In Re Hufford
460 B.R. 172
Bankr. N.D. Ohio2011Background
- Hufford debtors filed a June 15, 2009 Chapter 13 petition and proposed plan volving revesting title upon plan completion.
- Plan confirmation occurred September 2, 2009, authorizing the Trustee to disburse funds and, on dismissal or conversion, to pay remaining funds to creditors per the plan.
- The Trustee suspended Deutsche Bank’s mortgage payments after objections to the claim; Debtors objected to the Deutsche Bank claim as improperly increasing payments.
- Debtors later withdrew objection to the Trustee’s motion to dismiss for feasibility; case was dismissed July 20, 2011, with an order directing the Trustee to disburse funds to creditors.
- At dismissal the Trustee held about $15,600–$17,940 in funds; Debtors seek disbursement to themselves, while Deutsche Bank’s disputed claim remains unresolved.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether funds held by the Trustee at dismissal must be distributed per the plan. | Huffman (Debtors) | Trustee | Funds disbursed to creditors per plan; not to Debtors. |
| Whether dismissal voids the confirmed plan and revesting effects override the Trustee’s duty. | Debtors (Nash rationale) | Trustee to follow confirmed plan despite dismissal | Plan remains binding unless for cause; funds to creditors per plan. |
| Whether the objection to Deutsche Bank’s claim precludes distribution to it. | Debtors | Deutsche Bank owed a disputed claim not yet allowed | Disallow distribution to Deutsche Bank due to pending objection. |
Key Cases Cited
- In re Parrish, 275 B.R. 424 (Bankr.D.D.C.2002) (trustee must distribute funds per confirmed plan after dismissal)
- In re Nash, 765 F.2d 1410 (9th Cir.1985) (dismissal may vacate plan; issues of funds revestment)
- In re Wcislak, 446 B.R. 827 (Bankr.N.D.Ohio 2011) (court retains jurisdiction over assets of dismissed case)
- In re Cox, 381 B.R. 525 (Bankr.E.D.Tenn.2008) (for‑cause exception to §349(b) overrides revestment)