any time before the case is closed.' Absent a showing of bad faith or prejudice to creditors, courts routinely permit debtors to amend their claim of exemption. But . . . there is a difference between exercising the right to amend exemptions under Rule 1009 and actually being entitled to the exemption claimed in the amendment. The procedural right to amend is subordinate to the substantive res judicata effect of a confirmation order.").
In re Sciarrino, No. 9:11-bk-05881-FMD, 2013 WL 3465920, at *4 (Bankr. M.D. Fla. July 10, 2013) (Delano) (Citing Telfair v. First Union Mortgage Corp., 216 F.3d 1333 (11th Cir. July 7, 2000) (Kravitch, Marcus, Tjoflat), and Jones v. Boston Gas Co. (In re Jones), 369 B.R. 745 (B.A.P. 1st Cir. June 8, 2007) (Lamoutte, Carlo, Kornreich) (per curiam), and adopting estate transformation approach, utility creditor's invoice for postconfirmation services was not an attempt to collect a debt from property of the estate. "'[I]nclusion of a debtor's postpetition earnings in her chapter 13 estate is intended to capture for dedication to a chapter 13 plan all funds necessary to effectuate that plan. It does not prohibit a debtor from using postpetition earnings to satisfy postpetition obligations.' Implicit . . . is the concept that if a debtor's postpetition earnings are not necessary to fund the chapter 13 plan, they are the debtor's property to spend as the debtor chooses. This would include the payment of postpetition debts.").
In re Sciarrino, No. 9:11-bk-05881-FMD, 2013 WL 3465920 (Bankr. M.D. Fla. July 10, 2013) (Delano) (Citing Telfair v. First Union Mortgage Corp., 216 F.3d 1333 (11th Cir. July 7, 2000) (Kravitch, Marcus, Tjoflat), and Jones v. Boston Gas Co. (In re Jones), 369 B.R. 745 (B.A.P. 1st Cir. June 8, 2007) (Lamoutte, Carlo, Kornreich) (per curiam), because only that portion of debtor's income necessary to fund confirmed plan remains property of the estate, utility creditor's postconfirmation invoicing was a personal liability of debtor that did not violate stay.).
In re Rice, 442 B.R. 140 (Bankr. M.D. Fla. Dec. 23, 2010) (Adams) (Confirmation orders that required debtors to devote postpetition tax refunds to plans were binding on debtors and creditors under § 1327(a) but did not bind nonfiling spouses. Refunds had to be allocated based on income contributions of spouses.).
In re Rice, 442 B.R. 140 (Bankr. M.D. Fla. Dec. 23, 2010) (Adams) (Confirmation orders that required debtors to devote postpetition tax refunds to plans were not binding on nonfiling spouses. When only one spouse filed Chapter 13 but spouses filed prepetition joint income tax returns, refunds must be allocated based on each spouse's contribution to income. Spouses had separate interests in refunds, and only debtor's individual interest became property of bankruptcy estate.).
In re Diaz, No. 6:02-bk-05591-ABB, 2009 WL 3584517 (Bankr. M.D. Fla. Sept. 30, 2009) (unpublished) (Briskman) (State entities are bound by confirmation and by claims allowance process to the amount of allowed child support claims and cannot relitigate effect of confirmation when charged with stay violations and violations of discharge injunction. State child support agencies had notice and did not object to plan providing for payment of allowed child support claims. Preclusive effect was given to claim allowance process and confirmation order establishing amount of allowable support claims.).
In re Stansbury, 403 B.R. 741, 746, 748 (Bankr. M.D. Fla. Mar. 9, 2009) (Glenn) (Confirmed plan that surrendered corporation's property in full satisfaction of debtor's obligation was binding on creditor with notice that failed to object notwithstanding that plan incorrectly classified mortgage creditor. Two factors determine binding effect: "First, the Court should determine whether the affected creditor received proper notice of the proposed plan. . . . Second, the Court should determine whether the issue resolved in the plan was appropriately addressed as a contested matter in the confirmation process, or whether it should have been resolved in the context of an adversary proceeding. . . . In other words, a confirmed plan is binding on all creditors, unless a particular creditor was otherwise entitled to the heightened procedural safeguards provided by an adversary proceeding." This creditor had adequate notice and opportunity to litigate surrender and classification at confirmation. "The improper classification and treatment of a claim are matters that are suitable for resolution at the confirmation hearing. In re Burrell, 346 B.R. 561, 568-70 (B.A.P. 1st Cir. 2006).").
In re Stansbury, 403 B.R. 741, 749, 746, 748 (Bankr. M.D. Fla. Mar. 9, 2009) (Glenn) (Creditor had adequate notice and opportunity to litigate and is bound by confirmation of plan notwithstanding improper classification and surrender of corporation's property in full satisfaction of debtor's obligation. Plan incorrectly scheduled mortgagee as secured creditor when property was owned by corporation rather than debtor. Plan was confirmed without objection that surrendered corporation's property in full satisfaction of debtor's debt. Although creditor filed timely proof of claim for unsecured deficiency after surrender of the property, "[a] creditor is not excused from asserting its rights in the confirmation process, however, solely because the claims bar date had not expired prior to the confirmation hearing." Two factors determine binding effect: "First, the Court should determine whether the affected creditor received proper notice of the proposed plan. . . . Second, the Court should determine whether the issue resolved in the plan was appropriately addressed as a contested matter in the confirmation process, or whether it should have been resolved in the context of an adversary proceeding. . . . In other words, a confirmed plan is binding on all creditors, unless a particular creditor was otherwise entitled to the heightened procedural safeguards provided by an adversary proceeding." "The improper classification and treatment of a claim are matters that are suitable for resolution at the confirmation hearing. In re Burrell, 346 B.R. 561, 568-70 (B.A.P. 1st Cir. 2006).").
In re Carrasco, 395 B.R. 154 (Bankr. M.D. Fla. June 19, 2008) (Funk) (Citing In re Laplana, 363 B.R. 259 (Bankr. M.D. Fla. 2007), postpetition and postconfirmation tax refunds are property of the estate and are included projected disposable income; plan cannot be confirmed that vests tax refunds in debtor.).
In re Lohr, 377 B.R. 382, 386 (Bankr. M.D. Fla. Mar. 19, 2007) (Distinguishing Universal American Mortgage Co. v. Bateman (In re Bateman), 331 F.3d 821 (11th Cir. 2003), tax collector is bound by orders confirming plan and providing for discharge after completion of plan payments. "Bateman does not stand for the proposition that an objection to claim is the only way to deal with a secured claim in a Chapter 13 case." Debtor did not object to tax collector's claims. Confirmed plan specifically provided for those claims, albeit containing error in amount. Tax collector did not object to confirmation. Binding effects of confirmation and discharge order result in discharge of remaining tax obligation.).
In re LaPlana, 363 B.R. 259 (Bankr. M.D. Fla. Feb. 9, 2007) (Jennemann) (Citing Telfair v. First Union Mortgage Corp., 216 F.3d 1333 (11th Cir. July 7, 2000) (Tjoflat, Marcus, Kravitch), BAPCPA did not change rule that postpetition tax refund remains property of the Chapter 13 estate when plan provides that tax refunds shall be turned over to trustee for distribution to unsecured creditors; projected disposable income test does not change this result because overwithholding is inconsistent with allowable deduction for actual taxes and plan provision for turnover of tax refunds corrects for withholding mistakes.).
In re Stukes, 357 B.R. 879, 882 (Bankr. M.D. Fla. Dec. 5, 2006) (Res judicata effect of confirmation under § 1327(a) does not bar postconfirmation objection to mortgage holder's claim because § 1324(b) accelerates confirmation before claims bar date. Mortgage holder filed preconfirmation proof of claim for arrearages, and debtor amended plan to increase arrearage payment to amount in claim. After confirmation and after claims bar date, debtor filed objection to preconfirmation proof of claim. "[D]ue to the time limit imposed under Section 1324(b), the Court can no longer continue confirmation hearings to allow objections to be dealt with prior to confirmation and in many situations, such as the instant case, the plan is confirmed prior to the claims bar date. . . . [T]here are certain situations in which there will be no res judicata effect as to issues that could not be appropriately resolved at the confirmation hearing. . . . [D]ue to this Court's interpretation of § 1324(b), Debtor's objection could not have been responded to, noticed and heard by the Court prior to confirmation. Accordingly, the Court finds that Debtor's objection to ABN Amro's claim is not barred by 11 U.S.C. § 1327(a).").
In re Cushion, 349 B.R. 919, 921 (Bankr. M.D. Fla. Aug. 28, 2006) (Funk) (Confirmation of plan that provided full payment of $14,327.14 arrearage claim precludes debtors' postconfirmation objection to arrearage claim in that same amount when proof of claim was filed a month before hearing on confirmation. "A Chapter 13 debtor who has an opportunity to object to a creditor's claim prior to confirmation but fails to do so waives the right to object to the claim and is bound by the confirmation order. . . . Such a waiver does not apply to a claim, which is filed on the eve of confirmation and thus does not provide the debtor a reasonable opportunity to object. . . . Debtors had over a month to file an objection . . . . Debtors elected to amend their plan at the confirmation hearing to provide for the full payment . . . . Debtors waived their right to object . . . and are bound by the treatment thereof.").
In re Cushion, 349 B.R. 919, 921 (Bankr. M.D. Fla. Aug. 28, 2006) (Confirmation is preclusive of claim objection if claim was filed enough in advance of confirmation to provide a reasonable opportunity for objection; proof of claim filed a month before confirmation provided enough time for objection, and plan that provided full payment of the claim forfeited right to later object. "A Chapter 13 debtor who has an opportunity to object to a creditor's claim prior to confirmation but fails to do so waives the right to object to the claim and is bound by the confirmation order. . . . Such a waiver does not apply to a claim, which is filed on the eve of confirmation and thus does not provide the debtor a reasonable opportunity to object. . . . Debtors had over a month to file an objection . . . . Debtors waived their right to object.").
In re Zayed, 340 B.R. 108 (Bankr. M.D. Fla. Mar. 9, 2006) (Jennemann) (Debtor is bound by confirmed plan requiring turnover of tax refunds to trustee.).
In re Torres, 336 B.R. 839, 843 (Bankr. M.D. Fla. Dec. 16, 2005) (Jennemann) (Debtor is bound by confirmed plan to pay allowed secured claim and can't change that amount after completion of payments when collateral is damaged. Citing Ford Motor Credit Co. v. Stevens (In re Stevens), 130 F.3d 1027 (11th Cir. Dec. 12, 1997) (Cox, Barkett, Hunt), debtor is bound to plan terms for payment of allowed secured claim. Since debtor completed plan payments, "and the amount and status of Carmax's claim was determined at confirmation . . . [h]e cannot now at the eleventh hour, reclassify Carmax's claim to shift the burden of the van's loss, ex post facto, to Carmax and retain the $1,636.53.").
In re Santangelo, 325 B.R. 874, 879, 882 (Bankr. M.D. Fla. Mar. 22, 2005) (Jennemann) (Though confirmed plan provided that pre- and post-petition property of the debtors would be deemed property of the estate, debtors' claim in a class action against Fairbanks Capital was not committed to creditors and vested in the debtors at confirmation; barring debtors from participating in class action for failure to file a claim did not violate automatic stay. Debtors were victims and members of a class in a lawsuit against Fairbanks Capital. Chapter 13 plan provided 100% dividend to unsecured creditors and provided "all pre and post-petition property of the debtor(s) herein, including but not limited to wages or other earnings, shall be deemed property of this estate in bankruptcy and as such shall be protected post-confirmation and pre-confirmation." Under Eleventh Circuit law, only assets needed to make payments under the plan are protected. See Telfair v. First Union Mortgage Corp., 216 F.3d 1333 (11th Cir. 2000). Thus, debtors' claim against Fairbanks was no longer property of the estate because the debtors were not relying upon any recovery from Fairbanks to pay any portion of their Chapter 13 plan. "Pursuant to the decision in Telfair, when property is not necessary to the fulfillment of the plan, the property is revested in the debtor and no longer constitutes property of the estate." Accordingly, activity in the class action did not violate automatic stay.).
In re Sullivan, 321 B.R. 306, 308 (Bankr. M.D. Fla. Jan. 14, 2005) (Funk) (Mortgage holder is bound by confirmed plan notwithstanding consensual relief from stay before confirmation. "'The pre-confirmation lift stay order terminated the automatic stay under 11 U.S.C. § 362(a), but does not change the binding effect of an order of confirmation . . . . The Court agrees with the holding in [Green Tree Financial Corp. v. Garrett (In re Garrett), 185 B.R. 620 (Bankr. N.D. Ala. July 31, 1995) (Sledge)]. A confirmation order which provides for payments to a creditor is binding upon that creditor notwithstanding the fact that the creditor obtained relief from the automatic stay prior to confirmation of the plan.").
Northern District of Florida
In re Shiver, 484 B.R. 468, 474 (Bankr. N.D. Fla. Dec. 21, 2012) (Specie) (Citing Universal American Mortgage Co. v. Bateman (In re Bateman), 331 F.3d 821 (11th Cir. May 22, 2003) (Birch, Dubina, Kravitch), debtor was bound by confirmed plan that provided specific deadline for filing unsecured deficiency claim that was beyond bar date in Code and Rules—debtor was precluded to object to deficiency claim on basis that it was not timely filed. Plan unambiguously did not require that creditor's unsecured deficiency claim be preceded by prior timely filed proof of claim. "However inconsistent the Debtor's plan language may arguably be with the absolute bar date for claims, once the plan was confirmed, 11 U.S.C. § 1327 bound Hancock Bank and the Debtor to the plan.").
Harris v. Ben-Ezra & Katz, P.A. (In re Harris), 458 B.R. 591 (Bankr. N.D. Fla. Oct. 3, 2011) (Killian) (Vesting of property in debtor at confirmation defeated argument that Bankruptcy Rule 2016 applied when mortgage creditor claimed postconfirmation fees without seeking court permission. Fees would be payable by debtor personally, not by estate.).
Han v. GE Capital Small Bus. Fin. Corp. (In re Han), Nos. 00-42086, 05-03012, 2005 WL 2456933 (Bankr. N.D. Fla. July 12, 2005) (unpublished) (Mahoney) (Because property of the estate vested in the debtor at confirmation under § 1327(b) as interpreted in Telfair v. First Union Mortgage Corp. (In re Telfair), 216 F.3d 1333 (11th Cir. 2000), direct payments by debtor after confirmation were not property of estate and were not protected by automatic stay; GE did not violate stay by applying postconfirmation direct payments to prepetition arrearages or by charging excessive interest.).
Southern District of Florida
Florida, Dep't of Revenue v. Rodriguez (In re Rodriguez), No. 09-20863-CIV-ALTONAGA, 2015 WL 9697324, at *4-*8 (S.D. Fla. Dec. 9, 2015) (Altonaga) (Section 362(b)(2)(B) insulates state of Florida from violation of stay with respect to support collection after confirmation, but state violated confirmed plan under § 1327(a) and is in contempt when plan provided for payment of prepetition support arrears and state dunned debtor for the arrears during the Chapter 13 case. State waived Eleventh Amendment immunity with respect to violation of confirmed plan by filing proof of claim. Plan confirmed in 2005 provided for payment of prepetition child support arrears. During the Chapter 13 case, Florida Department of Revenue sent letters to the debtor. Bankruptcy court found state in contempt in February 2009. "[T]he plain language of section 362(b)(2)(B) allows the holder of a child support obligation against a debtor to proceed against the debtor in spite of the filing of a Chapter 13 petition. . . . ' . . . Congress intended in 1994 to change the law such that maintenance and support obligations not only may, but must, be treated specially and paid in full under a Chapter 13 plan.' . . . [T]he exception found in section 362(b)(2)(B) is somewhat superfluous. Because a Chapter 13 plan must provide for any support obligations due by the debtor, there is no need for an exception to the automatic stay to allow for a child support creditor to pursue the action in state court. . . . While the Division did not violate the automatic stay provisions, it nonetheless violated the terms of the debtor's confirmed Plan. The bankruptcy court therefore did not commit error in finding the Division in contempt and awarding attorney's fees . . . .").
In re Scott, 567 B.R. 847 (Bankr. S.D. Fla. Apr. 26, 2017) (Ray) (Debtor is bound by surrender provision in confirmed plan; court “commands” debtor to stop opposition to foreclosure in state court or face contempt.).
In re Prada, No. 14-25315-EPK, 2015 WL 7873749, at *1 (Bankr. S.D. Fla. Dec. 3, 2015) (Kimball) (Mortgage modification agreement that was offered by CitiMortgage and accepted by debtors, never signed by Citi but incorporated into confirmed plan is binding on Citi. "While the mortgage modification agreement itself was not an enforceable contract, the Debtors' chapter 13 plan was modified to incorporate the terms of the mortgage modification. Citi had appropriate notice of the proposed plan modification and the hearing thereon, and Citi failed to object to the proposed modification. The Debtors' plan as modified was confirmed . . . . Thereafter, Citi attempted to negate its deal with the Debtors by filing a notice of mortgage payment change inconsistent with the agreed modification. . . . Because the order confirming the Debtors' modified plan and the order directing Citi to comply with the terms of the loan modification are both final and no longer subject to appeal, Citi is bound by those orders in spite of the fact that the mortgage modification agreement would not otherwise have been binding on Citi.").
In re Grey, No. 14-27803-BKC-LMI, 2015 WL 3535410, at *2 (Bankr. S.D. Fla. June 4, 2015) (Isicoff) (Plan confirmed without objection that provided unequal payments of mortgage precludes objection to postconfirmation modification that raises unequal-payments issue for first time. Prior to confirmation, debtor amended plan seven times. NationStar objected to some of the amendments, but ultimately the seventh amended plan was confirmed without objection. The confirmed plan provided equal payments to NationStar during months one through three and then a different equal payment in months four through sixty. After confirmation, the debtor moved to modify the plan to provide for escrow payments for taxes and insurance, but otherwise the modified plan included the same step-up of "equal" payments as the confirmed plan. "[T]he res judicata effect of the confirmed Seventh Amended Plan precludes Nationstar from challenging the monthly payments proposed in the First Amended Plan. . . . The Eleventh Circuit explained that '[p]reclusion under § 1327 is somewhat harsher than common law issue preclusion' . . . . The preclusive effect of a confirmed Chapter 13 plan forecloses 'relitigation of any issue actually litigated and any issue necessarily determined by the confirmation order,' including whether the requirements of section 1325 have been satisfied. . . . This Court confirmed the Debtor's Seventh Amended Plan without objection by Nationstar . . . . The treatment of Nationstar's secured claim in the Seventh Amended Plan and the First Modified Plan are identical. Had Nationstar objected to the Seventh Amended Plan, perhaps it would have prevailed, but it chose not to. Thus, Nationstar may not use the Debtor's agreement to include escrow payments in the First Modified Plan as an opportunity to retread issues Nationstar should have raised prior to confirmation.").
In re Gonzalez, No. 11-23183-BKC-LMI, 2012 WL 2974813, at *3-*5 (Bankr. S.D. Fla. July 20, 2012) (Isicoff) (BAPCPA did not upset the holding in Florida Department of Revenue v. Rodriguez (In re Rodriguez), No. 09-13222, 2010 WL 597224 (11th Cir. Feb. 22, 2010) (unpublished) (Dubina, Pryor, Anderson): State of Florida is in contempt for violating confirmation order by intercepting a payment to the debtor to collect a child support arrearage that was provided for through the plan. Confirmed plan included payment of ongoing child support and payment to cure a $2,400 child support arrearage. After confirmation, the State of Florida intercepted a travel reimbursement check from the Department of Treasury to the debtor. Debtor brought contempt action for violation of the confirmation order. "[T]he decision of the DOR to allow the interception of the expense reimbursement as a method for payment of the arrearage was contrary to the express provisions of the Debtor's Plan, which provides that the arrearage of $2,400 will be paid in full . . . . [T]he changes in BAPCPA do not change the Rodriguez holding. . . . [E]ven if an action taken by the DOR in connection with its enforcement obligations is not a violation of the automatic stay, it may, nonetheless, be a violation of a confirmation order. . . . This Court agrees with Rodriguez that both domestic support creditors and debtors are bound by the terms of a chapter 13 plan . . . . [S]o long as the Debtor is meeting his obligations under the Plan, the DOR may not take any action inconsistent with the Plan. . . . [T]he DOR [is] in contempt for violating this Court's Confirmation Order. . . . [T]he Debtor is entitled to reasonable attorney fees and costs."), aff'd, No. 1:15-cv-20023-KAM, 2015 WL 5692561 (S.D. Fla. Sept. 29, 2015) (Marra).).
In re Dominique, 368 B.R. 913 (Bankr. S.D. Fla. May 14, 2007) (Isicoff) (Lender is bound by terms of confirmed plan, but postpetition home mortgage obligations may not be modified in plan.).
Lazar v. Cuevas (In re Cuevas), No. 06-01328-BKC-LMI, 2007 WL 397006 (Bankr. S.D. Fla. Feb. 1, 2007) (unpublished) (Isicoff) (Confirmation order that included valuation was binding in absence of timely objection, but second mortgage holder's complaint is treated as Rule 60(b) motion; evidentiary hearing set concerning sufficiency of service of plan and debtor's subsequent motion to sell.).
Georgia
Middle District of Georgia
Goodwyn v. Capital One, N.A., 127 F. Supp. 3d 1367, 1374-75 (M.D. Ga. Aug. 28, 2015) (Land) (Chapter 20 debtor not eligible for discharge can reduce interest rate on vehicle loan in plan when creditor did not object to confirmation. "By failing to object and by receiving payments under the plan that fully paid the principal amount of the debt plus a reasonable interest rate, [creditor] accepted the plan. . . . Since [creditor] accepted [debtor's] bankruptcy plan, the plan could permanently modify her debt. Section 1322(b)(2) allows for modification of rights to creditors, and a 'debtor who is not entitled to a discharge may still permanently modify a loan in a bankruptcy plan.' . . . 'Because the no-discharge case is closed without discharge, rather than dismissed, the code sections that reverse any lien avoidance actions . . . upon conversion or dismissal are not implicated, and, thus, do not act to prevent the permanence of the lien avoidance.' . . . [A] completed Chapter 13 plan retains its binding effect after a case is closed without discharge. . . . [O]nce [debtor] completed her Chapter 13 plan and her case was closed without discharge, 'the provisions of the plan bec[a]me permanent, and the lien [modification] is, similarly, permanent.'").
HomeQ Servicing Corp. v. Hauf, No. 4:06-CV-83 (CDL), 2007 WL 196857, at *5 (M.D. Ga. Jan. 23, 2007) (unpublished) (Land) (Reopening case to permit trustee's administration of cause of action added in amended schedules did not implicate vesting effect of § 1327(b), since debtors "had voluntarily consented to the assignment of the claim to the trustee for administration for the benefit of the creditors.").
Banks v. Kam's Auto Sales (In re Banks), 521 B.R. 417, 423-24 (Bankr. M.D. Ga. Oct. 17, 2014) (Carter) (Under Waldron v. Brown (In re Waldron), 536 F.3d 1239 (11th Cir. Aug. 4, 2008) (Pryor, Edmondson, Johnson), vehicle purchased postconfirmation was property of Chapter 13 estate. "[P]roperty obtained after confirmation never vests in the debtor under § 1327(b) because such vesting is a singular event that happens, if at all, upon plan confirmation and affects only property in existence at that time. . . . [V]esting under § 1327(b) is limited to assets that 'exist at confirmation.' . . . [A]ssets obtained post-confirmation during a pending Chapter 13 case are property of the estate—even if the property of the estate vested in the debtor at confirmation under § 1327(b). . . . [T]his property can be administered in the bankruptcy proceeding. . . . [T]he non-vesting provision in the Debtor's Plan as applied to the vehicle in this case [is superfluous] because the vehicle was acquired post-confirmation. Waldron held that vesting under § 1327(b) is limited to a debtor's pre-confirmation property and has no effect on property acquired after confirmation. By logical extension, a non-vesting provision in a plan—the purpose of which is to preclude § 1327(b)'s default vesting provision—likewise has no effect on property acquired after confirmation. Under Waldron, all property acquired after confirmation remains property of the estate.").
In re Ryles, 457 B.R. 138 (Bankr. M.D. Ga. June 10, 2011) (Laney) (Acceptance of confirmed plan that paid for car as fully secured claim bound bank to accept payments through plan rather than from proceeds of homeowners insurance that cross-collateralized the vehicle.).
In re Castleberry, 437 B.R. 705, 707-10 (Bankr. M.D. Ga. Sept. 29, 2010) (Walker) (Citing United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), and distinguishing Universal American Mortgage Co. v. Bateman (In re Bateman), 331 F.3d 821 (11th Cir. May 22, 2003) (Birch, Dubina, Kravitch), 910-day PMSI car lender accepted cramdown plan by failing to timely object to confirmation and cannot upset confirmation order under Bankruptcy Rule 9023; car lender is not entitled to retain its lien if the debtors complete their plan and receive a discharge. "An order confirming a Chapter 13 plan is a final order. . . . Ford Credit's motion is governed by Federal Rule of Bankruptcy Procedure 9023 . . . . The only grounds for granting such a motion are 'newly-discovered evidence or manifest errors of law or fact.' . . . The Supreme Court recently said in dicta that a bankruptcy judge is required 'to address and correct a defect in a debtor's proposed plan even if no creditor raises the issue.' Espinosa, 103 S. Ct. at 1381, n. 14. However, Debtors' cramdown of Ford Credit's claim is not an obvious plan defect. First, it is not clear from the plan that Ford Credit's claim was a 910 claim. . . . [A]t the time of the hearing on confirmation, Ford Credit had not filed a proof of claim. . . . [A]t the time of confirmation, the Court could not determine whether the car was purchased for the personal use of Debtors . . . . [T]he Court could not assume Ford Credit objected to such treatment when Ford Credit remained silent. . . . [A] creditor might find it preferable to accept payments under a plan in an amount less than the full amount of the 910 claim rather than dealing with the liquidation of the vehicle. . . . If a creditor is unhappy with its treatment under the plan, it must take some affirmative action to timely communicate its opposition. . . . Ford Credit did not file an objection until more than two weeks after the deadline for doing so and more than one week after the Chapter 13 Trustee recommended the plan for confirmation. . . . In such circumstances, the Court may deem Ford Credit's silence as acceptance of the plan. Because the creditor's acceptance of the plan satisfies § 1325(a)(5), the Court did not commit any legal error by confirming the plan. . . . The [Bateman] court noted its decision was specific to cases involving real property subject to the antimodification provision of § 1322(b)(2). . . . Bateman does not apply in this case. Therefore, Ford Credit is not entitled to retain its lien after Debtors complete their plan and receive a discharge.").
In re Castleberry, 437 B.R. 705, 708-10, 710 n.4 (Bankr. M.D. Ga. Sept. 29, 2010) (Walker) (Citing United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), and distinguishing Universal American Mortgage Co. v. Bateman (In re Bateman), 331 F.3d 821 (11th Cir. May 22, 2003) (Birch, Dubina, Kravitch), 910-day PMSI car lender's failure to timely object to cramdown plan is fatal to Bankruptcy Rule 9023 challenge to confirmation order; car lender is not entitled to retain its lien after debtors complete their plan and receive a discharge. With respect to the dicta in Espinosa that a bankruptcy judge is required to address and correct defects in a proposed plan: "Debtors' cramdown of Ford Credit's claim is not an obvious plan defect. . . . [I]t is not clear from the plan that Ford Credit's claim was a 910 claim. . . . [A]t the time of the hearing on confirmation, Ford Credit had not filed a proof of claim. . . . [T]he Court could not determine whether the car was purchased for the personal use of Debtors without taking evidence. . . . [T]he Court could not assume Ford Credit objected to such treatment when Ford Credit remained silent. . . . Ford Credit did not file an objection until more than two weeks after the deadline for doing so . . . . [T]he Court may deem Ford Credit's silence as acceptance of the plan. . . . The [Bateman] court noted its decision was specific to cases involving real property subject to the antimodification provision of § 1322(b)(2). . . . Bateman does not apply in this case. Therefore, Ford Credit is not entitled to retain its lien after Debtors complete their plan and receive a discharge." In a footnote: "An open question remains as to whether Bateman would dictate a different result if (1) Ford Credit had filed a proof of claim within the time to object to confirmation that conflicted with its treatment under the proposed plan and (2) the evidence available at confirmation demonstrated Ford Credit was entitled to 910 treatment. In such circumstances, the Court would have to consider whether the antimodification provisions of the hanging paragraph and of § 1322(b)(2) are analogous.").
In re Tapley, No. 06-52297-JDW, 2007 WL 2274716 (Bankr. M.D. Ga. Aug. 3, 2007) (unpublished) (Walker) (Creditor that failed to object to confirmation is bound by plan that pays first $1,500 to debtor's attorney before paying other creditors. Creditor admitted that it knew of this practice prior to confirmation.).
In re Huff, 332 B.R. 661, 665, 668 (Bankr. M.D. Ga. Oct. 5, 2005) (Upon the destruction of the Chapter 13 debtor's automobile, the creditor loss payee would be entitled to the insurance proceeds to the extent of its secured claim and the debtor's request to substitute collateral would be denied. AmeriCredit had a lien on the debtor's Pontiac Grand Prix which was destroyed, and insurance policy, owned by the debtor, listed AmeriCredit as the loss payee. The debtor sought to substitute the collateral so he could utilize the insurance proceeds to purchase another automobile. "It should be noted that mere ownership of the insurance policy by the bankruptcy estate does not necessarily mean that the bankruptcy estate has sole interest or ownership of the proceeds in that insurance policy. . . . [W]here both the debtor (via the bankruptcy estate) and the secured creditor (via the insurance policy) have an interest in the insurance proceeds, the secured creditor shall be paid the value of its interest in accordance with the confirmed Chapter 13 Plan and any remainder shall be paid to the debtor as the party in whom the automobile revested when the Chapter 13 plan was confirmed." Court noted that "the outcome may differ in cases where the collateral has not revested in the debtor by the time the collateral is destroyed. Such would be the case where destruction occurs pre-confirmation or where a provision in the debtor's Chapter 13 Plan states the collateral does not revest in the debtor upon confirmation.").
In re Johnson, 329 B.R. 783 (Bankr. M.D. Ga. Aug. 26, 2005) (Hershner) (Lender is not entitled to default rate of interest or late charges when payment term and interest rate are established in confirmed plan.).
Northern District of Georgia
In re Beam, 510 B.R. 399 (Bankr. N.D. Ga. Mar. 27, 2014) (Drake) (Res judicata effect of confirmed plan precluded debtors from stripping wholly unsecured junior residential lien when confirmed plan treated lienholder as secured creditor.).
In re Howard, 507 B.R. 394, 398-400 (Bankr. N.D. Ga. Mar. 14, 2014) (Sacca) (Confirmed plan cannot resurrect rights in pawned property that were forfeited prepetition under state law when debtor did not pay before maturity date. "'Pledged goods not redeemed within the grace period shall be automatically forfeited to the pawnbroker by operation of [law], and any ownership interest of the pledgor or seller shall automatically be extinguished as regards the pledged item [regardless of whether vehicle was repossessed].' . . . Under Georgia law, the rights of a pawnbroker in pawned property are different from the rights that the holder of a security interest generally has in encumbered property, largely because of the automatic entitlement to full ownership of pawned property that a pawnbroker has when the pledgor does not timely redeem the property. . . . Because the Debtor did not pay the outstanding principal, interest, or other charges due on the maturity dates of the contracts and because the Debtor did not redeem the vehicles prior to filing for bankruptcy protection, the vehicles are not included in 'property of the estate.' . . . [A] 'Chapter 13 plan may not provide for disposition of property which is not property of the estate as defined in 11 U.S.C. § 541' and the 'fact of plan confirmation cannot bind a property owner to a plan provision disposing of his property rights when such property is not within the Court's vested jurisdiction.' . . . [Section] 1322(b)(2) . . . cannot be used to restructure the claims of a pawnbroker after the expiration of the redemption period. . . . For the very same reasons that a former mortgage-holder is not bound to the terms of a confirmed Chapter 13 plan providing for the cure of a lawfully foreclosed mortgage and a former lessor is not bound to the terms of a confirmed plan assuming and curing a terminated lease, the Debtor's Chapter 13 plan cannot bring property into her bankruptcy estate that was not her property as of the petition date. Even though the Debtor continued to possess the vehicles on the petition date, she no longer held legal title to them. Her equity of redemption had expired, thus she had no rights left in the property and she therefore no longer has any right to cure her default.").
In re Berrouet, 469 B.R. 393 (Bankr. N.D. Ga. Mar. 26, 2012) (Diehl) (Res judicata effect of confirmed plan that treated second mortgage as secured precluded lien stripping.).
In re White, No. 11-67119, 2012 WL 909835 (Bankr. N.D. Ga. Feb. 14, 2012) (Diehl) (BOA entitled to relief from confirmation of plan that erroneously classified secured claim in personal property section rather than real property section.).
In re Taylor, No. 06-76846-MGD, 2011 WL 7070518 (Bankr. N.D. Ga. Dec. 7, 2011) (Diehl) (Confirmed plan that treated second mortgage as secured is binding on debtor and precludes motion that would value property and treat mortgage as unsecured. Motion cannot change valuation at petition, and there was value to secure second lien.).
In re Chambers, No. G06-20632-REB, 2008 WL 7842095, at *3 (Bankr. N.D. Ga. Feb. 5, 2008) (Brizendine) (Confirmed plan that valued claim at $0 is not sufficient to overcome presumptive validity of claim filed as secured before confirmation; objection to claim was also required because plan was not clear enough to bind creditor. "[W]hether or not a debtor can accomplish bifurcation of a claim through a plan that clearly sets forth such intent in compliance with Section 506(a) and Bankruptcy Rule 3012, the process effected here through Debtors' plan and motion to avoid lien does not produce this result as it did not provide for sufficient notice.").
In re Ridge, No. 05-75189-CRM, 2007 WL 7141630 (Bankr. N.D. Ga. Aug. 7, 2007) (Mullins) (Car lender was bound by amount fixed at confirmation when vehicle was destroyed postpetition; creditor must refund excess payments received from trustee and insurance.).
In re Ridge, No. 05-75189-CRM, 2007 WL 7141630 (Bankr. N.D. Ga. Aug. 7, 2007) (Mullins) (Secured creditor entitled to insurance resulting from postpetition accidental loss of vehicle was limited to recovery of secured claim amount fixed at confirmation; creditor must refund excess payments received from trustee and insurance proceeds.).
In re Carter, No. 00-75939, 2006 WL 6588999, at *2 (Bankr. N.D. Ga. Apr. 14, 2006) (Massey) (Debtor's attorney bound by amount of fee fixed in confirmation order. "Provisions related to compensation of the debtor's attorney are covered by the res judicata effect of the confirmation order.").
Southern District of Georgia
Vasquez v. Georgia Dep't Human Resources Office of Child Support Servs., No. CV507-82, 2008 WL 4425304 (S.D. Ga. Sept. 30, 2008) (Wood) (Notwithstanding shaky procedural context, remand is necessary to determine effect of confirmed plan that provided no payment for claim filed by debtor on behalf of Georgia Department of Human Resources when debtor alleged the claim was not a domestic support obligation and confirmed plan treated debt as unenforceable.).
In re Doolittle, No. 16-11048, 2018 WL 1627152, at *2–*4 (Bankr. S.D. Ga. Mar. 30, 2018) (Barrett) (Applying Telfair v. First Union Mortgage Corp., 216 F.3d 1333 (11th Cir. July 7, 2000) (Tjoflat, Marcus, Kravitch), and Waldron v. Brown (In re Waldron), 536 F.3d 1239 (11th Cir. Aug. 4, 2008) (Edmondson, Pryor, Johnson), escrow overpayment sent to Chapter 13 trustee after confirmation of plan that paid mortgage directly by debtor was property of the Chapter 13 estate under § 1306(a) notwithstanding that property of the estate vested in the debtor at confirmation under § 1327(b). “Section 1306(a) defines property of the chapter 13 bankruptcy estate to include all property acquired by the debtor after a case commences . . . . Section 1327(b) is more narrow and revests property of the bankruptcy estate into the debtor upon confirmation of the chapter 13 plan . . . . [T]he receipt of the escrow overage was unexpected and is a new post-confirmation asset that did not vest in Debtor at confirmation. . . . [I]t was not necessary for the mortgage payments. . . . Allowing the Trustee to retain the escrow overage is simply correcting the error of overestimating the amount of the mortgage payment, similar to a tax refund.”).
In re Jordan, No. 15-11081, 2018 WL 1626052 (Bankr. S.D. Ga. Mar. 30, 2018) (Barrett) (Applying In re Doolittle, No. 16-11048, 2018 WL 1627152 (Bankr. S.D. Ga. Mar. 30, 2018) (Barrett), excess escrow payments returned to Chapter 13 trustee by Wells Fargo in a direct-pay case are property of the Chapter 13 estate notwithstanding confirmed plan that vested estate in debtor at confirmation. Debtor can amend exemptions and seek to recover escrow overpayment from the trustee.).
Hicks v. U.S. Bank Nat’l Ass’n (In re Hicks), No. 15-10005, 2017 WL 1102909, at *5 (Bankr. S.D. Ga. Mar. 23, 2017) (Barrett) (Confirmed plan that “reserved for the Debtor all rights to proceed and/or continue with a mortgage modification” was binding on U.S. Bank and precluded bank’s argument that property was not property of the bankruptcy estate. “Debtor’s complaint states a plausible claim that U.S. Bank is bound by the terms of the confirmed plan because it did not object to confirmation.”).
Nicholson v. Wells Fargo Bank, N.A. (In re Nicholson), No. 16-40668-EJC, 2017 WL 991698 (Bankr. S.D. Ga. Mar. 10, 2017) (Coleman) (Foreclosing creditor was not bound by confirmed plan that treated residence as property of the estate because property was owned by nonfiling spouse and foreclosing creditor was not a creditor of the debtor. Property was not within bankruptcy court jurisdiction and treating property as property of the estate in the confirmed plan was not effective to capture an interest in the filing spouse that could be managed through the plan.).
In re Thompson, No. 13-11235, 2014 WL 1330110 (Bankr. S.D. Ga. Mar. 31, 2014) (Barrett) (Confirmed plan that provided for title-pawn creditor's claims foreclosed argument that pawned vehicles were not property of the estate when pawn agreements had not matured prior to petition date; however, cause for relief from stay included that no party filed proof of claim, creditor was not receiving distributions under plan and debtors had no equity in vehicles.).
Warren v. PNC Bank, Inc. (In re Warren), 499 B.R. 914, 918-20 (Bankr. S.D. Ga. Oct. 4, 2013) (Davis) (Binding effect of confirmation precludes modification four years later to strip off junior mortgage that became unsecured as result of decline in value of property. Plan could not strip off lien at confirmation because there was value to secure the debt and lien was protected from modification by § 1322(b)(2). "'Valuation of secured claims is adjudicated by the order of confirmation. A debtor's confirmed plan is res judicata as to claims determination.' . . . [E]ven if the allowed claim can be reconsidered under § 502(j), that process would only determine whether the claim can be disallowed for some reason. However, when a party contends that the secured status can be altered because of some post-confirmation event, the issue is not allowance/disallowance. The allowed claim remains an allowed claim. Rather, the issue is determination of the secured status of that claim. The authority to do that is § 506[,] which is procedurally dependent on plan confirmation, not claims allowance.").
Deutsche Bank Nat'l Trust Co. v. Thompson (In re Thompson), 499 B.R. 908 (Bankr. S.D. Ga. July 10, 2013) (Barrett) (Confirmed plan that allowed objections to claims before or after confirmation did not preclude mortgage holder's reformation action.), aff'd, No. CV 113-181, 2014 WL 3925277 (S.D. Ga. Aug. 11, 2014) (Hall).).
In re Waltower, No. 08-12867, 2012 WL 4758043, at *2 (Bankr. S.D. Ga. Sept. 7, 2012) (Barrett) (Surrender of property to mortgagee through confirmed plan and revesting of property in debtors under § 1327(b) removed property from estate and automatic stay terminated; neighbor is entitled to § 362(j) order confirming that automatic stay does not protect debtors from state court nuisance action when mortgagee did not foreclose or maintain property after surrender. Citing Telfair v. First Union Mortgage Corp., 216 F.3d 1333 (11th Cir. July 7, 2000) (Tjoflat, Marcus, Kravitch): "Under the 'estate transformation' approach, confirmation returns all property of the bankruptcy estate to the Debtor that is not necessary for fulfillment of the confirmed plan. . . . With the surrender, the relief from the stay and confirmation of the plan, the bankruptcy estate did not maintain an interest in the Property post-confirmation, so it is no longer under the protection of the automatic stay pursuant to 11 U.S.C. § 362(c)(1).").
In re Waltower, No. 08-12867, 2012 WL 4758043, at *2 (Bankr. S.D. Ga. Sept. 7, 2012) (Barrett) (Surrender of property to mortgagee through confirmed plan and revesting of property in debtors at confirmation under § 1327(b) removed property from estate and automatic stay terminated; neighbor is entitled to § 362(j) order confirming that automatic stay does not protect debtors from state court nuisance action when mortgage holder did not foreclose or maintain property after surrender. Citing Telfair v. First Union Mortgage Corp., 216 F.3d 1333 (11th Cir. July 7, 2000) (Tjoflat, Marcus, Kravitch): "Under the 'estate transformation' approach, confirmation returns all property of the bankruptcy estate to the Debtor that is not necessary for fulfillment of the confirmed plan. . . . With the surrender, the relief from the stay and confirmation of the plan, the bankruptcy estate did not maintain an interest in the Property post-confirmation, so it is no longer under the protection of the automatic stay pursuant to 11 U.S.C. § 362(c)(1).").
Crouser v. BAC Home Loans Servicing, L.P. (In re Crouser), 476 B.R. 340 (Bankr. S.D. Ga. Aug. 20, 2012) (Barrett) (Under Waldron v. Brown (In re Waldron), 536 F.3d 1239 (11th Cir. Aug. 4, 2008) (Edmondson, Pryor, Johnson), vesting at confirmation did not prevent property acquired postconfirmation from coming into estate. Damages for willful stay violation were property of estate that must be turned over to trustee for distribution to creditors.), aff'd, No. 13-14304, 2014 WL 2444399 (11th Cir. June 2, 2014) (unpublished) (Wilson, Pryor, Anderson).).
Best v. GMAC Mortg. LLC (In re Best), No. 11-06015, 2012 WL 2905748, at *6 (Bankr. S.D. Ga. July 5, 2012) (Dalis) (Confirmed plan purporting to strip lien was not adequately noticed to lienholder. Valuation provision was not clear, since GMAC's claim was listed as undersecured or partially secured, which was inconsistent with lien's being wholly unsecured. "The notice required to strip off a wholly unsecured lien through a chapter 13 plan includes two aspects: (1) Notice of the plan must be satisfactory under the circumstances and (2) the valuation provision in the plan must be 'clear and unambiguous.'").
In re Kennedy, No. 10-21613, 2011 WL 1322297 (Bankr. S.D. Ga. Mar. 25, 2011) (Dalis) (Citing Universal American Mortgage Co. v. Bateman (In re Bateman), 331 F.3d 821 (11th Cir. May 22, 2003) (Birch, Dubina, Kravitch), when DSO claim was filed before confirmation and no objection was filed, plan cannot alter priority status of claim. Debtor must follow proper procedure—either object to claim or modify plan to respect priority status of filed claim.).
Midfirst Bank v. Hill (In re Hill), No. 09-01082, 2010 WL 3927060 (Bankr. S.D. Ga. Sept. 29, 2010) (Barrett) (Applying United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 130 S. Ct. 1367, 176 L. Ed. 2d 158 (Mar. 23, 2010), Bank had notice and was bound by confirmation of plan that treated portion of lien as unsecured. Relief was denied to Bank in subsequent adversary proceeding to reform defective description in security deed.).
In re Gerena, No. 08-41912, 2009 WL 8592796 (Bankr. S.D. Ga. Sept. 23, 2009) (Davis) (Confirmed plan treating mortgage as secured precluded trustee's avoidance action based on postconfirmation discovery of possible title defect.).
In re Foreman, 378 B.R. 717 (Bankr. S.D. Ga. Nov. 26, 2007) (Dalis) (Applying Telfair v. First Union Mortgage Corp., 216 F.3d 1333 (11th Cir. 2000), debtor's postconfirmation wrongful death claim is not property of estate, absent showing that it is necessary for plan completion.).
In re Harvey, 356 B.R. 557, 565 (Bankr. S.D. Ga. Sept. 1, 2006) (Davis) (Postconfirmation causes of action for automobile accident injuries became property of estate under § 1306 and "are not deemed to be retroactively vested in the debtor as of confirmation" by operation of § 1327. "[T]hey must be scheduled so that the Trustee's or a creditor's right to seek modification is a meaningful right. If they are not scheduled, they remain property of the estate pursuant to Section 1306 and 554(d)." Court examined Telfair v. First Union Mortgage Corp., 216 F.3d 1333 (11th Cir. 2000), Witko v. Menotte (In re Witko), 374 F.3d 1040 (11th Cir. 2004), and Muse v. Accord Human Resources, Inc., 129 Fed. Appx. 487 (11th Cir. 2005). In Telfair, circuit adopted estate transformation approach to resolving §§ 1306(a) and 1327(b), holding that "confirmation returns so much of property to the debtor's control as is not necessary to the fulfillment of the plan." 216 F.3d at 1340. In Witko, circuit concluded that postpetition malpractice cause of action was not property of the estate, but case had been converted to Chapter 7 and court did not consider §§ 1306(a) and 1327(b). In Muse, which was not binding authority because not published, court held postconfirmation wage claim was not property of estate but there was "no assertion that it was necessary for the plan." 129 Fed. Appx. at 490. Burnes v. Pemco Aeroplex, Inc., 291 F.3d 1282 (11th Cir. 2002), and Ajaka v. BrooksAmerica Mortgage Corp., 453 F.3d 1339 (11th Cir. 2006), compelled holding that Chapter 13 debtor has continuing duty to amend schedules, even after confirmation. Postconfirmation assets may be necessary to plan, especially in context of possible modification of plan and in light of no abandonment of asset under § 554.).
In re Alexander, No. 05-43429, 2006 WL 6885808 (Bankr. S.D. Ga. June 28, 2006) (Davis) (Lessor of truck was bound by confirmation of plan that treated debt as secured claim. Lessor had adequate notice and did not object to plan, including amount of secured claim, monthly payment and interest rate.).
. D.C. Circuit
District of Columbia
Evans v. First Mount Vernon, ILA, 786 F. Supp. 2d 347 (D.D.C. May 24, 2011) (Walton) (Confirmation did not preclude debtor's action against mortgage broker, lender and trustee on deed of trust, alleging fraud, breach of fiduciary duty and statutory violations. Issues in adversary proceeding were not raised or litigated in confirmation hearing.).
In re Davenport, 544 B.R. 245, 254-56 (Bankr. D.D.C. Dec. 31, 2015) (Teel) (Confirmed plan that provided debtor would "pay directly the following claims, to the extent they are 11 U.S.C. § 1322(b)(5) claims" did not provide for the payment of arrears on a long-term real estate-secured debt the debtor paid directly. Neither Bankruptcy Rule 3002 nor judicial estoppel provides any remedy when debtor completed payments under the plan and creditor then asserted prepetition arrears that were not included in its proof of claim. "Under 11 U.S.C. § 1327(c), the property vesting in a debtor pursuant to a confirmed plan 'is free and clear of any claim or interest of any creditor provided for by the plan.' Here, the arrears claim at issue was not provided for by the plan, and thus the property remains subject to the arrears claim. . . . It is true that Fed. R. Bankr.P. 3002.1 provides a procedure for the debtor to obtain a determination of whether the debtor has cured any arrears when a claim secured by a security interest in the debtor's principal residence is 'provided for under § 1322(b)(5) of the Code in the debtor's plan.' Here, however, the issue of determining whether the debtor has cured the arrears does not arise because the plan did not make provision for payment of any arrears owed on the $80,000 promissory note, and Rule 3002.1 is thus inapplicable.").
In re Freeman-Coulbary, No. 11-00864, 2012 WL 1999432 (Bankr. D.D.C. June 4, 2012) (unpublished) (Teel) (Condominium association was bound by confirmed plan that provided for direct payment of postpetition fees.).
In re Payne, No. 09-00949, 2010 WL 3747806, at *1 (Bankr. D.D.C. Sept. 22, 2010) (unpublished) (Teel) (District of Columbia is protected from stay violation by exception in § 362(b)(2)(C), and debtor did not seek contempt for violation of confirmation order that provided for domestic support obligation. But court warns District that it might want to refund amounts withheld that are inconsistent with confirmation order in anticipation of contempt action with respect to confirmation order. District "may unilaterally decide to cease collecting amounts owed on the prepetition arrears that are provided for by the plan, and to refund any such amounts collected post-confirmation in violation of the terms of the confirmed plan." District of Columbia had increased deduction from debtor's monthly pay, to be applied toward prepetition domestic support obligation arrears, notwithstanding that arrears were provided for in confirmed plan.).
In re Henneghan, No. 03-01216, 2009 WL 2855835, at *1 (Bankr. D.D.C. June 15, 2009) (unpublished) (Teel) (Because confirmed plan overcame vesting effect of § 1327(b), unscheduled lender liability claim remained property of the estate until it vested in debtor at discharge. "Section 1327(b) does not distinguish between property of the estate that was scheduled versus estate property that was not scheduled. Unless the plan or the confirmation order provides otherwise, the property of the estate vesting in a debtor pursuant to § 1327(b) includes unscheduled property. Accordingly, the property of the estate that vested in Henneghan upon the entry of the discharge order included the unscheduled lender liability claim.").
Wilson v. Home-Savers, LLC (In re Wilson), Nos. 01-00092, 06-10037, 2006 WL 2348539 (Bankr. D.D.C. July 17, 2006) (unpublished) (Because property of Chapter 13 estate vested in debtor at confirmation under § 1327(b), debtor cannot use automatic stay or § 549 to attack postconfirmation transaction in which debtor executed deed and deed of trust to avoid foreclosure.).