620 B.R. 594
Bankr. E.D. Mich.2020Background
- Debtor filed Chapter 13 in July 2019 and was a below‑median income debtor with an applicable commitment period (ACP) of 36 months.
- The confirmed plan (Oct. 2019) nevertheless provided for 60 months of payments and a projected ~5% dividend to unsecured creditors.
- In August 2020 the debtor filed a post‑confirmation plan modification to shorten the plan to 36 months and to excuse application of a 2019 tax refund to plan payments.
- No creditors objected; the Chapter 13 Trustee objected and contested the shortening request.
- The court heard argument limited to the plan length issue, took the matter under advisement, and issued this opinion denying the shortening request.
Issues
| Issue | Debtor's Argument | Trustee's Argument | Held |
|---|---|---|---|
| Whether §1329(a) requires a post‑confirmation change in circumstances to approve a modification | §1329(a) permits modifications of specified types without any additional showing; no change requirement | A change in circumstances is necessary to protect §1327(a)’s res judicata effect and finality of confirmation | No—§1329(a) does not impose a threshold change‑of‑circumstances requirement; courts may consider changes but need not find them to approve a §1329 modification |
| Whether a §1329 modification may relitigate matters that were or could have been decided at confirmation (effect of §1327) | Modification should be allowed to correct inadvertent attorney error as to plan length | §1327 bars relitigation of issues decided or that could have been decided at confirmation; modification cannot be used to relitigate those issues | A modification cannot relitigate issues that were or could have been litigated at confirmation; the debtor’s request to revisit “cause” for a 60‑month plan was foreclosed and the modification was denied |
Key Cases Cited
- Witkowski v. Welch, 16 F.3d 739 (7th Cir. 1994) (§1329’s text does not require a change‑in‑circumstances prerequisite)
- Barbosa v. Solomon, 235 F.3d 31 (1st Cir. 2000) (rejecting a substantial/unanticipated‑change requirement)
- Meza v. Baker, 467 F.3d 874 (5th Cir. 2006) (same)
- Murphy v. W. Virginian, 474 F.3d 143 (4th Cir. 2007) (requiring a substantial and unanticipated change for §1329 modifications)
- Ledford v. Brown (In re Brown), 219 B.R. 191 (B.A.P. 6th Cir. 1998) (§1329 contains no change‑of‑circumstances prerequisite; courts may consider changes in their discretion)
- Storey v. Pees (In re Storey), 392 B.R. 266 (B.A.P. 6th Cir. 2008) (§1327 precludes modification to address issues that were or could have been decided at confirmation)
- Gresham (In re Gresham), 616 B.R. 505 (Bankr. E.D. Mich. 2020) (modification permissible without changed circumstances where a valid basis exists)
- Bullard v. Blue Hills Bank, 575 U.S. 496 (2015) (confirmation has preclusive effect; forecloses relitigation of issues actually litigated or necessarily decided)