Joe Pliler v. Richard Stearns, 747 F.3d 260

Plilers filed Chapter 13 on Aug 10, 2012; income above state median but disposable income negative.
Proposed plan paid nothing to unsecured creditors and long-term goals included early termination language to finish in ~55 months.
Trustee objected to confirmation and sought dismissal for bad faith and failure to contribute payments under 1325.
Bankruptcy court (joint session) revised plan to pay $1,784 monthly for 60 months, yielding unsecured dividends (84% in revised plan).
Fourth Circuit held applicable commitment period under §1325(b)(4) is a mandatory five-year duration for above-median debtors unless all unsecured claims are paid in full; negative projected disposable income at confirmation does not defeat five-year requirement.
Remand for individualized hearing on feasibility of a $1,784/month five-year plan and consideration of evidence on projected disposable income

Issue	Plaintiff's Argument	Defendant's Argument	Held
Is the applicable commitment period a freestanding plan-length requirement?	Plilers: not freestanding; should depend on disposable income	Plilers: it is a standalone duration requirement	Yes; applicable commitment period is a freestanding, time-based requirement
Can above-median debtor with negative disposable income have a five-year plan?	Negative disposable income negates need for five years	Five-year term valid regardless of initial disposable income	Five-year term required regardless of negative disposable income at confirmation
May the court consider Schedules I and J to assess projected disposable income when Form 22C shows negative disposable income?	Court should rely on disposable income formula, not Schedules I/J	Court may consider known/virtually certain changes reflected in I/J	Court may consider Schedule I/J for projected income; remand for individualized hearing on feasibility

In re Flores, 735 F.3d 855 (9th Cir. 2013 (en banc)) (confirms five-year commitment period as a freestanding requirement)
Baud v. Carroll, 634 F.3d 327 (6th Cir. 2011) (life of plan tied to commitment period; disposable income not sole determinant)
Whaley v. Tennyson, 611 F.3d 873 (11th Cir. 2010) (applies 1325(b)(4) as timing constraint for plan duration)
Coop v. Frederickson, 545 F.3d 652 (8th Cir. 2008) (recognizes temporal nature of commitment period)
In re Tennyson, 611 F.3d 877 (4th Cir. 2010) (defines 'applicable commitment period' as duration aligned with income category)
Lanning v. Hamilton, 560 U.S. 505 (U.S. Supreme Court 2010) (heart of consumer reforms to ensure debtors devote disposable income)
Carroll v. Logan, 735 F.3d 147 (4th Cir. 2013) (windfalls may occur post-confirmation; income changes affect plan)
Ransom v. FIA Card Servs., N.A., 131 S. Ct. 716 (2011) (core purpose of reforms; ensuring maximum repayment)