511 B.R. 719
Bankr. S.D. Ga.2014Background
- Debtor filed a Chapter 13 petition on Nov. 12, 2013; household size is one with no dependents.
- Debtor’s means test shows above-median income and a 5-year applicable commitment period.
- Debtor claims an $200 old car operating expense and a $517 ownership cost (netting to $442.90) under Local Standards.
- Debtor’s vehicle is a 2006 Ford Taurus with a non-purchase money security interest in Wells Fargo Bank.
- Trustee objects to the old car deduction as not within National/Local Standards and to the ownership cost deduction for a loan not tied to the vehicle’s purchase.
- Court sustains the Trustee’s objection, denying confirmation and requiring amended means test or dismissal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Old car operating expense deduction whether allowed | Sires; argues IRM permits old car deduction. | Sires; argues National/Local Standards include an elderly vehicle allowance. | Disallowed; old car deduction not in National/Local Standards per Ransom guidance. |
| Ownership cost deduction for non-purchase-money loan | Sires; argues IRM allows ownership costs for any vehicle-secured loan. | Sires; argues ownership costs cover any loan secured by vehicle. | Disallowed; ownership cost limited to costs related to purchase/lease of vehicle. |
Key Cases Cited
- In re King, 497 B.R. 161 (N.D. Ga. 2013) (ownership expense limited to financing the purchase or lease of a vehicle)
- In re Luedtke, 508 B.R. 408 (9th Cir. BAP 2014) (IRMs cannot create deductions not in National/Local Standards)
- In re Carroll, — (—) (ownership expense interpreted as tied to purchase/lease; non-purchase liens not deductible)
- Ransom v. FIA Card Servs., N.A., 131 S. Ct. 2464 (2011) (IRM may interpret but cannot create deductions; guides must align with statute)
- Hamilton v. Lanning, 560 U.S. 505 (2010) (courts may account for known/virtually certain changes in income/expenses)