§ 138.1     Alimony, Maintenance and Support in Cases Filed before October 22, 1994
Cite as:    Keith M. Lundin, Lundin On Chapter 13, § 138.1, at ¶ ____, LundinOnChapter13.com (last visited __________).
[1]

The Bankruptcy Reform Act of 1994 made important changes in the treatment of alimony, maintenance or support in Chapter 13 cases. As detailed above,1 debts for alimony, maintenance or support described in § 507(a)(7) are priority claims entitled to full payment under § 1322(a)(2) in Chapter 13 cases filed after October 22, 1994.2 Many problems with the management of domestic relations debts in cases filed before October 22, 1994, were eliminated or minimized by the 1994 amendments. For example, the new priority affects the ease with which support claims are separately classified for more favorable treatment.3

[2]

The 1994 amendments do not apply in cases filed before October 22, 1994.4 The pre-1994 case law dealing with the management of alimony, maintenance or support claims in Chapter 13 cases has historical significance especially as it reflects on other nondischargeable claims that are not entitled to priority, such as student loans. The discussion and citations in this section are based on the Code’s treatment of alimony, maintenance and support prior to the Bankruptcy Reform Act of 1994.

[3]

In some jurisdictions, it has always been common for debtors to use Chapter 13 to manage the payment of alimony, maintenance or child support.5 Especially in jurisdictions that routinely issue payroll deduction orders to the debtor’s employer,6 a Chapter 13 case can be the most reliable way to cure support arrearages and to stabilize continuing payments.

[4]

Many courts have read the Code accurately to permit management of support claims through Chapter 13 cases so long as the conditions for confirmation in §§ 1322 and 1325 are satisfied.7 A significant other group of reported decisions hold that claims for support arrearages can be dealt with through a Chapter 13 plan, but with conditions, for example, the consent of the claim holder or a requirement that the plan include the payment terms fixed by a state domestic relations court.8

[5]

In contrast, there are several decisions prohibiting Chapter 13 debtors from providing for the payment of support through the plan. The idea that delinquent support obligations are not ordinary claims for purposes of Chapter 13 seems to have originated with the U.S. Court of Appeals for the Fourth Circuit in Caswell v. Lang.9 Without reference to the definition of claims, the Fourth Circuit in Caswell held that past-due child support “may not be included in a Chapter 13 plan under the Bankruptcy Code.”10 Variations on this position have appeared in reported decisions from several courts.11

[6]

There is nothing in the Bankruptcy Code to compel the conclusion that alimony or support debts cannot be dealt with in Chapter 13 cases. The specific exception to discharge in § 1328(a)(2)12 for debts of the kind described in § 523(a)(5) demonstrates that Congress contemplated that claims for alimony, maintenance and support would be asserted in Chapter 13 cases and would survive discharge. Nowhere in § 1322 or § 1325 did Congress exclude from treatment under the plan claims that would survive discharge under § 1328(a)(2). There are special provisions of the Code dealing with the interaction between the automatic stay and claims for alimony, maintenance or support that are applicable in Chapter 13 cases.13 That Congress amended the Code in 1994 to change the priority for most claims for alimony, maintenance or support is substantial evidence that Congress always contemplated the management of such claims through Chapter 13 plans.14

[7]

A debt for alimony, maintenance or support fits the definition of claim in 11 U.S.C. § 101(5). Section 502(b)(5) disallows only “unmatured” debts excepted from discharge by § 523(a)(5). A support delinquency at the petition is an allowable claim. The logic that excludes postpetition support debts from participation in a Chapter 7 case, embodied in § 502(b)(5), is wholly inapplicable to allowance of prepetition support delinquencies in a Chapter 13 case: unmatured postpetition support claims are nondischargeable and do not share in the Chapter 7 estate because of prejudice to prepetition claim holders with dischargeable claims that cannot pursue postpetition assets; prepetition support delinquencies were accumulated on the same basis as other prepetition debts and have the same entitlement to share in the whole of the expanded Chapter 13 estate under § 1306.

[8]

Bankruptcy courts are sensitive to the management of domestic relations matters by the state courts.15 However, it does not follow that Chapter 13 cannot be used to pay delinquent alimony and support. Any argument that there is a broad “domestic relations exception” to federal jurisdiction that would prohibit bankruptcy courts from permitting Chapter 13 debtors to manage alimony and support arrearages through a plan is suspect after the Supreme Court’s opinion in Ankenbrandt v. Richards.16

[9]

In other contexts where Congress has declared debts to be nondischargeable in Chapter 13 cases—HEAL loans, for example17—the courts have concluded that debtors can make payments on the nondischargeable claim during the life of the plan.18 Through the careful use of classification of claims, most Chapter 13 debtors can construct a plan that deals fairly with all creditors, including a nondischargeable claim for prepetition support.19

[10]

Treatment of ongoing (postpetition) support through the plan is somewhat more problematic. “Unmatured” § 523(a)(5) claims are not allowable under 11 U.S.C. § 502(b)(5).20 This exclusion from participation in the estate makes sense in Chapter 7 cases, but it makes no sense in Chapter 13 given the expanded definition of the estate in § 1306.21 The budget in Schedule J to Official Bankruptcy Form 6 has a line item for alimony or support—suggesting that the ongoing obligation comes out of the income before calculation of payments to the trustee. Ongoing alimony or support payments are “reasonably necessary to be expended . . . for the maintenance or support of . . . a dependent of the debtor” for purposes of the disposable income test in § 1325(b).22 Support is appropriately deducted from income to calculate the amount that the debtor must pay to other creditors to accomplish confirmation.

[11]

Section 1322(b)(5)23 might be some help—the debtor could propose to maintain payments on a long-term support obligation while the case is pending. But, upon objection, the claim for postpetition support will be disallowed under § 502(b)(5). That the exception to the automatic stay in § 362(b)(2) is disabled by the expanded definition of property of the estate in § 1306, considered with the disallowance of postpetition support under § 502(b)(5) and the exception from discharge in § 1328(a)(2), suggests that Congress did not focus well on management of domestic obligations in Chapter 13 cases.

[12]

Most courts end up finessing the details of the Code to allow the payment of ongoing support either quietly as a budget item or in the open through the trustee on a priority basis that keeps the debtor out of jail. This is the practical outcome even in a jurisdiction that “forbids” treatment of support claims through the plan: the debtor still has to pay the support and it gets “allowed” as a budget deduction before calculation of disposable income, thus reducing funds available for other classes of unsecured claims without the formality of payment through the plan.

[13]

Both before and after the 1994 amendment,24 Chapter 13 debtors have problems with the accumulation of postpetition interest on support claims. It is common that prepetition alimony or support is contained in a state court judgment that almost certainly accrues interest under nonbankruptcy law. For purposes of allowance in the Chapter 13 case, postpetition interest accumulating on a prepetition support judgment is not allowable.25 Because the underlying support claim typically is not dischargeable,26 the accruing postpetition interest is a nondischargeable personal obligation of the debtor at the completion of payments under the plan.27

[14]

That alimony and support are priority claims in Chapter 13 cases filed after October 22, 1994, will little help the debtor with this problem—even claims entitled to priority under § 507 and to full payment under § 1322(a)(2) are not entitled to present value interest through the plan.28


 

1  See § 136.20  Alimony, Maintenance and Support in Cases Filed after October 22, 1994 and § 136.21  Domestic Support Obligations after BAPCPA.

 

2  See 11 U.S.C. § 507(a)(7), as amended by Bankruptcy Reform Act of 1994, Pub. L. No. 103-394, § 304, 108 Stat. 4106 (1994). See also § 73.2  What Claims Are Priority Claims?§ 78.3  Accounting for Adequate Protection and § 136.1  Treatment of Priority Claims.

 

3  See § 87.4  Priority Claims§ 87.5  Priority Claims after BAPCPA and § 88.4  Alimony, Maintenance and Support.

 

4  The 1994 amendments to the sovereign immunity provisions of § 106 are effective in all pending bankruptcy cases and could impact claims for alimony, maintenance or support assigned to a state. See also § 235.1 [ Other Limitations ] § 121.4  Other Limitations.

 

5  See § 8.16  Domestic Relations Problems, § 58.3  Additional Protection for Postpetition Property and Income, § 58.5  Alimony and Support Exception, § 58.6  Domestic Support Obligation Exception after BAPCPA§ 88.4  Alimony, Maintenance and Support, § 106.3  Alimony, Maintenance and Support and § 124.6  Alimony and Support Collection after Confirmation.

 

6  See § 248.1 [ Order to Debtor’s Employer ] § 125.1  Order to Debtor’s Employer.

 

7  See, e.g., Mickelson v. Leser (In re Leser), 939 F.2d 669 (8th Cir. 1991) (Chapter 13 debtor can separately classify child support arrearage for 100% payment and pay other unsecured claim holders only 8%. Child support arrearages are nondischargeable and, absent separate classification, a Chapter 13 plan could be confirmed only when full payment of all unsecured claims was possible.); In re Slater, 188 B.R. 852, 855–56 (Bankr. E.D. Wash. 1995) (Citing Ankenbrandt v. Richards, 504 U.S. 689, 112 S. Ct. 2206, 119 L. Ed. 2d 468 (1992), and In re Gonzales, 172 B.R. 320 (E.D. Wash. 1994), “this Court concludes that it has the authority to include child support arrearages in a Chapter 13 plan.”); In re Walter, 153 B.R. 38, 39–40 (Bankr. N.D. Ohio 1993) (Rejecting Caswell v. Lang, 757 F.2d 608 (4th Cir. 1985), and Pacana v. Pacana-Siler (In re Pacana), 125 B.R. 19 (B.A.P. 9th Cir. 1991), court denies relief from the stay to county child support enforcement agency where Chapter 13 plan proposes to pay prepetition child support arrearages in full through the plan and the debtor’s ongoing current obligation to pay child support is fully satisfied by a direct payroll deduction. “This Court finds instructive the Supreme Court’s view in Ankenbrandt v. Richards that ‘the domestic relations exception [to federal courts’ jurisdiction] encompasses only cases involving the issuance of a divorce, alimony, or child custody decree. . . .’ . . . [A]bsent a showing that the current needs of the payee are unmet, a plan providing for a one hundred percent (100%) payment of arrearages over the life of a Chapter 13 case is acceptable. This Court declines to follow Pacana to the extent that it imposes a per se prohibition against such plans. . . . Section 1306 provides that all income earned during the course of a Chapter 13 case is also property of the bankruptcy estate. It does not appear that there is any non-estate property to which § 362(b)(2) would apply in the present case.”); Lawson v. Lackey (In re Lackey), 148 B.R. 626 (Bankr. N.D. Ala. 1992) (Mickelson v. Leser (In re Leser), 939 F.2d 669 (8th Cir. 1991), presents the better reasoned view that a Chapter 13 plan can provide for child support arrearages. Caswell v. Lang, 757 F.2d 608 (4th Cir. 1985), and Pacana v. Pacana-Siler (In re Pacana), 125 B.R. 19 (B.A.P. 9th Cir. 1991), support the contrary view that domestic relations law is an exception to federal jurisdiction. The Supreme Court’s opinion in Ankenbrandt v. Richards, 504 U.S. 689, 112 S. Ct. 2206, 119 L. Ed. 2d 468 (1992), overrules or substantially limits the view that there is a broad domestic relations exception to federal jurisdiction. After Ankenbrandt, the enforcement of child support arrearages against a Chapter 13 debtor is clearly subject to federal jurisdiction and is a core proceeding. Child support arrearage claim holder is not entitled to postconfirmation relief from the stay where plan separately classified child support for payment of 9% and the debtors concede that the balance of the claim will be nondischargeable. Child support claim holder objected to confirmation but did not appeal order confirming the plan.); In re Benner, 146 B.R. 265 (Bankr. D. Mont. 1992) (Chapter 13 plan can manage past-due child support. To the extent that Caswell v. Lang, 757 F.2d 608 (4th Cir. 1985), holds otherwise, “the ruling must be wrong. . . . [C]hild support obligations have always been nondischargeable under the Code . . . indicating Congress chose this method to protect such creditors rather than to exclude them totally from bankruptcy proceedings. . . . The automatic stay of § 362 clearly applies to attempts to collect child support from property from the estate. . . . In addition, § 502(b)(5) provides that support debts not due as of the filing date are not allowable claims, indicating that support debts are allowable claims if they were already due prepetition. . . . A Chapter 13 plan may provide for the payment of a child support arrearage through the plan and for the payment of current support outside the plan.”); In re Whittaker, 113 B.R. 531 (Bankr. D. Minn. 1990) (“I do not believe that Congress intended to effectively deny Chapter 13 relief to virtually all debtors with child support arrearage obligations.” Declining to follow Caswell v. Lang, 757 F.2d 608 (4th Cir. 1985), court cites In re Davidson, 72 B.R. 384 (Bankr. D. Colo. 1987), for proposition that Chapter 13 debtors can separately classify child support arrearage claim for payment in full through the plan.). See also §§ 152.2 [ Alimony, Maintenance and Support ] § 88.4  Alimony, Maintenance and Support and 185.1 [ Alimony, Maintenance and Support ] § 106.3  Alimony, Maintenance and Support.

 

8  See, e.g., In re Harris, 132 B.R. 166, 170 (Bankr. S.D. Iowa 1991) (“As a general rule, past due child support payments cannot be included in a Chapter 13 plan. . . . However, upon express agreement between the debtor and the recipient, a plan providing for deferred payment of back child support may be confirmed. . . . The debtor has the burden of obtaining from the recipient an express agreement to have the past due payments treated in a manner proposed in the plan. . . . If the debtor cannot obtain the express written approval of the recipient, then a plan proposing to defer back child support payments violates § 1325(a)(3) as not being proposed in good faith.”); In re Santa Maria, 128 B.R. 32, 37 (Bankr. N.D.N.Y. 1991) (“As pertains to child support arrearages, the court declines to strictly follow [Caswell v. Lang, 757 F.2d 608 (4th Cir. 1985),] which held that child support arrearages may not be included in a Chapter 13 plan. . . . The better view would allow inclusion of child support arrearages, but require expedient resolution of the amount of arrearages fixed by the state court, and payment in full of that amount through the plan in accordance with the state court ordered schedule of repayment, if any, in order to establish good faith pursuant to Code § 1325(a)(3). Payment terms other than those ordered by the state court could be confirmable only with the consent of the ex-spouse. . . . Where no specific payment terms on the arrearages are ordered by the state court, good faith would dictate repayment in full through the plan over the briefest term practicable. Discrimination between child support arrearage claims and other unsecured claims in terms of the period of repayment and percent of dividend may be required to effect expedient payment in full of the support and alimony claims.”); In re Herkenhoff, 101 B.R. 585 (Bankr. E.D. Mo. 1989) (Chapter 13 plan can provide for the payment of past-due child support. However, absent the consent of the recipient, plan cannot be confirmed if it alters the rights of the recipient.); Bruggen v. Bruggen (In re Bruggen), 82 B.R. 515 (Bankr. W.D. Mo. 1987) (Citing Caswell v. Lang, 757 F.2d 608 (4th Cir. 1985), absent consent, support obligation cannot be treated under the plan and relief from the stay must be granted.); In re Davidson, 72 B.R. 384 (Bankr. D. Colo. 1987) (Citing Caswell v. Lang, 757 F.2d 608 (4th Cir. 1985), and McCray v. McCray, 62 B.R. 11 (Bankr. D. Colo. 1986), Chapter 13 plan that purports to treat past-due child support or alimony obligations, whether by way of compromise or extension, fails the good-faith requirement of § 1325(a)(3), absent express written approval of the former spouse or Department of Social Services.). See also In re Warner, 115 B.R. 233 (Bankr. C.D. Cal. 1989) (Court seems to hold that it will not confirm Chapter 13 plans dealing with child support arrearages except in extraordinary circumstances in which debtor is paying all or substantially all of unsecured claims and debtor’s plan is consistent with any state court support orders.).

 

9  757 F.2d 608 (4th Cir. 1985).

 

10  757 F.2d at 608.

 

11  See Pacana v. Pacana-Siler (In re Pacana), 125 B.R. 19, 22–24 (B.A.P. 9th Cir. 1991) (Citing Caswell v. Lang, 757 F.2d 608 (4th Cir. 1985), with approval, §§ 362(b)(2), 1328(a)(2) and 523(a)(5) “manifest a legislative intent that child support obligations be excepted from the broad reach of §§ 1322 and 1327, and therefore from the effects of a Chapter 13 plan, as well as the post-confirmation automatic stay. . . . [W]hile a Chapter 13 plan may alter or delay the enforcement of ordinary unsecured creditors’ claims, child support claimants need not wait in line with such creditors, but rather may proceed against the debtor without the hinderance [sic] of either automatic stay or discharge.”); In re Engel, 151 B.R. 542, 542–43 (Bankr. D. Idaho 1993) (State bureau of child support enforcement is entitled to postconfirmation relief from the automatic stay, notwithstanding confirmation of a plan proposing to pay child support arrears in full. “Upon confirmation of a chapter 13 plan all of the property of the estate becomes vested in the debtor. The child support payments as provided in the debtor’s plan are thus not property of the estate and section 362(b)(2) is applicable. Further §§ 523(a)(5) and 1328(a)(2) except child support obligations from discharge.” Citing Pacana v. Pacana-Siler (In re Pacana), 125 B.R. 19 (B.A.P. 9th Cir. 1991), and the “Congressional intent” that child support claimants need not wait in line with other creditors, state bureau “may proceed under the exception of § 362(b)(2) and stay relief is appropriate.”); Nelson v. Nelson (In re Nelson), 85 B.R. 731 (Bankr. E.D. Va. 1988) (Applying Caswell v. Lang, 757 F.2d 608 (4th Cir. 1985), debtor is not entitled to an injunction to stop a wage garnishment issued by a state court for attorneys’ fees in a child support case. The holding in Caswell is not limited to inclusion of past-due support obligations in a Chapter 13 plan, but prohibits the bankruptcy court from interfering with remedies provided by a state court in the whole area of child support concerns.); McCray v. McCray, 62 B.R. 11 (Bankr. D. Colo. 1986).

 

12  See § 158.1  Alimony, Maintenance or Support and § 159.5  Domestic Support Obligations: § 523(a)(5).

 

13  See, e.g., 11 U.S.C. § 362(b)(2), discussed in § 58.5  Alimony and Support Exception§ 58.6  Domestic Support Obligation Exception after BAPCPA and § 124.6  Alimony and Support Collection after Confirmation.

 

14  See § 136.20  Alimony, Maintenance and Support in Cases Filed after October 22, 1994 and § 136.21  Domestic Support Obligations after BAPCPA. See, e.g., In re Slater, 188 B.R. 852, 855 (Bankr. E.D. Wash. 1995) (“Since the case at bar was argued, the ‘Bankruptcy Reform Act of 1994’ was enacted. Although the new act applies to cases filed after October, 1994, it is instructive as to Congress’ intent on the issue of bankruptcy court jurisdiction in domestic relations matters. Various sections of the Code were amended to increase the protection the Code offers for alimony and child support. . . . The automatic stay will not apply to the establishment or modification of child support orders or to the collection of such payments for nonestate property. Such claims are given seventh priority under § 507(a). . . . Based on the foregoing, this court concludes that it has the authority to include child support arrearages in a Chapter 13 plan.”).

 

15  See, e.g., Pidgeon v. Pidgeon (In re Pidgeon), 155 B.R. 24, 26–27 (Bankr. D.N.H. 1993) (Because the Chapter 13 estate includes the future income and property of the debtor, the alimony, maintenance or support exception to the automatic stay does not relieve an estranged spouse of the obligation to seek relief from the stay before proceeding with an effort to collect temporary alimony, maintenance or support in a state court. “A chapter 13 plan may not be confirmed until the Court determines that all of the debtor’s disposable future income has been subjected to the control of the chapter 13 trustee. . . . The above determination requires knowing what a chapter 13 debtor’s actual expenses are. However, given the pending divorce proceeding and the related bankruptcy question of whether any obligations are dischargeable under 11 U.S.C. § 523(a)(5), this debtor’s actual expenses cannot be determined until some court, either the marital court or this Court, determines such issues between the debtor and his estranged wife. . . . What the Court has before it then is a case of potential judicial gridlock. To break the gridlock, . . . the Court will grant the motion for relief. . . . [S]tate courts have concurrent jurisdiction with bankruptcy courts to make the 523(a)(5) dischargeability determination. . . . This result also conforms with the Supreme Court’s observation nearly a century and a half ago that where at all possible, a federal court should abstain or avoid interfering with the determinations of family law matters by the appropriate state courts.”); In re Warner, 115 B.R. 233, 239 (Bankr. C.D. Cal. 1989) (“By exempting claims for child and spousal support arrearages from discharge . . . but staying their collection . . . Congress has created a unique status for such claims in Chapter 13 cases, without providing any guidance as to how they should be treated . . . The Chapter 13 policy that encourages debtors to repay their prepetition debts from future income conflicts with . . . strong competing policies of federal and state law.”).

 

16  504 U.S. 689, 112 S. Ct. 2206, 119 L. Ed. 2d 468 (1992). See In re Slater, 188 B.R. 852, 855 (Bankr. E.D. Wash. 1995) (Citing Ankenbrandt v. Richards, 504 U.S. 689, 112 S. Ct. 2206, 119 L. Ed. 2d 468 (1992), and In re Gonzales, 172 B.R. 320 (E.D. Wash. 1994), “this Court concludes that it has the authority to include child support arrearages in a Chapter 13 plan.” “The Supreme Court, in Ankenbrandt v. Richards, held the Constitution does not exclude all domestic relations matters from the jurisdiction otherwise granted by statute to the federal courts. The Ankenbrandt court limited federal jurisdiction to the enforcement of a state court decree, precluding authority to either grant or modify a divorce or alimony decree.”); In re Walter, 153 B.R. 38, 39 (Bankr. N.D. Ohio 1993) (“This Court finds instructive the Supreme Court’s view in Ankenbrandt v. Richards, 504 U.S. 689, 112 S. Ct. 2206, 119 L. Ed. 2d 468 (1992), that ‘the domestic relations exception [to federal courts’ jurisdiction] encompasses only cases involving the issuance of a divorce, alimony, or child custody decree.’”); Lawson v. Lackey (In re Lackey), 148 B.R. 626 (Bankr. N.D. Ala. 1992). But see Rogers v. Overstreet (In re Rogers), 164 B.R. 382, 391 (Bankr. N.D. Ga. 1994) (Ankenbrandt v. Richards, 504 U.S. 689, 112 S. Ct. 2206, 119 L. Ed. 2d 468 (1992), did not overrule the Eleventh Circuit’s decision in Carver v. Carver, 954 F.2d 1573 (11th Cir. 1992). Chapter 13 petition filed on the day the debtor was to be incarcerated for failing to pay child support was filed in bad faith where its only purpose was to avoid the domestic relations obligations. The automatic stay was not violated when the debtor was incarcerated later in the day, because incarceration “was an act of the state court trying to enforce its judgment, and it was not an act of the [debtor’s ex-spouse]. As such, the [ex-spouse] did not violate the stay when the Debtor was placed in jail.” Ex-spouse was under no duty to prevent the state court from incarcerating the debtor for failing to pay child support.).

 

17  See § 158.2  Student Loans and § 159.6  Student Loans: § 523(a)(8).

 

18  See United States v. Cleveland, 89 B.R. 69 (B.A.P. 9th Cir. 1988); In re Owens, 82 B.R. 960 (Bankr. N.D. Ill. 1988).

 

19  See § 152.2 [ Alimony, Maintenance and Support ] § 88.4  Alimony, Maintenance and Support.

 

20  See In re Raboin, 135 B.R. 682, 685 (Bankr. D. Kan. 1991) (“[Section] 502(b)(5) provides that support debts not due as of the filing date are not allowable claims.”).

 

21  See § 58.3  Additional Protection for Postpetition Property and Income§ 58.5  Alimony and Support Exception and § 58.6  Domestic Support Obligation Exception after BAPCPA.

 

22  11 U.S.C. § 1325(b)(2). See § 165.1 [ Reasonably Necessary for Maintenance or Support ] § 91.3  Reasonably Necessary for Maintenance or Support.

 

23  See §§ 152.2 [ Alimony, Maintenance and Support ] § 88.4  Alimony, Maintenance and Support, 155.2 [ Long-Term Debts ] § 88.9  Long-Term Debts and 171.1 [ Curing Default and Maintaining Payments on Unsecured Debt ] § 101.4  Curing Default and Maintaining Payments on Unsecured Debt.

 

24  See § 136.20  Alimony, Maintenance and Support in Cases Filed after October 22, 1994 and § 136.21  Domestic Support Obligations after BAPCPA.

 

25  See 11 U.S.C. § 502(b)(2).

 

26  See § 158.1  Alimony, Maintenance or Support and § 159.5  Domestic Support Obligations: § 523(a)(5).

 

27  See In re Slater, 188 B.R. 852, 855–56 (Bankr. E.D. Wash. 1995) (Applying Washington state law, judgment for unpaid child support accrues interest at 12% during the Chapter 13 case, and any unpaid balance will be nondischargeable at the completion of payments to other creditors. Citing Bruning v. United States, 376 U.S. 358, 84 S. Ct. 906, 11 L. Ed. 2d 772 (1964), and Leeper v. Pennsylvania Higher Education Assistance Agency, 49 F.3d 98 (3d Cir. 1995), “post-petition interest may accrue as to the debtor personally while a bankruptcy is pending. . . . [E]ven though the debtor’s plan does not provide for interest on the non-dischargeable child support debt, the plan is confirmable because the interest may continue to accrue against the debtor to be recovered from the debtor personally at the conclusion of the case. Furthermore, there is no requirement that the non-dischargeable debt—with or without interest—be paid in full during the pendency of the case.”); In re Crable, 174 B.R. 62 (Bankr. W.D. Ky. 1994) (Nondischargeable judgment for prepetition child support arrearages accumulates postpetition and postconfirmation interest at the Kentucky statutory rate of 12%; plan payment of arrearages without interest does not defeat the former spouse’s right to postpetition and postconfirmation interest. Citing Bruning v. United States, 376 U.S. 358, 84 S. Ct. 906, 11 L. Ed. 2d 772 (1964), and analogizing to student loans, child support arrearages are nondischargeable and accrue postpetition and postconfirmation interest, and the accumulating interest is nondischargeable upon completion of payments. However, during the Chapter 13 case, the arrearage claim holder cannot have an allowable claim for the postpetition (unmatured) interest.). But see Silverstein v. Glazer (In re Silverstein), 186 B.R. 85 (Bankr. W.D. Tenn. 1995) (Interest on state court judgment for child support arrearage pursuant to general state statute for interest on all judgments is not actually in the nature of support and therefore is dischargeable in § 523(a)(5) proceeding.).

 

28  See § 73.5  Interest Not Required, with Exceptions§ 73.6  Treatment of Priority Claims Changed by BAPCPA, § 136.16  Postpetition Interest on Priority Claims before BAPCPA and § 136.17  Postpetition Interest on Priority Claims after BAPCPA.