ENTRY
This matter is before the court on an appeal by Charles William Young and Deloris Jean Young, debtors in bankruptcy, challenging thе bankruptcy court’s decision to reconsider a portion of a confirmed Chapter 13 plan and to accоrd priority status to a claim for pre-petition interest on taxes. For the reasons discussed below, this court reverses the decision of the bankruptcy court.
I. Background
Charles Young filed a Chapter 13 bankruptcy petition on November 22, 1983; Deloris Young filed her Chapter 13 petition on February 3, 1984. The bankruptcy court consolidated these petitions on February 15, 1984. The debtors filed а first Amended Chapter 13 Plan on May 25, 1984, which contained a provision directing the trustee to make priority payments as required by 11 U.S.C. § 507, including amounts due to taxing authorities. The debtors’ amended plan was confirmed without objection by court order on June 21, 1984.
The Internal Revenue Service (“IRS”) filed an initial proof of claim on January 19, 1984. An amended proof of claim was filed by the IRS оn June 21, 1984, to which the debtors did not formally object. This amended proof included a priority unsecured claim for pre-petition interest on taxes.
On November 27, 1985, the trustee filed an application to allow claims and objections to clаims and a request for ruling, to which the IRS responded on December 26, 1985.
The debtors filed a second amended Chapter 13 plan on February 5,1986, which among other things categorizes the IRS' claim for pre-petition interest as unsecured without priority. This was сonfirmed without objection by a court order dated July 24, 1986.
On August 12, 1986, the court executed an order on the trustee’s application. The court ordered that the debtors' principal tax obligation be treated as secured, with the remaining balanсe treated as unsecured. The IRS filed a motion for reconsideration on October 14, 1986, which requested among other things thаt the court reclassify $3,109.50 in pre-petition interest as an unsecured priority claim. A hearing was set for November 17,1986. On February 3, 1987, the court granted the IRS’ motion for reconsideration, vacating the prior order confirming the Chapter 13 plan and according priority status to the IRS claim for pre-petition interest.
II. Discussion
Although it has become apparent through a Seventh Circuit opinion that the decision of the bankruptcy court tо accord priority status to pre-petition interest was correct,
see Matter of Larson,
The reсord reflects that the debtors’ second amended Chapter 13 plan was confirmed without objection on July 24, 1986. This plan is res judicata as to any claims which were or could have been asserted by the IRS. So much is clear from the relevant provision of the Bankruptcy Code:
The provisions of a confirmed plan bind the debtor and each creditor, whether or nоt the claim of such creditor is provided for by the plan, and whether or not such creditor has objected to, has aсcepted or has rejected the plan.
11 U.S.C. § 1327(a) (1988 ed.).
Thus, the argument made by the IRS, that the failure to formally object to the confirmed plan does not preclude reconsideration, misses the point. It is the res judicata effect of the confirmation of such a plan which does preclude reconsideration (except in limited circumstances discussed
*397
below). “The terms of a Chapter 13 plan bind both the debtor and the creditor and control any claims of the creditor whether or not he has filed an objection to the plan.”
In re Edelsberg,
The IRS cites
In re Goble Boat Co.,
The Bankruptcy Code does allow for the revocation of a confirmed plan, but only in those circumstances where the order of confirmation was procured by frаud. 11 U.S.C. § 1330(a) (1988 ed.).
See also United States v. Lee,
The IRS аrgues that bankruptcy courts are courts of equity, empowered to provide relief to prevent undeserved windfalls. Hоwever, a well-known maxim of equity guides the court here, that being that equity aids the vigilant, not those who slumber upon their rights.
Int’l Union, Allied Workers of America, AFL-CIO v. Local Union No. 589,
In conclusion, the Bankruptсy Code expresses a strong interest in according finality to confirmed Chapter 13 plans by treating them as res judicata аs. to all claims which were or could have been made. The only exception to this finality is in cases of fraud, a situatiоn not present here. Accordingly, it was an abuse of discretion for the bankruptcy court to vacate its confirmation order and reconsider the terms of a confirmed Chapter 13 plan. The decision of the bankruptcy court is REVERSED.
It is so ORDERED.