Summary:
Confirmation of the Debtor’s Chapter 13 plan was delayed for 15 months due to an adversary proceeding to cram-down a residential mortgage held by JPMorgan Chase. Following dismissal of the adversary proceeding, the Debtor proposed a plan that would have run for 60 months from confirmation. Because that plan would have run for a total of 75 months from the first §341 Meeting of Creditors, the Trustee objected.
Finding that this issue had already been addressed by the 4th Circuit in West v. Costen, 826 F.2d 1376, 1378 (4th Cir. 1987), the bankruptcy court held that “he applicable commitment period cited in § 1329(c) begins with the first payment made under a confirmed plan and not the first payment due under a proposed plan, which is typically due within one month of filing the petition.” This is still subject to the other requirements of § 1329, including good faith, but any delays in the adversary proceeding were “not fully or even mostly the debtor’s fault” and the Trustee’s failure to engage had further delayed that proceeding.
Commentary:
It’s worth noting and questioning why the Chapter 13 Trustee objected to a plan where the secured creditor (which had actively participated in the adversary proceeding) did not. Perhaps, it is a concern that auditors flagging cases that run longer, but that would be a shame that such a fear would impede helping make Chapter 13 succeed.
For a copy of the opinion, please see:
Morris- Chapter 13 Plan Length Cannot Exceed 60 Months from Confirmation
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