Roberts v. Boyajian (In Re Roberts)Roberts v. Boyajian (In Re Roberts)
After appellants Edmond and Sharon Roberts, husband and wife, filed their chapter 13 petition in 1993, the bankruptcy court confirmed their joint plan calling for (i) monthly payments of $474, to the chapter 13 trustee, extending over a five-year period; (ii) a $9,000 distribution to the Internal Revenue Service (IRS) on its priority prepetition income tax claim; and (iii) a ten percent dividend on all allowed unsecured claims. Several years later, IRS submitted supplemental claims asserting that Edmond Roberts had continued to incur additional income tax obligations after the chapter 13 proceeding was commenced, amounting to $15,000 by 1996 and more than $53,000 by 1999. The chapter 13 trustee thereupon successfully moved to dismiss the chapter 13 proceeding due to the debtors’ failure to make payments sufficient to fund the confirmed plan,
see
Bankruptcy Code § 1307(c)(6); 11 U.S.C. § 1307(c)(6), thereby effectively precluding appellants from obtaining discharges of their debts.
In re Roberts,
An order allowing a motion to dismiss pursuant to Bankruptcy Code § 1307 is reviewed only for abuse of discretion.
See Blaise v. Wolinsky (In re
Blaise),
Appellants contend on appeal that the Bankruptcy Code entitles them to a chapter 13 discharge, see 11 U.S.C. § 1328(a) (“As soon as practicable after completion by the Debtor of all payments under the plan ... the court shall grant the Debtor a discharge ....”) (emphasis added), due to the fact that they had paid the chapter 13 trustee the entire $28,440 required under their confirmed plan (i.e., sixty installments at $474 per month), a commitment which the chapter 13 trustee and the bankruptcy court repeatedly reaffirmed even after the amount due the IRS on its tax claims surpassed the $9,000 in cumulative payments required by the confirmed plan.
Appellants can cite no authority for their contention, since the courts uniformly have held that a confirmed chapter 13 plan provision requiring a fixed percentage return
Lastly, Sharon Roberts appeals from another bankruptcy court order which denied her request for a so-called “hardship discharge.” See 11 U.S.C. § 1328(b)(1) (“[T]he court may grant a discharge ... if [t]he debtor’s failure to complete such payments is due to circumstances for which debtor should not justly be held accounta-ble_”). Her request for a “hardship discharge” represented that the postpetition tax penalties, which ultimately totaled more than $53,000, were incurred by her husband only, and even though she and her husband had filed a joint chapter 13 petition, no order for consolidated administration was ever entered by the bankruptcy court. Thus, she argues, the bankruptcy court was obliged to accord separate treatment to their respective credit obligations.
Rulings on applications for discharge under Bankruptcy Code § 1328 are reviewed only for abuse of discretion.
See Bandilli v. Boyajian (In re Bandilli),
All the authorities she cites are inappo-site, however, relating instead to the entirely different matter as to whether each debtor in a joint proceeding is entitled to an independent homestead exemption.
See, e.g., Cheeseman v. Nachman, 656
F.2d 60, 64 (4th Cir.1981) (relying upon Bankruptcy Code § 522(m), which
expressly
empowers each debtor, in a joint case, to assert a separate exemption claim). Thus, the bankruptcy court plainly did not abuse its discretion by denying the request for a hardship discharge under Bankruptcy Code § 1328(b)(1), particularly in light of (i) Sharon Roberts’ election to proceed, with her husband, under a joint chapter 13 petition and plan, and (ii) her full aware
The judgment is affirmed; costs to be assessed against appellants. SO ORDERED.
Notes
. Although the circumstances involved in these decisions differ slightly, each involved the same basic rationale;
viz.,
that the plain language of section 1328(a) (like the provision for plan modification in § 1329) entitles the debtor to a discharge only "after completion ... of
all payments under the plan."
11 U.S.C. § 1328(a) (emphasis added).
See, e.g., In re Carr,